Research on the sales mode selection of smart homing firms considering carbon neutrality and digital privacy

Abstract

Achieving carbon neutrality is the ultimate goal of the global economy. By leveraging Internet of Things (IoT) technology to gather users' data, smart home devices can effectively achieve energy conservation and reduce carbon emissions. The strategic allocation of investment by smart device producers towards environmentally-friendly functionality and choosing the optimal sales mode have emerged as significant research questions. Addressing consumer concerns regarding data privacy sensitivity, this paper presents a game-theoretical model, involving manufacturers, e-commerce platforms, and consumers, to explore the intricate dynamics among investment in smart environmental functionality, sales mode selection, and pricing strategies. The results indicate that manufacturers consistently benefit from such investments. If the number of data-sensitive consumers is considerable, manufacturers will subsidize the platform to encourage the purchase of smart devices, thereby gaining from cross-selling opportunities. When the commission ratio is low, the equilibrium strategy shifts from the agency selling mode to wholesale pricing one, in response to the advent of investments in smart environmental functionality. Furthermore, the commission ratio, consumer perceived environmental value, and unit carbon emissions collectively impact social welfare. This study offers valuable theoretical insights for manufacturers in making informed decisions regarding pricing strategies and sales mode selection, by analyzing the interplay between profit margin and cross-selling income resulting from demand expansion.