Essays on commercial media and advertising

2013-04-17My dissertation aims to advance our understanding of marketing processes in light of the emerging new media and technology. ❧ My dissertation first provides guidance on how websites should offer sponsored-links services with new hybrid advertising auctions mechanism. Facebook and Google offer hybrid advertising auctions that allow advertisers to bid on a per-impression or a per-click basis for the same advertising space. This chapter studies the properties of equilibrium and considers how to increase efficiency in this new auction format. Rational expectations require the publisher to consider past bid types in order to prevent revenue losses to strategic advertiser behavior. The equilibrium results contradict publisher statements and suggest that, conditional on setting rational expectations, publishers should consider offering multiple bid types to advertisers. ❧ The second chapter of my dissertation examines factual content production in commercial media and provides insights into a wide variety of settings, including user-generated content (UGC), daily news, and product reviews. Commercial media supply factual content to consumers who pay for facts to learn about the state of the world (the state). If media take stances that closely reflect the actual state, they can provide many facts. But, if consumers also value content that matches their opinions, media may want to slant their stances away from the state, which limits the number of facts they can report. We find that competitive media leave consumers knowing less by providing fewer facts. We also find that a monopoly medium may be more polarizing than competitive media