Lecture 2: Flashcards
what are the mean brand advertising elasticities?
- short term = .12
- long term = .24
most important takeaway is that they are less than 1%.
advertising elasticity
the percentage increases in sales for a 1% increase in advertising costs.
when is advertising elasticity lower?
- over time (declines over time)
- lower for non-durable goods than durable
- lower in the mature stage of product life than the early stages.
how have these price elasticties changed compared to earlier in history?
we see a decline.
- previous short term was .22
- previous long term was .41
why have the advertising elasticities declined
- market characteristics (internet for example)
- research methods
- different consumer response
Sex and violence draw attention?
key points from “do sex and violence sell?”
propose they get humans attention because of evolution, which takes away form other things like brand memory and therefore buying intention.
-> but attention is not the same as purchase intention
effects on brand memory with both sex and violence (meta analysis)
key points from “do sex and violence sell?”
- media; reduces memory for the brand presented in the ad
- ad; no significant effect
- congruent: brand memory increases
- Incongruent: brand memory decreases
effect on brand attitudes
key points from “do sex and violence sell?”
on average it decreases in both the media and the ad.
effect on buying intention
key points from “do sex and violence sell?”
aggregated both sex and violence
- media had significant decrease
- ad had again no significant effect
- congruency has positive effect
conclusion from both articles?
- advertising has a small effect in sales and violence and sex in media or ads “does not sell”
- advertising is probably more effective when a product is novel, durable and media and ad content are congruent.
