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Advertising Effectiveness

By Peter J. Danaher

The internet has enabled many business developments, but it has turned media allocation and planning on its head. In traditional mass media like television, advertisers can purchase a commercial slot and expect large audiences.

However, many of those reached are not interested in the advertised product or service, so a large percentage of those exposed to advertising do not respond to the message. In digital advertising, websites containing specialized content (e.g., model airplanes) allow advertisers to display their products to loyal and attentive audiences. In the social media space, Facebook delivers ad content to ideal target audiences by examining the web activity of users and their networks. Paid search advertising sends firms customers who are already “in the market” for their products, as indicated by their keyword use.

Over the past 15 years, television channels have grown in number. But the more significant change has been the exponential growth in websites supporting themselves with advertising, not to mention the rapid uptake of paid search advertising.

Advertisers have moved to new digital media outlets not only because of their ability to target customers, but also their lower cost compared to traditional media. Furthermore, digital media allows firms to connect ad exposures and search clicks to downstream sales, a feature Danaher and Dagger (2013) suggest eludes traditional media. Sethuraman, Tellis, and Briesch (2011) show the most convincing way for firms to demonstrate advertising’s effectiveness is by linking the effort to sales. In turn, researchers can use two methods to assess advertising effectiveness: field experiments and econometric models.

Field Experiments

Targeting and retargeting customers who are more likely to respond to offers, an increasingly common practice, makes advertising appear more effective than it is. Lambrecht and Tucker (2013) , in an award-winning Journal of Marketing Research paper, reported a comparison of advertising response between customers exposed to standard banner ads and retargeted banner ads showed the ads displaying products previously viewed were six times more effective at generating sales. However, the consumers receiving retargeted ads had already demonstrated product predilection. The researchers therefore randomly assigned consumers to a treatment group seeing retargeted, product-specific ads and a control seeing generic product category ads. They found the retargeted ads were less effective than the generic ads, as the customers were in different stages of the purchase funnel, and while retargeted ads work well near purchase, they are not effective for the larger group of customers embarking on their search.

The use of field experiments to determine ad effectiveness has subsequently blossomed, with studies using “ghost ads” on Google ( Johnson, Lewis, and Nubbemeyer 2017 ) and Facebook ( Gordon et al 2019) to create randomized control groups. For example, Sahni (2016) used a field experiment to show digital ads for one restaurant increased sales at competing restaurants offering similar cuisine.

In every case, these field experiments have shown that advertising effects are often difficult to detect. For example, the study of Facebook ads by Gordon and colleagues (2019) examined 15 campaigns and found that only eight produced a statistically significant lift in sales.

Econometric Models

The studies by Johnson, Lewis, and Nubbemeyer and Gordon and colleagues also highlight the challenges of designing an experiment to assess digital ad effectiveness. Individual customers use the internet in different ways, and providers deliver digital ads via unique online auction processes. Econometric models therefore provide a versatile approach to gauging advertising effectiveness. And while field experiment studies have been limited to examining one medium at a time, econometric models allow researchers to compare effectiveness across several media.

Researchers can use econometric models to examine time series data, such as weekly or monthly advertising and sales records. Dinner, van Heerde, and Neslin (2014) studied traditional and digital advertising’s effects on in-store and online sales for an upscale clothing retailer across 103 weeks. The retailer made about 85% of its sales in-store, and the researchers examined three media: traditional (i.e., total spend on newspapers, magazines, radio, television, and billboards), online banner advertising, and paid search. They found online display and paid search were more effective than traditional advertising. Although firms might expect digital advertising to influence only online sales, the researchers found it also influenced in-store sales.

Researchers can also use econometric models to examine single-source data linking individual-level ad exposure to sales, the strategy employed by Danaher and Dagger in 2013. They examined 10 media types employed by a large retailer: television, radio, newspaper, magazines, online display ads, paid search, social media, catalogs, direct mail, and email. The researchers found traditional media and paid search effectively generated sales, while online display and social media advertising did not.

