Research on Optimal Group-Purchase Threshold and Pricing Strategy of Community Group Purchase

Abstract

This study delves into the rapidly evolving community group-buying model, specifically focusing on the determination of optimal group-buying thresholds and pricing strategies for merchants. Aiming to bridge the gap in the existing literature, the methodology employs optimization models, integrating a numerical analysis to construct and evaluate a single merchant model. The findings reveal a nuanced relationship: within a specific threshold interval, a unique group-purchase threshold exists where merchants can maximize profits by balancing group and ordinary sales. The study shows that factors like ordinary selling price, group-buying publicity, and associated costs significantly influence these thresholds and pricing strategies. A critical insight is the threshold’s variability in response to market conditions, highlighting a strategic balance for maximizing profitability. The research underscores the need for merchants to adapt their strategies in response to evolving market dynamics and consumer behaviors. However, the study acknowledges its limitations due to its theoretical nature and focus on the Chinese market, suggesting the potential for future empirical studies in diverse cultural and economic contexts. Overall, this research contributes both theoretically and practically by providing a foundational framework for merchants to optimize group-purchase thresholds and pricing strategies in the dynamic realm of community group buying.

Keywords

• community group buying
• group-buying threshold
• optimal pricing