Abstract: ‘Setting higher price to their past consumers’ is a quite common pricing strategy in e-commerce platforms, and also is one of disputed marketing strategies recently. Compared with the traditional duopoly competition, third-party sellers need to pay the e-commerce platform a fraction of their revenues as fee for accessing his customers, expect for directly competing with the platform’s self-operated business. Two phenomena about behavior-based pricing (BBP) are observed in hybird e-commerce platforms. The first is some BBP were implemented by e-commerce platforms, and the others by third-party sellers. The second is consumers have different reactions to BBP. Some like it, some don’t. The effect of peer-induced unfairness and fairness on BBP in an extremely simple vertical differential hybird e-commerce platform model with only one third-party seller is studied, and the difference of who implementing BBP is investigated, and the choice of optimal pricing policy, BBP or uniform pricing (UP) is also analyzed. It is found that “setting higher price to their past consumers” is always true in hybrid e-commerce platform, no matter who implements BBP. The seller who implements BBP not only keeps all of his past consumers, but also attracts some new consumers from his competitor. (UP, UP) is a Nash equilibrium. Compared with the platform implementing BBP, the third-party seller implementing BBP can enhance competition, drive more consumers switching in period 2, improve consumer surplus, and increase social welfare. Both peer-induced unfairness and fairness increase positive effects of BBP, and decrease its negative effects.

Key words: hybrid E-commerce platform; behavior-based pricing; peer-induced unfairness concern