Download Measuring Advertising Effectiveness

Marketing
Measuring Advertising Effectiveness
not enough tools
many managers believe simply not
possible to measure short term
success; rely on promotions for
short term measurable returns
●
Measuring: some tools
test market
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PLUS ÇA CHANGE
●
Recent ad industry seminar
on ‘maximising advertising
effectiveness’ included
sessions on setting budgets,
paying the agency, using
media, production; but
nothing on measuring ad
effectiveness...
Obstacles to measuring
ad effectiveness
●
theory: long-term gains
unlikely unless campaign
generates short-term sales
●
large sample of households
measure TV ads: electronic
devices measure number of ads
for a specific brand each
householder sees
lack of consensus
little agreement on how
advertising works and time frame
●
too many players
often with competing agendas;
stated beliefs of clients and
agencies poles apart: clients think
ad agencies only in it for creative
awards; agencies think clients
don’t appreciate their talent and
often oppose measurement
●
household purchases analysed
●
difference between number
households that bought brand
after seeing ad, and those that
bought without seeing the ad
is the STAS (short-term
advertising strength)
●
focus groups
‘advertising awareness’
discussions measure only
number and change of
awareness or recall of TV ads
neural networks
claimed to be faster, more
sensitive and more accurate
than statistical techniques
●
●
use PC-based computer systems
loosely modelled on how
human brain works; network
‘learns’ by being given examples
●
can recognise patterns in vast
amounts of data, detect subtle
relationships between, say, sales
trends and ad spending
●
although better at identifying
relationships with past data,
may be just as inaccurate a
predictor as old-style modelling
●
even strongest proponents say
this technique cannot be taken
at face value or used in isolation
value creation
●
more integrated but more
theoretical view
●
clarify relationship between £
ad spend and £ economic
value; set return targets similar
to other capital spending
●
aim for customer retention not
just acquisition eg include
lifetime value of customer in
calculation of economic value
●
●
not enough facts
lack of hard, reliable appropriate
information with which to
measure effectiveness
●
fine for large fmcg and TV;
more difficult to test response
in national magazines,
business/trade press, or for
capital items eg cars, white
goods
statistical techniques
one way:
●
too many goals
often ‘change perceptions’,
‘maintain awareness’, ‘reinforce
brand loyalty’, ‘influence
frequency’, ‘entertain’, ‘persuade’
‘inform’, ‘amuse’, all stated as
goals at once
eg TV ad in one region;
compare directly sales in that
region with others where no
advertising
sales response modelling
● must adjust for factors like
weather, seasonal demand,
counter-marketing by
competitors, price changes,
point-of-sale promotion, shelf
space, placement (eg retailers
stocking more or placing better
in anticipation of ad)
controversy raging in industry
whether enough correlation
between increased awareness
and increases in actual
purchase
BMW, winner of last year’s
Advertising Effectiveness
Award, spent £91m on UK
advertising from 1980-1993.
Sales trebled over period,
while European average
sales fell 45%.
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TEL: 01737 247357 FAX: 01737 226651
© BULLETPOINT – JULY/AUGUST 1995
Airtime costs are rising. Audiences
are falling. Print prices continue
to climb steeply. Companies say
that ads via TV, radio, press,
posters must now more than ever
prove their worth. Problem
remains: advertising is a very
costly activity which often defies
tight analysis; if a campaign
succeeds or fails you don’t always
know why.
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