Multimedia, Multichannel, and Multibrand Advertising

Danaher and colleagues (2020) also used single-source data but extended it to multiple retailer-brands, two purchase channels, and three media (email, catalogs, and paid search). They collected the data from a North American specialty retailer selling mostly apparel, where 80% of sales were in-store. The parent retailer owned three relatively distinct brands operating independently. They collected customer data in a combined database, giving them information on sales for each retailer-brand over a two-year period.

The researchers found emails and catalogs from one retailer-brand negatively influenced competing retailer-brands in the category. Paid search influenced only the focal retailer-brand. However, competitor catalogs often positively influenced focal retailer-brand sales among omni-channel customers. The researchers also segmented customers by retailer-brand and channel usage, revealing customers shopping across multiple retailer-brands and both purchase channels were the most responsive group to multimedia advertising.

In the contemporary business environment of ever-increasing media channels but static advertising budgets, firms must be able to measure advertising effectiveness. Many businesses have shifted their advertising expenditure toward digital media, but multiple studies show traditional media remain effective.

How do marketing managers decide what is best for their companies? Digital media firms like Google and Facebook offer in-house field experiment methods of examining advertising effectiveness. For multimedia studies, analysts can apply econometric models in any setting where time series or single-source data are available.

Peter Danaher is Professor of Marketing and Econometrics and Department Chair at Monash Business School in Melbourne, Australia. He was recently appointed a co-editor of the Journal of Marketing Research .

Danaher, Peter J. (2021), “Advertising Effectiveness,” Impact at JMR , (January), Available at: https://www.ama.org/2021/01/26/advertising-effectiveness/

Danaher, Peter J., and Tracey S. Dagger (2013), “Comparing the Relative Effectiveness of Advertising Channels: A Case Study of a Multimedia Blitz Campaign,” Journal of Marketing Research , 50(4): 517-534. https://doi.org/10.1509/jmr.12.0241

Danaher, Peter J., Tracey S. Danaher, Michael S. Smith, and Ruben Laoizo-Maya (2020), “Advertising Effectiveness for Multiple Retailer-Brands in a Multimedia and Multichannel Environment,” Journal of Marketing Research , 57(3): 445-467. https://doi.org/10.1177/0022243720910104

Dinner, Isaac, Harald J. van Heerde, and Scott A. Neslin (2014), “Driving Online and Offline Sales: The Cross-channel Effects of Traditional, Online Display, and Paid Search Advertising,” Journal of Marketing Research , 51(5): 527-545. https://doi.org/10.1509/jmr.11.0466

Gordon, Brett R., Florian Zettelmeyer, Neha Bhargava, and Dan Chapsky (2019), “A Comparison of Approaches to Advertising Measurement: Evidence from Big Field Experiments at Facebook,” Marketing Science , 38(2): 193-225. https://doi.org/10.1287/mksc.2018.1135

Johnson, Garrett A., Randall A. Lewis, and Elmar I. Nubbemeyer (2017), “Ghost Ads: Improving the Economics of Measuring Online Ad Effectiveness,”  Journal of Marketing Research , 54(6): 867-84. https://doi.org/10.1509/jmr.15.0297

Lambrecht, Anja, and Catherine Tucker (2013), “When Does Retargeting Work? Information Specificity in Online Advertising,” Journal of Marketing Research , 50 (October): 561-576. https://doi.org/10.1509/jmr.11.0503

Sahni, Navdeep S. (2016), “Advertising Spillovers: Evidence from Online Field Experiments and Implications for Returns on Advertising,” Journal of Marketing Research , 53(4): 459-78. https://doi.org/10.1509/jmr.14.0274

Sethuraman, Raj, Gerard J Tellis, and Richard A. Briesch (2011), “How Well Does Advertising Work? Generalizations from Meta-Analysis of Brand Advertising Elasticities,” Journal of Marketing Research , 48 (June): 457-471. https://doi.org/10.1509/jmkr.48.3.457

