"Will They Pay for It?" A Conceptual Framework for Analyzing Consumer Responses to Pricing Decisions Regarding the Online Distribution of Digital ContentDiploma Thesis from the year 2007 in the subject Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media, grade: 1,7, University of Mannheim (Lehrstuhl f r Allgemeine BWL und Marketing I), 338 entries in the bibliography, language: English, abstract: No other electronic medium - in fact, no other medium at all - has become a mass medium as fast as the Internet did. At the beginning of 2008, there were more than 1.3 Billion users online, which accounts for roughly one fifth of the world population. Historically, the Internet has been conceptualized as a means of communication. Realizing its potential, however, it was soon used for commercial purposes as well. In addition to that, there is a third major area that has long been a major pillar of Internet usage: content. Much of the tremendous growth of the Internet over the past decade can be explained by the fact that, apart from fees for the usage of bandwith, content and other services on the Internet have usually been offered for free, typically financed by revenues from online advertising. Faced with the burst of the Internet bubble and the sales from Internet advertising breaking away, however, online companies started looking for alternative ways of generating revenues. One of the most obvious options was to start charging consumers directly for the content offered to them, which was a rather significant paradigm shift. The picture emerging today is twofold: On the one hand, online consumers who have grown accustomed to free services and content find the prospect of having to pay for those rather appalling. On the other hand, there is evidence that there is at least some degree of willingnes to pay for digital content among online consumers. These controversial findings show that there is still a lot to be learned about business models, pricing strategies, and consumer attitudes towards paid content. It seems as if online consumers are definitely willing to pay for conten |
Contents
| 1 | |
| 14 | |
Overview of Definitions in Academic Literature | 21 |
Product Classification based on the SECFramework | 27 |
Pricing Strategies for the Online Distribution of Digital Content | 37 |
Definition of Constructs | 68 |
Summary of Research on Willingness to Pay for Digital Content | 73 |
Overview of Perceived Risk Dimensions | 94 |
Analyzing Consumer Reactions to the Pricing Decisons of Digital Content | 111 |
Conclusions and Research Opportunities | 146 |
References | 158 |
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Common terms and phrases
actual addition already authors behavior benefits bundling buyers chapter charging companies compared concept consequences consumers costs customers differentiation digital content discussed distribution economic effects electronic essentially evaluation example existence experience factors Figure Finally findings framework gains given hand higher hold important increase individuals influence initial Internet introduced Kahneman literature losses lower marginal medium mental mental accounting motive negative network externalities notion paid content offerings particular payments penetration pricing perceived fairness perceived risk perceptions perceptions of fairness positive possible presented price fairness pricing decisions pricing schedules pricing strategies profits purchase reasons reference reference price regarding reputation respect sellers showed similar skim pricing sources specific Stahl studies suggest Thaler theory traditional transaction unfairness usage users utility willingness to pay