Popularity and Transaction Prices as Drivers of Price Dispersion on Two-Sided Digital Platforms
Main Article Content
Abstract
Objective: the increase in e-commerce transactions has resulted in the understanding of the dynamics of pricing in digital marketing in B2B and B2C environments. This is crucial for capturing buyer preferences and influencing store profitability. Our empirical study reviews how factors such as product popularity, transaction volume, price adjustments, and shipping time influence price dispersion on two-sided e-commerce platforms. Methods: panel data regression models were estimated using a comprehensive dataset from different product categories. Results: the main findings reveal a negative influence of product popularity on price dispersion, suggesting stronger competition and buyer engagement as potential drivers. A positive association between transaction volume and price dispersion also highlights the effect of efficient marketing strategies. Conclusions: the research is important because it sheds light on variables that are significant for transactions on digital twosided platforms, such as product popularity. It also assists managers in efficiently planning pricing strategies, product promotion, and reputation management.
Downloads
Article Details

This work is licensed under a Creative Commons Attribution 4.0 International License.
References
Auer, D., & Petit, N. (2015). Two-Sided Markets and the Challenge of Turning Economic Theory into Antitrust Policy. The Antitrust Bulletin, 60(4), 426–461. https://doi.org/10.1177/0003603X15607155
Backus, M., Blake, T., Larsen, B., & Tadelis, S. (2020). Sequential bargaining in the field: Evidence from millions of bargaining interactions. The Quarterly Journal of Economics, 135(3), 1319–1361. https://doi.org/10.1093/qje/qjaa003
Baltagi, B. H. (2005). Econometric Analysis of Panel Data. Em John Wiley & Sons Ltd.
Baye, M. R., Morgan, J., & Scholten, P. (2004). Price Dispersion in the Small and in the Large: Evidence from an Internet Price Comparison Site. The Journal of Industrial Economics, 52(4), 463–496. https://doi.org/10.1111/j.0022-1821.2004.00236.x
Bei, Z., & Gielens, K. (2022). The One-Party Versus Third-Party Platform Conundrum: How Can Brands Thrive? Journal of Marketing, 87(2), 253–274. https://doi.org/10.1177/00222429221116803
Böheim, R., Hackl, F., & Hölzl-Leitner, M. (2021). The impact of price adjustment costs on price dispersion in e-commerce. International Journal of Industrial Organization, 77, 102743. https://doi.org/10.1016/j.ijindorg.2021.102743
Bouichou, S. I., Wang, L., & Zulfiqar, S. (2022). How Corporate Social Responsibility Boosts Corporate Financial and Non-financial Performance: The Moderating Role of Ethical Leadership. Frontiers in Psychology, 13, 871334. https://doi.org/10.3389/fpsyg.2022.871334
Bown, N. J. (2007). The relevance of judgment and decision making research for marketing: Introduction to the special issue. Marketing Theory, 7(1), 5–11. https://doi.org/10.1177/1470593107073841
Branchik, B. J., & Davis, J. F. (2009). Marketplace Activism: A History of the African American Elite Market Segment. Journal of Macromarketing, 29(1), 37–57. https://doi.org/10.1177/0276146708328066
Bronnenberg, B. J., Mela, C. F., & Boulding, W. (2006). The periodicity of pricing. Journal of Marketing Research, 43(3), 477–493. https://doi.org/10.1509/jmkr.43.3.477
Bruno, H. A., Che, H., & Dutta, S. (2012). Role of Reference Price on Price and Quantity: Insights from Business-to-Business Markets. Journal of Marketing Research, 49(5), 640–654. https://doi.org/10.1509/jmr.09.0334
Brynjolfsson, E., & Smith, M. D. (2000). Frictionless commerce? A comparison of Internet and conventional retailers. Management Science, 46(4), 563–585. https://doi.org/10.1287/mnsc.46.4.563.12061
Bunn, M. D. (1993). Taxonomy of Buying Decision Approaches. Journal of Marketing, 57(1), 38–56. https://doi.org/10.1177/002224299305700103
Cai, Y.-J., & Choi, T.-M. (2023). Omni-channel marketing strategy in the digital platform era. Journal of Business Research, 168, 114197. https://doi.org/10.1016/j.jbusres.2023.114197
Castro, I. A., Morales, A. C., & Nowlis, S. M. (2013). The Influence of Disorganized Shelf Displays and Limited Product Quantity on Consumer Purchase. Journal of Marketing, 77(4), 118–133. https://doi.org/10.1509/jm.11.0495
Chen, J., & Scholten, P. (2003). Price Dispersion, Product Characteristics, and Firms’ Behaviors: Stylized Facts From Shopper.Com. Advances in Applied Microeconomics, 12, 143–164. https://doi.org/10.1016/S0278-0984(03)12006-8
Chen, W., Katehakis, M., & Tang, Q. (2022). Dynamic inventory system with pricing adjustment for price-comparison shoppers. Applied Stochastic Models in Business and Industry. https://doi.org/10.1002/asmb.2737
Choi, H., & Mela, C. F. (2019). Monetizing Online Marketplaces. Marketing Science, mksc.2019.1197. https://doi.org/10.1287/mksc.2019.1197
Cohen, M. (1998). Linking price dispersion to product differentiation— Incorporating aspects of customer involvement. Applied Economics, 30(6), 829– 835. https://doi.org/10.1080/000368498325534
De New, J. P., & Zimmermann, K. F. (1994). Native wage impacts of foreign labor: A random effects panel analysis. Journal of Population Economics, 7(2), 177–192. https://doi.org/10.1007/BF00173618
Desai, V., & Vidyapeeth, B. (2019). Digital Marketing: A Review. International Journal of Trend in Scientific Research and Development, 196–200.
