Journal of Shanghai Jiaotong University ›› 2014, Vol. 48 ›› Issue (02): 300-305.

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Pricing Strategies of eWOM Virtual Communities

LU Xiaojing,CHEN Hongmin
  

  1. (Antai College of Economics and Management, Shanghai Jiaotong University, Shanghai 200052, China)
  • Received:2012-11-16

Abstract:

Based on theory of two-sided market, this paper discussed the impact of self network externalities and across network externalities between users of two sides on the pricing strategy of eWOM virtual communities. Additionally, the  quality of merchants was considered and explored. The results show that the of the  optimal price platform for consumers rises with the augment of  self network externalities of consumers and the percentage of merchants with high quality, and declines with the augment of across network externalities of consumers to merchants. The  optimal price of the platform for merchants rises with the augment of  across network externalities of machant to consumers. And the price elasticity of the demand of merchants with high quality is smaller than that of merchants with low quality.
 

Key words: two-sided market, electronic word-of-mouth, virtual community, network externality

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