Starting with the premise that advertising is always designed to increase consumer awareness and to persuade users that the brand is superior, a new research study by a team of researchers from by Stanford University tested the impact of advertising on both awareness and perceived quality. What they found is that “advertising has consistently a significant positive effect on brand awareness but no significant effect on perceived quality.”
An interesting side finding from the study is that share-of-voice does not impact brand awareness – in fact, if you outperform your competitors with advertisement it will have a slightly negative impact on your brand awareness.
The research paper also mentions empirical studies that show that advertising lowers price sensitivity – again confirming that pricing may be controlled more by the supply side rather than the demand side.
All that being said, the study confirms that advertising has little effect on sales.