Research On The Pricing Mechanism Of Competitive Two-Sided Platforms

In recent years,the platform economy has gradually become the main driving force for economic development,and the ecosystem has become an important support point for enterprises to conduct strategic competition.Platforms need to gradually improve their ecosystems,and actively deploy in areas that are complementary to their own businesses.New platforms that enter the market later will have fierce platform competition with incumbent platforms.With the increasing frequency of platform competition,the competition between platforms is receiving extensive attention from academia.Under the framework of the two-sided market theory,considering the characteristics of platform competition under network externalities,this paper studies the pricing strategies of new platforms and incumbent platforms.The model is constructed,and it is concluded that the competitive bilateral platform adopts the pricing mechanism under different differentiation strategies,which provides guidance for the development of platform competition.Aiming at the horizontal differentiation of platforms,this paper discusses how the user scale and user switching cost between platforms affect the pricing strategy in the platform competition,and how the new platforms can make differentiated positioning and compatible strategic choices.The study found that the user switching cost and the existing user scale of incumbent platforms are the biggest barriers for new platforms to enter the market,while new platforms can alleviate the intensity of competition with incumbent platforms by implementing active differentiation strategies and compatibility strategies.The horizontal differentiation of the platform will increase the platform’s revenue level,and the new platform at a disadvantage will prefer a fully compatible strategy,gradually reducing the gap with the incumbent platform,thereby enhancing the pricing advantage and market revenue of the new platform.Aiming at the vertical differentiation of platforms,a two-stage model of platform competition is constructed,and then the sensitivity differences of bilateral users to quality perception are distinguished.The results show that the increase of user switching cost will increase the gap in platform quality,and the equilibrium pricing and user scale of high-quality platforms will increase,while the opposite is true for low-quality platforms.The bilateral user scale and pricing of the platform will increase,while the bilateral user scale and pricing of new platforms will decrease;when there are differences in the sensitivity of bilateral users to the quality of the platform,high-quality platforms will be more sensitive to the quality of the platform.High-priced,low-quality platforms will set lower prices for users who are more sensitive to the quality level of the platform,and vertical differentiation of platforms will separate the profit focus of competition among different quality platforms.The research results can provide suggestions for the pricing strategy of competition between new platforms and incumbent platforms,help to study how new platforms can make up the gap with incumbent platforms,and provide theoretical guidance for the competition between platforms of asymmetric scale.