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Consumer Favorites and the Design of News

Author

Listed:
  • Yi Xiang

    (Marketing Department, China Europe International Business School, Pudong, 201206 Shanghai, China)

  • David Soberman

    (Rotman School of Management, University of Toronto, Toronto, Ontario M5S 3E6, Canada)

Abstract

The objective of this paper is to better understand the factors that competitive news providers consider to design or deliver news programmes. The focus is broadcast news where, in any programming time period, a viewer watches (or consumes) one programme. We assume that each viewer is interested in a limited set of topics and that her utility only comes from the “most interesting” news she observes. The key questions we address are as follows: (a) Should firms adopt designs that facilitate the delivery of more information in their news programmes? (b) Does the decision of firms to implement such strategies depend on the complexity of the news programme (i.e., the number of news stories covered in the news product)? (c) How do such strategies influence competition? We show that firms may or may not benefit by providing better-designed news. The incentive to do this is strongly affected by the complexity of the news product and the intensity of competition between news providers. This paper was accepted by J. Miguel Villas-Boas, marketing.

Suggested Citation

  • Yi Xiang & David Soberman, 2014. "Consumer Favorites and the Design of News," Management Science, INFORMS, vol. 60(1), pages 188-205, January.
    • Handle: RePEc:inm:ormnsc:v:60:y:2014:i:1:p:188-205
    DOI: 10.1287/mnsc.2013.1742
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    References listed on IDEAS

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