Advertising pricing in German consumer magazine industry [Elektronische Ressource] : an industrial economic analysis of market concentration, advertising prices, and their interrelations / Astrid Kurad
424 Pages
English

Advertising pricing in German consumer magazine industry [Elektronische Ressource] : an industrial economic analysis of market concentration, advertising prices, and their interrelations / Astrid Kurad

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Universität Flensburg Internationales Institut für Management Professur für Allgemeine Betriebswirtschaftslehre, insbesondere Medienmanagement ADVERTISING PRICING IN GERMAN CONSUMER MAGAZINE INDUSTRY - An Industrial Economic Analysis of Market Concentration, Advertising Prices, and their Interrelations - Dissertation zur Erlangung des akademischen Grades Doktorin der Wirtschaftswissenschaften (Dr. rer. pol.) an der Universität Flensburg Astrid Kurad, M.B.A., B.B.A. Flensburg, 24. November 2008 Supervisor: Prof. Dr. Stephan Panther Universität Flensburg Internationales Institut für Management Censors: Prof. Dr. Robert Picard Jönköping International Business School Media Management and Transformation Centre Prof. Dr. Mike Friedrichsen Stuttgart Media University Department Business Informatics Institute for Media Business (IMB) ii Meinen Eltern iii ACKNOWLEDGEMENT In pursuing my dissertation, many people supported me on this way. Finally, I have the chance to express my thankfulness to them. First and foremost, I thank Prof. Dr. Mike Friedrichsen for guiding me through the entire dissertation process with tremendous expertise, sin-cerity and cordiality. During the last years, he was a continuous source of motivation and inspiration. In issues of media economics and media management, he was an experienced and patient partner in every de-bate.

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Published 01 January 2008
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Language English
Document size 8 MB

Universität Flensburg
Internationales Institut für Management
Professur für Allgemeine Betriebswirtschaftslehre,
insbesondere Medienmanagement




ADVERTISING PRICING IN GERMAN CONSUMER
MAGAZINE INDUSTRY
- An Industrial Economic Analysis of Market Concentration, Advertising
Prices, and their Interrelations -




Dissertation
zur Erlangung des akademischen Grades
Doktorin der Wirtschaftswissenschaften (Dr. rer. pol.)
an der Universität Flensburg


Astrid Kurad, M.B.A., B.B.A.
Flensburg, 24. November 2008
Supervisor:
Prof. Dr. Stephan Panther
Universität Flensburg
Internationales Institut für Management

Censors:
Prof. Dr. Robert Picard
Jönköping International Business School
Media Management and Transformation Centre

Prof. Dr. Mike Friedrichsen
Stuttgart Media University
Department Business Informatics
Institute for Media Business (IMB)

ii






Meinen Eltern
iii ACKNOWLEDGEMENT
In pursuing my dissertation, many people supported me on this way.
Finally, I have the chance to express my thankfulness to them.
First and foremost, I thank Prof. Dr. Mike Friedrichsen for guiding me
through the entire dissertation process with tremendous expertise, sin-
cerity and cordiality. During the last years, he was a continuous source
of motivation and inspiration. In issues of media economics and media
management, he was an experienced and patient partner in every de-
bate. Furthermore, his help and suggestions were invaluable in the
process of empirical analyses and interpretations. His influence as an
esteemed tutor and a dear friend will have major impact on me wher-
ever I will go and whatever I will do in the future.
I am also very grateful to Prof. Dr. Stephan Panther for being available
for discussions on theoretical, empirical and formal topics of my disser-
tation. As an unmitigated economist, he helped me to discover new
perspectives of the topic and gave me valuable comments and sugges-
tions to improve my thesis.
During my stay at the Media Management and Transformation Centre, I
not only experienced a beautiful wintertime but also received valuable
information in plenty of precious discussions on the theoretical part of
my thesis and possible empirical approaches. I would like to express
my gratefulness to Prof. Dr. Robert Picard, Prof. Dr. Gustafsson and the
entire MMTC staff for their hospitality and for giving me the possibility to
present and discuss crucial aspects of the dissertation with them. I am
grateful and honoured for having been part of the MMTC and having
met a whole lot of wonderful people. I particularly owe thanks to Robert
Picard who took over the task of reviewing my dissertation.
iv I thank Timo Abend for his loving understanding and his neverending
patience and support no matter how far away I have been during this
challenging task.
Furthermore, I would like to thank my dear friends Anne-Katrin Nie-
meier, Kati Jäckel and Katrin Späth and my brother Dieter Kurad for
accompanying and encouraging me in all these years and always being
there for me.
Finally, I owe special thanks to my parents who supported me in every
imaginable way.