eBay. (2023, novembro 15). eBay Company: Global scale e reach. Our Company. https://www.ebayinc.com/company/
Forbes. (2023). 62% dos consumidores fazem até cinco compras online por mês. https://encr.pw/coJsl FourWeekMBA. (2024). EBay versus Amazon. https://fourweekmba.com/pt/ebay-x-amazon/
Gao, H., Zhang, Y., & Mittal, V. (2017). How Does Local–Global Identity Affect Price Sensitivity? Journal of Marketing, 81(3), 62–79. https://doi.org/10.1509/jm.15.0206
Ghose, A., & Yao, Y. (2011). Using transaction prices to re-examine price dispersion in electronic markets. Information Systems Research, 22(2), 269–288. https://doi.org/10.1287/isre.1090.0252
Grewal, D., Janakiraman, R., Kalyanam, K., Kannan, P. K., Ratchford, B., Song, R., & Tolerico, S. (2010). Strategic online and offline retail pricing: A review and research agenda. Journal of Interactive Marketing, 24(2), 138–154. https://doi.org/10.1016/j.intmar.2010.02.007
Gujarati, D. N., & Porter, D. C. (2011). Econometria Básica. Bookman. Hanson, W. A., & Putler, D. S. (1996). Hits and misses: Herd behavior and online product popularity. Marketing Letters, 7(4), 297–305. https://doi.org/10.1007/BF00435537
Hofacker, C., Golgeci, I., Pillai, K. G., & Gligor, D. M. (2020). Digital marketing and business-to-business relationships: A close look at the interface and a roadmap for the future. European Journal of Marketing, 54(6), 1161–1179. https://doi.org/10.1108/EJM-04-2020-0247
Jang, S., & Chung, J. (2021). What drives add-on sales in mobile games? The role of inter-price relationship and product popularity. Journal of Business Research, 124, 59–68. https://doi.org/10.1016/j.jbusres.2020.11.025
Jiang, P., & Rosenbloom, B. (2005). Customer intention to return online: Price perception, attribute‐level performance, and satisfaction unfolding over time. European Journal of Marketing, 39(1/2), 150–174. https://doi.org/10.1108/03090560510572061
Kannan, P. K., & Li, H. (2017). Digital marketing: A framework, review and research agenda. International Journal of Research in Marketing, 34(1), 22–45. https://doi.org/10.1016/j.ijresmar.2016.11.006
Krishna, A., Currim, I. S., & Shoemaker, R. W. (1991). Consumer Perceptions of Promotional Activity. Journal of Marketing, 55, 4–16. https://doi.org/10.2307/1252233
Lach, S. (2002). Existence and Persistence of Price Dispersion: An Empirical Analysis. Review of Economics and Statistics, 84(3), 433–444. https://doi.org/10.1162/003465302320259457
Lai, C.-H., Lee, S.-J., & Huang, H.-L. (2019). A social recommendation method based on the integration of social relationship and product popularity. International Journal of Human-Computer Studies, 121, 42–57. https://doi.org/10.1016/j.ijhcs.2018.04.002
Lin, S. (2020). Two-Sided Price Discrimination by Media Platforms. Marketing Science, 39(2), 317–338. https://doi.org/10.1287/mksc.2019.1211
Lindgren, C., Daunfeldt, S. O., Rudholm, N., & Yella, S. (2020). Is intertemporal price discrimination the cause of price dispersion in markets with low search costs? Applied Economics Letters, 28(11), 1–4. https://doi.org/10.1080/13504851.2020.1789055
Maia, C. R., Lunardi, G. L., Dolci, D., & D’Avila, L. C. (2019). Competitive Price and Trust as Determinants of Purchase Intention in Social Commerce. BAR - Brazilian Administration Review, 16(4), e190074. https://doi.org/10.1590/1807-7692bar2019190074
Massad, V. J., & Tucker, J. M. (2000). Comparing bidding and pricing between in-person and online auctions. Journal of Product & Brand Management, 9(5), 325–340. https://doi.org/10.1108/10610420010347128
