Pricing strategies for digital freight platforms with risk attitudes: a two-sided market theory-based approach

In the current digital landscape, non-vessel-operating common carriers (NVOCCs) are increasingly migrating to digital freight platforms (DFPs). However, pricing decisions for these platforms remain underexplored, particularly in the presence of demand volatility and other external risks. This study aims to obtain optimal pricing strategies for DFPs with different risk attitudes to maximize profits in a two-sided market. This study proposes mathematical formulations based on the Hotelling model to examine the pricing mechanisms of DFPs. Our findings reveal that when users are partially multihoming, the prices of shippers and carriers are negatively correlated with risk sensitivity. Higher cross-group externalities amplify the impact of platform risk attitudes on pricing, whereas greater price sensitivity diminishes it. Our results indicate that the optimal pricing strategy is dynamic with respect to the changes in platform risk attitudes. Additionally, in a multihoming environment, DFPs should aim to maintain risk neutrality to maximize profits.