Advertising activities and the impact of advertising on sales performance. Features of the influence of advertising on the promotion of goods and services The influence of advertising on sales

Advertising activities - information dissemination activities carried out in order to promote products on the market. Advertising is distributed in a certain form and using special media, addressed to a specific target group of people and aimed at drawing attention to the advertised product, generating or maintaining interest in it and promoting it. on the market.

Advertising activity is informational persuasive or in nature and is aimed at influencing consumer behavior or the opinion of a wide group of consumers. Advertising is one of the marketing tools and can be used in conjunction with techniques such as individual sales tactics, sales promotion or business relationships.

Advertising activities are carried out by a specialized service of the manufacturer and independent advertising agencies. The main means of advertising are: advertisements, information materials, press releases, newsletters, catalogs, promotional films, trademarks, corporate identities, exhibitions.

Conducting various studies of advertising is primarily due to the fact that decisions in the field of advertising are made under conditions of risk and uncertainty. Advertising managers are always faced with questions like: “Are the target markets and target audience chosen correctly? Do we understand the needs of our customers correctly? Are the people watching media ads the right people? Did advertising have any effect on sales volume?” These and other similar questions are very often answered by conducting appropriate market research. In order to determine the effectiveness of the marketing policy pursued by the company, marketing managers have a whole range of different tools. In addition, there are various directions in the field of determining the effectiveness of advertising activities.

Studies of the popularity of individual advertising media (advertising carriers) for different target audiences. Based on the study of the degree of popularity of individual radio and television programs in the media. The effectiveness of advertising strongly depends on the effectiveness of advertising, and the popularity among the population of certain means of presenting advertising information. Any even the most perfect advertising campaign will have low performance if the means of presenting advertising information will have low productivity.

When studying the effectiveness of the company's advertising policy as a whole, the degree of awareness about the company and its products is studied based on the results of advertising activities for a certain period of time. The effectiveness of the advertising policy pursued in the organization is an important marker for determining the effectiveness of the entire commercial activity of the company. An effective advertising policy is the locomotive in promoting the company's products on the market and the key to the sustainable development of the organization.

The study of the effectiveness of individual advertising campaigns based on special experiments is carried out as follows. A control area is established where the advertising campaign is not carried out, and an experimental area in which the advertising campaign is carried out. A comparative assessment for different target audiences is carried out in the direction of studying the degree of familiarity of consumers with the advertised product and the desire to buy it. An important tool in determining the effectiveness of a company's advertising policy.

One way or another, any advertising is designed to change people's behavior and increase people's motivation to purchase the products advertised by the company. Determining the effectiveness of this criterion is an important part in determining the overall effectiveness of an organization's advertising policy.

This method of research is mainly used when using several media in the advertising policy. Studies of the synergistic effect are given to determine the effectiveness of the interaction between the presentation of information by various sources. These studies are primarily aimed at improving the effectiveness of advertising activities, reducing the risk of its implementation, better use of financial resources.

It is customary to distinguish two types of advertising effectiveness: communication and final (according to sales results). Marketing research in its essential part is aimed at determining the communication effectiveness of advertising, which is much easier to determine compared to the final effectiveness. Studies of communication effectiveness are carried out both at the stage of planning an advertising campaign and after it has been carried out. To assess the reasons for the effectiveness of advertising, the following four criteria are usually used that characterize individual areas of research on the effectiveness of advertising, namely: recognition, the ability to recall advertising, the level of motivation, and the impact on purchasing behavior. Of course, such a classification to a certain extent is conditional. For example, the recognition score is closely related to the recall score. Therefore, when conducting a study of the effectiveness of advertising, it is sometimes difficult to obtain estimates in their pure form separately for these indicators. In addition, it should be remembered that the considered criteria are only intermediate measures of the effectiveness of advertising and do not give any indication of its final effectiveness.

Problem: how to get the most information about the effectiveness of advertising spending. Intuitively, the author came to the conclusion that advertising impacts can be considered as incentives, and sales - as responses to them.

Cause-Response Hypothesis: A small amount of advertising has little to no effect on sales, but as the volume increases, the response rises to a threshold where the impact of advertising messages on sales figures begins. When the saturation point is reached, the degree of exposure to advertising gradually decreases and levels off. The response to a further increase in advertising remains relatively unchanged until respondents reach the point supersaturation when the negative reaction begins.

