Abstract

This paper studies the decision of product diversity by firms on digital platforms, and the impact of the decisions on the performance of the firms. Specifically, we take the cinema as the unit of analysis, and study the influence of the diversity of movie scheduling on cinema performance in the context of O2O (online-to-offline) platforms. The results show that the diversity of movie scheduling has a significant negative impact on box office revenues and attendance. The ratio of consumers’ adoption of O2O platforms significantly and negatively moderates the main effect. That is, the higher the online ratio is, the weaker the influence of movie-scheduling diversity on cinema performance. Implications of findings are discussed.

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