1 Department of Innovation and Organizational Economics, Copenhagen Business School2 University at Albany
This paper examines how the ability of traditional media firms to engage in targeted advertising has changed with the advent of the Internet. We find that the premium for reaching a homogeneous audience increases for magazines that have a companion website, as well as for those whose readers are more likely to be online. This indicates a complementarity between offline and online channels with respect to targeted advertising. We hypothesize that this result is driven by multihoming consumers who enhance the value of targeted advertising, in contrast to the usual assumption that multiple advertising messages are redundant.
Management Science, 2014, Vol 60, Issue 7, p. 1829-1843
Targeted advertising; Magazines; Advertising rates; Internet complementarity; Multihoming