Differentiation Strategy for Firms: Online Ad versus Mass Media Ad

Konferenzbeitrag

This study analyzes advertiser firms' product differentiation strategies and the relationship two media advertising effect, mass media and online media. We derive an inverse demand function from the utility function relating to the evaluation of the goods' additional information that consumers obtain from advertisements, and we analyze the advertising choices of firms using a two-stage decision-making model. The analysis results indicate that firms choose asymmetric advertising to take advantage of the interdependent effects of two advertising and differentiation and to increase profit through rivals' advertising effects. However, the profits of firms are the highest when both firms choose the discriminatory online media advertising. Social welfare is highest in symmetric choice of the discriminatory online advertising, but consumer surplus is highest in symmetric choice of the discriminatory mass media advertising.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: 31st European Conference of the International Telecommunications Society (ITS): "Reining in Digital Platforms? Challenging monopolies, promoting competition and developing regulatory regimes", Gothenburg, Sweden, 20th - 21st June 2022

Classification and Topics

• Classification: Wirtschaft
• Subject: Online media advertising ; Mass media advertising ; Targeting ; Differentiation Strategy ; Interaction

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fujisawa, Chieko ; Kasuga, Norihiro
• Event: Veröffentlichung
• (who): International Telecommunications Society (ITS)
• (where): Calgary
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/265629
• Last update: 10.03.2025, 11:42 AM CET