IDEAS home Printed from https://ideas.repec.org/a/spr/elcore/v24y2024i2d10.1007_s10660-022-09591-3.html
   My bibliography  Save this article

Optimal contract design for live streaming shopping in a manufacturer–retailer–streamer supply chain

Author

Listed:
  • Yi He

    (Hainan University)

  • Lidong Chen

    (Hainan University)

  • Jingjing Mu

    (China Aerospace Science and Technology Corporation)

  • Azmat Ullah

    (Hainan University)

Abstract

This study considers a manufacturer–retailer–streamer supply chain, in which the retailer first purchases products from a manufacturer and then sells them to consumers through a streamer. In the live streaming context, the retailer usually cooperates with the streamer by providing three different contracts: only a commission of the sale (OC), only a fixed fee (OF), and a commission of the sale and fixed fee (CF). Therefore, this study develops a theoretical model to investigate the effects of these three contracts on supply chain members’ optimal decisions and profits. The following results were obtained: (1) the retailer prefers an OC contract with a high-ability streamer, and the manufacturer benefits from this contract. Additionally, the manufacturer, retailer, and high-ability streamer can achieve a win–win–win outcome in certain cases. Furthermore, the retailer is willing to sign an OC contract with a low-ability streamer when the fixed fee of the OF contract is high. (2) The retailer prefers to cooperate with a low-ability streamer through an OF contract when the fixed fee is low. (3) The CF contract is the most profitable alternative for the retailer when the total commission rate is low and the fixed fee is medium.

