Many studies have quantified the effects of TV ad spending or gross rating points on brand sales. Yet this effect is likely moderated by the different types of brand-related messages or cues (e.g., logo, brand attributes) embedded in the ads and by the ways (e.g., explicitly or implicitly) these cues are conveyed to TV audiences. The authors thus measure 17 cues often used within ads to build brand awareness (or salience) and brand image and investigate their influence on ad effectiveness. Technically, the study builds a dynamic model to quantify the effects of advertising on sales; builds a robust and interpretable (i.e., nonparametric and sparse) factor model that integrates correlated, left-censored branding cues; and then models the effects of advertising as a function of the factors identified by these cues. An analysis of 177 campaigns aired by 62 brands finds that salience cues (e.g., logo) and benefit and attribute messages moderate ad effectiveness. It also finds that explicit cues are more effective than implicit ones; nonetheless, the primary drivers of ad effectiveness are visual salience cues: the duration and frequency with which the logo and the duration with which the product are displayed. The study can thus suggest ways brand and ad agency managers can improve the effects of creative ad content on sales.
AngristJoshua D.PischkeJörn-Steffen (2009), Mostly Harmless Econometrics: An Empiricist’s Companion. Princeton, NJ: Princeton University Press.
2.
AtamanM. Berkvan HeerdeHarald J.MelaCarl F. (2010), “The Long-Term Effect of Marketing Strategy on Brand Sales,” Journal of Marketing Research, 47 (6), 793–806.
3.
BakerWilliam E.HoneaHeatherRussellChristel A. (2004), “Do Not Wait to Reveal the Brand Name,” Journal of Advertising, 33 (3), 77–85.
4.
BassFrank M.BruceNorris I.MajumdarSumitMurthiB.P.S. (2007), “Wearout Effects of Different Advertising Themes: A Dynamic Bayesian Model of the Advertising-Sales Relationship,” Marketing Science, 26 (2), 179–95.
5.
BatraRajeevKellerKevin (2016), “Integrating Marketing Communications: New Findings, New Lessons, and New Ideas,” Journal of Marketing, 80 (6), 122–45.
6.
BeckerMarenWiegandNicoReinartzWerner J. (2019), “Does It Pay to Be Real? Understanding Authenticity in TV Advertising,” Journal of Marketing, 83 (1), 24–50.
7.
BelchGeorge E.BelchMichael A. (2009), Advertising and Promotion, 8th ed. New York: McGraw-Hill International Edition.
BlackwellDavidMacQueenJames B. (1973), “Ferguson Distributions via Polya Urn Schemes,” The Annalys of Statistics, 1 (2), 353–55.
10.
BookAlbert C.SchickC.D. (1997), Fundamentals of Copy and Layout. Lincolnwood, IL: NTC/Contemporary Publishing Group.
11.
BruceNorris I. (2019), “Nonparametric Bayesian Dynamic Methods: Applications to Linear and Nonlinear Advertising Models,” Journal of Marketing Research, 56 (2), 210–29.
12.
BruceNorris I.MurthiB.P.SRaoR. (2017), “A Dynamic Model for Digital Advertising: The Effects of Creative Formats, Message Content and Targeting Engagement,” Journal of Marketing Research, 54 (2), 202–18.
13.
BruceNorris I.PetersKayNaikPrasad A. (2012), “Discovering How Advertising Grows Sales and Builds Brands,” Journal of Marketing Research, 49 (6), 793–806.
14.
CameronA. ColinTrivediPravin K. (2005), Microeconomics: Methods and Applications. New York: Cambridge University Press.
15.
CarvalhoCarlosChangJefferyLucasJoseph E.NevinsJoseph (2008), “High-Dimensional Sparse Factor Modeling in Gene Expression Genomics,” Journal of the American Statistical Association, 103 (484), 1438–56.
16.
ChattopadhyayAmitavaBasuKunal (1990), “Humor in Advertising: The Moderating Role of Prior Brand Evaluation,” Journal of Marketing Research, 27 (4), 466–76.
17.
CunhaFlavioHeckmanJames J.SchennachS.M. (2010), “Estimating the Technology of Cognitive and Non-Cognitive Skill Formation,” Econometrica, 78 (3), 883–931.
18.
DraganskaMichaelaHartmannWesley R.StangleinGena (2014), “Internet Versus Television Advertising: A Brand-Building Comparison,” Journal of Marketing Research, 50 (5), 578–90.
19.
EastlackJoseph O.JrRaoAmbar G. (1989), “Advertising Experiments at the Campbell Soup Company,” Marketing Science, 8 (1), 57–71.
