Service quality standard and pricing decision for wedding-car leasing platforms

Typically, wedding-car leasing platforms gather a number of wedding-cars together and then provide service for clients. Besides pricing for both sides of platforms under the consideration of two-sided network externalities, the service quality provided by platforms is also important. A dynamic game model was built to investigate the trade-offs of pricing decision and service quality. Two distinct settings, charge fees by the cost of one car and charge fees by total cost, were considered. By analyzing the model the optimal service quality and optimal pricing decision were obtained, and the effects of customer and wedding-car externalities on optimal service quality and optimal pricing decision were revealed.