Can Loyalty to Creators Dilute Loyalty to Promoted Products? Examining the Heterogeneous Effects of Live-Streamed Content on Video Game Usage

TL;DR

This paper examines how live-streamed content influences video game engagement, revealing that viewing increases gameplay, especially with micro-streamers, and discusses implications for firms' sponsorship strategies.

Contribution

It provides causal evidence on the impact of live-streamed content on game engagement and highlights the heterogeneous effects based on streamer types, informing sponsorship decisions.

Findings

Live-streamed content increases gameplay by 3.08% for a 10% increase in viewing.

Micro-streamers have the strongest positive effect on game engagement.

The effect of live-streaming varies by streamer size, being smallest for mega-streamers.

Abstract

Social media platforms have led to online consumption communities, or fandoms, that involve complex networks of ancillary creators and consumers focused on some core product or intellectual property. For example, video game communities include networks of players and content creators centered around a specific video game. These networks are complex in that video game publishers often sponsor creators, but creators and publishers may have divergent incentives. Specifically, creators can potentially benefit from content that builds their own following at the expense of the core game. Our research investigates the relationship between consuming live-streamed content and engagement with a specific video game. We examine the causal effect of viewing live-streamed content on subsequent gameplay for a specific game, using an unexpected service interruption of the livestreaming platform and time zone differences among users. We find live-streamed content significantly increases gameplay as a 10% increase in live-streamed viewing minutes results in a 3.08% increase in gameplay minutes. We also explore how this effect varies by user loyalty to different types of streamer channels (firm-owned, mega, and micro). The positive effects of live-streamed content are greatest for micro-streamers and smallest for mega-streamers. These findings are salient for firms allocating sponsorship resources.