Social Group Buying Strategy Considering Group Leader Incentives

Abstract

With the proliferation of social group buying, leader incentives have become a common yet strategically complex platform tool. Their effectiveness is highly context dependent and requires careful market-specific evaluation. This study develops game-theoretic models to analyze monopolistic and competitive markets by examining how social tie strength, leader incentives, group size, and pricing interact. Leader incentives increase profits only when strong user-leader social ties exist. In competitive settings, they are the most effective against smaller rivals with low cross-price sensitivity. This research provides actionable guidance for platforms to optimize incentive strategies on the basis of social relationship strength and a competitive landscape, enhancing strategic decision-making in social commerce.