MIT Libraries logoDSpace@MIT

MIT
View Item 
  • DSpace@MIT Home
  • MIT Open Access Articles
  • MIT Open Access Articles
  • View Item
  • DSpace@MIT Home
  • MIT Open Access Articles
  • MIT Open Access Articles
  • View Item
JavaScript is disabled for your browser. Some features of this site may not work without it.

Targeting in Advertising Markets: Implications for Offline Versus Online Media

Author(s)
Bergemann, Dirk; Bonatti, Alessandro
Thumbnail
Downloadtargeting-paper-2-june-2011-randfinal.pdf (526.8Kb)
OPEN_ACCESS_POLICY

Open Access Policy

Creative Commons Attribution-Noncommercial-Share Alike

Terms of use
Creative Commons Attribution-Noncommercial-Share Alike 3.0 http://creativecommons.org/licenses/by-nc-sa/3.0/
Metadata
Show full item record
Abstract
We develop a model with many advertisers (products) and many advertising markets (media). Each advertiser sells to a different segment of consumers, and each medium is targeting a different audience. We characterize the competitive equilibrium in the advertising markets and evaluate the implications of targeting. An increase in targeting leads to an increase in the total number of consumer-product matches, and hence in the social value of advertising. Yet, targeting also increases the concentration of firms advertising in each market. Surprisingly, we then find that the equilibrium price of advertisements is first increasing, then decreasing, in the targeting capacity. We trace out the implications of targeting for competing media. We distinguish offline and online media by their targeting ability: low versus high. As consumers’ relative exposure to online media increases, the revenues of offline media decrease, even though the price of advertising might increase.
Date issued
2011-09
URI
http://hdl.handle.net/1721.1/77229
Department
Sloan School of Management
Journal
Rand Journal of Economics
Publisher
Wiley Blackwell
Citation
Bergemann, Dirk, and Alessandro Bonatti. “Targeting in Advertising Markets: Implications for Offline Versus Online Media.” The RAND Journal of Economics 42.3 (2011): 417–443.
Version: Author's final manuscript
ISSN
0741-6261
1756-2171

Collections
  • MIT Open Access Articles

Browse

All of DSpaceCommunities & CollectionsBy Issue DateAuthorsTitlesSubjectsThis CollectionBy Issue DateAuthorsTitlesSubjects

My Account

Login

Statistics

OA StatisticsStatistics by CountryStatistics by Department
MIT Libraries
PrivacyPermissionsAccessibilityContact us
MIT
Content created by the MIT Libraries, CC BY-NC unless otherwise noted. Notify us about copyright concerns.