Astrid Kurad
Flensburg, November 2008
v LIST OF CONTENTS
ACKNOWLEDGEMENT ............................................................................. IV!
LIST OF CONTENTS ................................................................................... VI!
LIST OF FIGURES ....................................................................................... XI!
LIST OF TABLES ..................................... XV

PART I.! INTRODUCTION ......................................................................... 1!
1! RESEARCH PROBLEM AND DEMARCATION OF THE TOPIC ..................... 1!
2! RESEARCH APPROACH OVERVIEW ..................................................... 13!
3! AIMS AND STRUCTURE OF THE THESIS ............................................... 17

PART II.! THEORETICAL FRAMEWORK ............................................ 20!
4! ECONOMICS OF CONSUMER MAGAZINES ............................................ 20!
4.1! Definition and Typology of Consumer Magazines ........................ 20!
4.2! Attributes and Particularities of Consumer Magazines ................ 23!
4.2.1! Legal Particularities ................................................................... 24!
4.2.2! Duality of Submarkets and Business Model ............................. 25!
4.2.3! Financial Particularities ............................................................. 30!
4.3! Good Classification of Consumer Magazines ............................... 30!
4.3.1! Free Good versus Scarce Good ................................................. 30!
4.3.2! Real/Material Good versus Service/Immaterial Good .............. 31!
4.3.3! Consumer Good versus Producer Good .................................... 31!
4.3.4! Durable Good versus Nondurable Good ...............32!
4.3.5! Private Good versus Public Good ............................................. 34!
4.3.6! Search Good versus Experience or Credence Good .................. 35!
vi 4.3.7! Substitution Good versus Complementary Goods .................... 37!
4.3.8! Heterogeneous Good versus Homogeneous Good .................... 38!
5! MARKET CONCENTRATION, ADVERTISING PRICING STRATEGIES, AND
THEIR INTERRELATION IN MEDIA INDUSTRIES .................................... 40!
5.1! Industrial Economics as the Main Theoretical Framework and
relevant Aspects from Strategic Management ............................... 41!
5.1.1! General Assumptions and Approaches ..................................... 41!
5.1.2! Application and Integration of General Industrial Economic
Theory to Media Economics Research ...................................... 46!
5.1.3! Relevant Concepts from Strategic Management ....................... 49!
5.2! Market Concentration in Media Markets ...................................... 52!
5.2.1! General Definition and Demarcation of Market Concentration 52!
5.2.2! Measuring Market Concentration .............................................. 54!
5.2.3! Media Related Studies on Market Concentration...................... 60!
5.3! Economics of Pricing and Advertising Pricing ............................. 64!
5.3.1! Definition and Demarcation of the Terms Price and Pricing .... 64!
5.3.2! Theoretical Approaches and Concepts of Pricing ..................... 68!
5.3.3! Strategic Options and Instruments in Advertising Pricing ........ 76!
5.3.4! Media Related Studies in Advertising Pricing .......................... 85!
5.4! Media Related Studies on Interrelation between Market
Concentration and Pricing Strategies ........................................... 86

