Television ad-skipping,consumption complementarities and the consumer demand for advertising

Endogenous consumption of advertising is common. Consumers choose to change channels to avoid TV ads, click away from paid online video ads, or discard direct mail without reading advertised details. As technological advances give firms improved abilities to target individual consumers through various media, it is becoming increasingly important for models to reflect the endogenous nature of ad consumption and to consider the implications that ad choice has for firms’ targeting strategies. With this motivation, we develop an empirical model of consumer demand for advertising in which demand for ads is jointly determined with demand for the advertised products. Building on Becker and Murphy (The Quarterly Journal of Economics, 108(4), 941–964 1993)’s ideas, the model treats advertising as a good over which consumers have utility and obtains demands as the outcome of a joint utility maximization problem. Leveraging new data that links household-level TV ad-viewing with product purchases, we provide empirical evidence that is consistent with the model: ad-skipping is found to be lower when a household has purchased more of the advertised brand, and purchases are higher when more ads have been watched recently, suggesting that advertising and product consumption are jointly determined. Fitting a structural model of joint demand to the data, we evaluate consumer welfare and advertiser profitability in advertising targeting counterfactuals motivated by an “addressable” future of TV. We find that targeting on the predicted ad-skip probability is an attractive strategy, as it indirectly selects consumers that value the product. Reflecting the positive view of advertising in the model, we also find that net consumer welfare may increase in several targeting scenarios. This occurs because under improved targeting, firms shift advertising to those who are likely to value it. At the same time, consumers that do not value the ads end up skipping them, mitigating possible welfare losses. Both forces are relevant to assessing advertising effects in a world with improved targeting and ad-skipping technology.     

Owning and Operating a Destination Management Company

ABSTRACT

Attorneys are the top revenue category for the yellow pages and the yellow pages arc the most popular form of attorney advertising. We studied over 14,000 attorney yellow page ads from three cities including a detailed analysis of all display ads. We compared the advertising strategy used in attorney yellow page ads with the literature on the information consumers desire from attorney ads. This comparison of consumer desires with the actual advertising strategy used by attorneys in the marketplace led to several recommendations for improving attorney yellow page advertising.     

The effect of augmented reality versus traditional advertising: a comparison between neurophysiological and self-reported measures

Despite the growing application of augmented reality in advertising, there is limited understanding about how customers respond to their interaction with the augmented reality advertising and how it differs from a standard paper-based advertising. Augmented reality ads are immersive, interactive, and lifelike, which means they may help companies create an emotional connection with their customers. The authors test if customers would respond in terms of emotional and affective intensity differently to augmented reality versus standard paper-based advertising. The results of two laboratory studies that consider physiological measures of arousal (galvanic skin response), self-reported measure of affect intensity and willingness to pay show that the higher willingness to pay for customers exposed to augmented reality as opposed to standard paper-based ads is driven by the physiological arousal, but not by the self-reported affect intensity and that processing fluency possibly underlies consumer’s enhanced emotional responses toward AR. These results suggest that replacing traditional advertisements with augmented reality advertisements enhances customer physiological responses and willingness to pay, with possible implications on customer segmentation and marketing communication.

     

Symbols or icons in gay-themed ads: How to target gay audience

This study examines the characteristics of gay-themed ads, focusing on culturally meaningful symbols or iconographies, in gay magazines (specifically Out and Curve). In recent years, advertising scholars and practitioners have grown more interested in how gay-themed ads influence gay consumers and nongay consumers. In gay-themed ads, advertisers employ culturally meaningful symbols or iconographies as part of an effort to not alienate nongay consumers. Gay-themed advertising, however, has yet to be deeply analyzed in terms of creativity or consumer reactions. We go on to clarify the findings' implications, discuss some concerns raised over gay-themed ads, and suggest directions for future research.     

Perceived Third‐Person Effects and Consumer Attitudes on Prevetting and Banning DTC Advertising

This study examined consumer attitudes toward two potential direct‐to‐consumer (DTC) advertising regulatory options—prior approval of DTC ads and a total ban—and how those attitudes are influenced by perceived DTC ad effects and receiver‐specific characteristics within the context of the third‐person effect framework. Results suggest that (1) consumers support the prevetting of DTC ads, but not the banning of DTC ads, (2) their support for prior approval is unaffected by demographic, predispositional, and ad‐effect perceptual differences, but (3) their support for a ban is associated with age, attitude toward DTC advertising, and perceptions of negative effects on self and others.     

