Year: 2025
Type: article
Abstract: Capturing value across national borders represents a fundamental issue in international business (IB). The burgeoning digital economy has made free business models commonplace, raising the question of how firms can capture value from freely available products. Building on the demand-side perspective, we propose that firms relying predominantly on ad-sponsored models generate lower revenues compared to those emphasizing freemium models. Further, we argue that this negative relationship is less pronounced in markets where consumers have a stronger free mentality and higher online engagement tendency. Using a multilevel dataset from the global mobile app industry across 50 country/region markets, we find empirical support for these hypotheses. Our study underscores the importance of integrating consumer heterogeneity into IB research, highlighting how demand-side factors shape international value capture strategies in digital contexts.
Source: Journal of Digital Management
Authors: Pengxiang Zhang, Liang Chen
Institutions: Peking University, Singapore Management University
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $2,060
Award: G4818261855
OpenAlex ID: W4415021560