Factors influencing platform owners’ seller control choices in E-marketplaces

Abstract

Operating as micro-economies, electronic marketplace (EM) platforms connect numerous consumers and sellers and facilitate value-creating interactions. However, EM platform providers (platform owners)/ have limited authority over independent sellers, who often connect with several platforms, referred to as multihoming behaviors. An effective control portfolio serves as a crucial tool for owners to influence sellers' actions in alignment with the goals of the EM platform. For a control portfolio to be effective, it must be aligned with the prevailing contextual factors. This paper investigates the key antecedent factors that influence the control choices made by EM platform owners. By probing what factors guide EM platform owners in selecting specific control modes in this multi-case study, this research extends control theory into the relatively unexplored context of EM. The study identifies seven antecedent factors influencing owners' control mode choices: task programmability, outcome measurability, behavior observability, interdependencies, uncertain controlee motivations, internalization of controller objectives, and reciprocity norms. Based on these findings, the paper proposes explanations for the prominence of formal controls and the selective inclusion of informal control mechanisms in EM seller control portfolios, offering insights for practitioners and future research. The study findings help EM platform owners create a balanced portfolio of contextually appropriate control mechanisms.