Incorporating long-term effects in determining the effectiveness of different types of online advertising

Although online advertising has become a full member of the marketing mix and is still growing in importance, studies of long-term, or lagged, advertising effects have generally either neglected online advertising channels or have treated online advertising as one homogeneous block. We analyze the short- and long-term effectiveness of different types of online advertising channels by incorporating separate time lags for each advertising channel. We look at the sales effect of email, banner, and price comparison advertising (PCA) using a sample of 2.8 million purchases and more than 1.1 million individual costumers aggregated to 365 days. Our analysis shows that email advertising has the longest effect, followed by banner advertising and PCA. We find that the length of the effect does not always go hand in hand with its intensity since, for example, banner advertising lasts longer than PCA but performs worse in terms of actual sales. This research yields important insights for theory and practice since it shows how to model long-term advertising effects and provides meaningful insights for improving the allocation of advertising budgets.     

Investigating the Drivers of Consumer Acceptance and Response of SMS Advertising

This study tests five potential drivers underlying the acceptance of SMS advertising. After developing a scale to measure behavioral responses to SMS advertising, the relationships between the acceptance of SMS advertising, intention to receive SMS advertising and behavioral responses to SMS advertising are tested. A convenience sampling method was employed. Survey questionnaires were distributed across Western Australia. The return yielded 203 usable questionnaires from the respondents. Several factors emerge as significant drivers of acceptance of SMS advertising including utility of SMS advertisements, context of SMS advertisements and attitudes to advertising in general. Contrary to expectation, control over SMS advertisements did not emerge as a significant driver for acceptance of SMS advertising. Trust in advertisers and laws did not emerge as a significant driver of the acceptance of SMS advertising among Australian respondents. Advertisers who pursue consumer acceptance should strive to build utility and context considerations into their SMS campaigns. Future research opportunities include testing the drivers of SMS advertising to further investigate the impact of control and trust on acceptance of SMS advertising in other countries where the SMS advertising has not been explored yet.     

The Effects of Advertising Rates on Newspaper Advertisng Linage: A Pilot Study

The highly complex area of newspaper economics is often reduced to the simple statement-advertising revenue is a function of circulation. While this statement is obviously oversimplified, it does express the perceived importance of the circulation/advertising relationship to management of newspapers. The relationship's importance is further amplified by the fact that newspapers partially base advertising rate structures on circulation and advertising linage levels. Yet, surprisingly, very few attempts have been made to study the relationship between newspaper circulation, advertising rates and advertising linage empirically.

This study examines the effect of differences in newspaper circulation and advertising rates on the amount of total advertising linage, national advertising linage and retail advertising linage.

The results imply that circulation seems to have a significant and strong positive effect on total advertising linage in the sample analyzed. Time-series analysis confirm this finding. Circulation's effect on national advertising linage is even greater-elasticities of one or larger.

The effect on local advertising linage is much less elastic. but still significant. The effects of the advertising rate on advertising linage are much less clear from this research. In fact. it is not possible to draw any significant conclusions concerning the way advertisers respond to changes in the advertising rate from the results of the research. This is an area that needs more indepth research.     

Predicting Consumer Avoidance of Native Advertising on Social Networking Sites: A Survey of Facebook Users

Abstract

As a result of constant efforts to improve consumers’ online advertising experiences, native advertising has started to gain popularity on social networking sites (SNSs). This survey study examined antecedents of avoidance of native advertising on SNSs and the moderating role of consumer skepticism toward native advertising. Our findings suggest perceived intrusiveness and perceived informative and entertainment advertising value as major antecedents of consumer advertising avoidance. Additionally, the number of brands that consumers are following on SNSs and negative communication among peers on SNSs were found to be factors affecting native advertising avoidance. Finally, consumer skepticism toward native advertising was found to be an important moderating variable in the mechanism of advertising avoidance on SNSs.     

The impact of online display advertising and paid search advertising relative to offline advertising on firm performance and firm value

This research examines the impact of online display advertising and paid search advertising relative to offline advertising on firm performance and firm value. Using proprietary data on annualized advertising expenditures for 1651 firms spanning seven years, we document that both display advertising and paid search advertising exhibit positive effects on firm performance (measured by sales) and firm value (measured by Tobin's q). Paid search advertising has a more positive effect on sales than offline advertising, consistent with paid search being closest to the actual purchase decision and having enhanced targeting abilities. Display advertising exhibits a relatively more positive effect on Tobin's q than offline advertising, consistent with its long-term effects. The findings suggest heterogeneous economic benefits across different types of advertising, with direct implications for managers in analyzing advertising effectiveness and external stakeholders in assessing firm performance.     

