Competitive Strategy Research Of Social Commerce Ecosystem In China

Social commerce is a new born business model within thee-commerce business chain. It incorporates social content into the processof online shopping. Although―social commerce‖had brought in massiveattention, its scholar attention had been rare. This article tries to define―social commerce‖followed by soliciting the basic economic principlesof social commerce platforms. Based by two sided market, severalmodels are built in order to study the facts influencing price and utilities.This article defined social commerce by social networks, UGC andbrokerage. It also made a delicate analysis of competitive edge andstrategies of social commerce in multiple aspects. The article believesthat based on interest, low UGC threshold, vertical social platformsobtains the strongest competitive power.The article also extracted unique economic principles, which are theviscosity of users increase with user numbers and the conversion rateincreases with user numbers, from the social commerce sites based oninterests. Based on the above hypothesis, three models are built and theprofit-maximizing price structure and competitive strategy are derived.Main conclusions are:(1) Compared to C2C platforms, the profit-maximizing pricestructure of social commerce gives consumers more subsidies.(2) The charging model of social commerce to sellers has no effecton the pricing structure of the platform.(3) The optimal―tech-service rate‖of C2C platform is different from0and1, and varies with the changing of the in-group networkexternalities magnitude.