Nambisan, S., Zahra, S. A., & Luo, Y. (2019). Global platforms and ecosystems: Implications for international business theories. Journal of International Business Studies, 50(9), 1464–1486. https://doi.org/10.1057/s41267-019-00262-4
Oliveira, A. C., Almeida, M. I. S., & Isabella, G. (2024). De que forma os preços variam em sites de comparação? Influência do cashback e da estrutura de mercado na dinâmica de preços. ReMark - Revista Brasileira de Marketing, 23(2), 516–579. https://doi.org/10.5585/remark.v23i2.25391
Overby, E., & Forman, C. (2015). The effect of electronic commerce on geographic purchasing patterns and price dispersion. Management Science, 61(2), 431–453. https://doi.org/10.1287/mnsc.2014.1977
Pan, X., Ratchford, B. T., & Shankar, V. (2002). Can price dispersion in online markets be explained by differences in e-tailer service quality? Journal of the Academy of Marketing Science, 30(4), 433–445. https://doi.org/10.1177/009207002236915
Perren, R., & Kozinets, R. V. (2018). Lateral Exchange Markets: How Social Platforms Operate in a Networked Economy. Journal of Marketing, 82(1), 20–36. https://doi.org/10.1509/jm.14.0250
Powell, D., Yu, J., DeWolf, M., & Holyoak, K. J. (2017). The Love of Large Numbers: A Popularity Bias in Consumer Choice. Psychological Science, 28(10), 1432–1442. https://doi.org/10.1177/0956797617711291
Putra, I. G. D., & Belgiawan, P. F. (2023). Proposed Marketing Strategy to Increase Purchase Intention on Tokopedia Package Subscription. International Journal of Current Science Research and Review, 6(01). https://doi.org/10.47191/ijcsrr/V6-i1-36
Puzakova, M., & Kwak, H. (2017). Should Anthropomorphized Brands Engage Customers? The Impact of Social Crowding on Brand Preferences. Journal of Marketing, 81(6), 99–115. https://doi.org/10.1509/jm.16.0211
Roson, R. (2005). Two-Sided Markets: A Tentative Survey. Review of Network Economics, 4(2). https://doi.org/10.2202/1446-9022.1070
Sarker, T., Dey, S., Maity, M., Arli, D., & Nguyen, G. (2022). The 7A Framework: Extending the 4A Framework Based on Exchanges in Subsistence Marketplaces in India and Vietnam. Journal of Macromarketing, 42(3), 356–380. https://doi.org/10.1177/02761467221099818
Saxena, D., Muzellec, L., & Trabucchi, D. (2020). BlaBlaCar: Value creation on a digital platform. Journal of Information Technology Teaching Cases, 10(2), 119– 126. https://doi.org/10.1177/2043886919885940
Scarf, H. E. (1982). Chapter 21 The computation of equilibrium prices: An exposition. Handbook of Mathematical Economics. https://doi.org/10.1016/s1573-4382(82)02016-5
Sen, A., Kumar, A., Dubey, V., & Gupta, A. (2023). Managing two-sided B2B electronic markets: Governance mechanisms, performance implications, and boundary conditions. Journal of Business Research, 169, 114257. https://doi.org/10.1016/j.jbusres.2023.114257
Sevilla, J., & Townsend, C. (2016). The Space-to-Product Ratio Effect: How Interstitial Space Influences Product Aesthetic Appeal, Store Perceptions, and Product Preference. Journal of Marketing Research, 53(5), 665–681. https://doi.org/10.1509/jmr.13.0601
Singh, N., Munjal, S., & Kundu, S. K. (2023). Marketplace platforms as game changers: Internationalization of smaller enterprises. Journal of International Management, 29(4), 101035. https://doi.org/10.1016/j.intman.2023.101035
Sridhar, S., Mantrala, M. K., Naik, P. A., & Thorson, E. (2011). Dynamic Marketing Budgeting for Platform Firms: Theory, Evidence, and Application. Journal of Marketing Research, 48(6), 929–943. https://doi.org/10.1509/jmr.10.0035
Srinivasan, S., Pauwels, K., & Nijs, V. (2008). Demand-Based Pricing versus Past- Price Dependence: A Cost–Benefit Analysis. Journal of Marketing, 72(2), 15–27. https://doi.org/10.1509/jmkg.72.2.15
