Friends in High Places: Heterogeneity in On-Platform Demand Spillovers

73 Pages Posted: 12 May 2021 Last revised: 4 Oct 2023

See all articles by Manav Raj

Manav Raj

University of Pennsylvania - Management Department

Date Written: September 1, 2023

Abstract

In this project, I explore heterogeneity in inter-provider demand spillovers on a digital platform. In a study of the Spotify streaming platform, I argue and then demonstrate that the size of the demand spillover experienced by a focal provider following peer activity on a digital platform depends on: a) the attention brought to the platform by peer activity; b) the likelihood of attention transfer; and c) the benefits of consumer learning for the focal provider. Critically, these dynamics have implications for provider strategy. On Spotify, providers benefit from releasing an album at the same time as a high performing peer to take advantage of the demand spillovers such peers create. Through this research, I provide insight into competitive interactions between providers on digital platforms.

Keywords: platforms, competition, spillovers, digital markets, agglomeration

Suggested Citation

Raj, Manav, Friends in High Places: Heterogeneity in On-Platform Demand Spillovers (September 1, 2023). Available at SSRN: https://ssrn.com/abstract=3843249 or http://dx.doi.org/10.2139/ssrn.3843249

Manav Raj (Contact Author)

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
370
Abstract Views
1,310
Rank
139,688
PlumX Metrics