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Advertising Research

• First Online: 13 January 2024

Cite this chapter

• Manukonda Rabindranath 3 &
• Aradhana Kumari Singh 4  

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This chapter gives an overview of conducting research in the field of advertising. Research is very vital for any business entity and companies. But when it comes to creative field like advertising research plays a significant role in producing creative content that instantly grab the attention of its incidence. Creativity is the heart of advertising while research is the backbone of advertising. Without appropriate research, even creativity also fails. Advertising promotes products and brands to increase sales of the advertised products or brands. Without proper research, it is difficult to achieve advertising goals and objectives. Research helps to understand the nature of potential target consumers very well. It is extremely needed to identify prospective consumers and to understand their buying behaviour. What influence them to prefer one product over the other product of the same category? The answer to this question lies in research. Research is also important to evaluate the effectiveness of the ad. It is also vital to find out the result of the efforts put into the advertising campaign. Advertisers spend a lot of money on advertising every year. Because of this, it is important to evaluate how well the advertising copy and the final ad work to influence consumers and get a good response to the advertised products. Marketers have a firm belief that the process of advertising that is not backed by research activities is a waste of time and effort. Research activities in advertising are usually performed by advertising agencies on the demand of their clients. There is an individual department that only deals in research activities about planning, preparation, placement and evaluation of advertising campaigns. In this chapter, we are going to learn about the basics of advertising research and what techniques and methods are involved in advertising research. This chapter's objective is to provide both theoretical and practical knowledge of advertising research. A case study of the Beti Bachao Beti Padhao (BBBP) (Save daughter, educate daughter.) advertising campaign is provided at the end of the chapter to demonstrate how post-test research in advertising is conducted.

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Manukonda Rabindranath

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Aradhana Kumari Singh

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Rabindranath, M., Singh, A.K. (2024). Advertising Research. In: Advertising Management. Palgrave Macmillan, Singapore. https://doi.org/10.1007/978-981-99-8657-6_7

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U.S. Tightens Rules on Risky Virus Research

A long-awaited new policy broadens the type of regulated viruses, bacteria, fungi and toxins, including those that could threaten crops and livestock.

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By Carl Zimmer and Benjamin Mueller

The White House has unveiled tighter rules for research on potentially dangerous microbes and toxins, in an effort to stave off laboratory accidents that could unleash a pandemic.

The new policy, published Monday evening, arrives after years of deliberations by an expert panel and a charged public debate over whether Covid arose from an animal market or a laboratory in China.

A number of researchers worried that the government had been too lax about lab safety in the past, with some even calling for the creation of an independent agency to make decisions about risky experiments that could allow viruses, bacteria or fungi to spread quickly between people or become more deadly. But others warned against creating restrictive rules that would stifle valuable research without making people safer.

The debate grew sharper during the pandemic, as politicians raised questions about the origin of Covid. Those who suggested it came from a lab raised concerns about studies that tweaked pathogens to make them more dangerous — sometimes known as “gain of function” research.

The new policy, which applies to research funded by the federal government, strengthens the government’s oversight by replacing a short list of dangerous pathogens with broad categories into which more pathogens might fall. The policy pays attention not only to human pathogens, but also those that could threaten crops and livestock. And it provides more details about the kinds of experiments that would draw the attention of government regulators.

The rules will take effect in a year, giving government agencies and departments time to update their guidance to meet the new requirements.

“It’s a big and important step forward,” said Dr. Tom Inglesby, the director of the Johns Hopkins Center for Health Security and a longtime proponent of stricter safety regulations. “I think this policy is what any reasonable member of the public would expect is in place in terms of oversight of the world’s most transmissible and lethal organisms.”

Still, the policy does not embrace the most aggressive proposals made by lab safety proponents, such as creating an independent regulatory agency. It also makes exemptions for certain types of research, including disease surveillance and vaccine development. And some parts of the policy are recommendations rather than government-enforced requirements.

“It’s a moderate shift in policy, with a number of more significant signals about how the White House expects the issue to be treated moving forward,” said Nicholas Evans, an ethicist at University of Massachusetts Lowell.

Experts have been waiting for the policy for more than a year. Still, some said they were surprised that it came out at such a politically fraught moment . “I wasn’t expecting anything, especially in an election year,” Dr. Evans said. “I’m pleasantly surprised.”

Under the new policy, scientists who want to carry out experiments will need to run their proposals past their universities or research institutions, which will to determine if the work poses a risk. Potentially dangerous proposals will then be reviewed by government agencies. The most scrutiny will go to experiments that could result in the most dangerous outcomes, such as those tweaking pathogens that could start a pandemic.

