Is streamer live-stream favorable to merchant live-stream? The effect of pre- and post-effort

Abstract

In the digital commerce era, live-stream has become an essential sales channel, prompting manufacturers to strategically select among merchant employees, low-influence streamers (L-streamers) and high-influence streamers (H-streamers). Few studies comparatively analyze how sales effort and dynamic commission rate influence manufacturers' profitability and channel selection. This study bridges this gap by developing a dual-channel model to evaluate these two incentive mechanisms. Results indicate that at equal commission rates, L-streamers consistently yield higher profits than merchant employees, whereas H-streamers only outperform employees at higher commission rates for products easily sold via live-stream. Additionally, L-streamers generate higher profits than H-streamers under identical commission rates. In post-effort scenarios, increasing commission rate motivates sales effort from streamers and employees, significantly affecting manufacturers' channel preferences. Specifically, manufacturers prefer merchant employees at lower commission rates and shift towards L-streamers at higher rates. The choice between merchant employees and H-streamers depends on product characteristics, hassle cost and disutility factor: H-streamers are favored at higher commission rates for easily sellable products, while merchant employees are preferred when the traditional online channel retains clear advantages. Furthermore, manufacturers’ preferences between pre- and post-effort scenarios vary by hassle cost and commission rate. Our analysis demonstrates the effectiveness of dynamic commission structure relative to sales effort incentive, guiding manufacturers in optimizing channel strategies and commission structures to achieve sustained profitability and channel stability.