Academic Events

Topic:

Time&Date:

10:30 am - 12:00 pm, March 28, 2025 (Friday)

Venue

Room D504, Teaching Complex D Building

Speaker:

Jinzhao Du

the University of Hong Kong

Consumers derive functional utility from the content of news articles. In addition, consumers derive social utility from social interactions centered around news articles. The widespread consumption of news through mobile devices has encouraged media platforms, such as The New York Times and The Financial Times, to permit their subscribers to gift articles to nonsubscribers. This paper explores how publishers should manage gift articles and the social interactions driven by these articles. One might think that consumers' desire for social interaction would help media platforms to charge higher prices. To the contrary, we find that consumers' desire for social interaction intensifies price competition.  Because gift articles enable non-subscribers to gain access to a publisher's content, one may believe that gift articles will reduce consumers' incentive to subscribe, thus hurting publishers' profits. We show that gift articles can have the opposite effect by softening competition between publishers. Interestingly, as consumers' desire for social interaction increases and directly intensifies competition, publishers can mitigate the negative outcome by strategically permitting consumers to gift more content, thereby leading to higher prices and profits. Typically, in a competitive multi-sided market, the prospect of monetizing consumer attention and earning advertising revenue intensifies competition and reduces subscription prices. However, we show that advertising revenue from gift articles does not have this effect, as it comes from competitors' consumers rather than the publisher's own. We further extend the model to examine the strategic implications of a few variations in how consumers interact within their social circles, such as distance-dependent social interaction,  segment-dependent social interaction, and directional social interaction.

Biography:

Jinzhao Du is an assistant professor of marketing at the University of Hong Kong. He receives his Ph.D. in marketing from the Fuqua School of Business at Duke University and B.A. in Economics from the School of Economics and Management at Tsinghua University. Jinzhao's research investigates platform-based marketing. His current work studies media platforms and matching platforms. His research on media platforms focuses on the strategic interactions among multiple players including publishers, consumers, advertisers, content suppliers, and news aggregators, and their implications on media platforms’ decisions such as pricing, content provision, and collaboration with news aggregators. His work on matching platforms focuses on how information design, strategic pricing, and AI development can improve matching outcomes, and their implications for firm strategies, consumer welfare, and regulators’ policymaking. He uses game-theoretic models to enhance understanding of new phenomena and practices in this growing field. His work has been published in Marketing Science, Journal of Marketing Research, and Production and Operations Management.