Online Webcast Demand vs. Offline Spectating Channel Demand (Stadium and TV) in the Professional Sports League

Abstract

This study investigates the online spectating behavior of sports fans. Due to the great mobility and low opportunity/switching costs, webcast sports fans’ spectating behaviors are distinct from those associated with traditional spectating channels such as stadium attendance or TV viewership. We explore the unique characteristics of online webcast demand in professional sports leagues by rigorously modeling all three spectating choices of sports fans. To consider the substitute relationship of the three spectating choices simultaneously, we employ a BLP (Berry–Levinsohn–Pakes)-style random coefficient model. For the analysis, we collect a comprehensive game-level dataset from the Korean Professional Baseball Organization (KBO) League fan samples from three different channels: online webcast viewership, stadium attendance, and TV viewership. We find that the demand for online webcasts is distinctive compared to that of traditional spectating channels. Notably, we find that the impact of team performance is three times stronger than that of TV viewership demand and that the impact of game quality is four times stronger than that of attendance demand. In contrast, a nonperformance variable is relatively less effective in attracting sports fans to online broadcasting. Furthermore, we find evidence of a strong retention effect of online webcast viewers. Our findings indicate that the previous spectating experience of online webcasts increases the next-time choice of sports fans for the webcast because the genuine spectating experience with distinctive webcast services (such as real-time interactive communication or various supplementary programs) can induce consumers to revisit the channel.