An integrative framework of cooperative advertising: Should manufacturers continuously support retailer advertising?

A two-period game is developed in a bilateral monopoly where, besides pricing decisions, the retailer and manufacturer can set their advertising and cooperative advertising support rates for each period. It is demonstrated that, in addition to the established continuous cooperative advertising programs, in which the retailer advertises and the manufacturer supports retailer advertising in each period, two other advertising schedules are possible. First, the retailer advertises in each period, while the manufacturer only supports the second-period advertising. Second, whether or not the manufacturer provides a cooperative advertising program in the first period, the retailer only advertises in the second period and receives advertising support. The conditions under which each of these advertising arrangements is implemented are identified. In a continuous cooperative advertising schedule, the manufacturer may change his advertising support over time depending on the nature of the long-term effects of retailer advertising. The implications of these findings are discussed.     

An empirical examination of public attitudes towards advertising in a transitional economy

This paper examines public attitudes towards advertising within the context of transition in central and eastern Europe. Drawing on a consumer survey conducted in three cities within Romania, the study conceptualises Pollay and Mittal’s (1993) model of beliefs and attitudes towards advertising. This study introduces a novel differentiation between image and the social integration role of advertising, extending in this way the concept of the personal uses of advertising. It highlights variations in public opinion towards advertising between socio-cultural areas in Romania. Attitudes towards the institution of advertising, attitude–instrument, product information and hedonic/pleasure have a positive effect on general attitude to advertising as expected. Consumers who perceive an informational and entertaining value of advertising, those holding positive attitudes towards advertising as an institution in a free market economy and the instruments used to further it, are more likely to hold positive general attitudes towards advertising. The role of advertising exhibits a positive effect on general attitude. Image has a surprisingly negative effect on general attitude towards advertising, which contrasts with expectations based upon developed countries. Finally, the managerial implications are discussed.     

Social Consumer Neuroscience: Neurophysiological Measures of Advertising Effectiveness in a Social Context

The application of neurophysiological methods to study the effects of advertising on consumer purchase behavior has seen an enormous growth in recent years. However, little is known about the role social settings have on shaping the human brain during the processing of advertising stimuli. To address this issue, we first review previous key findings of neuroscience research on advertising effectiveness. Next, we discuss traditional advertising research into the effects social context has on the way consumers experience advertising messages and explain why marketers, who aim to predict advertising effectiveness, should place participants in social settings, in addition to the traditional ways of studying consumer brain responses to advertising in social isolation. This article contributes to the literature by offering advertising researchers a series of research agendas on the key indicators of advertising effectiveness (attention, emotion, memory, and preference). It aims to improve understanding of the impact social context has on consumers' neurophysiological responses to advertising messages.     

A Comparison of Advertising Practices within the Accounting Profession

This article reports the findings of a survey among UK chartered accountancy firms on their promotional practices following the 1984 removal of advertising prohibitions in the profession. Specifically, it compares advertising practices between firms, using a typology of firms based on size of advertising budgets and use of advertising agencies. The financial resources devoted to advertising certainly influenced promotional activities. However, they were found to be no substitute for advertising agency expertise. Firms using advertising agencies had a more systematic approach to promotion; they were more likely to undertake pre-advertising research, segment their markets, make more varied and intensive use of media, and to evaluate their advertising. Firms with relatively large budgets which did not use advertising agencies tended to be less rigorous in their approach, showing little interest in crucial matters such as pre-advertising research and post-advertising evaluation.     

