Live streaming channel strategy of an online retailer in a supply chain

Abstract

With the increasing development of live streaming selling, it is important for retailers to determine whether and how to introduce such channel. We develop a theoretical model to address these issues by considering three scenarios, i.e., without live streaming channel, with an influencer channel and a third-party channel. Our results show that the retailer will always benefit from adding a live streaming channel in the face of two channel choices, but not always do so only facing an influencer channel. Within a certain slotting fee, if the relative utility enhancement effect and the inconvenience cost are both small or both large, the retailer is better off choosing the third-party channel, but the influencer channel otherwise. Notably, adding a live streaming channel will not always benefit the upstream supplier. Furthermore, the presence of more loyal followers of the influencer may not always benefit the retailer if choosing the influencer channel.