Referral strategy of e‐commerce platform under different selling modes

Abstract

AbstractThis study considers a market comprising two suppliers and one e‐commerce platform. The two competitive suppliers sell products to consumers through the platform. The platform can choose three selling modes: reseller, market, and mixed. Additionally, we consider two referral strategies—namely, exclusive and nonexclusive recommendations—and build a three‐party Stackelberg game model. Per the findings, the difference in the players' decision‐making results exhibits an essential relationship with the recommendation market's initial size. A counterintuitive result is that the product price is not affected by the commission rate in the market mode. This provides referential insights for platforms and suppliers.