Abstract

Currently, the majority of Chinese online consumers paid more attention to price and service quality. This paper studied the Price and Service competition in E-commerce of China. A price game within two online business companies is used in this paper. This study shows that the product’s utility to a customer has a great influence on decision making of the two online business companies. As the product’s utility to a customer varies, the two companies may compete or not. This paper will help US companies to get some knowledge about China Market and to avoid failures.

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E-Commerce in China: Price and Service Competition

Currently, the majority of Chinese online consumers paid more attention to price and service quality. This paper studied the Price and Service competition in E-commerce of China. A price game within two online business companies is used in this paper. This study shows that the product’s utility to a customer has a great influence on decision making of the two online business companies. As the product’s utility to a customer varies, the two companies may compete or not. This paper will help US companies to get some knowledge about China Market and to avoid failures.