IDEAS home Printed from https://ideas.repec.org/a/taf/jmedec/v19y2006i1p55-79.html
   My bibliography  Save this article

A Deeper Look at the Economics of Advertiser Support for Television: The Implications of Consumption-Differentiated Viewers and Ad Addressability

Author

Listed:
  • Eun-mee Kim
  • Steven Wildman

Abstract

Commercial addressing technologies are currently being trialed that will make it possible to simultaneously deliver different ads to different viewers. Because the members of the audience for a given program often consume different products, addressable ads promise to substantially increase the revenue generated by television ad time. This article presents models of competitive television markets with addressable and nonaddressable ads and shows that addressability significantly alters strategies for profit maximization and, most likely, equilibrium mixes of programs. This article also shows that allowing for viewers who are differentiated in their preferences for products can lead to dramatic departures from the equilibria and audience maximization strategies described in the traditional program choice literature. Ironically, the predictions of the traditional models are likely to be more accurate for television markets with addressable ads than for the markets with nonaddressable ads they were supposed to describe.

Suggested Citation

  • Eun-mee Kim & Steven Wildman, 2006. "A Deeper Look at the Economics of Advertiser Support for Television: The Implications of Consumption-Differentiated Viewers and Ad Addressability," Journal of Media Economics, Taylor & Francis Journals, vol. 19(1), pages 55-79.
    • Handle: RePEc:taf:jmedec:v:19:y:2006:i:1:p:55-79
    DOI: 10.1207/s15327736me1901_4
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1207/s15327736me1901_4
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1207/s15327736me1901_4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gomes, Orlando, 2006. "The dynamics of television advertising with boundedly rational consumers," MPRA Paper 2847, University Library of Munich, Germany.
    2. Roberto Roson, 2008. "Price Discrimination and Audience Composition in Advertising-Based Broadcasting," Journal of Media Economics, Taylor & Francis Journals, vol. 21(4), pages 234-257.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jmedec:v:19:y:2006:i:1:p:55-79. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/HMEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.