Abstract:

With the increasing willingness of consumers to shop online， a growing number of retail platforms not only serve as service providers to operate an agency channel， but also sell competing store brands through their own platforms. At the same time， many manufacturers who used to sell national brands through the retail platform have also established direct online channel to sell the products. As a result， there is not only brand competition between the manufacturer and the retail platform but also selling channel competition between the direct online channel and the platform’s online channel. Therefore， two strategies of the retail platform are considered： introducing store brand and non-introducing store brand. Given the platform’s strategy， the manufacturer has three channel strategies： selling products through the retail platform， selling products through the online direct channel， and selling products through the dual channels. Combining with consumers’ willingness to pay for different selling channels and brands， two-stage game models are constructed in different strategy scenarios. The games are solved by backward induction and equilibrium selling prices and profits are obtained. The optimal strategies of both players can be identifiedby comparing and analyzing these equilibrium outcomes.The results suggest that when the unit purchasing cost of the store brand is low， the platform has an incentive to introduce thebrand and can obtain higher revenues by charging commission feesfrom manufacturer and selling store brand products. However， a higher commission rate may hurt its profit. Even if the online platform introduces the competing store brand， themanufacturer sells national brand product through the platform only， and the selling price and market demand of the national brand are both higher. However， when there is no store brand on the platformand the channel establishment cost is low， the manufacturer sells national brands through dual channels. Nevertheless， it is worth noting that the manufacturer’s profit will be worseas the price difference between the dual channels increases. Furthermore， compared with the case where the platform firstly decides brand strategy， the case where the manufacturer firstly decides channel strategy results in a prisoner’s dilemma， whereas the higher preference of store brand can achieve the profit improvement of both players.

Key words: co-opetition game, retail platform, national brand, prisoner's dilemma