Competition for Attention in the Digital Age: The Case of Recorded Music
Year: 2015
Type: article
Abstract: In markets with long tails and thousands of products, consumers cannot possibly be aware of every product. Actions to attract consumer attention are therefore integral components of a firm's competitive toolbox. In this paper, we study how the intensity and frequency of advertising is driven by the level of competition in the market.The empirical application is recorded music, where firms market songs via music videos and radio airplay to advertise for albums. In accordance with predictions from a simple theoretical model, we show that firms repeat marketing efforts faster and advertise more often when facing greater competitive pressure. We find different effects when looking at data from the pre-digital era, providing evidence that digitization, through more entry and forced unbundling of albums, has made markets move faster.
Language: English
Subfield: Marketing
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W236865419