网络广告主体法律制度的完善

随着网络媒体的迅速发展,网络广告大有取代传统媒体广告的趋势,但是,其法律规制却相对滞后,各国对网络广告的法律定位及立法模式尚未形成统一的认识。由于某些网络广告的基本理论问题尚未得到解决,目前我国网络广告的法律监管仍然处于一个较低的水平,从而直接影响了广告法律、法规的执行。为此,应借鉴电子商务发达国家的实践经验,尽快完善我国网络广告主体法律制度。     

An integrated model of advertising clutter in offline and online media

The rapid growth of online advertising raises concerns about advertising clutter in the online media environment. This paper proposes an integrated model of advertising clutter that addresses the unique characteristics of the online media environment. We review the structural, information processing and functional approaches to advertising clutter, and integrate these approaches into a new comprehensive framework that explains consumer response to advertising clutter by differentiating consumer-centred analysis from media-centred analysis. The differences between online media and offline media are compared in terms of audience control and advertiser control. Attitudes towards advertising in general and in specific media contexts, and task orientations are introduced as mediating factors that affect the perception of and the subsequent response to advertising clutter. This paper offers a set of propositions on the factors affecting perception of advertising clutter, the relationship between physical characteristics and perception of advertising clutter, and how perception of clutter creates negative advertising effects. Managerial and theoretical implications of this framework are discussed.     

Managing advertising investments in marketing channels

This paper investigates how should manufacturers optimally allocate resources to retailer-initiated (retailer) advertising through cooperative advertising programs and own (manufacturer) advertising in a bilateral monopoly. Retailer advertising stimulates immediate sales but may also harm long-term (post-advertising) demand, whereas manufacturer advertising aims at building brand equity and stimulates both immediate and long-term sales. A game-theoretic model in which a manufacturer and a retailer set pricing and advertising decisions over a two-period planning horizon is developed to account for the differences between manufacturer and retailer advertising. We characterize equilibrium solutions for four advertising scenarios for the manufacturer, ranging from no investment in any advertising activity to undertaking own advertising and supporting retailer advertising simultaneously. Comparing the two players’ equilibrium strategies and profits across these scenarios, we find that manufacturers should avoid offering exclusively cooperative advertising programs to retailers. When retailer advertising positively influences long-term sales, manufacturers should offer cooperative advertising supports to retailers in addition to undertaking their own advertising. When retailer advertising negatively affects long-term sales, manufacturers can still undertake own advertising and offer cooperative advertising under certain conditions. However, if these conditions are not met, focusing exclusively on own advertising is their best advertising strategy. Retailers also prefer scenarios in which manufacturers advertise, but may choose not to participate in manufacturers’ cooperative advertising programs. This leads to suboptimal outcomes if cooperative advertising programs are not enhanced by additional incentives (e.g., side payments or other services).     

An Empirical Model of Advertising Dynamics

This paper develops a model of dynamic advertising competition, and applies it to the problem of optimal advertising scheduling through time. In many industries we observe advertising “pulsing”, whereby firms systematically switch advertising on and off at a high-frequency. Hence, we observe periods of zero and non-zero advertising, as opposed to a steady level of positive advertising. Previous research has rationalized pulsing through two features of the sale response function: an S-shaped response to advertising, and long-run effects of current advertising on demand. Despite considerable evidence for advertising carry-over, existing evidence for non-convexities in the shape of the sales-response to advertising has been limited and, often, mixed. We show how both features can be included in a discrete choice based demand system and estimated using a simple partial maximum likelihood estimator. The demand estimates are then taken to the supply side, where we simulate the outcome of a dynamic game using the Markov perfect equilibrium (MPE) concept. Our objective is not to test for the specific game generating observed advertising levels. Rather, we wish to verify whether the use of pulsing (on and off) can be justified as an equilibrium advertising practice. We solve for the equilibrium using numerical dynamic programming methods. The flexibility provided by the numerical solution method allows us to improve on the existing literature, which typically considers only two competitors, and places strong restrictions on the demand models for which the supply side policies can be obtained. We estimate the demand model using data from the Frozen Entree product category. We find evidence for a threshold effect, which is qualitatively similar to the aforementioned S-shaped advertising response. We also show that the threshold is robust to functional form assumptions for the marginal impact of advertising on demand. Our estimates, which are obtained without imposing any supply side restrictions, imply that firms should indeed pulse in equilibrium. Predicted advertising in the MPE is higher, on average, than observed advertising. On average, the optimal advertising policies yield a moderate profit improvement over the profits under observed advertising.JEL Classification: L11, L66, M30 M37 R12     

