In recent years, content platforms have expanded their operations into e-commerce by leveraging short videos or live-streaming and collecting commissions. This paper examines the optimal operational modes that content platforms should adopt when launching e-commerce businesses. Specifically, we analyze the content platforms’ choices between building a joint channel with e-commerce platforms (joint mode), building a self-operated channel independently (self-operated mode), or operating both channels simultaneously (dual-channel mode). Using a game-theoretic model, we find that the content platform tends to choose the self-operated mode (or joint mode) when all sellers have high (or low) conversion ability, and the dual-channel mode when sellers have differentiated conversion abilities. Additionally, our analysis shows that the content platform's mode selection switches from joint mode to dual-channel mode and to self-operated mode with a decrease in e-commerce platform's commission rate or a weaker spillover effect from the content platform to the e-commerce platform.
Chen, Sihang; Feng, Haiyang; and Li, Minqiang, "Optimal Retailing mode for Content Platforms' E-commerce" (2023). PACIS 2023 Proceedings. 109.
When commenting on articles, please be friendly, welcoming, respectful and abide by the AIS eLibrary Discussion Thread Code of Conduct posted here.