Zhang Shuo's team from Antai College of Economics and Management, Shanghai Jiaotong University published a paper in "Marketing Science", proposing how entertainment digital content consumption can achieve a win-win situation between enterprises and consumers

Recently, Zhang Shuo and his research team from Antai College of Economics and Management published their research results Time-Inconsistent Preferences on Time-Inconsistent Preferences and Consumer Self-Control in Digital Content Consumption inMarketing Science , one of the top three international marketing journa.

In recent years, people's cultural and entertainment consumption has gradually shifted to online, and digital content consumption has developed rapid.

Discover the 'secret' behind online novel subscription habits

Zhang Shuo's research team tracked the consumer data of a large online novel platform and found that more than one-third of heavy online novel consumers will continue to choose the latter when they are faced with purchasing a monthly subscription or paying by chapt.

"Time inconsistency preference", in layman's terms, refers to the decision maker's "current" decision expectations for "future", which are inconsistent with the actual decisions taken when "future" becomes "curren.

In short, "don't read this chapter after reading it", but after really reading it, it starts to "really fragran.

Expand new theoretical models to overcome empirical challenges

In order to describe the time-inconsistent consumption and self-control of consumers, it is necessary to introduce a time-inconsistent preference function into the dynamic mod.

In response to these two technical challenges, Zhang Shuo and his team spent four years researching and tackling the difficulties, and finally successfully developed a new theoretical model and overcome the empirical difficulti.

Based on the characteristics of real decision-making in entertainment digital consumption, a new theoretical framework of time-inconsistent addiction consumption is proposed, and two selection stages, price plan selection and consumption level selection, are introduced into consumption decision-making, and consumers are allowed to adjust monetary cost and consumption level in different selection stag.

The team constructed a dynamic time inconsistency measurement model on the basis of theoretical modeling, and combined gradient optimization (BFGS algorithm) and numerical optimization (Nelder-Meade numerical optimization) to improve the optimization algorithm, which greatly shortened the time required for estimation using large-scale consumption da.

Propose a dynamic pricing model to promote win-win for consumers and enterprises

 The essence of this phenomenon is analyzed through theoretical mode.

Zhang Shuo's research team found that when there is consumer self-control behavior, increasing consumers' addictive consumption pricing model not only damages consumer welfare, but also is not necessarily optimal for the platfo.

Therefore, Zhang Shuo's research team suggests that entertainment digital content companies should incorporate consumers' self-control behavior into the consideration of price strategy formulation, and provide practical guidance for companies to quantify consumers' self-control tendency and formulate and evaluate dynamic pricing strategi.

In practice, Zhang Shuo and his team propose a data-driven dynamic pricing method for companies to significantly increase profits without compromising the long-term welfare of consumers; the research can also help governments evaluate different pricing The impact of the mechanism on consumers and social welfare provides a scientific basis for formulating consumer protection polici.

Abstract

In recent years, online novels have accounted for an increasing proportion of consumers' cultural and entertainment consumption, and large online platforms often try to increase consumers' online time and reading volume by adopting various marketing measur.

By tracking the consumer data of a large network in China, the study found that more than one third of heavy consumers of online novels will continue to choose the latter and pay for it when faced with purchasing a monthly subscription or paying by chapt.

Higher cost than monthly subscripti.

Behind this seemingly abnormal consumer behavior, consumers try to limit their future impulse consumption by paying by bil.

We introduce "time inconsistency preference" into the traditional rational addictive consumption model, establish a consumer dynamic time inconsistency structural model, and find that the parameters of the model estimated by the data can well explain the observed consumer overpayment behavi.

Based on the model estimates, the study also proposes an innovative pricing plan that raises the marginal price as consumer consumption increases and resets after a period of ti.

Modeled counterfactual experiments have shown that this innovative dynamic pricing scheme can help consumers exercise self-control and improve both consumer welfare and company profits in the long r.

Original link https://pubsonli.

infor.

org/doi/abs/11287/mk.

2021318