20.
EdellJulia A.BurkeMarian Chapman (1987), “The Power Feelings in Understanding Advertising Effects,” Journal of Consumer Research, 14 (3), 421–33.
21.
ElliottRichardPercyLarry (2007), Strategic Brand Management. New York: Oxford University Press.
22.
EscobarMichael D.WestMike (1998), “Computing Nonparametric Hierarchical Models,” in Practical Non- and Semiparametric Bayesian Statistics, MüllerP.DeyD.SinhaD., eds. New York: Springer-Verlag, 1–22.
23.
GewekeJohnZhouGuofu (1996), “Measuring the Pricing Error of the Arbitrage Theory,” Review of Financial Studies, 9 (2), 557–87.
24.
HausmanJerry A. (1997), “Valuation of New Goods Under Perfect and Imperfect Competition,” in The Economics of New Goods, National Bureau of Economic Research Studies in Income and Wealth, Vol. 58, BresnahanTimothy F.GordonRobert J., eds. Chicago: University of Chicago Press, 209–47.
25.
HendersonPamela W.CoteJoseph A. (1998), “Guidelines for Selecting or Modifying Logos,” Journal of Marketing, 63 (2), 14–30.
26.
HjortNils L. (2010), Bayesian Nonparametrics, HolmesC.MüllerP.WalkerS. E., eds. New York: Cambridge University Press.
27.
JarqueCarlos M.BeraAnil K. (1987), “A Test for Normality of Observations and Regression Residuals,” International Statistical Review, 55 (2), 163–72.
28.
KaiserHenry (1958), “The Varimax Criterion for Analytic Rotation in Factor Analysis,” Psychometrika, 23 (3), 187–200.
KardesFrank R. (1988), “Spontaneous Inference Processes in Advertising: The Effects of Conclusion Omission and Involvement on Persuasion,” Journal of Consumer Research, 15 (2), 225–33.
31.
KaufmannSylviaSchumacherChristian (2019), “Bayesian Estimation of Sparse Dynamic Factor Models with Order-Independent and Ex-Post Mode Identification,” Journal of Econometrics, 210 (1), 116–34.
32.
KellerKevin L. (1993), “Conceptualizing, Measuring, and Managing Customer-Based Brand Equity,” Journal of Marketing, 57 (1), 1–22.
33.
KellerKevin L. (2007), “Advertising and Brand Equity,” in The SAGE Handbook of Advertising, TellisGerhard J.AmblerTim, eds. London: SAGE Publications, 54–70.
34.
KellerKevin L.LehmannDonald R. (2006), “Brands and Branding: Research Findings and Future Priorities,” Marketing Science, 25 (6), 740–59.
35.
KrippendorffKlaus (1980), Content Analysis: An Introduction to its Methodology. Beverly Hills, CA: SAGE Publications.
36.
LeeflangPeter S.H.WittinkDick R.WedelMichelNaertPhilippe A. (2000), Building Models for Marketing Decisions. Dordrecht, Netherlands: Kluwer Academic.
37.
LiaukonyteJuraTeixeiraThalesWilburKenneth C. (2015), “Television Advertising and Online Shopping,” Marketing Science, 34 (3), 311–330.
38.
LodishLeonard M.AbrahamMagidKalmensonStuart (1995), “How TV Advertising Works: A Meta-Analysis of 389 Real World Split Cable TV Advertising Experiments,” Journal of Marketing Research, 32 (2), 125–39.
39.
LoewensteinJeffreyRaghunathanRajagopalHeathChip (2011), “The Repetition-Break Plot Structure Makes Effective Television Advertisements,” Journal of Marketing, 75 (5), 105–19.
40.
LuZhao-HuaChowSy-MiinLokenEric (2016), “Bayesian Factor Analysis as a Variable Selection Problem: Alternative Priors and Consequences,” Multivariate Behavioral Research, 51 (4), 519–39.
41.
LucasJosephCarvalhoCarlos M.WangQuanliBildAndrea H.NevinsJoseph R.WestMichael A. (2006), “Sparse Statistical Modelling in Gene Expression Genomics,” in Bayesian Inference in Gene Expression and Proteomics, MüllerP.DoK.VannucciM., eds. Cambridge, UK: Cambridge University Press, 155–76.
42.
MacInnisDeborah J.RaoAmbar G.WeissAllen M. (2002), “Assessing When Increased Media Weight of Real-World Advertisements Helps Sales,” Journal of Marketing Research, 39 (4), 391–407.
43.
NaikPrasadRamanKalyan (2003), “Understanding the Impact of Synergy in Multimedia Communication,” Journal of Marketing Research, 40 (4), 375–88.
