TV Advertising Effectiveness and Profitability

Post by reader_mode » Tue, Jul 27, 2021, 7:31 PM UTC

slg wrote: post #60

hammock wrote: post #27

There is a fundamental misunderstanding (intentional or not) with these types of studies and claims. Limited-time promotions, e.g. a 10% off sale, work on short timescales that are easily measured. You can easily say what the ROI is of an advertised promotion, and it is often positive. (Side note, these promotions have a more-difficult-to-measure detrimental effect on your long-term profitability, closely related to…

>Brand advertising, in contrast, works on a spread-out scale of years or decades...The actual effect that a brand advertisement has, is to add PENNIES (not dollars) to their sales every day, for the next 100 YEARS. It's a long-term investment. And for these reasons hard if not impossible to measure or control for confounders - but that doesn't mean it doesn't work!! Car brands are the obvious example of brand adverti…

Post by ghaff » Tue, Jul 27, 2021, 7:35 PM UTC

andreilys wrote: post #32

hammock wrote: post #27

There is a fundamental misunderstanding (intentional or not) with these types of studies and claims. Limited-time promotions, e.g. a 10% off sale, work on short timescales that are easily measured. You can easily say what the ROI is of an advertised promotion, and it is often positive. (Side note, these promotions have a more-difficult-to-measure detrimental effect on your long-term profitability, closely related to…

And for these reasons hard if not impossible to measure or control for confounders - but that doesn't mean it doesn't work!! One of the ways that advertisers and marketing people stay employed is they say that the output of their effort and money spent is not quantifiable.

Post by yKnoTho » Tue, Jul 27, 2021, 7:36 PM UTC

hammock wrote: post #27

There is a fundamental misunderstanding (intentional or not) with these types of studies and claims. Limited-time promotions, e.g. a 10% off sale, work on short timescales that are easily measured. You can easily say what the ROI is of an advertised promotion, and it is often positive. (Side note, these promotions have a more-difficult-to-measure detrimental effect on your long-term profitability, closely related to…

Post by long_time_gone » Tue, Jul 27, 2021, 7:39 PM UTC

hengri wrote: post #72

long_time_gone wrote: post #59

Earlier quoted context omitted.

==One of the ways that advertisers and marketing people stay employed is they say that the output of their effort and money spent is not quantifiable.== It gets quantified as "Goodwill" any time a company is valued (acquisition, IPO, investment, etc.) or releases financial statement (it's on the balance sheet). Coca-Cola is coming up a lot in this discussion. They have Goodwill of $17.7 billion, along with additional…

I was under the impression that marketing costs fall under a cost of revenue column and goodwill is just a BS account item to account for differences in money spent and 'market value' during m&a. See https://www.investopedia.com/terms/g/goodwill.asp

Post by slg » Tue, Jul 27, 2021, 7:40 PM UTC

reader_mode wrote: post #71

slg wrote: post #60

Earlier quoted context omitted.

>Brand advertising, in contrast, works on a spread-out scale of years or decades...The actual effect that a brand advertisement has, is to add PENNIES (not dollars) to their sales every day, for the next 100 YEARS. It's a long-term investment. And for these reasons hard if not impossible to measure or control for confounders - but that doesn't mean it doesn't work!! Car brands are the obvious example of brand adverti…

And yet the most valuable car company in the world (for whatever that's worth) spends 0 on advertising and sells everything they can produce.