Digital Pricing With Variety Seeking

With the popularity of computers and smartphones,digital products are gradually integrated into our lives,and piracy is becoming more and more common.Many enterprises want to maximize their profits through reasonable piracy attack strategies and pricing strategies.Because of its own attributes,digital products show obvious network externalities,and the traditional economic laws are no longer applicable.Therefore,digital enterprises can no longer win in the fiercely competitive market according to the traditional pricing theory.Behavioral pricing has always been the focus of marketing science and psychology.Consumer diversification seeking behavior is a common type of consumer behavior,which can be understood as the "change of opinion" of consumers.With the rapid development of the digital economy,the digital product market is becoming more and more abundant,and consumers are faced with various choices.Therefore,if enterprises want to succeed,they must consider the consumer diversification seeking behavior into corporate decision-making.The purpose of this paper is to explore behavioral digital pricing.In a duopoly market,consumer diversification seeking behavior is introduced into corporate pricing and anti-piracy investment models.Hotelling model is expanded by considering the influence of network externalities.The equilibrium results of different market positions of enterprises and different government strike strategies are analyzed numerically.The main research work is as follows:Firstly,according to the different market position of enterprises,this paper proposes three price competition game models:(1)Nash simultaneous decision-making model(the same market position of the original company and the pirated group),(2)Stackelberg model with the original company as the leader,(3)the Stackelberg model with the pirated group as the leader.The optimal pricing strategy,investment strategy and expansion strategy under the three models are given by the models.In order to simplify the analysis,we assume the special situation when the total market demand is fixed.It is interesting to find that no matter who is the market leader,it will gain more profits.Therefore,in reality,enterprises should preempt.Secondly,this paper considers the government's crackdown on piracy.In real life,the government as the attacker is often more effective than the enterprise attacking,so this paper joins the government in the decision-making of Nash simultaneous decision-making model to fight against piracy.From the perspective of genuine companies,copyright protection and social welfare,it gives the optimal attacking strategy of the government under different circumstances.It finds that the government attacking is more effective than the enterprise attacking.When the intensity of network externalities is small,the government stands in the perspective of the legitimate company,and the incomplete strike strategy will not only save the government funds,but also bring higher profits to the legitimate company.Finally,we explore the multi-stage consumer diversification seeking behavior,and take the time value of capital into account in the product life cycle,and give the optimal pricing strategy,investment strategy and strike strategy.The study finds that both original and pirated companies would adopt high-price strategy in the first stage.Diversification seeking brings higher benefits to both sides in the two stages,and the two companies will become "similar" because of the existence of consumer diversification seeking behavior.Therefore,in markets where consumers seek to diversify,skimming strategy will enable enterprises to obtain more profits.