The Research Of SaaS Services Pricing For New Entrants In Different Market Structures

In the past ten years,With the development of cloud computing technology and the continuous extension of application scenarios,As the earliest application model with the most extensive market share,SaaS service has attracted the attention of enterprises.The concept of "new SaaS" has increased the demand for SaaS services.The development of technology has lowered the barriers to entry,and more and more companies are pouring into the industry,which has intensified competition among suppliers.As a new entrant in this market,how to obtain users and gain revenue is the most important issue in an environment of increased competition.First of all,this paper summarizes the current development of SaaS,and identifies the influencing factors of new entrant pricing from the perspective of market and consumers,as the basis of the research model.Secondly,this paper takes the free trial strategy as the starting point,and market share and price as the decision point to explore the optimal pricing and market entry strategy for new entrants in the SaaS market.On the model side,expanding the Hotelling-based model put the free strategy,supplier and consumer sustainability expectations into a pricing model.In the face of the current status of existing SaaS service providers to lock customers' market share through high conversion costs,this paper studies the optimal pricing of new entrants entering the market with free trial strategies under the monopoly market structure.In addition,the consumer heterogeneity is incorporated into the competitive game model,and the optimal price and return of the duopoly at the same time entering the market are discussed.Finally,Under the premise of ensuring the maximization of consumer utility,This paper discusses the decision-making model with sequential entry,and solves the Stackelberg model equilibrium point and the optimal entry time of the new entrantModel discussion findings:(1)Under the monopoly market structure,when new entrants enter the market and provide free and fee-based products,the new entrants get the best returns at this time;(2)When the duopoly enters the market at the same time,new entrants with low product quality should consider from a short-term perspective,enter at a high price,accumulate market share based on free strategy,and obtain income.New entrants with high product quality should consider from a long-term perspective,enter at low prices,increase conversion rate through free trials,and stabilize the market by brand effect.(3)Under the market structure of sequential competition,when high loyalty customers and incumbent manufacturers do not provide free products,new entrants will reduce the price of entering the market if they provide free strategies,which is not conducive to the entry of new entrants;If the incumbent and the new entrant improve product quality at the same time,compatibility will affect the price,market share and revenue.Under fully compatible conditions,new entrants in the market dominate;under conditions of complete incompatibility,new market entrants may consider entering when network externalities are less than differential sensitivity.