Green Demarketing in Advertisements: Comparing “Buy Green” and “Buy Less” Appeals in Product and Institutional Advertising Contexts

This research compares consumer response to traditional green advertising appeals to that of less conventional, “green demarketing” (GD) appeals—messages by for-profit companies encouraging reduced category consumption for the sake of the environment. Rather than encouraging greener consumption, modern environmentalism calls for decreased consumption overall, a trend reflected in recent advertising campaigns (e.g., Patagonia's “Don't Buy This Jacket”). Despite its potential impact and unconventionality, research on GD in general is sparse, and no empirical research has examined consumer response to GD appeals relative to traditional green appeals. In three experiments, we find that, in the context of product advertising, consumers' attitudes for green ads are more favorable than those for GD ads, mediated by greater inferences of genuine environmental concern. However, we find the reverse pattern in the context of institutional ads. Further, an “anti-consumption amplifier” message embedded in the ad—espousing the potential harm of overconsumption—further boosts favorable consumer attitudes for the GD institutional ad relative to its traditional green counterpart. Importantly, we assess all effects while controlling for consumers' individual levels of green consumerism, such that implications may be applied more generally rather than to a specific segment of green consumers.     

Britt,Steuart Henderson. Psychological Principles of Marketing and Consumer Behavior. Lexington,Mass.: Lexington Books, 1978

Abstract

Conventionally, an advertiser's spending on the creative component of an advertising campaign is small in relation to the media budget and is channeled exclusively to a single advertising agency. Gross challenged those conventions more than 20 years ago, using a mathematical model of advertising effectiveness. His model suggested spending more on the creative component and doing so in a competition among several independent sources. The model assumed a normal distribution of effectiveness of advertisements. Data on response to consumer product ads show that the distribution of effectiveness is not normal, but quite skewed. Using Monté Carlo simulations and Gross's framework, the authors find that the skewness strengthens the case for competition. Shifting a sizable percentage of a campaign budget away from media spending and into competitive generation of creative renderings apparently can be very profitable.     

Consumer responses to different degrees of advertising adaptation: the moderating role of national openness to foreign markets

We investigate the moderating role of national openness to foreign markets on consumer responses (attitude to ad, brand and purchase intention) to different degrees of advertising adaptation in Belgium, Iran and India. We operationalize three levels of advertising adaptation (standardization, glocalization and adaptation) by manipulating the model (international versus local celebrity) and advertising copy (international versus local advertising copy). The results show that societies with a low openness to foreign markets respond more positively to fully adapted ads than to glocalized and standardized ads. The differences in responses decrease with national openness.     

From four hundred million to more than one billion consumers: a brief history of the foreign advertising industry in China

As an industry and a form of mass communication, modern advertising was introduced in China from the West at the turn of the century. The 1920s and 1930s witnessed China's first major exposure to foreign advertising and consumer culture. The 1990s may prove to be China's second encounter with global consumer culture through the medium of advertising; only this time, its experience is more massive and far-reaching. This article provides a capsule history of the development of the foreign advertising industry in China within the context of Chinese economy and media.     

A Cross-Country Investigation of Recall of and Attitude toward Comparative Advertising

Abstract

The author reports the results of an exploratory study of cross-country differences in recall of and attitude toward comparative advertising. As American companies are increasingly advertising their products in other countries, the issue of cross-country differences in comparative advertising effectiveness is very important. The study found that although recall of comparative ads was high, consumer attitudes toward comparative ads was not very positive, especially in countries where comparative ads are not widely used or are used rarely. Therefore, comparative ads should be targeted at other countries with caution.     

Pigott,Stanley. OBM/A Celebration: One Hundred and Twenty-Five Years in Advertising. London: Ogilvy,Benson & Mather Limited, 1975

Abstract

This study reports the results of a survey of advertising managers and editors of weekly and daily newspapers and of selected consumer magazines concerning the issue of feature advertising. Feature advertising is defined as paid advertising space that looks like editorial copy in the form of a short feature article. It was posited that this type of advertising might offer a unique challenge to the process of advertising self-discipline among print media. Ad managers and editors differed on a number of points, but agreed that questions pertaining to feature ads should be addressed through media self-discipline.     

Images paired with concrete claims improve skeptical consumers’ responses to advertising promoting a firm’s good deeds

Previous research has focused attention on state skepticism over corporate social responsibility (CSR) communications, but little work has focused on how to override preexisting differences in consumer skepticism. To gain insight into this issue, the present studies explore whether company ads promoting a firm’s good deeds generate more positive responses when the ads contain concrete claims and/or images related to the firm’s corporate social responsibility claims, and how these elements of the CSR communication interact with individual differences in advertising skepticism. Results show that highly skeptical consumers (a) respond less favorably to ads than less skeptical consumers, overall; (b) respond more favorably to ads that contain a combination of concrete claims and images supporting those claims; and (c) respond as favorably as less skeptical consumers when ads feature concrete claims with supporting images. Additional results suggest that images are effective among highly skeptical consumers because skeptical consumers have a reduced ability to visualize advertising claims. Implications and future research directions are discussed.     

The Skeptical Green Consumer Revisited: Testing the Relationship Between Green Consumerism and Skepticism Toward Advertising

This article revisits the widely believed notion of the skeptical green consumer, in other words, that green consumers tend to distrust green advertising. Study 1, a survey of U.S. consumers, found no positive relationship between green consumerism and general ad skepticism. However, green consumerism was negatively related to green advertising skepticism. Study 2, a survey of Austrian consumers, addressed the underlying mechanism of this negative relationship in a mediation analysis. It was shown that green consumers saw more informational utility in green ads than nongreen consumers did. This, in turn, decreased their green advertising skepticism. The emotional appeal of green ads, however, had no impact on green advertising skepticism. Findings suggest that the “dilemma for marketers who desire to target the green consumer” (Zinkhan and Carlson 1995, p. 5) is far less serious than previously thought.     

