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The relationship between consumer characteristics and willingness to pay for general online content: Implications for content providers considering subscription-based business models

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Abstract

An increasing number of digital content providers are considering ways to charge consumers for content that was previously free. A key question for these companies is whether a change in business model from one that is advertising-based to one that is subscription-based likely to generate more revenue? Hence, the purpose of the research is to profile consumers who are more likely to pay for online content and estimate the amount they are likely to pay. Data from a nationally representative probability sample of 755 internet users are used to estimate the model. The results indicate that while the estimated amount paid for digital content is related to income and education, willingness to pay is more related to age and gender. The findings have important implications for digital content providers who are evaluating the possibility of shifting from an advertising supported content-for-free model to a subscription supported pay-for-content business model.

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Acknowledgments

The author gratefully acknowledges the financial support provided by the Connecticut Information Technology Institute (CITI) and thanks the Pew Internet & American Life Project for providing the data for the study.

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Correspondence to Girish Punj.

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Please address all correspondence to Girish N. Punj, Department of Marketing, School of Business, University of Connecticut, 2100 Hillside Road, Storrs, CT 06269-9013. Phone: (860)-486-3835; e-mail: Girish.Punj@business.uconn.edu.

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Punj, G. The relationship between consumer characteristics and willingness to pay for general online content: Implications for content providers considering subscription-based business models. Mark Lett 26, 175–186 (2015). https://doi.org/10.1007/s11002-013-9273-y

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  • DOI: https://doi.org/10.1007/s11002-013-9273-y

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