Livestreaming sales strategy considering valuation correlation and influence effect

Abstract

Livestreaming e-commerce is a new and emerging mode of online shopping that offers various products, interactive communication, and real-time feedback. It poses some challenges for streamers who need to design effective sales strategies that account for correlated consumer valuations of products and influenced valuation of a new product by owned products. In this paper, we analyze the optimal livestreaming sales strategy for streamers who sell correlated products sequentially in a livestreaming event and further check the robustness of the main results in extensions. We find that streamers can benefit more from selling complementary products rather than substitute products and leverage the valuation influence effect to optimize product prices. Moreover, we use Copula functions to model the joint distribution of consumer valuations. Through simulation experiments, we examine how the livestreaming profit varies with the strength of valuation correlation and influence effect, how the streamer sets the selling sequence of products, and the robustness of profit by different Copula functions.