Kretschmer, Tobias and Peukert, Christian (2014) Video killed the radio star? Online music videos and digital music sales. CEP Discussion Papers (CEPDP1265). London School of Economics and Political Science. Centre for Economic Performance, London, UK.
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Abstract
Sampling poses an interesting problem in markets with experience goods. Free samples reveal product quality and help consumers to make informed purchase decisions (promotional effect). However, sampling may also induce consumers to substitute purchases with free consumption (displacement effect). We study this trade-o_ in the market for digital music where consumers can sample the quality of songs by watching free music videos online. Identification comes from a natural experiment in Germany, where virtually all videos that contain music are blocked on a popular video platform due to a legal dispute with representatives of the rights-holders. We show that promotional and displacement effects cancel out in the sales performance of individual songs, whereas online music videos trigger sales of albums.
| Item Type: | Monograph (Discussion Paper) |
|---|---|
| Official URL: | http://cep.lse.ac.uk/_new/publications/series.asp?... |
| Additional Information: | © 2014 The Authors |
| Divisions: | Centre for Economic Performance |
| Subjects: | H Social Sciences > HD Industries. Land use. Labor M Music and Books on Music > M Music Q Science > QA Mathematics > QA75 Electronic computers. Computer science |
| JEL classification: | D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief L - Industrial Organization > L8 - Industry Studies: Services > L82 - Entertainment; Media (Performing Arts, Visual Arts, Broadcasting, Publishing, etc.) M - Business Administration and Business Economics; Marketing; Accounting > M3 - Marketing and Advertising > M37 - Advertising |
| Date Deposited: | 26 Nov 2014 15:18 |
| Last Modified: | 15 Sep 2023 23:33 |
| Funders: | Economic and Social Research Council |
| URI: | http://eprints.lse.ac.uk/id/eprint/60276 |
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