Suggested Citation

  • Yi He & Lidong Chen & Jingjing Mu & Azmat Ullah, 2024. "Optimal contract design for live streaming shopping in a manufacturer–retailer–streamer supply chain," Electronic Commerce Research, Springer, vol. 24(2), pages 1071-1093, June.
    • Handle: RePEc:spr:elcore:v:24:y:2024:i:2:d:10.1007_s10660-022-09591-3
    DOI: 10.1007/s10660-022-09591-3
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10660-022-09591-3
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10660-022-09591-3?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kang, Kai & Lu, Jinxuan & Guo, Lingyun & Li, Wenlu, 2021. "The dynamic effect of interactivity on customer engagement behavior through tie strength: Evidence from live streaming commerce platforms," International Journal of Information Management, Elsevier, vol. 56(C).
    2. Hu, Yihong & Qu, Shengnan & Li, Guo & Sethi, Suresh P., 2021. "Power structure and channel integration strategy for online retailers," European Journal of Operational Research, Elsevier, vol. 294(3), pages 951-964.
    3. Prince Clement Addo & Jiaming Fang & Andy Ohemeng Asare & Nora Bakabbey Kulbo, 2021. "Customer engagement and purchase intention in live-streaming digital marketing platforms," The Service Industries Journal, Taylor & Francis Journals, vol. 41(11-12), pages 767-786, September.
    4. Kim, Jihye & Kim, Minseong, 2020. "Spectator e-sport and well-being through live streaming services," Technology in Society, Elsevier, vol. 63(C).
    5. Wongkitrungrueng, Apiradee & Assarut, Nuttapol, 2020. "The role of live streaming in building consumer trust and engagement with social commerce sellers," Journal of Business Research, Elsevier, vol. 117(C), pages 543-556.
    6. Nelly Bart & Tatyana Chernonog & Tal Avinadav, 2021. "Revenue-sharing contracts in supply chains: a comprehensive literature review," International Journal of Production Research, Taylor & Francis Journals, vol. 59(21), pages 6633-6658, November.
    7. He, Yi & Wang, Hang & Guo, Qiang & Xu, Qingyun, 2019. "Coordination through cooperative advertising in a two-period consumer electronics supply chain," Journal of Retailing and Consumer Services, Elsevier, vol. 50(C), pages 179-188.
    8. Soraya Fatehi & Michael R. Wagner, 2019. "Crowdfunding via Revenue-Sharing Contracts," Manufacturing & Service Operations Management, INFORMS, vol. 21(4), pages 875-893, October.
    9. Yi He & Qingyun Xu & Bing Xu & Pengkun Wu, 2016. "Supply chain coordination in quality improvement with reference effects," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 67(9), pages 1158-1168, September.
    10. Yang, Huixiao & Luo, Jianwen & Wang, Haijun, 2017. "The role of revenue sharing and first-mover advantage in emission abatement with carbon tax and consumer environmental awareness," International Journal of Production Economics, Elsevier, vol. 193(C), pages 691-702.
    11. Haoyu Liu & Shulin Liu, 2021. "Optimal decisions and coordination of live streaming selling under revenue‐sharing contracts," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(4), pages 1022-1036, June.
    12. Cai, Jianhu & Hu, Xiaoqing & Tadikamalla, Pandu R. & Shang, Jennifer, 2017. "Flexible contract design for VMI supply chain with service-sensitive demand: Revenue-sharing and supplier subsidy," European Journal of Operational Research, Elsevier, vol. 261(1), pages 143-153.
    13. Wang, Xin & Tao, Zhiying & Liang, Liang & Gou, Qinglong, 2019. "An analysis of salary mechanisms in the sharing economy: The interaction between streamers and unions," International Journal of Production Economics, Elsevier, vol. 214(C), pages 106-124.
    14. He, Yi & Xu, Qingyun & Shao, Zhen, 2021. "“Ship-from-store” strategy in platform retailing," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 145(C).
    15. Zhang, Juliang & Chen, Jian, 2013. "Coordination of information sharing in a supply chain," International Journal of Production Economics, Elsevier, vol. 143(1), pages 178-187.
    16. Park, Hyun Jung & Lin, Li Min, 2020. "The effects of match-ups on the consumer attitudes toward internet celebrities and their live streaming contents in the context of product endorsement," Journal of Retailing and Consumer Services, Elsevier, vol. 52(C).
    17. Shijie Lu & Dai Yao & Xingyu Chen & Rajdeep Grewal, 2021. "Do Larger Audiences Generate Greater Revenues Under Pay What You Want? Evidence from a Live Streaming Platform," Marketing Science, INFORMS, vol. 40(5), pages 964-984, September.
    18. Linh, Cao To & Hong, Yushin, 2009. "Channel coordination through a revenue sharing contract in a two-period newsboy problem," European Journal of Operational Research, Elsevier, vol. 198(3), pages 822-829, November.
    19. Palsule-Desai, Omkar D., 2013. "Supply chain coordination using revenue-dependent revenue sharing contracts," Omega, Elsevier, vol. 41(4), pages 780-796.
