scholarly journals Analyzing Pricing Strategies for Online-Services with Network Effect

2011 ◽  
Author(s):  
Min-Seok Pang ◽  
Hila Etzion
Keyword(s):  
Network Effect ◽  
Pricing Strategies ◽  
Online Services

scholarly journals Coordinating Demand and Supply for Crowd Logistics Platforms with Network Effect

2021 ◽  
Vol 2021 ◽  
pp. 1-14
Author(s):  
Wenjie Wang ◽  
Lei Xie
Keyword(s):  
Network Effects ◽  
Service Providers ◽  
Negative Impact ◽  
Positive Impact ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Demand And Supply ◽  
Direct Network ◽  
Crowd Logistics

The crowd logistics platforms connect stochastic demand with uncertain delivery supply which is provided by independent service providers. Considering direct-network effects and cross-network effects between the demand and supply side, a dynamic surge pricing model for crowd logistics platforms is built. The pricing strategy is derived to coordinate the supply with demand to equilibrium. Furthermore, the pricing strategy minimizing cumulative delivery orders is analyzed. The numerical simulation results show that the dynamic surge pricing strategies can stimulate the uncertain delivery supply for maximizing platforms’ revenue. And, direct-network effects pose a positive impact on the dynamic surge pricing strategy. In contrast, the cross-network effects have a negative impact on the pricing strategy. However, direct-network effects and cross-network effects negatively influence platforms’ revenue.

Pricing Strategies of Unbundling and Mixed-Bundling in a Two-Sided Market Under Stochastic Demand

2020 ◽  
Vol 37 (03) ◽  
pp. 2050016
Author(s):  
Xiaogang Lin ◽  
Yong-Wu Zhou ◽  
Qiang Lin
Keyword(s):  
Stochastic Demand ◽  
Sharp Contrast ◽  
The Other ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Royalty Rate ◽  
Mixed Bundling ◽  
The Impact ◽  
Two Sided Markets

We investigate the pricing strategies of unbundling and mixed-bundling for a firm that produces both a product and a compatible integrated content, respectively. The firm can be viewed as a two-sided transaction platform between sellers and customers, and decides whether to sell the product and the integrated content separately or jointly. Sellers develop independent content and are charged a per-unit royalty rate for each transaction on the platform, and customers are required to pay the prices for the product and the contents. With the consideration of stochastic demand, we study the impacts of cross-side network effect on the pricing strategies of unbundling and mixed-bundling, respectively. Moreover, we compare the impact of unbundling and mixed-bundling on the pricing strategy of the platform. Compared with no cross-side network effect, we show that the firm (with unbundling and mixed-bundling) need not subsidize customers and sellers in the presence of the effect under certain conditions, indicating that it can extract the most surplus from both sides to maximize the profit. This stands in sharp contrast to the finding of the literature on two-sided markets that the platform should subsidize one side of the market in order to make profit from the other side. Moreover, our result suggests that mixed-bundling can help the firm make more profit with fewer products by subsidizing one side of the market compared with the unbundling.

scholarly journals Optimal Software Feature-Limited Freemium Model Design: A New Consumer Learning Theoretical Framework

Mathematics ◽  
2021 ◽  
Vol 9 (9) ◽  
pp. 944
Author(s):  
Kang Li ◽  
Jingwei Zhang ◽  
Lunchuan Zhang
Keyword(s):  
Software Industry ◽  
Network Externality ◽  
Network Effect ◽  
Pricing Strategies ◽  
Consumer Learning ◽  
Prior Beliefs ◽  
Free Trial ◽  
Learning Framework ◽  
Strategy Design ◽  
New Consumer

The software industry is increasingly adopting a feature-limited freemium business model that combines “free” and “premium” contents in one product, to sell its products. How to determine the optimal product quality differences between the free and premium versions of software is a central business problem facing many software vendors. In this paper, we study the optimal feature-limited freemium software strategy design, as well as the associated pricing strategies based on consumer learning and network externality effects. We propose a new consumer learning framework induced by cross-module synergies that contains both direct and indirect learning processes. By employing a two-stage mathematical theoretical model and a numerical analysis method, we gained some insights regarding the feature-limited free trial strategy design and associated pricing strategies while considering the associated trade-off between the benefits and costs of the free trial strategy. In our modeling and numerical results, consumers’ prior beliefs about the quality of premium content before the free trial, network effect intensity, and indirect learning intensity were found to be three conditions that need to be studied to examine software vendors’ management decisions. For the software industry, the quality difference between free and premium functionality or the service and price strategy for a feature-limited free trial model can be designed while considering these factors, which will provide some useful guidelines for the industry.

Firm Discrimination Pricing Strategies with Network Effect

2006 ◽  
Vol 532-533 ◽  
pp. 941-944
Author(s):  
Xiao Jun Pan ◽  
Hong Min Chen ◽  
Li Xu
Keyword(s):  
Social Welfare ◽  
Price Discrimination ◽  
Equilibrium Price ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Uniform Pricing ◽  
Competitive Price ◽  
The Social ◽  
Differentiated Goods

We explore the price and welfare effect of price discrimination in a differentiated-goods oligopoly market with network effect and the effect of network effect on the equilibrium price, profit and output. We show that competitive price discrimination and network effect may intensify competition and the price discrimination increases the social welfare under oligopoly market with network effect. If firms differ in which markets they target for aggressive pricing strategy and competitive firm’s reaction is strong, prices in all markets may fall. So both firms agree on the strategies of setting the uniform pricing.

Customer Satisfaction on e-SERVQUAL in Islamic Online Banking Services

2017 ◽  
Vol 3 (2) ◽  
pp. 29
Author(s):  
NURHAZIRAH HASHIM ◽  
MOHAMMAD ZAIM MOHD SALLEH ◽  
NOR SARA NADIA MUHAMAD YUNUS ◽  
INTAN SYAFINAZ MAT SHAFIE
Keyword(s):  
Customer Satisfaction ◽  
Consumer Satisfaction ◽  
Pearson Correlation ◽  
Business Environment ◽  
Online Banking ◽  
Security And Privacy ◽  
Accurate Information ◽  
Online Services ◽  
Banking Services ◽  
Customer Information

The recent development in the ecommerce services has shown a variety of established companies participating in the web business environment including Islamic banks. Business with the mostexperience and success in using ecommerce are beginning to realize that the indicator of success or failure of the ecommerce environment was included in the online services. Nowadays, the trend ofa business is to serve the customer with best quality of services to enhance the consumer satisfaction and compete with the global competitors as online services enabled registered user to make productspurchase transaction only through website such as check and manage financial standing, transfer funds, bill payment, prepaid reload and so forth. However, in recent times, Islamic banking users faced problems with the online system such as cannot log in to the system, payment failure and  mostly security and privacy hindrance. Therefore, this study aimed to investigate the relationship between electronic service quality (e-SERVQUAL) and customer satisfaction towards IslamicOnline Banking Services users. Based on the sample size, only 76 respondents were selected to participate in this study by using a convenience sampling. Further, Pearson correlation and multipleregression were reported to analyze the mentioned relationship. The findings have shown that there is a positive relationship between e-SERVQUAL and customer satisfaction in using Islamic onlinebanking services. Based on the findings, Islamic online banking developer is recommended to improve more on their responsiveness in order to provide quick response to their customer’s requirements.  Moreover, they also should be more reliable in providing accurate information in performing the promised services. They must assure that all of their customers can quickly get responds and true feedback regarding their problems to ensure customer satisfy with service provided. Besides, the safety of the website and the protection of customer information alsoconsidered a vital action that should be concerned in order to increase the customers’ satisfaction.

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