Conclusion.

A serious obstacle to the transition to an internal market economy is reluctance of many senior managers to share information with subordinates, to which they have exclusive access, because information is power .

Part IV. THE SCIENCE.

General outline of the chapter: Criticism of the statement about the possibility of finding a formula for corporate success. It is especially important for our readers to understand that neither correlation nor regression analysis makes it possible to identify the causal relationships of any phenomenon. This problem is solved only during the experiment. The invasion of pseudoscientific methods of management research through correlation (comparative) and regression (simplified) analysis creates continuous sources of misconceptions (incorrect identification of companies in the category "successful - unsuccessful", which contributes to the transfer of signs and conclusions to other cases). We view science as a process of inquiry, namely a set of activities aimed at a) getting answers to questions, b) solving problems, c) developing better methods for answering questions and solving problems. Science is interesting as a process of generating knowledge. Signs of scientific research - control, self-preservation and self-improvement. It is a continuously evolving system that pursues a single ideal - the infinite expansion and deepening of our knowledge and our ability to answer questions and solve problems. The results of scientific research are:

· An array of information that provides us with knowledge of the world in which we live;

· A set of methods that ensure the successful growth of information arrays.

Conclusions: Business is a social system. The firm appears to society as a set of transactions (related to the exchange of goods and money) with suppliers, employees, buyers, investors, creditors, government.

We have tried to conceptualize the organization as a social system. The corporation has responsibilities to the society of which it is a part. So it is in front of their constituent parts and their employees. Its main function is the production and distribution of wealth. Its main means of distributing wealth is compensation for work - employment. The main task of the corporation as a social system is its own development. To develop means to increase one's own desire and ability to satisfy one's own needs and the needs of others.

System management is the management of interactions. It is based on the knowledge that the system is the product of the interactions of the parts of the organization with each other and with the external environment. In systems management, supervision and teams are replaced by the authority of a leader. Systemically managed corporations contribute to the development of all groups interested in their activities and the society of which they are a part.

Efficiency is the estimated performance, productivity multiplied by the value, the effectiveness of the evaluated result. Intelligence is the ability to increase productivity, wisdom is the way to increase efficiency. The difference between productivity and efficiency is what distinguishes wisdom from understanding, knowledge, information, data; it is reflected in differences in development and growth.

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The effectiveness of advertising - the degree of impact of advertising media on consumers in the interests of the manufacturer or intermediary. It is determined before and after the transmission of the advertising message. Determining the impact of advertising on sales results (economic efficiency) is carried out by relative comparison of advertising costs and sales volumes of goods based on the results of activities in the past. The accuracy of the latter method is not high, since sales results are influenced by many other factors besides advertising (“Glossary of Advertising Terms”).

The need to promote products on the market in a highly competitive environment encourages manufacturers to choose and use new and more effective ways to communicate advertising information to consumers. The methods of transmission of advertising information that have already become traditional, such as television, radio, press and others, are supplemented by the use of methods that allow working with each buyer more individually. Accordingly, the costs of transferring this information increase, which makes it necessary to analyze the effectiveness and optimize costs.

Evaluating the effectiveness of advertising and advertising investments is one of the most important and most difficult issues in planning advertising events. At the moment, a lot of work is devoted to the study of the effectiveness of advertising, but there is no single method that allows you to evaluate the effectiveness of advertising investments with absolute accuracy.

It is possible to calculate the economic efficiency of advertising campaigns only indirectly due to the large number of various market factors, the influence of which is sometimes difficult to calculate. It is impossible to separate the effect of advertising or consumer contacts with other buyers on the effectiveness of a promotion, as well as the influence of factors such as seasonality, price changes, competitor actions, etc.

You can evaluate the result of the action on various indicators. The following are most commonly used:

1. Sales volume.

According to this indicator, the share is evaluated as follows:

the volume of sales before, during and after the promotion is measured on the same days and hours;
compared with the volume of sales in the same period for previous periods;
changes in demand for goods are taken into account, which may be related to seasonality, the specifics of the goods and other factors;
the volume of sales of competing products in a given market is taken into account (an assessment in a particular market allows you to evaluate a stock more accurately).

2. Brand awareness.

Polls are conducted at retail outlets before, during and after the promotion. In addition to knowledge of the brand, surveys during the campaign allow you to evaluate the attractiveness of its idea, the visibility of the campaign and promotional materials, etc.