Evolution in the usage of localized appeals in Japanese and American print advertising

Based on global consumer culture theory, this empirical investigation examines how the usage of local appeals in Japanese and American advertising content has shifted over a period of nearly three decades. It replicates and improves upon Mueller’s investigation (Journal of Advertising Research, 1987, 27(3)). Content analysis determined the existence or absence of five traditionally Japanese appeals vs five traditionally Western appeals in 2005 issues of women’s, general interest, business and sports magazines published in each country. A total of 899 US ads and 853 Japanese ads were collected. Japanese advertisers appear to have turned to a rather more direct and persuasive selling approach, but continue to maintain a tradition of Japanese subtlety. American ads have shifted from a hard-hitting and aggressive strategy to a more benefit-orientated strategy with a distinctly softer touch. Appeals employed, however, were found to vary with the product category promoted. Overall, findings suggest that while Japanese advertising may have become somewhat more ‘American’, American advertising appears to have become significantly more ‘Japanese’. Possible future convergence between Eastern and Western advertising has implications for international marketers as they craft messages to appeal to these audiences.     

Remembering the Good Old Days: The Moderating Role of Consumer Affective State on the Effectiveness of Nostalgic Advertising

Employing different experimental priming procedures and advertising treatments across two studies, we examine the moderating role of consumer affective state on individuals’ responses to nostalgic and nonnostalgic advertising. Consistent with hypothesized expectations, our findings indicate that when consumers are in a positive affective state they respond more favorably (i.e., report more positive memories and favorable brand-related responses) to nostalgic (versus nonnostalgic) ads. In contrast, one's negative affective state appears to play a limited role in affecting responses between ad types. The theoretical implications of these findings as they relate to nostalgic advertising effects are discussed, and recommendations for advertising practitioners are offered.     

Hope and self-regulatory goals applied to an advertising context : Promoting prevention stimulates goal-directed behavior

This article proposes the existence of two types of hope which differ in terms of self-regulatory goals: prevention hope and promotion hope. Consistent with the functional emotion approach and regulatory focus theory, we show that prevention hope generates more goal-directed behavior compared to promotion hope. Next, we replicate these findings in an advertising context. Results from three experiments show that prevention hope ads lead to more goal-directed consumer behaviors like (1) greater memory for product information, (2) greater willingness to test the advertised product, and (3) more intentions to focus on product information and undertake product-related action than promotion hope ads.     

Consumer Skepticism of Claims in Food Ads vs. on Food Labels: An Exploration of Differences and Antecedents

Considerable evidence shows that consumers are skeptical of advertising, that is, have a tendency to doubt the truth of advertising claims. The main focus of our paper is to explore, in the context of food products, whether this typically high level of skepticism is also exhibited for product labels. In addition, we look at consumer skepticism associated with health claims in food ads and labels as well as with the Nutrition Facts Panel on food packages. Finally, we examine some individual difference factors that might influence consumer skepticism. We report the results of a large‐scale survey designed to explore these issues, and we discuss the implications of our findings for public policy and future research.     

Advertising Management: Its Role in Marketing. Sachs,William S. Tulsa,Oklahoma: PennWell Books, 1983

Abstract

The advertising literature contains some evidence that offensive advertising is multidimensional in nature, but little is known about the character of these dimensions. In an exploratory study of TV advertising, two different dimensions of “offensive” were identified. These dimensions were labeled Offensive Products and Offensive Execution. This distinction is important both for the study of the construct as well as for advertisers who are faced with decisions on advertising execution. The Offensive Products dimension contains those products related to consumer problems which social norms dictate should not be discussed in public. The Offensive Execution dimension, the dimension over which the advertiser has more control, consists of those ads which are perceived to be offensive by the nature of the execution or themes and/or topics of the ad and not the product itself.     

Consistency and commonality in advertising content: Helping or Hurting?

Scholars and practitioners widely argue that strong, successful brands are built on consistent and unique positioning, which should be reflected in the brands’ advertising. Surprisingly, however, little empirical evidence supports this claim, especially with regard to advertising content. The authors investigate whether and to what extent brands’ advertising content consistency—the similarity in the firm’s own advertising content over time—and commonality—the similarity between the firm’s and competitors’ advertising content—affect brands’ sales. Insights emerge from the analysis of the impact on sales of the content of 247 television ads aired by 33 brands in six consumer packaged goods categories over a four-year period. Results indicate that more than advertising spending, both consistency and commonality in advertising content affect sales, especially with respect to long-term cumulative sales. However, brands differ considerably regarding the direction of the effects. While small brands tend to benefit from increased consistency and commonality in advertising content, large brands tend to suffer from increased consistency. Thus, whether consistency and commonality in advertising content will help or hurt depends on the size of the brand.