Targeted Advertising by Asymmetric Firms
时间: 2020年12月11日19: 00
腾讯会议ID: 492 829 381
In competitive businesses, weak firms that incur high costs may have an “advantage of the weak” when competing against strong firms that spend low costs. They could deploy strategies that are not so appealing to strong firms,thereby getting benefits from competition. This paper investigates whether this “advantage of the weak” works in the advertising market. We develop a duopoly model where two firms compete on informative advertising. While endowed with asymmetric costs, the two firms endogenously choose between mass advertising and targeted advertising. Using a game theoretic method, we find that targeted advertising implies less wastage, more flexible decision, and less fierce competition. However, targeted advertising indirectly closes the gap between the costs of the two firms. As a result, targeted advertising may benefit the high-cost firm at the expense of the low-cost firm. We also analyze the case of imperfect targeting and predict that imperfection of targeted advertising tends to restore the low-cost firm’s cost advantage, thereby making the low-cost firm better off. By extending the model to incorporate targeted pricing and various cost functions, we check the robustness of the model and get more insights about asymmetric competition on targeted advertising. Overall, this paper claims that new technologies on targeting provide the less efficient firm opportunities to catch up with its competitor.
张建强，江苏师范大学副教授，东南大学管理学博士，德克萨斯大学奥斯汀分校、印第安纳大学访问学者。曾获江苏省优秀博士学位论文，入选江苏高校“青蓝工程”优秀青年骨干教师。在Management Science、Omega、European Journal of Operational Research、International Journal of Production Research、Quantitative Marketing and Economics、Marketing Letters、Information Economics and Policy等学术期刊上发表多篇论文，担任国际、国内权威期刊的审稿人，担任国家自然科学基金项目通讯评审专家。主持国家自然科学基金项目、教育部人文社会科学项目、江苏高校哲学社会科学项目等课题。研究方向主要为运营与营销管理。