3. Brand loyalty.

The degree of brand loyalty, customer satisfaction with the product, and the desire to continue to consume your product are assessed.

But the assessment of the results of the action cannot be complete if you do not analyze the costs of its implementation. How much will an attracted buyer cost?

In our work, we have repeatedly encountered the fact that our clients, when planning promotions, compared holding promotions in the Pyaterochka and Karusel networks with placement on traditional media - TV, radio, outdoor advertising, advertising in the subway, transport, etc. . And often the comparison was not in favor of advertising at the point of sale due to the fact that the following question arose: what should be considered the main criterion for evaluating the effectiveness of advertising at the point of sale? Sales growth? At this particular point in this particular period of the action? But after all, buyers purchase goods not only in our stores, moreover, these people see and hear advertising placed on traditional media. There was no doubt about one type of BTL advertising - a promotion, the effectiveness of which can be measured with a relative error, at least in a clearly defined period of time (during the promotion).

However, now, in the conditions of fierce competition, when the consumer has the opportunity to choose from a huge number of actually similar products, manufacturers often began to work with each buyer in a more personalized way - every year an increasing percentage of advertising budgets is distributed in favor of advertising at the point of sale. That is why we decided to show how we compare the effectiveness of advertising and what indicators we rely on when calculating.

In this article, we compared the types of advertising most commonly used to promote FMCG products with similar types of advertising at the point of sale. All calculations given in this article are based on data from the Pyaterochka and Karusel networks.

Why is the question of performance evaluation so important?

by 2008, the media market is projected to increase to $8 billion (according to the Federal Agency for Press and Mass Communications);
advertising expenses will grow - in Russia in 2005 advertising expenses amounted to $24 per person per year, in the USA - $557 (according to a study by Publicis Group for 2005);
companies spend up to 50% of their budget on advertising, and they are interested in the effectiveness of their investments.

The main indicators that affect the effectiveness of advertising:

number of contacts - the total number of contacts of the target audience with an advertising message;
receiving attention - the fact of paying attention to advertising transmitted by the media. Since the consumer usually pays attention to items related to his needs, position or beliefs, attention is selective.
advertising noise (clatter - interfering plots) - a mass of advertising and informational plots transmitted in short (up to two minutes) periods of time. Moreover, each of them competes for the attention of the listener or viewer, and together they reduce the perception of each of them. Multiple advertisements may be inserted in any given advertising time slot.
Contact cost (CPT - cost per thousand - cost per thousand contacts) - index of cost per thousand contacts among potential customers (or the cost of reaching a thousand people from the target audience). In other words, the unit cost of advertising. The indicator is used to compare the cost of advertising when using different advertising media. This indicator is determined by multiplying advertising costs by 1000 and then dividing by the total audience;
duration of contact - time of contact of the consumer with the advertising message;
the period of time from contact with advertising to making a purchase decision.

There are other equally important indicators - product quality, distribution, design of advertising materials, actions of competitors - promotions held by them in the same period, text of advertising materials, etc.

Consider and compare the types of advertising familiar to us with advertising at the point of sale - outdoor and indoor. When comparing the effectiveness of advertising and CPT calculations at the points of sale in the tables below, data on the traffic and cost of advertising campaigns in the Pyaterochka and Karusel retail chains were used. Of course, these indicators differ from similar indicators of other retail chains, but the difference is small and uncritical.

Conventional TV/radio - indoor TV/radio in stores

Indicators	Comparison		Result
Indicators	conventional radio	"Media Five"	Result
Number of contacts	depending on the radio station	600,000 per day	POS advertising has less
CPT contact cost (in dollars)	1-5	1-5	Equally
Getting Attention	70% attention - switching	Broadcast can't be turned off
Advertising noise (clutter)	3-10 commercials together	1 promotional video with a beat	Point-of-sale advertising is better
Time from contact to purchase	Difficult to measure	Minimum	Point-of-sale advertising is better

Conclusion: the internal radio in stores is more efficient - it cannot be turned off, one video attracts more attention than an advertising block, the period before making a purchase is minimal.

Outdoor advertising / backbone billboards - billboards in the parking lot, near shops

How many images does the driver see? The main disadvantage of shields placed on highways is speed. The duration of contact with advertising information placed on the main billboards is short. A person remembers only one object or main idea. Advertising on similar billboards at stores will undoubtedly receive more attention from buyers.

