Third-Party Retailers’ Logistics Service Level Decision Considering Platform Private Brand Invasion Mode

E-commerce platforms are invading the market by introducing private brand, which has the potential to self-preference behavior. We introduce platform retailers’ (PRs’) private brand preferences into the Hotelling model and explore the third-party retailers’ (TPRs’) optimal logistics service level under two scenarios: PRs’ fair invasion and PRs’ biased invasion. The study shows that as PRs’ private brand preference increases, TPRs’ logistics service level will decline. When there is a fair invasion of platform private brands and consumers are sensitive to logistics service levels, TPRs may invest in logistics services as an anti-invasion tool to mitigate market share loss due to PRs’ invasion. However, in a biased invasion scenario, TPRs may reduce their own logistics service levels. In particular, PRs’ self-preference can be anti-competitive. Our findings may provide some theoretical support for TPRs’ logistics service level decisions and government departments’ regulation of platform firms’ self-preferential behavior.