Optimizing the composition of paid content in a freemium model


Schmitt, Daniela ; Iyengar, Raghuram ; Stahl, Florian



URL: https://www.abstractsonline.com/pp8/#!/6819/presen...
Document Type: Conference presentation
Year of publication: 2019
Conference title: 2019 INFORMS 41st Annual ISMS Marketing Science Conference
Location of the conference venue: Roma, Italy
Date of the conference: 20.-22.06.2019
Publication language: English
Institution: Business School > ABWL, Quantitatives Marketing (Stahl 2013-)
Subject: 330 Economics
Abstract: Many companies try to sell subscriptions for their digital products using a freemium revenue model. Such a business model typically implies offering a low-end version of the product for free and a high-end version for a fee. For instance, a news publisher may offer some content for free to all customers while placing other content behind a paywall. Little is known about how the characteristics of the content determine whether it would be free or paid. Using data from an online news publisher that employs a freemium model, we quantify the impact of the quality and quantity of paid content on the demand for subscriptions. Using the findings from our empirical analysis, we develop a framework for setting a freemium strategy (i.e., the ratio of free versus paid content) optimal for revenue maximization.




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Schmitt, Daniela ; Iyengar, Raghuram ; Stahl, Florian ORCID: 0000-0002-2846-3424 Optimizing the composition of paid content in a freemium model. (2019) 2019 INFORMS 41st Annual ISMS Marketing Science Conference (Roma, Italy) [Conference presentation]


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