Every business owner on earth has asked this question at some point or another… They lament, “does advertising really work? Am I wasting my money? Please, someone, explain to me how this all works.”
I will do my very best.
Professor Byron Sharp, Director of the Erenburg-Bass Institute and frequent speaker at the Wharton School of Business has done extensive research on the subject of advertising effectiveness. In his book “How Brands Grow” he answers our question quite clearly.
“Forty years of single-source-based data has delivered solid empirical evidence that brand advertising drives sales among those who are exposed to it. These results have held across a range of brands, categories, countries and data sets.”
Let me repeat that important caveat: Advertising works among those who are exposed to it.
In other words, your advertising’s never going to work on people who don’t see it. Seems like a no brainer! You gotta make some noise. You gotta be seen.
And yet, most ad campaigns reach so few people they have no chance of moving the needle. Just not enough eyeballs, or ears, on the ads to make a difference.
There’s also a self-defeating lack of frequency — ie, repetition — in most ad campaigns from small and medium-sized companies.
I’ve seen this too many times… A business owner says, “I tried TV ads, and they didn’t work.”
Then when I look at the details of the campaign I see that the ads reached very few people, very few times before the owner pulled the plug and made his definitive judgement on the entire affair.
Campaigns that are thin on both reach and frequency are what give advertising a bad name.
Advertising works when it’s executed in creative, unexpected ways.
Most of the business owners I’ve worked with want to see advertising that’s persuasive and chock full of information. But in the context of advertising, no one pays attention to reason. In fact, people are tremendously skeptical of any fact, claims or info you pack into an ad.
Don’t waste your breath. The fact is, facts will not produce effective advertising.
Instead, you need to leave a lasting impression by doing, showing or saying something completely unexpected and refreshing. Feelings trump facts every time.
So it’s not just what you say, it’s how you say it. In fact, research from Sharp and his team show that advertising works even when it’s not the least bit persuasive.
“Even advertising that says nothing persuasive and gives no new reasons to buy can have a dramatic impact on sales. But it does need to be distinctive… The European style of advertising… quirky, understated, indirect, unusual visual effects and the use of bizzare humor is often surprisingly effective.”
That’s the stuff that wins advertising awards and gets studied and copied by creative teams all over the world. We recognize it as “good work”, but business owners only see “risky.”
Price promotion advertising produces irrefutable results. But at what cost?
No one will argue the fact that promotional advertising moves the needle. When retailers run a big sale on a holiday weekend and make enough noise with their advertising, they make money.
Talk to any car dealer, mattress retailer or furniture store about that. The ROI is well known and repeatable.
So yes, promotional advertising really works. But the benefits of that advertising do not last. It’s a short-term, adrenalin-producing blip in the sales data. And if you start running sale ads every other weekend, even the short-term high begins to diminish.
Like a bad drug.
If all you want is a short-term fix, then go ahead and do nothing more than ads that scream SALE, SALE, SALE! But if you want your advertising to produce consistent brand growth over time, price point ads cannot be your only approach.
The most successful CMOs who maintain consistent brand growth year after year have a nice balance of brand advertising AND promotional advertising. Do both!
Advertising works by triggering associative memory.
Here’s a common scenario…
Someone gets a glimpse of an ad. It doesn’t even register the first time, or the second, or the third. (The human brain doesn’t remember anything as unimportant as advertising unless it’s exposed to the message multiple times.)
Ads have to be seen, heard and experienced over and over and over again.
Later that day she’s in the grocery store (or shopping online) trying to choose a reasonable bottle of wine, and she stumbles across a reminder of some kind — a distinctive brand asset that was in the ads — that cues her to pick up a certain brand.
She didn’t walk into the store with “brand purchase intent.” She remembers nothing about the ad content or the mission of the company behind the product. She’s not convinced of anything. However, she was primed to say “what hell, it’s worth a try.”
So with enough repetition, brand advertising works to get that one bottle of wine into the shopping cart one time. And you never know when that might happen. It could be weeks, months or even years after exposure.
In other words, good, old-fashioned top-of-mind awareness still works.
That means you need as many touch points, as many times, with as many people as you can possibly afford. It’s not easy, and yes, it takes a sustained commitment to a substantial budget.
“One of the hardest ongoing battles any marketer faces is to get occasional customers and non customers to think about their brand,” Sharp said.
You can’t just talk to a narrow niche of loyal customers and expect to see large returns on your advertising investment.
Advertising works as defense against aggressive competitors.
Sharp says, “There is plenty of empirical evidence that shows brand advertising does produce sales, but it’s hard to see the effect in sales reports because the results are spread out over a long time period.”
So a solid mix of long term brand advertising PLUS some short-term promotional campaigns will keep brands cruising along at their current levels.
He uses an airliner analogy… “The sales of a brand are like the cruising altitude at which an airliner flies. Ad spend is like the plane’s engines… while the engines are running, everything’s fine. But when the engines stop, the descent inevitably starts.”
No business owner or CMO wants to be the one to test that theory by pulling the plug and going silent on every front. I’d love to see a sales and market-share study of 100 businesses that were willing to do that.
Any volunteers???
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