Indicators	Comparison		Result
Indicators	Backbone shields	Shields in the parking lot	Result
Number of contacts	Traffic	3,000 buyers per day	Less advertising at the point of sale
Getting Attention	Low (distracts traffic)	High (low speed - arrival, pedestrians)	Point-of-sale advertising is better
Advertising noise	Many shields in a row	1 entrance shield	Point-of-sale advertising is better
Contact duration	0.5 seconds	0.5 minutes - entry, 2 minutes - parking	Point-of-sale advertising is better
Time to purchase	indefinite	Minimum	Point-of-sale advertising is better

Subway posters - posters, light boxes, etc. in the shop

Of course, placing advertisements in the subway is far ahead of placing posters in stores in terms of the duration of contact and is most effective if these posters are informative, that is, they contain not only an image of the advertised product, but a lot of text - for example, the conditions of promotions, store addresses, etc. At the same time, advertising in stores is more effective in terms of time to purchase, as it is placed directly next to the product - at the point of sale.

Subway posters - posters, light boxes, etc. in the shop

Indicators	Comparison		Result
Indicators	Posters in the subway	Posters in the store	Result
CPT (in dollars)	Price/Traffic/10 = (2.65)	3	Almost the same
Getting Attention	Low (many posters)	High (100% hit)	Point-of-sale advertising is better
Contact duration	5-10 minutes	0.5 seconds	Metro is better if there is a lot of information in the advertisement
Period before purchase	Uncertain	Minimum	Point-of-sale advertising is better

Conclusion: posters in stores (banners, stoppers, lightboxes, etc.) are more effective in terms of "Getting attention", "Time / period before making a purchase."

The last type of advertising that will be discussed in this article is two types of BTL events. But one of them has long become traditional and has been successfully used for many years, while the other is relatively young and is used so far only in the Pyaterochka and Karusel networks. These are promotions and a check program. A feature of these types of advertising is the work with each buyer personally. In both cases, buyers receive a gift for the purchase immediately after it is made.

Promotions - check program

Promoters. The promo staff tells the conditions and gives out prizes.

Check program. The cash register registers the fulfillment of the condition - the purchase of a certain product in the quantity necessary to receive a gift. An inscription appears on the buyer's cash receipt informing about the receipt of the gift. The cashier gives out the prize.

Promotions - check program

Indicators	Comparison		Result
Indicators	Promoters	Check Program	Result
CPT (usd)	166	5	The check program is better
To attract attention	High (dialogue with the buyer)	High (advertising at the entrance, radio, at the product)	A promoter is better if you need to talk a lot about a product
Number of contacts	100 people per day served by 1 promoter	864,000 shoppers per day in 360 stores	The check program is better

Conclusion: the check program is more efficient - the number of contacts is incomparably greater, and the cost of a contact is low.

more contact time;
draws more attention;
less advertising noise;
lower cost of contact;
the time from contact to making a purchase decision is minimal.

Of course, no type of advertising is universal. Only by using various ways of conveying advertising information, you can achieve the greatest effect of an advertising campaign and optimize the costs of working with each specific buyer.

Much attention has been paid to the topic of the long-term impact of advertising in recent years. The participants in the discussions agree that the "long-term" effect of an advertising campaign is not only important, but also fundamentally different from the results measured immediately after its completion.

Notable advertisers Forest Bynet(Les Binet) and Peter Field(Peter Field) formulated the conclusions of their analysis of the work of the winners of the prestigious award IPA Effectiveness(awarded for designing and running effective advertising campaigns - R&T): “The way in which the long-term effects of an advertising campaign are formed is fundamentally different from how most short-term effects are achieved. Although long-term effects are always accompanied by some short-term effects, the converse would not be true, since the mere accumulation of short-term effects does not in itself produce long-term effects. (The Long and the Short of It: 2013)

These conclusions are extremely important, because, as they write in their famous article Matt Clary(Matt Clary) and Paul Dyson(Paul Dyson) "Many econometric studies have shown that the short-term return on advertising is often less than the investment made ... and there is clear evidence in the form of published econometric studies that the long-term impact of advertising is 2-5 times greater than the short-term." (The Case for Long-Term Advertising: Admap February 2014)

