The Drivers of Online News Readership: A Decomposition Approach

39 Pages Posted: 29 Nov 2001

Date Written: October 2001

Abstract

How does online news readership develop over time? To what extent do important news items, Internet activity and web site quality drive the dynamics of the category, of brand visits and of usage depth? Both publishers of online newspapers as potential advertisers have a keen interest in these questions. Academic research has only started to analyze online news readership patterns and key aspects of its dynamics are not yet understood. In this paper, I decompose online readership in its category, brand and usage components. Persistence modeling of these components uncovers the online market dynamics and the competitive advantage for twelve newspapers. First, category incidence takes off fast and fuels readership growth, but then stabilizes. Important news items, general Internet activity and weekly consumer reading patterns are the main drivers. Second, brand choice is in equilibrium, with the exception of short punctuations caused by new entrants. Third, usage depth increases for the online market and becomes the main driver for readership growth after category incidence stabilizes. Brand-specific usage depth growth does not come for granted however, as it depends on the quality of the news site. Finally, online newspapers obtain different benefits from important news items. The short-term news effects on brand visits are proportional to the size of the offline audience, whereas the long-term news effects on usage depth depend on site quality. I therefore establish the relation between web site quality (formerly known as 'stickiness') and the persistence of readership gains.

Keywords: Marketing, Online News, Emerging Markets, Persistence Modeling, Long-term Effects, Site Quality

JEL Classification: C32, D40

Suggested Citation

Pauwels, Koen H., The Drivers of Online News Readership: A Decomposition Approach (October 2001). Tuck School of Business Working Paper No. 01-08. Available at SSRN: https://ssrn.com/abstract=290330 or http://dx.doi.org/10.2139/ssrn.290330

Koen H. Pauwels (Contact Author)

Ozyegin University ( email )

Kusbakisi Cd. No: 2
Altunizade, Uskudar
Istanbul, 34662
Turkey

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