The impact of advertising campaign content on product brand sales

• Applicants: Dr. Monika Käuferle; Professor Werner Reinartz, Ph.D.
• Subject Area: Accounting and Finance
• Term: from 2014 to 2015
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 256554923

In todays competitive market environment, firms invest significant sums in advertising in order to position their brands and to generate sales. For example, Unilever spent $8.6 billion on advertising in 2012 and its main competitor P&G invested even $9.3 billion. Despite recent strong growth of mobile- and internet-advertising, the largest share of investment is still spent on television advertising (Nielsen Media Research 2012). In fact, companies continuously spend more on television advertising each year and this trend is expected to continue (Nielsen Global AdView 2011). At the same time, marketers are more and more under pressure to justify their advertising spending and to reveal the return on marketing investment (Rust 2004).Thus, it does not come as a surprise that much research has been examining the effects of TV advertising spendings on product sales or market share (Assmus, Farley, and Lehmann 1984, Sethuraman, Tellis, and Briesch 2011). Whereas the key finding from these meta-analyses is that advertising spendings do have a positive effect on sales, findings on the magnitude of this effect are decidedly mixed. One reason for this phenomenon could be that prior research did not or at least not sufficiently consider the content of television advertising in their analysis, even though advertising can differ greatly with respect to their content (e.g. with regard to creativity, informational content, visual and verbal complexity, the use of humor or brand prominence) (Tellis 2009). Thus, it can be assumed that specifically these content factors moderate the effect of television advertising on sales (Chandy et al. 2001).The proposed study investigates the effect of different content factors on television advertising effectiveness in a systematic and comprehensive manner. Moreover, as the impact of the content factors might depend on the specific context, the study also analyzes how these moderating effects vary across different product categories (e.g. low vs. high involvement) as well as types of brands (e.g. new vs. established or utilitarian vs. hedonic). Specifically the following research questions will be answered within the scope of this study:  1. Which content factors moderate the effect of television advertising on brand sales (in the context of fast moving consumer goods)? 2. Which combination of the various content factors reveals the largest effect on television advertising effectiveness? 3. To what extent does the effect of various content factors differ across product categories (e.g. low vs. high involvement) and types of brands (e.g. new vs. established or utilitarian vs. hedonic)?

• DFG Programme: Research Grants