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The Game Model of the Pricing Methodology of B2B e-Marketplace and Its Competitive Strategy on the Basis of Long Tail Theory

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2 Author(s)
Lifang Peng ; Manage. Sch., Xiamen Univ., Xiamen, China ; Limin Chen

Through the establishment of game theory model, this thesis studies the pricing methodology of B2B electronic platform and its competitive strategy, which is based on the long tail theory. To establish the process of B2B electronic platform's pricing methodology, SMEs need to take into account the opportunity cost of entering the electronic platform, and the platform is striving to maximize its revenue. This article divided this process into three stages as a game model of B2B electronic platform through comprehensive consideration of commissions, membership fees, fee for service charged from the buyers and sellers trading in this platform, and the exogenous variable of searching cost of goods. The results show that B2B electronic platform with monopoly advantages can take all the value created by buyers and sellers who trade in the market, whereas the new entrants can take measures to further tap the potential market on the basis of long tail theory.

Published in:

Management of e-Commerce and e-Government (ICMeCG), 2010 Fourth International Conference on

Date of Conference:

23-24 Oct. 2010