When do you Zap: The Effects of Ad Delivery in Streaming Media

62 Pages Posted: 17 Dec 2019 Last revised: 26 Apr 2024

See all articles by Prashant Rajaram

Prashant Rajaram

Ivey Business School, Western University

Puneet Manchanda

University of Michigan, Stephen M. Ross School of Business

Eric M. Schwartz

University of Michigan, Stephen M. Ross School of Business

Date Written: April 22, 2024

Abstract

Free ad-supported streaming of on-demand content is growing. Platforms that provide this service need to better understand how ad delivery affects the consumption experience – do viewers zap (leave a program incomplete) during immediate ad exposure or subsequent (program) content exposure? Using debiased machine learning with Hausman instruments, we capture the causal effect of four levers of ad delivery on immediate ad zapping and subsequent content zapping behavior. Our results find that on average, an increase in number of pods (ad breaks), length of pods or repetition of ads, results in a larger increase in subsequent content zapping than immediate ad zapping. On the other hand, an increase in spacing till the next pod, results in a larger decrease in immediate ad zapping than subsequent content zapping. We also investigate differences in effects across sub-types of zapping: (a) switching to another episode of same TV show, (b) switching to new TV show or movie and (c) stop watching. We find that the platform can face tradeoffs between preventing ad zapping or content zapping for some ad delivery levers based on whether the platform wants to promote stickiness to the content or to the platform.

Keywords: Streaming Platforms, Ad Delivery, Zapping, Causal Inference, Debiased Machine Learning

JEL Classification: M31, M37, C14, C36, C61

Suggested Citation

Rajaram, Prashant and Manchanda, Puneet and Schwartz, Eric M., When do you Zap: The Effects of Ad Delivery in Streaming Media (April 22, 2024). Available at SSRN: https://ssrn.com/abstract=3496039 or http://dx.doi.org/10.2139/ssrn.3496039

Prashant Rajaram (Contact Author)

Ivey Business School, Western University ( email )

1255 Western Road
London, Ontario N6G0N1
Canada

Puneet Manchanda

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street
Ann Arbor, MI MI 48109
United States
734-936-2445 (Phone)
734-936-8716 (Fax)

Eric M. Schwartz

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street
Ann Arbor, MI MI 48109
United States

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