TITLE:
Game Theory Analysis of E-Commerce’s Price War
AUTHORS:
Yue Hu, Manzhen Tang
KEYWORDS:
Home Appliance Industry, E-Commerce Price War, Nash Equilibrium, Cooperation Win-Win
JOURNAL NAME:
iBusiness,
Vol.6 No.4,
December
23,
2014
ABSTRACT: Home appliance industry
is one of the most competitive industries in China, but the price war also
prolonged. The reasons for E-commerce price war of home appliance industry are
various; this article attempts to use the game theory and information economics
analysis method to discuss the form of competition pattern, and further study
the possibility of price coordination behavior in the industry. The analysis to
our enlightenment is that, in order to get out of the price war trap, and
improve the industry competition level, home appliance enterprises must pay
more attention to technology and product innovation. At the same time,
E-commerce should be rational to marketing strategy; it could avoid market
competition environment destruction, and loss of consumer confidence caused by
excessive price war in the adverse consequences.