In a guidance document , the White House provided examples of research that would be expected to come under such scrutiny. In one case, they envisioned scientists trying to understand the evolutionary steps a pathogen needed to transmit more easily between humans. The researchers might try to produce a transmissible strain to study, for example, by repeatedly infecting human cells in petri dishes, allowing the pathogens to evolve more efficient ways to enter the cells.

Scientists who do not follow the new policy could become ineligible for federal funding for their work. Their entire institution may have its support for life science research cut off as well.

One of the weaknesses of existing policies is that they only apply to funding given out by the federal government. But for years , the National Institutes of Health and other government agencies have struggled with stagnant funding, leading some researchers to turn instead to private sources. In recent years, for example, crypto titans have poured money into pandemic prevention research.

The new policy does not give the government direct regulation of privately funded research. But it does say that research institutions that receive any federal money for life-science research should apply a similar oversight to scientists doing research with support from outside the government.

“This effectively limits them, as the N.I.H. does a lot of work everywhere in the world,” Dr. Evans said.

The new policy takes into account the advances in biotechnology that could lead to new risks. When pathogens become extinct, for example, they can be resurrected by recreating their genomes. Research on extinct pathogens will draw the highest levels of scrutiny.

Dr. Evans also noted that the new rules emphasize the risk that lab research can have on plants and animals. In the 20th century, the United States and Russia both carried out extensive research on crop-destroying pathogens such as wheat-killing fungi as part of their biological weapons programs. “It’s significant as a signal the White House is sending,” Dr. Evans said.

Marc Lipsitch, an epidemiologist at Harvard and a longtime critic of the government’s policy, gave the new one a grade of A minus. “I think it’s a lot clearer and more specific in many ways than the old guidance,” he said. But he was disappointed that the government will not provide detailed information to the public about the risky research it evaluates. “The transparency is far from transparent,” he said.

Scientists who have warned of the dangers of impeding useful virus research were also largely optimistic about the new rules.

Gigi Gronvall, a biosafety specialist at the Johns Hopkins Bloomberg School of Public Health, said the policy’s success would depend on how federal health officials interpreted it, but applauded the way it recognized the value of research needed during a crisis, such as the current bird flu outbreak .

“I was cautiously optimistic in reading through it,” she said of the policy. “It seems like the orientation is for it to be thoughtfully implemented so it doesn’t have a chilling effect on needed research.”

Anice Lowen, an influenza virologist at Emory University, said the expanded scope of the new policy was “reasonable.” She said, for instance, that the decision not to create an entirely new review body helped to alleviate concerns about how unwieldy the process might become.

Still, she said, ambiguities in the instructions for assessing risks in certain experiments made it difficult to know how different university and health officials would police them.

“I think there will be more reviews carried out, and more research will be slowed down because of it,” she said.

Carl Zimmer covers news about science for The Times and writes the Origins column . More about Carl Zimmer

Benjamin Mueller reports on health and medicine. He was previously a U.K. correspondent in London and a police reporter in New York. More about Benjamin Mueller

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Research center marks 75 years of cutting-edge crop science

Jessica Torrion, Superintendent of Montana State University's Northwestern Agricultural Research Center in Creston, inspects a row of the Center's winter wheat crop on Wednesday, March 27. (Casey Kreider/Daily Inter Lake) Casey Kreider

Jessica Torrion, Superintendent of Montana State University's Northwestern Agricultural Research Center in Creston, talks about the Center's winter wheat crop on Wednesday, March 27. (Casey Kreider/Daily Inter Lake) Casey Kreider

Winter wheat grows in rows at Montana State University's Northwestern Agricultural Research Center in Creston on Wednesday, March 27. (Casey Kreider/Daily Casey Kreider

Maggie Sands lays out spring wheat seeds on germination paper while she and research associate Dan Porter perform germination tests at Montana State University's Northwestern Agricultural Research Center in Creston on Wednesday, March 27. (Casey Kreider/Daily Inter Lake) Casey Kreider

Jessica Torrion, Superintendent of Montana State University's Northwestern Agricultural Research Center in Creston, talks about the Center's new no-till drill on Wednesday, March 27. (Casey Kreider/Daily Inter Lake) Casey Kreider

Research associate Dan Porter places spring wheat seeds into a seed-counting machine before running germination tests at Montana State University's Northwestern Agricultural Research Center in Creston on Wednesday, March 27. (Casey Kreider/Daily Inter Lake) Casey Kreider

A Case International combine waits for harvest season inside an equipment barn at Montana State University's Northwestern Agricultural Research Center in Creston on Wednesday, March 27. (Casey Kreider/Daily Casey Kreider

Walking through a plot of winter wheat plantings just starting to push up through the dark soil in Creston, Jessica Torrion sees the results of decades of hard work and research.

