【主题】Payment Schemes for Internet Advertising: A Tale of Two-sided Information Asymmetry 【时间】2010-6-2410:00-11:30
【地点】Shunde 418C, Tsinghua SEM
【语言】中文
【内容摘要】
The growth of digitization has led to the emergence of new pricing mechanisms in a wide range of sectors including financial services, consumer retailing, and advertising among others. The advertising sector, in particular, has undergone significant changes in terms of both the technologies used, as well as the payment mechanisms. Digital technologies have improved the targetability (the ability to target individual consumers) as well as the measurability (the ability to measure the outcomes) of advertising, which give rise to a number of new payment schemes that cater to the differing needs of publishers as well as advertisers. The three most commonly used payment schemes are (i) Pay-per-impression (PPI), wherein advertisers are charged for each impression or exposure, (ii) Pay-per-Click (PPC), wherein the advertiser pays only when a user clicks on the link, and (iii) Pay-per-Sale (PPS), where in the advertisers pay only when a sale, originating from the advertisement, is consummated. As we move from PPI to PPS, the payments (i.e., the advertising expenses) are more closely tied to the outcomes (i.e., the sales). It is not surprising then that, PPS is often considered the holy grail of advertising. However, the predictions that these new payment mechanisms (PPS, in particular) would supplant the conventional PPI mechanism have not materialized. On the contrary, these different payment mechanisms coexist, with some publishers still choosing PPI and PPC over PPS. Given the puzzles over payment schemes, this paper seeks to explain the optimal choice of payment schemes from a publisher抯 perspective. Different from prior literature that assumes one publisher and one advertiser, we study a setting where a publisher auctions advertising slots to multiple advertisers. We move away from the traditional risk-sharing explanation for payment scheme choices and focus on the role of information asymmetry instead. Specifically, both the publisher and advertiser have some private information regarding their future advertisement outcomes. As we move away from PPI to PPS, the publisher loses allocation efficiency because under PPS the publisher allocates advertising slots based on advertisers� willingness-to-pay per sale, not (or not perfectly) knowing how many sales each advertisers will generate. On the other hand, a high-type publisher (i.e., a publisher who is endowed with high future sales) could benefit from PPS because PPS allows him to separate from low-type publishers. This trade-off between allocation efficiency and signaling drives the equilibrium choice of payment schemes. We conduct several comparative statics on factors that impact optimal choice of payment schemes under this framework. We also investigate the possibility of offering payment schemes simultaneously to screen advertisers. Interestingly, we find that the high-type publisher should not engage in 揺fficient� screening because of the risk of imitation from low-type publishers.
【主讲人简介】
De LIU is currently an associate professor in the Department of Information Systems at Gatton College of Business and Economics, University of Kentucky. His research interest includes the optimal design of IT-enabled mechanisms in electronic commerce and other business settings and his recent research topics include the design of auctions for Internet advertising, the design of contests for interactive digital entertainment and knowledge transfer mechanisms. Prof. Liu has published several papers on top journals like Journal of Marketing, Information Systems Research, etc.
He received the Ph.D. degree in Management Science and Information Systems from University of Texas at Austin (2004), and the B.E. (1998) and M.E. (2000) from Department of Management Science and Engineering, Tsinghua SEM.
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