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Combining Choice and Response Time Data: A Drift-Diffusion Model of Mobile Advertisements

Author

Listed:
  • Khai Xiang Chiong

    (Naveen Jindal School of Management, University of Texas at Dallas, Richardson, Texas 75080)

  • Matthew Shum

    (Division of Humanities and Social Sciences, California Institute of Technology, Pasadena, California)

  • Ryan Webb

    (Rotman School of Management, University of Toronto, Toronto, Ontario M5S3E6, Canada)

  • Richard Chen

    (Independent Researcher)

Abstract

Endogenous response time data are increasingly becoming available to applied researchers of economic choices. However, the usefulness of such data for preference estimation is unclear. Here, we adapt a sequential sampling model—previously validated to jointly explain subjects’ choices and response times in laboratory experiments—to model users’ responses to video advertisements on mobile devices in a field setting. Our estimates of utility correlate positively with out-of-sample measures of ad engagement, thus providing external validation of the value of incorporating endogenous response time information into a choice model. We then use the model estimates to assess the effectiveness of manipulating attention toward an advertisement at the beginning of a decision. Counterfactual simulations predict that making an ad “nonskippable” (requiring users to watch some portion of the ad)—as is the practice of some online platforms (e.g., YouTube)—generates only modest increases in click-through rates and revenue.

Suggested Citation

  • Khai Xiang Chiong & Matthew Shum & Ryan Webb & Richard Chen, 2024. "Combining Choice and Response Time Data: A Drift-Diffusion Model of Mobile Advertisements," Management Science, INFORMS, vol. 70(2), pages 1238-1257, February.
    • Handle: RePEc:inm:ormnsc:v:70:y:2024:i:2:p:1238-1257
    DOI: 10.1287/mnsc.2023.4738
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