Pricing strategy and its impact on the effort of community leader and platform: Uniform or differentiated pricing?

¹ Business School, University of Shanghai for Science and Technology, Shanghai 200093, P.R. China
² School of Management Science and Technology, Henan University of Engineering, Zhengzhou 450001, P.R. China
³ School of Economics and Management, Shanghai Maritime University, Shanghai 201306, P.R. China
⁴ International Business College, South China Normal University, Guangzhou 510631, P.R. China

^* Corresponding author: helenyun@ibc.scnu.edu.cn

Received: 6 June 2023
Accepted: 14 July 2024

Abstract

This paper is motivated by the rapid development of community group buying (CGB), where the CGB platform dramatically relies on the community leader to provide last-mile services and fulfill consumers’ orders. Considering two types of community leaders, the friend role and seller role, this work adopts a game-theoretical model and investigates how the pricing strategy, uniform pricing strategy (N) or differentiated pricing strategy (Y), affects players’ performance and decisions on effort level. This study shows that the commission rate is an essential factor in stimulating the role transformation of community leaders. A significantly large commission rate results in the friend role community leader with lower trust value changing into the seller role. Generally, the community leader works harder under the uniform pricing scenario except in situations with a significant commission rate and moderate sensitivity coefficient of trust value. However, the effort level of the platform is jointly influenced by the pricing strategy, commission rate, and the role of a community leader. Moreover, regardless of the commission rate, when the community leader is a friend role and the trust value is high, both the platform and community leader can gain higher profits under the uniform pricing scenario than the differentiated pricing case. It indicates that a win–win situation can be achieved.