"Marketplace" or "mall"? : business model and strategy for a startup in China's B2B e-commerce market

Abstract

E-commerce companies face a strategic decision to choose the business model. Should they choose the Marketplace model, an online Intermediary on which suppliers sell their products directly to buyers? Should they choose Mall model, on which intermediaries purchase products from suppliers and sell them to buyers? Or should they choose the Hybrid model, which blends the Marketplace and Mall models. While most literature focuses on the Marketplace model and discusses its pricing and efficiency issues, Hagiu and Wright's papers focus on the tradeoff between Marketplace and Mall, and more importantly, propose six criteria to decide the right model. My thesis will apply the theory to choose the right business model for an E-commerce startup and design the strategies to implement this model. My thesis will be a practical contribution to this field. My thesis will examine the current E-commerce market, analyze the tradeoffs of different models, choose the right model for the startup, and recommend strategies to implement this model.