PART III.! RESEARCH STRATEGY .......................................................... 89!
6! QUANTITATIVE AND HYPOTHETICO-DEDUCTIVE RESEARCH DESIGN . 89!
6.1! Derivation of Research Questions from Research Aims ............... 91!
6.2! Relevant Variables for the Analyses .............................................. 91!
6.2.1! General Variables ...................................................................... 92!
6.2.2! Market Concentration ................................................................ 93!
vii 6.2.3! Advertising Prices ..................................................................... 95!
6.3! Causal Hypotheses, Operationalization, and Variables for
Concentration-Price-Interrelation Analysis ................................. 95!
6.4! Selected Sample for Analysis ......................................................... 97!
6.5! Data Sources ............................................................................... 100!
7! METHODS OF EVALUATION AND INTERPRETATION........................... 102

PART IV.! ANALYSIS OF DATA AND RESULTS ................................. 108!
8! MARKET CONCENTRATION IN CONSUMER MAGAZINE SUBMARKETS
(RESEARCH QUESTION 1) ................................................................. 108!
8.1! Market Concentration in Reader Market .................................... 108!
8.1.1! Number of Publishing Houses ................................................. 109!
8.1.2! Market Shares in the Reader Market for Consumer Magazine
Submarkets and General Results for Concentration on the
Reader Market ......................................................................... 113!
8.1.3! Comparative Analysis of Reader Market Concentration in the
Consumer Magazine Submarkets ............................................ 118!
8.2! Market Concentration in Advertising Market ............................. 128!
8.2.1! Advertising Earnings and derived Market Shares ................... 128!
8.2.2! Comparative Analysis of Advertising Market Concentration in
the Consumer Magazine Submarkets ...................................... 130!
8.3! Summary ...................................................................................... 139
9! ANALYSIS OF ADVERTISING PRICES AND ADVERTISING PRICING
STRATEGIES IN CONSUMER MAGAZINE INDUSTRY (RESEARCH
QUESTION 2) .................................................................................... 141!
9.1! Absolute Advertising Prices ........................................................ 141!
9.1.1! Descriptive Results of Absolute Advertising Prices in Total
Consumer Magazine Market ................................................... 142!
viii 9.1.2! Comparative Analysis of Absolute Advertising Pricing in
Consumer Magazine Submarkets ............................................ 145!
9.2! Cost per Thousand as Relative Advertising Price Measure ........ 148!
9.2.1! Descriptive Results of Relative Advertising Pricing in
Consumer Magazine Submarkets ............................................ 149!
9.2.2! Comparative Analysis of Relative Advertising Prices ............ 151!
9.3! Comparative Analysis of Advertising Pricing Strategies of
Relevant Consumer Magazine Publishers ................................... 159!
9.3.1! Advertising Pricing Strategies ................................................. 160!
9.3.2! Derivation of Generic Advertising Pricing Strategies ............. 174!
10! INTERRELATIONS BETWEEN MARKET CONCENTRATION AND
ADVERTISING PRICING (RESEARCH QUESTION 3) ............................. 182!
10.1! Interrelations between Market Concentration and Absolute
Advertising Prices ....................................................................... 182!
10.2! Interrelations between Market Concentration and CPT ............. 185!
10.3! Interim Summary of Concentration-Price Interrelations and
Conclusion ................................................................................... 187!
10.4! Additional Variables and their Interrelations with Advertising
Prices ........................................................................................... 189!
10.4.1! Description of Additional Variables ....................................... 189!
10.4.2! Multivariate Regression Analysis and Interpretation .............. 192!
10.5! Summary and Visual Model ........................................................ 199

PART V.! SUMMARY, CONCLUSION AND RESEARCH
IMPLICATIONS ...................................................................... 202!
11! FINAL EVALUATION OF RESEARCH RESULTS ................................... 202!
11.1! Findings from the Empirical Analysis ......................................... 203!
11.1.1! Market Concentration in the Consumer Magazine Industry ... 203!
ix 11.1.2! Magazine Publisher’s Advertising Pricing Strategies ............. 207!
11.1.3! Interrelations between Market Concentration and Advertising
Pricing ..................................................................................... 209!
11.2! Contributions and Limitations of the Thesis ............................... 210!
12! RESEARCH IMPLICATIONS ................................................................ 213

APPENDIX .................................................................................................... 217

REFERENCES ........................................... 358!
x