Newspaper and Internet Display Advertising – Co-Existence or Substitution?
AbstractNewspapers have been experiencing declining circulation figures and diminishing advertising revenues for several years – both effects might pose a threat to the continuing existence of (print) newspapers. In an earlier paper, Lindstädt & Budzinski (2011) argued from a theoretical viewpoint that industry-specific patterns exist that determine substitution or complementation effects between internet and newspaper advertising. It was argued that retail advertising, in particular, may offer a niche for regional/local newspapers that can be expected to present a sustainable segment of complementarity along with the otherwise mostly substitutional advertising markets. This paper empirically tests these hypotheses by analyzing advertising spending data for newspaper and internet display advertising of 13 different industries in the U.S. from 2001-2010. We find evidence for some of the hypotheses. Whereas some industries showed clear substitution effects between internet display and newspaper advertising, the majority of our hypotheses could be only partly rejected: newspaper substi-tution effects could be observed, however, in the direction to traditional media platforms instead of internet display advertising. For two retail-sub-industries, the hypotheses could not be rejected for the analyzed period. The authors would like to thank the College of Communications at the Pennsylvania State University and in particular Anne Hoag and Dennis Davis for hosting Nadine Lindstädt as a Research Visiting Scholar in 2010/2011 which made it possible to access and use the Kantar Media Intelligence Ad$pender™ database for this research.
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Bibliographic InfoPaper provided by University of Southern Denmark, Department of Environmental and Business Economics in its series Working Papers with number 114/12.
Length: 71 pages
Date of creation: Apr 2012
Date of revision:
: media economics; advertising; complementation; substitution; newspapers; internet;
Other versions of this item:
- Lindstädt, Nadine & Budzinski, Oliver, 2012. "Newspaper and internet display advertising - co-existence or substitution?," Ilmenau Economics Discussion Papers 74, Ilmenau University of Technology, Institute of Economics.
- L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
- A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- M21 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - Business Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-23 (All new papers)
- NEP-COM-2012-07-23 (Industrial Competition)
- NEP-CUL-2012-07-23 (Cultural Economics)
- NEP-ICT-2012-07-23 (Information & Communication Technologies)
- NEP-MKT-2012-07-23 (Marketing)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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- Lindstädt, Nadine & Budzinski, Oliver, 2012.
"Newspaper vs. online advertising - Is there a niche for newspapers in modern advertising markets?,"
Ilmenau Economics Discussion Papers
73, Ilmenau University of Technology, Institute of Economics.
- Nadine Lindstädt & Oliver Budzinski, 2011. "Newspaper vs. Online Advertising – Is There a Niche for Newspapers in Modern Advertising Markets?," Working Papers 113/11, University of Southern Denmark, Department of Environmental and Business Economics.
- Matthew Gentzkow, 2007. "Valuing New Goods in a Model with Complementarity: Online Newspapers," American Economic Review, American Economic Association, vol. 97(3), pages 713-744, June.
- Nadine Lindstädt & Oliver Budzinski, 2011.
"Newspaper vs. Online Advertising – Is There a Niche for Newspapers in Modern Advertising Markets?,"
113/11, University of Southern Denmark, Department of Environmental and Business Economics.
- Lindstädt, Nadine & Budzinski, Oliver, 2012. "Newspaper vs. online advertising - Is there a niche for newspapers in modern advertising markets?," Ilmenau Economics Discussion Papers 73, Ilmenau University of Technology, Institute of Economics.
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