Competition Between Store Brands and National Brands: Examining Whether and When Live Streaming Channels Should Be Introduced

With the vigorous promotion of store brands (SBs) by platform retailers, they have rapidly risen in the market, which not only meets the diversified needs of the market but also intensifies competition with national brands (NBs). In order to solidify their position in this brand competition, national brand manufacturers have begun to actively introduce live streaming sales models. In this context, we have delved into whether, by whom, and when live streaming channels (LSCs) should be introduced as brand competition intensifies. Taking into account the impact of live streaming sales, we analyzed the sales strategies of e-commerce platforms and manufacturers in traditional online channels (TOCs) and LSCs. In the absence of LSCs, e-commerce platforms sell SBs products through their TOCs, while manufacturers resell their NBs products through TOCs. However, when an LSC is introduced, both parties have the opportunity to collaborate with live streamers and further expand the market. To comprehensively study this issue, we compared three different strategies: both parties not introducing LSCs (SN strategy), only the manufacturer introducing LSCs (SL strategy), and both parties simultaneously introducing LSCs (LL strategy). The research results show that the introduction of an LSC does not always positively impact the demand and profits of both parties. This primarily depends on the fan base of the live streamer and the required slot fee. Specifically, when the slot fee is at a lower level, live streaming sales are beneficial for both manufacturers and e-commerce platforms. In addition, we further explored the profit differences between manufacturers and e-commerce platforms under two different strategies. Specifically, in the comparison between the LL strategy and the LN strategy, we found that these differences are closely related to the level of slot fees and show an inverse relationship. Specifically, in scenarios with low slot fees, manufacturers are more inclined to choose the LL strategy to maximize their profits, while e-commerce platforms perform better under the LN strategy; and vice versa. This finding reveals that in a constantly changing market environment, manufacturers and e-commerce platforms can optimize their respective interests by flexibly adjusting their LSCs strategies. It’s worth noting that our study also found that in a particularly competitive market, consumer surplus (CS) and social welfare (SW) reached their peak under the SL strategy, while they dropped to their lowest under the SN strategy. This discovery not only emphasizes the significant role of LSCs in enhancing brand competitiveness and expanding sales channels, but also provides strong theoretical support and practical guidance for brand owners to develop effective strategies in a complex and changing market environment.