Publication Type
Conference Proceeding Article
Version
publishedVersion
Publication Date
12-2018
Abstract
It becomes increasingly popular that some large online retailers such as Amazon open their platforms to allow third-party retail competitors to sell on their own platforms. We develop an analytical model to examine this retailer marketplace model and its business impact. We assume that a leading retailer has both valuation advantage that may come from its reputation and information advantage that may come from its brand awareness. We find that the availability of relatively low-cost advertising through social media or search engine can effectively reduce the leading retailer's information advantage, and thus be an important driving force for its strategic decision to open its platform. Not only does the advertising option directly make small sellers more visible to consumers, but also incentivizes the online retailer to open its platform and dramatically increases small sellers' exposure, indirectly contributing to an even more prominent long tail phenomenon in e-commerce.
Keywords
Positive reviews, electronic commerce, cash-back rebate, pricing decision
Discipline
Databases and Information Systems
Research Areas
Information Systems and Management
Publication
Proceedings of the 18th International Conference on Electronic Business, Guilin, China, 2018 December 2-6
First Page
743
Last Page
746
City or Country
Guilin, China
Citation
CHEN, Jianqing; GUO, Zhiling; and HUANG, Jian.
An economic analysis of incentivized positive reviews. (2018). Proceedings of the 18th International Conference on Electronic Business, Guilin, China, 2018 December 2-6. 743-746.
Available at: https://ink.library.smu.edu.sg/sis_research/4332
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.