emergencemarketing.com

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.

(via Strategy+Business)

Another great experiment by MIT behavioral economist Dan Ariely as described in his book “Predictably Irrational” shows that it is not the product that counts but the information about the product.

In one experiment, they sold SoBe drinks to two groups of students who were about to exercise. The first group paid full price, while the second group got a 30% discount. After exercising they asked the students whether they felt more or less fatigued than usual - and all reported that they were indeed less tired. Except that the group which paid full price was less fatigued than the group which paid less. The 50c aspirin does work better than the 5c aspirin…

They then did an experiment where they sold students SoBe, which claims to provide “energy for the mind,” before administering a 15-word puzzle. Again, one group paid full price and another paid less. They also baselined the experiment with a group that did not take SoBe. The group that paid full price solved as many word puzzles as the group that did not get the drink, while the group which got the discount solved about 30% less word puzzles.

WOW…we are doomed.

But wait! It gets better. They then performed the same experiment except that this time they printed the following message on the cover of the quiz booklet “Drinks such as SoBe have been shown to improve mental functioning, resulting in improved performance on tasks such as solving puzzles.” They also stated that the SoBe web site referred to 50 scientific studies to support these claims - information which was totally fictional. The results? The ones that paid full price solved 33% more puzzles than the ones who did not get the drink, and the ones that got the discount solved 7% more word puzzles.

And who said that messaging was dead? The things you say about your product may indeed be more important that the product itself…

The Online Publisher Association announced that it added Community as a category to its Internet Activity Index (IAI). So they will now measure how much time consumers spend online with Content, Communications, Commerce, Search and Community.

The OPA defines community as:

“Web sites and applications that combine user-generated content with communications in order to foster relationships between individual members and groups of members. Many Community sites are content driven, and they were previously accounted for in the Content category. However Community’s content is largely user-generated, and when merged with communication, creates a specific category of online activity.”

The IAI numbers for January show that consumers spent 42.7% of their online time interacting with content, 28.7% with communications, 16.1% with commerce, 7.5% with community and 5.0% with search.

AdAge picked up on the story, declaring “When It Comes to Time Spent Online, Content Trumps Community.”

But wait a minute here, adding community as a category at the same level as content, communications, search and commerce, is like comparing apples and oranges. Or better yet, comparing apples and oranges with air or water. Communities are combinations of content, commerce, communications and search. And communities affect the usage pattern of all the above categories and vice versa. So if I am spending time on Amazon.com, am I spending time with commerce, content, search or community? Obviously the end result is commerce if I buy something, but it could also be searching without buying or interacting with content (both user generated reviews and published content) without commerce. The fact that Amazon is a community which leverages my personal profile very well (another component of communities) is determining my interactions and time consumption on that site. The same can be said for many other sites that combine content with community. If I am spending time on the WSJ Health blog, I am spending time with content or community? If as a car buff I spend time on Carspace.com, I am spending time with commerce, content or community? Would I spend as much time conducting commerce, searching for stuff or interacting with the content on those sites if there were no community component to them?

Probably not…

Besides the fact something does not sit right with the categories, many conclusions drawn from the new numbers by AdAge and the IPA are equally flawed. Jim Nail at the Cymphony’s Influence 2.0 blog captures those flaws in detail in his post today (well worth the read). A couple of highlights include:

• The fact that page views per person in content dropped 225 pages suggests that a number of content sites were just moved to community.
• Content sites show 480 pages per month per user vs. 380 pages for community sites. So from an ad perspective, the reach may be just the same.
• Another factor not reflected in the new numbers is influence. If a third of people below 30 don’t make buying decisions before checking with their social networks, the impact of communities on the commerce is obviously not reflected in those numbers.

We should of course remember the agendas that both organizations are representing - those of advertisers and publishers.

Joshua Porter has an interesting analysis about social ads and why they are not working. The gist of his argument is summarized in these two paragraphs:

The difference, of course, is that when people go to Google, they’re actively looking for something. That something isn’t on Google. They are performing a search activity. Thus their task will be to click on a link that seems to promise what it is they’re looking for. It may be the organic results, or it may be an ad that seems close to what they want.

When people are on MySpace, the activity they’re doing isn’t search. It’s something akin to “hanging out” or “networking”. Their task is almost the opposite of search. They are already on the site they want to be on. They don’t need to click on links to take them where they want to go.

That makes sense. When I am searching for something I am clearly looking for something, making me an easy target for online advertisers. When I am hanging out on a social site, I maybe in a buying mode as well, but as a marketer you have no clue what I may be interested in. So the effectiveness of social ads may not be any better than that of TV ads or print ads - it’s a total hit or miss.

(via Wine Life Today Blog)

While on the topic of ads - here are a couple of clever Viagra ads (via Ads of the World)

A new study by the IBM Institute for Business Value predicts that the next 5 years will hold more change for the advertising industry than the previous 50 did (here for executive summary, and here for full pdf report of the study).

Based on a survey of 2,400 consumers and feedback from 80 advertising execs, they see four change drivers that will shift control within the Industry:

Attention - consumers are increasingly in control of where they direct their attention. And not just by using Tivo-like products which enable them to skip ads and watch what they want when they want it, but because of a fundamental shift from TV usage to PC usage. 71% of the survey respondents use the Internet more than 2 hours a day, with only 48% spending equivalent time watching TV. 19% spend six hours or more on a PC with just 9% watching that much TV.

Creativity - consumers now have the tools to create their own user-generated and peer-delivered content. User generated content sites are already the top destinations for viewing online video, attracting 39% of the survey respondents.

Measurement - advertising executives predict that 20% of all advertising dollars will shift from impression-based models to impact-based models within 3 years.

Advertising inventories - ad space is increasingly available through open exchanges instead of proprietary channels that were controlled by broadcasters.

Based on these drivers, and considering that two of them have a high degree of uncertainty - the attention driver and the open inventory driver - the study envisions 4 possible scenarios for 2012:

Continued Evolution: One to many still dominates but thanks to DVR’s, increased penetration of CGC and better measurement techniques, a greater portion of direct marketing dollars gets allocated to channels typically used for brand oriented advertising.

Open Exchange: Not much changes in this scenario other than most inventory gets bought through open exchanges.

Consumer Choice: In this scenario the user takes full control of the way ads get viewed and filtered.

Ad Marketplace: In this one the consumer choose preferred ad types as part of self-programming their media choices and are more involved with the creation and distribution of the ads.

Here is how the study predicts advertising spend allocation will evolve over the next 3 years:

[Tags: marketing advertising IBM]

This one is quite funny…

(via Coolz0r)

This article in the April 4th edition of Modern Mechanix reminds us that many new ideas are…well not so new after all - “Radio listeners who dislike advertising announcements and long speeches will welcome a new invention that automatically shuts off voice programs.”

(via MIT’s Advertising Lab)

(link for RSS subscribers)

On NPR last night they were discussing the impact of of the known presence of registered sex offenders on social networking sites like MySpace or FaceBook on how advertisers will make their advertising decisions…concluding at one point with an expert opining “well if I were P&G I would worry”…

Should they really worry? Do they worry now whether sexual predators subscribe to the Wall Street Journal and The New York Times online? Is the importance of identity in marketing really different online then offline?