The TV Advertising Industry: Demographic Segmentation and the Impact of Viewership Decline

59 Pages Posted: 26 May 2021 Last revised: 24 Jan 2022

Date Written: November 16, 2021

Abstract

Viewership of traditional television has decreased in the past decade, particularly among younger viewers. This paper studies the impact of this decline on the U.S. TV advertising industry using a two-sided model that explicitly considers viewers’ demographics. The model incorporates viewers, who choose which channel to watch; advertisers, who choose how many advertising views to purchase in each demographic group; and channels, who choose how many advertisements to show during their programs. I use the model to evaluate how viewership declines affect demographic-specific prices per ad view, advertisers from different industries, TV channels, and viewers.

Keywords: advertising, demographics, TV

JEL Classification: L82, M37

Suggested Citation

Zubanov, Andrey, The TV Advertising Industry: Demographic Segmentation and the Impact of Viewership Decline (November 16, 2021). Available at SSRN: https://ssrn.com/abstract=3853300 or http://dx.doi.org/10.2139/ssrn.3853300

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