All over the property at the Northwest Agricultural Research Center, high tech research equipment mingles with decades old farming implements.

“At first we were using shovels, using animals,” said Torrion, who serves as the center’s superintendent. “You can see that in our 1949 field day. But nowadays, we have this very advanced equipment attached to a GPS that’s very precise, and we’ve come a long way.”

In one of the property’s cavernous barns, Torrion, an associate professor of crop physiology, points to a small International tractor from 1947.

“We are still using this after 75 years, and it’s still very useful,” she says.

A field station for Montana State University’s College of Agriculture, the center conducts some of Montana’s most cutting-edge crop science research and is marking its 75th anniversary this year.

Originally established as the Northwestern Montana Branch Station by the Montana State Legislature in 1947, the center officially opened its doors in 1949. The station is one of seven scattered throughout the state operating under the Montana Agricultural Experiment Station system. 

Established to conduct agricultural research specific to the needs of producers in the Flathead Valley, the center originally focused on potatoes and sheep but today work mostly encompasses crops like wheat. 

Presently, the center researches both abiotic or physical impacts on crop productivity, such as water and nutrients, as well as biotic or living stressors like weeds, insects and diseases. 

The center’s first female superintendent, Torrion, came here 10 years ago by way of the University of Nebraska. She primarily focuses on irrigation research and the impacts of drought. This has been particularly important of late, as half of the years in the decade since Torrion arrived have been classified as drought years. 

Providing research that is tailored specifically to the unique geographical conditions that producers are facing is one of the primary goals. Torrion said this commitment lends credibility to the research and builds rapport with local producers.

The station’s location, on 200 acres along Montana 35, plays a large role in supporting that mission. Montana State University gave significant consideration to a number of locations and ultimately selected the site at Creston because its soil, topography and accessibility made it the ideal place to conduct research that would be applicable to a large number of counties. 

Sitting on the center’s advisory committee, Ken McAlpin commercially farms a couple thousand acres of irrigated crops in Lake County. A long-time collaborator with the station, he feels lucky to have access to quality research that he can apply to his own operation.

“That center at Creston is the gem of the system…. because it’s got some of the best soil in the whole state. They’ve got a nice facility, new buildings, great laboratories, center pivots, and all the bells and whistles that allow them to do research that’s really really pertinent for everybody.”

Torrion echoed the sentiment.

“We are very lucky because just to compare with other research centers I feel like this research center has a lot of things that we need and we have the space for things that we can do. We have the tractors, we have the seed lab, which is probably the best seed lab I’ve been in because of the space.”

The station maintains a year-round staff of seven, although the number of staff will swell as the crops mature and harvest kicks off and research begins in earnest, bringing in seasonal workers and MSU graduate students alike.

For now, the seed laboratory is relatively quiet, and only two staff members occupy the space in the early months of spring.

Dan Porter, a research assistant at the center, and Maggie Sand, a meteorologist by trade who spends ample time at the research station, are hard at work counting batches of 100 wheat seeds for this summer’s experiments. They run the seeds through a high-tech seed counting machine that uses a laser, and then double-check to make sure the machine didn’t make any errors.

Later this summer, after the wheat has been harvested, researchers will process the samples and conduct falling number tests and analyze the quality of the wheat. The results will provide the center and the wider farming community with valuable information about how different wheat varieties perform in a range of conditions, including soil, irrigation and fertilizer.

THERE ARE 10 buildings total on the property, brilliant red and muted blue and various shades of tan, from different eras in the station’s history. The buildings themselves, Torrion says, tell stories of how the center has evolved over time. 