Stahl, F., Schomm, F., Vomfell, L., & Vossen, G. (2017). Marketplaces for Digital Data: Quo Vadis? Computer and Information Science, 10(4), 22. https://doi.org/10.5539/cis.v10n4p22
Statista. (2022). Retail e-commerce sales worldwide from 2014 to 2026. https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/
Statista. (2023a). eBay: Quarterly active buyers worldwide 2010-2023. https:// www.statista.com/statistics/242235/number-of-ebays-total-active-users/
Statista. (2023b). Most visited online marketplaces worldwide as of April 2023, by monthly traffic. https://www.statista.com/statistics/1155246/leading-onlinemarketplaces- usa-average-monthly-visits/
Tucker, C., & Zhang, J. (2011). How does popularity information affect choices? A Field Experiment. Management Science, 57(5), 828–842. https://doi.org/10.1287/mnsc.1110.1312
Vargas, V. C., Vieira, V. A., Moura, L. R. C., & Filho, C. G. (2023). The use of offline and online paid media, earned social media, and organic search in explaining supermarket’s performance: A cyclical Echoverse model. Journal of Marketing Theory and Practice, 1–18. https://doi.org/10.1080/10696679.2023.2273560
Vieira, V. A., Almeida, M. I. S., Agnihotri, R., Silva, N. S. D. A. C., & Arunachalam, S. (2019). In pursuit of an effective B2B digital marketing strategy in an emerging market. Journal of the Academy of Marketing Science, 47(6), 1085–1108. https://doi.org/10.1007/s11747-019-00687-1
Vieira, V. A., Almeida, M. I. S., & Schreiner, T. F. (2022). Amplifying retailers’ sales with a hub’s owned and earned social media: The moderating role of marketplace organic search. Industrial Marketing Management, 101, 165–175. https://doi.org/10.1016/j.indmarman.2021.12.012
Viswanathan, M., Sridharan, S., & Ritchie, R. (2010). Understanding consumption and entrepreneurship in subsistence marketplaces. Journal of Business Research, 63(6), 570–581. https://doi.org/10.1016/j.jbusres.2009.02.023
Wang, W., Li, F., & Zhang, Y. (2020). Price discount and price dispersion in online market: Do more firms still lead to more competition? Journal of Theoretical and Applied Electronic Commerce Research, 16(2), 140–154. https://doi.org/10.4067/S0718-18762021000200110
Wijaya, I. W. K., Rai, A. A. G., & Hariguna, T. (2019). The impact of customer experience on customer behavior intention use in social media commerce, an extended expectation confirmation model: An empirical study. Management Science Letters, 2009–2020. https://doi.org/10.5267/j.msl.2019.7.005
Wooldridge, J. M. (2002). Introductory econometrics: A modern approach. em south-western college pub. South-Western College Pub. https://doi.org/10.1198/jasa.2006.s154
Zhao, K., Zhao, X., & Deng, J. (2015). Online price dispersion revisited: How do transaction prices differ from listing prices? Journal of Management Information Systems, 32(1), 261–290. https://doi.org/10.1080/07421222.2015.1029397
Zhou, Q., Allen, B. J., Gretz, R. T., & Houston, M. B. (2022). Platform Exploitation: When Service Agents Defect with Customers from Online Service Platforms. Journal of Marketing, 86(2), 105–125. https://doi.org/10.1177/00222429211001311
Zhu, F., & Zhang, X. (2010). Impact of Online Consumer Reviews on Sales: The Moderating Role of Product and Consumer Characteristics. Journal of Marketing, 74, 133–148. https://doi.org/10.1509/jm.74.2.133
Zhuang, H., Popkowski Leszczyc, P. T. L., & Lin, Y. (2018). Why is Price Dispersion Higher Online than Offline? The Impact of Retailer Type and Shopping Risk on Price Dispersion. Journal of Retailing, 94(2), 136–153. https://doi.org/10.1016/j.jretai.2018.01.003







