Blessing or curse? The role of the influencer’s quality-price ratio constraint in live streaming e-commerce

When sellers collaborate with influencers to sell products through live streaming e-commerce, it is common for influencers to require lower prices for a given quality product. This requirement, known as the quality-price ratio constraint, can be a “Blessing” by strengthening the influencer’s reputation and boosting demand through enhanced consumer satisfaction (“demand-promoting effect”), but it may also be a “Curse”, harming the seller’s revenue due to the compressed price and causing cross-channel conflicts (“price-compressing effect”). This paper develops a theoretical model to explore how these dual effects influence the strategic decisions of sellers and influencers and shape their cooperation. Key findings include: (1) The quality-price ratio constraint does not always hurt the seller; its impact depends on product quality, with medium-quality products benefiting more from this constraint. (2) A higher constraint does not necessarily benefit the influencer, especially when the consumer’s hassle cost for watching live streaming is low or the influencer’s popularity is very high or low. (3) For highly price-elastic products (e.g., innovative goods), both the seller and the influencer may benefit from this constraint, while for low-elasticity products (e.g., functional goods), avoiding this constraint may help prevent conflict. (4) Although the constraint consistently benefits consumers, it can sometimes reduce overall social welfare. These insights clarify when the quality-price constraint acts as a “Blessing” or a “Curse” in live streaming e-commerce partnerships, and offer strategic guidance for navigating the complexities of such partnerships.