上海广告产业现状及转型发展所面临的问题

上海市是我国最主要的广告经营中心之一,本文通过对2012年上海市广告企业的普查数据的分析,解读上海市广告产业发展现状。与2011年度的数据统计相比,2012年的统计数据更为准确集中,更真实全面的反映了上海广告产业的现状。数据显示,小型微型广告公司数量占据上海主营广告企业绝大多数,国际广告公司与本土广告公司的经济地位成反比,生活服务仍是本土广告经营服务收入的主业,广告业务收入电视仍是主流,互联网与电影展露锋芒,少量规模庞大的内资广告公司分走较多收益,微型广告公司的广告业利润最低。     

An Electrical Circuit Analogue of Market Behavior—As Used in Advertising Decisions

An electrical circuit analogue is proposed in this paper to model sales response to advertising. For a given marketing and advertising strategy. and for a given advertising budget, the electrical circuit analogue is used to analyze sales behavior corresponding to various forms of advertising input. It is shown how this analysis can be used to plan the advertising time pattern most appropriate to the manager's requirements and as a means of evaluating the effectiveness of an advertising campaign.     

How advertising is covered in the Egyptian press: a longitudinal examination of content

The possibility of Egyptian attitudes towards advertising being affected by exposure to media portrayals of advertising is discussed in the context of cultivation effects. A census of all content related to advertising in Al-Ahram from 1978 through 1997 is conducted. Findings show that most columns, letters to the editor and editorials are negative in tone, and most news stories dealing with advertising are neutral. Domestic and international industry practices and social aspects of advertising are commonly covered. Outdoor and television advertising are most often criticised. The concerns expressed typically involve morality, culture and deception. Calls for increased government regulation and censorship of advertising are common. It appears that the coverage of advertising in Egypt is more negative than in the US. Future research examining links between media content and public attitudes towards advertising is suggested.     

Advertising strategies for brand image repair: The effectiveness of advertising alliances

Advertising alliances are an effective shortcut to increase brand awareness and improve brand image. However, few studies have compared the effectiveness of advertising alliances with traditional (single-brand) advertising. Thus, this study focuses on a specific type of brand beliefs – namely, brand personality – and compares the ability of advertising alliances and traditional advertising to strengthen positive traits and downplay negative traits for a real brand in need of image repair. The results show that the advertising alliance is considerably more effective in upgrading positive brand personality traits than single-brand advertising. Importantly, this superior effect remained one week after exposure. The choice of advertising strategy had no effect on negative brand personality traits. Implications for advertising management are discussed.     

The Typicality and Accessibility of Consumer Attitudes Toward Television Advertising: Implications for the Measurement of Attitudes Toward Advertising in General

Despite the wide array of contemporary advertising formats and media, television advertising remains the most dominant form to which typical consumers are exposed. Research on attitudes toward advertising in general (Att-AiG) implicitly assumes that the Att-AiG measure represents advertising as a whole. A major finding of the current research is that consumers tend to have a mental representation, or exemplar, of the most typical type of advertising—television advertising—when they report their Att-AiG. Therefore, in reality, Att-AiG primarily reflects attitudes toward television advertising. In addition, the results of our experiments indicate that television ad exemplars generate temporal changes in consumers’ reported Att-AiG and attitudes toward television advertising. Theoretical and practical implications are discussed.     

A Factor Analysis of College Student Attitudes toward Advertising

Eighty college students were administered 26 Likert-type statements designed to measure their attitudes toward advertising along four different dimensions: 1) economic effects of advertising, 2) social effects of advertising, 3) ethics of advertising and 4) regulation of advertising. Analysis of the responses revealed five clusters or “types” of individuals based on their attitudes. While all five types exhibited some negative feelings toward advertising the degree of, and basis for, their criticisms varied considerably. Findings such as these indicate the need for a better understanding of the reasons for student dissatisfaction with the activities of the advertising community and a more comprehensive program for the dissemination of information about advertising and its activities to a wider cross-section of the college student today.     

广告比稿模拟在市场营销专业广告学教改中的应用研究

广告比稿是广告主选择广告公司及广告公司获取业务的重要方式。市场营销专业的广告学课程,应使学生具备从企业角度判断广告提案是否适合企业所需的能力,以及从广告公司角度做出能解决企业现实问题的广告提案的能力。广告学的实践教学采用比稿模拟的形式,有利于学生促进学生全面掌握广告学理论,也更符合市场营销专业的培养目标。