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Trading minutes for minutes in advertising ? Attention is not only about time

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Bernard Cools
Bernard Cools

Thoughts and remarks on a paper by Matthew Gentzkow (2014) ??Trading dollars for dollars: the price of attention online and offline?? AEA papers and proceedings. My own paper "Media dwell time" does tell that one minute consumption of a given medium is not equal to one minute of attention to another one when it comes to ad absorption. Just because attention value is not the same !

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Trading minutes for minutes? Thoughts and remarks on a paper by Matthew Gentzkow (2014) ? Trading dollars for dollars: the price of attention online and offline ? AEA papers and proceedings, vol. 104 n°5
Based on ? Trading dollars for dollars ? ? the price of attention in traditional media has fallen as the Internet has made advertising markets increasingly competitive ? ? the price of attention for similar consumers is actually higher online than offline? Source: Matthew Gentzkow “Trading Dollars for Dollars: The Price of Attention Online and Offline” in American Economic Review Papers and Proceedings. 104 (5). May 2014. pp,481-488. http://faculty.chicagobooth.edu/matthew.gentzkow/research/DollarsForDollars.pdf
The so-called ? price of attention ? Media Minutes per person per day Advertising revenue per hour 2008 2012 Evolution 2008 2012 Evolution Newspapers Print 9.54 8.24 -14% $ 2.78 $ 1.57 -44% Online 0.63 0.54 -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. Advertising revenue per hour is total amount advertising revenue divided by total annual minutes in 2012 dollars ?
Not a bit dangerous ?
Dubious assumptions Empirical evidence that ? of concurrent minutes is the right way when multitasking does increase? ? Average minutes per day as minutes of exclusive use plus half ‘for simplicity’ of minutes concurrent with other activities ? Validation ? ?For print newspapers and magazines […] implicitly fixing reading time per copy at the 2008 value ? Above all: is exclusive media usage synonymous with attention ?
Ad absorption after 30 minutes of controlled, exclusive use of media % of ads correctly recalled vs ads exposed in two 14% 30% 40% 37% 75% 75% Television Television Newspapers Magazines Internet Internet separate (US & BE) experiments More on: http://www.slideshare.net/Bernard_Cools/30minutesfor-slideshare
Minutes for minutes does not work ! % of ads correctly recalled vs ads exposed in two 14% 30% 40% 37% Television Television Newspapers Magazines Internet More on: http://www.slideshare.net/Bernard_Cools/30minutesfor-slideshare 75% 75% Internet separate (US & BE) experiments
Nevertheless ? Trading dollars for dollars ? tells a lot on media consumption & advertising investments
What the data do tell us on media usage Actually change in circulation * Media Minutes per person per day Advertising revenue per hour 2008 2012 Evolution 2008 2012 Evolution Similar evolution Newspapers Print 9.54 8.24 -14% $ 2.78 $ 1.57 -44% Online 0.63 0.54 -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Online newspapers evolution different from Web in general ! Change in circulation * In spite of a heavy increase of Web exclusive usage *, consumption relatively stable +6% cumulated time spent Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. * See above
What the data do tell us on ad invest Media Minutes per person per day Advertising revenue per hour Reports of decrease: ad 2008 2012 Evolution 2008 2012 Evolution market overreacts Newspapers Print Losses 9.54 in paper ad 8.24 revenue -14% $ 2.78 $ 1.57 -44% Online not balanced 0.63 by online 0.54 gains -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Seems the overall media allocation remains unchanged or decreases globally >40% up in 4-5 years ! Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. Advertising revenue per hour is total amount advertising revenue divided by total annual minutes in 2012 dollars ?
Contradictory to Gentzkow’s statements: one minute of media use ≠ one minute of another media use when it comes to attention It seems the ad market (not only US…) flows into Internet, forgetting the confirmed marketing attractiveness of ? old media ?, especially print In times of recession, overall media investment does not grow, only the media shares change ?

