Power structures unleashed: driving product and live content innovation in live streaming commerce

The booming development of live streaming commerce has attracted many brands and streamers. However, serious homogenization of live content and formats and uneven product quality are the main problems facing the live streaming commerce industry, which has largely been ignored in previous studies. To address this gap, we develop four innovation decision models based on the Stackelberg game, in which the brand is responsible for product innovation to improve product quality and user experience, and the streamer is responsible for live content innovation. By considering or not considering pricing decisions, we investigate how power structures drive product and live content innovation and who (the brand or the streamer) should lead supply chain innovation. We find that streamer-led supply chain innovation is always more effective than brand-led supply chain innovation when the commission and product price are exogenous, while whether supply chain innovation is streamer-led or brand-led depends on the product innovation efficiency and the live content innovation efficiency when price and commission are endogenous. An intriguing finding is that in the game between the brand and streamer, they always tend to hold the power to lead supply chain innovation themselves, distorting the feasible region of their decision towards the other. Moreover, the optimal profits, total consumer utility, and social welfare are positively related to the degree of dependence of product innovation on live content innovation.