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Marketing Letters

, Volume 25, Issue 2, pp 193–206 | Cite as

Modeling advertising impact at campaign level: Empirical generalizations relative to long-term advertising profit contribution and its antecedents

  • Philippe AurierEmail author
  • Anne Broz-Giroux
Article

Abstract

Research on advertising effectiveness is focused on sales and provides few empirical generalizations on profitability and its antecedents. To fill this gap, we develop an econometric model to capture the impact of advertising at campaign level, using retail panel data coupled with TV audience tracking data. Our study involves 31 brands from six packaged goods categories observed weekly and nationally over 4 years and representing 264 TV campaigns. Although we confirm empirical generalizations on the capacity of advertising to increase sales, we establish a different picture for profitability. Only 11 % of campaigns make a positive contribution to profit. Advertising is more profitable for challengers and medium brands, whereas leaders and small brands (recent or established) have a lower profitability. Advertising intensity in the category and campaign carry-over emerge as the strongest (respectively) negative and positive drivers of profitability. The antecedents of carry-over are also analyzed and discussed.

Keywords

Advertising campaign Campaign profitability antecedents Advertising carry-over Advertising Adstock Advertising econometric model 

Notes

Acknowledgments

The authors thank IRI France for supplying the data, and the LabEx Entreprendre for financial support. They also thank Professor J.P. Couderc and the anonymous ML reviewers for their helpful comments.

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Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.School of Business Administration, Montpellier Research in ManagementUniversity of Montpellier2MontpellierFrance
  2. 2.IRIChambourcy CedexFrance

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