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Trading minutes for minutes in advertising ? Attention is not only about time

  • 1. Trading minutes for minutes? Thoughts and remarks on a paper by Matthew Gentzkow (2014) ? Trading dollars for dollars: the price of attention online and offline ? AEA papers and proceedings, vol. 104 n°5
  • 2. Based on ? Trading dollars for dollars ? ? the price of attention in traditional media has fallen as the Internet has made advertising markets increasingly competitive ? ? the price of attention for similar consumers is actually higher online than offline? Source: Matthew Gentzkow “Trading Dollars for Dollars: The Price of Attention Online and Offline” in American Economic Review Papers and Proceedings. 104 (5). May 2014. pp,481-488. http://faculty.chicagobooth.edu/matthew.gentzkow/research/DollarsForDollars.pdf
  • 3. The so-called ? price of attention ? Media Minutes per person per day Advertising revenue per hour 2008 2012 Evolution 2008 2012 Evolution Newspapers Print 9.54 8.24 -14% $ 2.78 $ 1.57 -44% Online 0.63 0.54 -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. Advertising revenue per hour is total amount advertising revenue divided by total annual minutes in 2012 dollars ?
  • 4. Not a bit dangerous ?
  • 5. Dubious assumptions Empirical evidence that ? of concurrent minutes is the right way when multitasking does increase? ? Average minutes per day as minutes of exclusive use plus half ‘for simplicity’ of minutes concurrent with other activities ? Validation ? ?For print newspapers and magazines […] implicitly fixing reading time per copy at the 2008 value ? Above all: is exclusive media usage synonymous with attention ?
  • 6. Ad absorption after 30 minutes of controlled, exclusive use of media % of ads correctly recalled vs ads exposed in two 14% 30% 40% 37% 75% 75% Television Television Newspapers Magazines Internet Internet separate (US & BE) experiments More on: http://www.slideshare.net/Bernard_Cools/30minutesfor-slideshare
  • 7. Minutes for minutes does not work ! % of ads correctly recalled vs ads exposed in two 14% 30% 40% 37% Television Television Newspapers Magazines Internet More on: http://www.slideshare.net/Bernard_Cools/30minutesfor-slideshare 75% 75% Internet separate (US & BE) experiments
  • 8. Nevertheless ? Trading dollars for dollars ? tells a lot on media consumption & advertising investments
  • 9. What the data do tell us on media usage Actually change in circulation * Media Minutes per person per day Advertising revenue per hour 2008 2012 Evolution 2008 2012 Evolution Similar evolution Newspapers Print 9.54 8.24 -14% $ 2.78 $ 1.57 -44% Online 0.63 0.54 -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Online newspapers evolution different from Web in general ! Change in circulation * In spite of a heavy increase of Web exclusive usage *, consumption relatively stable +6% cumulated time spent Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. * See above
  • 10. What the data do tell us on ad invest Media Minutes per person per day Advertising revenue per hour Reports of decrease: ad 2008 2012 Evolution 2008 2012 Evolution market overreacts Newspapers Print Losses 9.54 in paper ad 8.24 revenue -14% $ 2.78 $ 1.57 -44% Online not balanced 0.63 by online 0.54 gains -14% $ 3.79 $ 4.24 12% Internet 26.12 37.17 42% $ 0.68 $ 0.68 0% Magazines 3.95 3.64 -8% $ 2.58 $ 2.07 -20% Television 205.4 209.8 2% $ 0.27 $ 0.26 -4% Seems the overall media allocation remains unchanged or decreases globally >40% up in 4-5 years ! Source: Matthew Gentzkow ? Trading dollars for dollars: the price of attention online and offline ? p.485 ? Minutes per person per day is for American adults 18 and older. Advertising revenue per hour is total amount advertising revenue divided by total annual minutes in 2012 dollars ?
  • 11. Contradictory to Gentzkow’s statements: one minute of media use ≠ one minute of another media use when it comes to attention It seems the ad market (not only US…) flows into Internet, forgetting the confirmed marketing attractiveness of ? old media ?, especially print In times of recession, overall media investment does not grow, only the media shares change ?