Research On Platform Pricing Strategy In The Competitive Environment Of Two-sided Market

In the digital network era,platforms have gradually become important enterprise organization models,and payment platforms,online shopping platforms,video software,and other enterprises with bilateral market characteristics have gradually penetrated people’s lives.The content of freemium models mostly exists in some platforms,such as online video platforms,shopping platforms,online games,etc.Current research on freemium models is mostly conducted in a unilateral market environment or in a static equilibrium of bilateral markets.However,more and more platforms choose to adopt freemium models as a marketing strategy to enter the market.This thesis takes the bilateral market as the background considers the existence of two platforms competing in the market,and studies the pricing strategies of the platforms when both platforms adopt the freemium model,based on their bilateral pricing and version quality differentiation,respectively,when they launch different versions simultaneously and sequentially.This thesis investigates the pricing strategies of platforms for bilateral and version differentiation decisions under the freemium model,and analyzes the impact of version differentiation strategies and network externalities on platform pricing and revenue when platforms launch their products simultaneously and sequentially based on the context of platform competition.Firstly,we review the relevant domestic and international research progress about platform pricing,network externality,and innovation product diffusion model,introduce the relevant theories of the bilateral market platform,freemium model,innovation diffusion model,conduct an in-depth analysis of the difference between platform and traditional products,and provide an in-depth analysis of the uniqueness of platform pricing,so as to lay the corresponding theoretical foundation for the study.Secondly,the bilateral pricing under the competitive equilibrium of the platform and the version differentiation strategy,the pricing strategy of the sequential launch of versions under the freemium model are studied respectively,the self-network externality,cross-network externality,and product mismatch are introduced,the revenue function of the platform is constructed based on the Bass diffusion model and consumer utility in the bilateral market competition environment,the optimal pricing and revenue of the platform under the equilibrium are resolved,and the platform’s phased introduction of new products and the problem of product pricing strategy.Finally,based on this,the impact of network externalities and version differentiation on the optimal pricing strategy and revenue of the platform is analyzed with the help of software simulations.Through the solution and analysis,the optimal strategy for the platform at market equilibrium and sequential product launch is obtained,which provides pricing strategy options for the platform to improve its competitive advantage.