Third-party sellers’ product entry strategy and its sales impact on a hybrid retail platform

Li, Qi; Wang, Quansheng; Song, Peijian

doi:10.1016/j.elerap.2021.101049

Cited by 15 publications

(22 citation statements)

References 52 publications

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“…The following experiments replicate the dynamic process of platform self-operated items in two sides with the modification of critical parameters. According the study by Li et al . (2021) on the classification of online sellers on retail platforms based on reputation, we consider a WS network (Jun et al.…”

Section: Experimental Setting and Resultsmentioning

confidence: 99%

The diffusion of platform self-operation on reputation-based two-layer network

Li,

2023

IMDS

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PurposeDue to the cross-network effect, two-sided users communicate with each other, producing a coupling network. To study the spread of platform self-operation in two-sided users' marketing and purchasing tactics, this paper considers the differences in reputation acquired by platform-owned and third-party operating channels.Design/methodology/approachThis study proposes a two-layer network with cross-network links: one layer represents the social network of consumers, while the other layer represents the competitive network of buyers. A closed system of differential equations, based on the binary dynamics of the stochastic network, is developed to study the trend and stability points of the platform self-operation dissemination. Then the overall benefits of platform are analyzed to unify the platform diffusion and pricing strategies.FindingsThe degree of difference in social influence and cross-network effects affect diffusion synergistically. Cross-network effects hinder diffusion when there is a significant difference of social influence between consumers and sellers but promote diffusion when there is little difference of social influence between consumers and sellers. Additionally, the network weights and reputation gap exhibit a nonlinear correlation with diffusion. For pricing strategy of the platform, it can achieve maximum profit when the pricing of self-operated goods and third-party-operated goods is equal.Originality/valueThis study considers the complex network architecture created by bilateral markets and the dynamic influence of group interactions on product. Additionally, this study takes reputation into account when considering the price and dissemination tactics of various operating channels, offering guidelines for platforms to control merchants and mediate disputes between various operating channels.

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Section: Experimental Setting and Resultsmentioning

confidence: 99%

The diffusion of platform self-operation on reputation-based two-layer network

Li,

2023

IMDS

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“…However, with the development of TPSs, TPSs, especially large TPSs, are playing an increasingly important role on the platform. For example, TPSs contribute a considerable share of revenue for the platform (via commissions or paid services such as marketing and advertising), so the wellbeing and profitability of TPSs determine the long-term financial sustainability of the platform ecosystem (Chen and Guo, 2022;Li et al, 2021). In this study, we focus on large TPSs, who have more resources and expertise than other TPSs.…”

Section: Seller's Types and Their Strategies On Online B2c Platformsmentioning

confidence: 99%

“…Prior research has investigated various strategies applied by TPSs to maintain performance on e-commerce platforms, such as forming ties with platform firms or reallocating resources to new customer segments (Huang et al, 2013;Wen and Zhu, 2019;Cennamo and Santalo, 2013). Most of them assume that TPSs should maintain or enhance their performance by avoiding directly competing for consumers with platform firms, ignoring that TPSs can proactively apply customer acquisition strategies to acquire consumers in consumers' person-goods matching process (Foerderer et al, 2018;Zhu and Liu, 2018;Li and Agarwal, 2017;Li et al, 2021). Consumers' person-goods matching process refers to the process in which consumers strive to find the most suitable product before making final purchase decisions (Moorthy et al, 1997;Bronnenberg et al, 2016).…”

Section: Introductionmentioning

confidence: 99%

“…The similarity of these strategies will sway consumers' decision during their person-goods matching process (He et al, 2020). Specifically, platform firms enjoy higher reputation and have priority in displaying their own products in prominent positions over TPSs (Parker and Alstyne, 2017;Zhu and Liu, 2018;Li et al, 2021). When platform firms apply strategies similar to large TPSs, they can easily make more consumers aware of a product, which may expand the awareness of similar product sold by TPSs.…”

Section: Introductionmentioning

confidence: 99%

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Pay more attention to consumers: exploring customer acquisition strategies of large third-party sellers on e-B2C market

Li,

Wu,

Huang

et al. 2024

IMDS

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PurposeThis study develops an empirical framework to address how large third-party sellers (TPSs) can apply customer acquisition strategies to improve their performance in consumers’ person-goods matching process and how the platform firm’s similar strategies moderate the effects of TPSs’ strategies.Design/methodology/approachUsing data collected from the top ten TPSs from a Chinese e-commerce platform, the fixed effect model is used to validate the conceptual model and hypotheses.FindingsThe study results show that both market detection strategy and matching optimization strategy can help large TPSs improve their sales performance. Moreover, the similar market detection strategy applied by the platform firm weakens the effect of large TPSs’ customer acquisition strategies, while the similar matching optimization strategy applied by the platform firm strengthens the effect of large TPSs’ customer acquisition strategies.Originality/valueThis study provides firsthand evidence on the performance of large TPSs’ and the platform firm’s strategies. It demonstrates the effectiveness of large TPSs’ market detection strategy and matching optimization strategy, which can be adopted to meet consumers’ search and evaluation motivations in their person-goods matching process respectively. Moreover, it identifies the role of platform firms by showing the moderating effect of similar strategies adopted by the platform firm on the effect of large TPSs’ customer acquisition strategies.

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“…Foerderer et al , 2018; Cennamo, 2018). While platform-owner entering complementary markets, end users are simultaneously reminded of other similar apps in the targeted category (Sahni, 2016; Liu et al , 2015; Li et al , 2021), which would in turn enhance developers' innovation efforts due to a demand-side market scale increase. This theoretical thesis was termed as “the attention spillover effect” (Foerderer et al , 2018) and has been empirically supported by several recent studies.…”

Section: Literature Reviewmentioning

confidence: 99%

Software platform owners' entry and application developers' innovations: a conceptual model

Zuo

Song

2021

IMDS

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PurposeThe primary aim of this article is to develop an understanding that resolves and integrates the conflicting findings with regard to the effects of platform-owner entry on the innovation of individual complementors.Design/methodology/approachDrawing on the platform ecosystem literature and the profiting from innovation (PFI) framework, this study presents a conceptual model that articulates how developers' marketing capabilities and the size of platform's installed base are two key moderators that explain the conflicting results between platform-owner entry and complementor innovations.FindingsThis article theorizes that platform owners' entry stimulates developers' innovations when the size of platform's installed base is large or when developers' marketing capabilities are strong while the entry can discourage innovations otherwise.Originality/valueBy proposing the conceptual model, this article makes important theoretical contributions to the rising literature on platform governance and complementor innovations. It lays a foundation for future research exploring the implications of platform-owner entry.

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Third-party sellers’ product entry strategy and its sales impact on a hybrid retail platform

Cited by 15 publications

References 52 publications

The diffusion of platform self-operation on reputation-based two-layer network

The diffusion of platform self-operation on reputation-based two-layer network

Pay more attention to consumers: exploring customer acquisition strategies of large third-party sellers on e-B2C market

Software platform owners' entry and application developers' innovations: a conceptual model

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