She points out the faded blue barns on the property which have been here since 1949. In the 1950s, they housed sheep, but today store advanced planting equipment as the center has pivoted away from livestock research and now focuses exclusively on crops. 

The shift, Torrion said, was based on the economics of production in the Flathead Valley. As farmers’ needs changed, the center adjusted.

Choosing what to research is extremely important. As academics, there are endless topics that Torrion and her team would love to explore. Yet, they are limited by time, funding, and meeting practical needs.

“It’s a fine balance. You have an interest because you are hired to do a specific thing, and then you realize when you come here that there’s other problems brought to you by the farmers.”

“It’s expensive,” Torrion said of conducting cutting-edge research, but the center has been lucky enough over the years to consistently receive funding to keep the tractors, old and new, running.

Funding comes from the university along with commodity groups like the Montana Wheat and Barley Committee, along with industry and federal grants and the local community. 

Selecting what to research, Torrion, requires being aware of the needs of those who support and are impacted by the center’s research. 

To that end, the Flathead Valley center, like all of the branch stations in MSU’s system, is governed by an advisory committee. 

The committee is composed of up to 15 members from Flathead, Lake, Lincoln, and Sanders counties, most of whom are local producers directly impacted by the center. They are responsible for guiding the research undertaken to ensure its relevance to the farming community.

McAlpin, who is serving his second term on the advisory committee, sees immense value in the close collaboration between producers and researchers. 

“That’s what the advisory council is for: ‘Will it work? Could it work? Yeah, it looks like it, so let’s try it.’ There’s a lot of cool new science that happens there, and then if it’s shown that it can be successful at the station, there’s no reason that our everyday producers can’t adopt the same technology. So that’s the real value in my mind.”

While the center is located in Creston, a significant amount of research also happens off-site, in the fields of farmers who allow center scientists to create “test plots,” which enables the center to further refine and personalize their research to different geographical regions even within the Flathead Valley.

McAlpin will be hosting two off-station plots on his farm this year because he sees the benefits of collaborating with the center in this way. 

“You can see a replication of the trial that took place in Creston on a farm in Lake County, and you can compare and see if things stack up side by side or if there are differences, soil differences, environmental differences. It’s all pretty pertinent stuff to guys who are trying to make a living growing food.”

FORMER CENTER superintendent Bob Stougaard, who served in the role for about 10 years first joining the center in 1991, said that collaboration in this way made a big difference in combating the orange wheat blossom midge infestation between 2006 and 2014. The center, through collaboration with scientists and producers, was able to come up with a variety of wheat resistant to the midge, which is devastating to crops. 

“That was probably the biggest involvement, and some were very willing to do some on-farm research comparing different varieties of spring wheat to determine on a large scale whether the variety actually attracted the midge or repelled the midge. They were very supportive of this research program.”

Staying connected with the community they serve is immensely important for the center, and one of the ways they do that is through an annual field day in July. Held every year since the center officially opened its doors in 1949, the center invites the public to come see for themselves what happens on the research farm.

Torrion said it’s still one of her favorite ways to connect with farmers and other members of the community.

“We invite them over in July… and we are still doing it in the traditional ways, like we barbecue and tour around using a wagon and have an actual field demonstration and question and answer.”

McAlpin said the field day, which will be held on July 11 this year, is an amazing opportunity to learn more about cutting-edge research happening right in our own community.

“It’s been a pretty amazing part of agriculture in Northwest Montana for a long time. Everyone pays attention and if they aren’t they should be. There’s some good stuff going on over there.” 

Having been at the center for a decade, Torrion is transitioning to a new role as the department head of the Creston center and is excited for the future of the center. As the needs of producers continually evolve, she hopes to further improve efficiency related to fertilizer and water input, as well as develop precision agriculture technology and access in Montana. 

Reflecting on the anniversary, Stougaard, though he’s moved to a position at the University of Georgia College of Agricultural and Environmental Sciences, hopes the Creston facility will continue to do what it has always strived to do — benefit the farmers who are at the center of it all. 

“I think and I hope that the local community and the farming community view the research center as an asset,” he said. “Hopefully the center has helped the ag community, making farming more economical and more sustainable. That’s what we strive to do and what we hope to do in the future.”

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