The Effects of Platform and Consumer Lifecycles on Content Sales in a Platform-Mediated Market

52 Pages Posted: 16 Feb 2013

See all articles by John Healey

John Healey

University of Maryland - Robert H. Smith School of Business

Wendy W. Moe

University of Maryland - Robert H. Smith School of Business

Date Written: February 15, 2013

Abstract

Previous research has demonstrated the importance of installed base size effects, in which content released on a platform with a larger installed base tends to generate greater sales. We further examine the role of the installed base by considering the impact of installed base composition on content sales. We specifically investigate the roles of the platform product lifecycle and the consumer lifecycle. We examine differences in content sales resulting from an installed base that is comprised of platform “innovators” versus one that contains more late adopters. Additionally, we consider the role of consumer lifecycles on content sales and compare the impact of an installed base consisting of a large number of new platform users to one consisting of pre-existing platform users. Using sales data from the video game market, we find strong evidence to support the existence of significant platform and consumer lifecycle effects. We find that earlier and newer platform adopters purchase more content than later and pre-existing adopters. These results underline the importance of considering installed base composition when releasing new content.

Keywords: Movies & Entertainment Marketing, Installed Base Effects, Product Lifecycles, Regression Models, Diffusion Models

JEL Classification: M31

Suggested Citation

Healey, John and Moe, Wendy W., The Effects of Platform and Consumer Lifecycles on Content Sales in a Platform-Mediated Market (February 15, 2013). Robert H. Smith School Research Paper No. RHS-06-148, Available at SSRN: https://ssrn.com/abstract=2218803 or http://dx.doi.org/10.2139/ssrn.2218803

John Healey (Contact Author)

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States

Wendy W. Moe

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
99
Abstract Views
743
rank
320,844
PlumX Metrics