Analysis of mutual benefit from information sharing and exchange between an online platform and a seller

When a seller uses both a direct sales channel and an external online platform, the seller and the platform can obtain private yet correlated market signals that improve demand forecasting. This setting motivates an analysis of whether, and under what conditions , they should unilaterally share or mutually exchange these signals. While the platform sets its commission rate and the seller determines its selling price, we investigate whether bilateral “exchange” can address the incentive misalignment inherent in unilateral “sharing,” thereby enabling both parties to maximize their profits by leveraging each other’s signals. Our equilibrium analysis reveals that when demand for the seller’s online channel is sufficiently high, the seller can incentivize the platform to unilaterally share its signal via a side payment. Furthermore, when the seller’s signal is highly precise, unilateral sharing can benefit both parties, regardless of the relative market sizes of the two channels. However, mutual exchange yields no additional benefit over unilateral sharing for either party. Even when the commission rate is fixed and independent of signals, the platform can still achieve a win-win outcome through unilateral sharing by using a two-part tariff, albeit with a higher commission than in the no-sharing scenario. • A game-theoretic framework for unilateral information sharing and mutual exchange between an online platform and a seller. • The seller’s unilateral sharing can lead to mutual benefits for both players, even without a financial incentive mechanism. • The benefits of mutual information exchange do not exceed those of unilateral sharing for either party. • The platform can use a two-part tariff and create a win-win via information sharing, even with a prefixed commission rate.

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Publication Details

Journal
European Journal of Operational Research
Published
2025-10-30
DOI
https://doi.org/10.1016/j.ejor.2025.10.017
Citations
1
Primary Topic
Auction Theory and Applications
Type
article
Field-Weighted Citation Impact
2.11
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article

Analysis of mutual benefit from information sharing and exchange between an online platform and a seller

Eunji Lee, Stefan Minner, Christopher S. Tang
1 citations
European Journal of Operational Research
Auction Theory and Applications
2.11
article

Analysis of mutual benefit from information sharing and exchange between an online platform and a seller

Eunji Lee, Stefan Minner, Christopher S. Tang
article en
1 citations

Abstract

When a seller uses both a direct sales channel and an external online platform, the seller and the platform can obtain private yet correlated market signals that improve demand forecasting. This setting motivates an analysis of whether, and under what conditions , they should unilaterally share or mutually exchange these signals. While the platform sets its commission rate and the seller determines its selling price, we investigate whether bilateral “exchange” can address the incentive misalignment inherent in unilateral “sharing,” thereby enabling both parties to maximize their profits by leveraging each other’s signals. Our equilibrium analysis reveals that when demand for the seller’s online channel is sufficiently high, the seller can incentivize the platform to unilaterally share its signal via a side payment. Furthermore, when the seller’s signal is highly precise, unilateral sharing can benefit both parties, regardless of the relative market sizes of the two channels. However, mutual exchange yields no additional benefit over unilateral sharing for either party. Even when the commission rate is fixed and independent of signals, the platform can still achieve a win-win outcome through unilateral sharing by using a two-part tariff, albeit with a higher commission than in the no-sharing scenario. • A game-theoretic framework for unilateral information sharing and mutual exchange between an online platform and a seller. • The seller’s unilateral sharing can lead to mutual benefits for both players, even without a financial incentive mechanism. • The benefits of mutual information exchange do not exceed those of unilateral sharing for either party. • The platform can use a two-part tariff and create a win-win via information sharing, even with a prefixed commission rate.

European Journal of Operational ResearchVol. 331(3)
University of Mannheim (DE), Technical University of Munich (DE), Anderson University - South Carolina (US)
Openalex Percentile: Top 9%
Auction Theory and Applications
2.11
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