Cross-border E-commerce Competitive Strategy Based on the Survey of Product Differentiation

Jun Chen, Shiyan Xu, Chenyang Zhao, Hui Chen

Abstract: With the development of international trade and information technology, cross-border e-commerce is booming globally. It involves the movement of goods between domestic and foreign markets, domestic warehouses, and consumers. However, as cross-border e-commerce products often need long-distance transport, the commodities suitable for sale through cross-border e-commerce are limited. Therefore, merchants are increasingly facing fiercer competition. In this paper, a game model was built to analyze how differentiation of products affects the competitive strategy making in the cross-border dual-channel supply chain. The optimal pricing and service level under centralized and decentralized decisions were formulated. The relationship between multiple variables and service levels and profits were interpreted in combination with spatial geography. The equilibrium solution revealed that a centralized supply chain can generate more profits. And merchants should increase the degree of product differentiation and strive to improve service levels.