    20. Guo Li & Lin Tian & Hong Zheng, 2021. "Information Sharing in an Online Marketplace with Co‐opetitive Sellers," Production and Operations Management, Production and Operations Management Society, vol. 30(10), pages 3713-3734, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, Yanfen & Xu, Qi & Zhang, Guoqing, 2023. "Optimal contracts with moral hazard and adverse selection in a live streaming commerce market," Journal of Retailing and Consumer Services, Elsevier, vol. 74(C).
    2. Qiang Wang & Nenggui Zhao & Xiang Ji, 2024. "Reselling or agency selling? The strategic role of live streaming commerce in distribution contract selection," Electronic Commerce Research, Springer, vol. 24(2), pages 983-1016, June.
    3. Chen, Jianyu & Gong, Xiushuang & Ren, Rui, 2023. "Active or avoidance coping? Influencing mechanisms of streamers' coping strategies on viewers’ word of mouth after livestreaming e-commerce failures," Journal of Retailing and Consumer Services, Elsevier, vol. 72(C).
    4. Zhou, Chi & Yu, Jing & Qian, Yong, 2024. "Should live-streaming platforms nonexclusively promote brands from traditional retail platforms?," Journal of Retailing and Consumer Services, Elsevier, vol. 80(C).
    5. Ma, Xiaoyu & Huang, Feiteng & Li, Xue & Zhang, Jihong, 2024. "Optimal contract design in mobile service industry considering network congestion," International Journal of Production Economics, Elsevier, vol. 267(C).
    6. Yang, Xiaolin & Gou, Qinglong & Wang, Xin & Zhang, Juzhi, 2022. "Does bonus motivate streamers to perform better? An analysis of compensation mechanisms for live streaming platforms," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    7. Zhen, Xueping & Wang, Ping & Li, Xinran, 2024. "The Streamer's sales strategy choice considering sales effort," Journal of Retailing and Consumer Services, Elsevier, vol. 78(C).
    8. Xin, Baogui & Hao, Yaru & Xie, Lei, 2023. "Strategic product showcasing mode of E-commerce live streaming," Journal of Retailing and Consumer Services, Elsevier, vol. 73(C).
    9. Zhang, Xiaoping & Zhang, Shihan, 2024. "Investigating impulse purchases in live streaming e-commerce: A perspective of match-ups," Technological Forecasting and Social Change, Elsevier, vol. 205(C).
    10. Dawei Liu & Jinyang Yu, 2024. "Impact of perceived diagnosticity on live streams and consumer purchase intention: streamer type, product type, and brand awareness as moderators," Information Technology and Management, Springer, vol. 25(3), pages 219-232, September.
    11. Xiaojun Mai & Fauziah Sheikh Ahmad & Jiayi Xu, 2023. "A Comprehensive Bibliometric Analysis of Live Streaming Commerce: Mapping the Research Landscape," SAGE Open, , vol. 13(4), pages 21582440231, December.
    12. Zheng, Shiyong & Chen, Jiada & Liao, Junyun & Hu, Hsin-Li, 2023. "What motivates users' viewing and purchasing behavior motivations in live streaming: A stream-streamer-viewer perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 72(C).
    13. Ji, Guojun & Fu, Tianyu & Li, Shuhao, 2023. "Optimal selling format considering price discount strategy in live-streaming commerce," European Journal of Operational Research, Elsevier, vol. 309(2), pages 529-544.
    14. Yang, Wenting & Govindan, Kannan & Zhang, Jiantong, 2023. "Spillover effects of live streaming selling in a dual-channel supply chain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 180(C).
    15. Luo, Xi & Cheah, Jun-Hwa & Hollebeek, Linda D. & Lim, Xin-Jean, 2024. "Boosting customers’ impulsive buying tendency in live-streaming commerce: The role of customer engagement and deal proneness," Journal of Retailing and Consumer Services, Elsevier, vol. 77(C).
    16. Chen, Xiayu & Shen, Junya & Wei, Shaobo, 2023. "What reduces product uncertainty in live streaming e-commerce? From a signal consistency perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 74(C).
    17. Huang, Lingchen & Liu, Bin & Zhang, Rong, 2024. "Channel strategies for competing retailers: Whether and when to introduce live stream?," European Journal of Operational Research, Elsevier, vol. 312(2), pages 413-426.
    18. Liu, Baolong & Wang, Weilong, 2023. "Live commerce retailing with online influencers: Two business models," International Journal of Production Economics, Elsevier, vol. 255(C).
    19. Zhucheng Shao & Jessica Sze Yin Ho & Garry Wei-Han Tan & Keng-Boon Ooi & Prianka Sarker & Yogesh K. Dwivedi, 2024. "How celebrity attributes damage customer–brand relationship in live streaming commerce: a dark side," Journal of Brand Management, Palgrave Macmillan, vol. 31(6), pages 593-615, November.
    20. Li, Nianlin & Xuan, Changchun & Chen, Rui, 2024. "Different roles of two kinds of digital coexistence: The impact of social presence on consumers' purchase intention in the live streaming shopping context," Journal of Retailing and Consumer Services, Elsevier, vol. 80(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:elcore:v:24:y:2024:i:2:d:10.1007_s10660-022-09591-3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.