1 / 17

Is There Evidence that VOD Cannibalizes DVD Rentals? A Spatial Regression Analysis

Philadelphia, May 2–4, 2005 www.locationintelligence.net. Is There Evidence that VOD Cannibalizes DVD Rentals? A Spatial Regression Analysis. Dr. Amy Liu, Marketing Systems Group Kevin Babyak, Marketing Systems Group Dr. Paul Rappoport, Temple University. Outline. The Hypotheses The Data

jolene
Download Presentation

Is There Evidence that VOD Cannibalizes DVD Rentals? A Spatial Regression Analysis

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Philadelphia, May 2–4, 2005 www.locationintelligence.net Is There Evidence that VOD Cannibalizes DVD Rentals?A Spatial Regression Analysis Dr. Amy Liu, Marketing Systems Group Kevin Babyak, Marketing Systems Group Dr. Paul Rappoport, Temple University

  2. Outline • The Hypotheses • The Data • The Model • Results • Conclusions

  3. Hypotheses • The availability of video-on-demand (VOD) leads to a reduction of DVD rentals. • The use of VOD leads to an increased reduction of DVD rentals. • Households demand for DVD rentals depends on the distance a household is from a DVD rental store

  4. Databases • CENTRIS Omnibus Survey • Household RDD survey • 50,000+ observations • Track DVD rentals, VOD availability and use • Projected activity down to Census Block Group • Location of Video/DVD rental stores

  5. CENTRIS http://www.centris.com

  6. Predicted VOD Penetration 2.5%

  7. DVD Rentals by Age

  8. DVD Rentals by Income

  9. Spatial Regression Model Variables Poisson Regression • Household Usage • VOD availability • Store locations • Distance to store • Demographics Model of DVD Rentals (counts) DVD usage = f(Income, Age, Distance, VOD usage, VOD availability, Children) (+) (-) (-) (-) (-) (+)

  10. Results • VOD availability by itself is marginally important • VOD usage triggers substitution • VOD usage expected to grow – will lead to an increasing impact on DVD rentals • DVD rental cannibalization less pronounced when store is close • Substitution is most pronounced for younger households, households with higher incomes and households with children

  11. Conclusions • 1 Cable VOD roll-out strategies will have a large impact on the traditional DVD rental market. • 2 The push towards digital cable will accelerate this cannibalization • 3 VOD availability is limited – real impact of cannibalization is still a few years off • 4 The VOD – DVD battleground will be in areas of high income, younger households

  12. Contact Information • Amy Liu – Marketing Systems Group, aliu@m-s-g.com, 215-653-7100 x143 • 2. Kevin Babyak – Marketing Systems Group, kbabyak@m-s-g.com, 215-653-7100, x118 • Paul Rappoport – Department of Economics, • Temple University, paul.rappoport@temple.edu, • 215-913-1775

More Related