Content Spending and Network Quality in Mobile Channels: A Hidden Markov Model of User Engagement and Content Consumption

Abstract

Nowadays, individuals increasingly depend on mobile devices and apps for every aspect of their daily lives. Even though the number of mobile users and the time that they spend on mobile apps have grown tremendously, app providers are still struggling with low user engagement and a high attrition rate. This study examines how users’ prior content spending and network delay impact consumers’ mobile content consumption decisions and how the impacts vary in different engagement states. We develop a Hidden Markov Model and calibrate it using a large tapstream data set of individual users’ reading activities from a mobile app provider. We identify three engagement states and heterogeneous impacts of the financial and operational factors. This study will generate important implications on content pricing and user engagement in mobile channels