44.
ParkC. WhanJaworskiBernard J.MacInnisDeborah J. (1986), “Strategic Brand Concept-Image Management,” Journal of Marketing, 50 (4), 135–45.
PiatekRémiPapaspiliopoulosOmiros (2018), “A Bayesian Nonparametric Approach to Factor Analysis,” working paper, Department of Economics, University of Copenhagen.
RočkováVeronikaGeorgeEdward I. (2016), “Fast Bayesian Factor Analysis via Automatic Rotations to Sparsity,” Journal of the American Statistical Association, 111 (516), 1608–22.
49.
RomaniukJenni (2009), “The Efficacy of Brand–Execution Tactics in TV Advertising, Brand Placement, and Internet Advertising,” Journal of Advertising Research, 49 (2), 143–50.
50.
RossiPeter E. (2014), “Even the Rich Can Make Themselves Poor: A Critical Examination of IV Methods in Marketing Applications,” Marketing Science, 33 (5), 655–72.
51.
RossiPeter E.AllenbyGreg M.McCulloghRob (2005), Bayesian Statistics and Marketing. Hoboken, NJ: John Wiley & Sons.
52.
RossiterJohn R.PercyLarry (1997), Advertising Communications and Promotion Management. New York: McGraw-Hill.
53.
RossiterJohn R.BellmanSteven (2005), Marketing Communications: Theory and Applications. Upper Saddle River, NJ: Pearson Education.
54.
SawyerAlan G.HowardDaniel J. (1991), “Effects of Omitting Conclusions in Advertisements to Involved and Uninvolved Audiences,” Journal of Marketing Research, 28 (4), 467–74.
55.
SethuramanRajTellisGerard JBrieschRichard A., (2011), “How Well Does Advertising Work? Generalizations from Meta-Analysis of Brand Advertising Elasticities,” Journal of Marketing Research, 48 (3), 457–71.
56.
SotgiuFrancescaGielensKatrijn (2015), “Suppliers Caught in Supermarket Price Wars: Victims or Victors? Insights from a Dutch Price War,” Journal of Marketing Research, 52 (6), 784–800.
57.
SpiegelhalterDavid J.BestNicola G.CarlinBradley P.Van Der LindeAngelika (2002), “Bayesian Measures of Model Complexity and Fit,” Journal of the Royal Statistical Society: Series B (Statistical Methodology), 64 (4), 583–639.
58.
SrinivasanShubaVanhueleMarcPauwelsKoen (2011), “Mindset Metrics in Market Response Models: An Integrative Approach,” Journal of Marketing Research, 47 (4), 672–84.
59.
StewartDavid W.FurseDavid H. (1986), Effective Television Advertising: A Study of 1000 Commercials. Lexington, MA: Lexington Books.
60.
TeixeraThales S.WedelMichelPietersRik (2010), “Moment-to-Moment Optimal Branding in TV Commercials: Preventing Avoidance by Pulsing,” Marketing Science, 29 (5), 783–804.
61.
TellisGerard J. (2004), Effective Advertising: How, When, and Why Advertising Works. Thousand Oaks, CA: SAGE Publications.
Van HeerdeHaraldJ.GijsenbergMaarten J.DekimpeMarnikSteenkampJan-Benedict E.M. (2013), “Price and Advertising Effectiveness over the Business Cycle,” Journal of Marketing Research, 50 (2), 177–93.
64.
WestMike (2003), “Bayesian Factor Regression Models in the ‘Large p, Small n’ Paradigm,” in Bayesian Statistics 7, BernardoJ.M.BavarriM.J.BergerJ.O.DawidD.HeckermanA.P.SmithA.F.M., et al. eds. Oxford, UK: Oxford University Press.
65.
WuTsung WenDayRalph L.MacKayDavid B. (1988), “Consumer Benefits Versus Product Attributes: An Experimental Test,” Quarterly Journal of Business and Economics, 27 (3), 88–113.
66.
ZhuLi-PingYuZhouZhuLi-Xing (2010), “A Sparse Eigen-Decomposition Estimation in Semi-Parametric Regression,” Computational Statistics and Data Analysis, 54 (4), 976–86.
Supplementary Material
Please find the following supplemental material available below.
For Open Access articles published under a Creative Commons License, all supplemental material carries the same license as the article it is associated with.
For non-Open Access articles published, all supplemental material carries a non-exclusive license, and permission requests for re-use of supplemental material or any part of supplemental material shall be sent directly to the copyright owner as specified in the copyright notice associated with the article.