This data serves as a reminder of a topic we've been arguing about for years. Almost 25 years ago, in 1990 Gordon Brown(Gordon Brown), co-founder of Millward Brown, at the seventh annual ARF Copy Research Workshop, said: “I am very concerned that current trends in assessing the impact of advertising on sales are clearly biased towards short-term effects.. But isn't the main value of advertising in changing the long-term trends of a brand? (Copy Testing Ads for Brand Building)

We have returned to this topic many times over the years. As said Andy Farr(Andy Farr) of Millward Brown in 1996, “With extensive purchase scanning data available, it is reasonable to expect that we can easily identify the short-term impact of advertising on sales for most consumer products. The problem is that such an approach will most likely only demonstrate the inability of most commercials to justify themselves in terms of short-term payback. However, our own experience…shows that advertising has a long-term impact on a brand…Marketers need proof that today’s investment in advertising will pay off in the long run.” (Advertising and Brand Equity: Admap April 1996)

In 1998, at the Admap Conference on Advertising Effectiveness, a speaker from Millward Brown voiced the thesis that "most commercials created over the past 15 years have not generated enough profit to pay off in the short term." (Justifying the Advertising Budget).

Like Bynet and Field, we have recognized that the short and long term effects of advertising differ. In 1997 Nigel Hollis, global analyst Millward Brown wrote in a report for the Canadian Advertising Research Foundation, “Some ads can be extremely persuasive in terms of creating a significant short-term impact on sales, while others can work as a support for the brand, helping it needs to grow on the natural switching of consumers that occurs over time in any category. Some particularly effective commercials can do both.” (Looking to the Future: the Search for Long-Term Advertising)

Over the years, we have identified some parameters that relate to the short and long term impact on sales. In 2007 Dominic Twose(Dominic Twose) and Dale Smith(Dale Smith) of Millward Brown had this to say about the short-term effect: "How effectively can ad research predict sales" ("How effectively can ad research predict sales", Admap, 2007): "There is a significant correlation between the effectiveness of advertising, measured by such parameters like ad awareness and persuasiveness, and the ability of a video to generate sales... It is important to note that parameters such as Awareness Index Prediction and Persuasion measure different aspects, and there is no relationship between these two indicators. The article also showed the relationship between the long-term impact on sales and the Awareness Index.

However, despite the importance of the long-term impact on sales, it is difficult to forecast it with high accuracy, since the magnitude of the long-term impact can depend on many factors. As Clary and Dyson, already cited above, write, “The ratio of DS / KS factors (long-term / short-term) depends on a number of parameters - brand size, category, level of competition in the market, buyer cycle, media channels, advertising message creativity, as well as seasonality factor products. In particular, products with longer purchase cycles tend to show higher LT (long-term effects), while seasonal products are prone to short-term effects (TS). Because it has less opportunity to form a habit of use before the product is out of season... Brands with significant market share are also more likely to show higher CV/CR ratios.”

Significance, distinctiveness, conspicuousness

So we came to the conclusion that the best way to deal with these complexities is to evaluate brand equity. In 1996, Millward Brown launched a methodology for measuring this indicator - BrandDynamics™, which has become widely known. Later, drawing on an extensive database (over 100,000 brand reports), we developed the Meaningfully Different Framework, which can quantify brand equity more accurately and comprehensively than before. It builds on the Millward Brown BrandDynamics database, which shows that the most successful brands tend to have the following general qualities:

1. Significance. Shows how brands are able to build an emotional connection, and are perceived by consumers as being able to provide their functional needs.

2. distinctiveness . Shows how brands stand out from other brands in their category by offering something (tangible or intangible) that others do not, and act as pioneers.

3. Visibility : how quickly and easily brands come to mind.

These three qualities (in one combination or another) are present in those brands that have the highest sales, can command the highest price premium, and generate the most share price growth next year.

Average share of sales, prices and share price growth indices (%)

Source: Millward Brown

We've spent a lot of time and research to develop questions for our Link™ Ad Test Tool, which identifies both functional and emotional elements to better assess the likely impact of a video on long-term brand equity across these dimensions. Together they form the basis for Power Contribution» (the contribution of advertising to the formation of brand strength), our measure of the likely long-term impact of advertising.

Incorporating long-term valuation parameters into the Link methodology

After several months of collecting data on these parameters, we began to investigate their validity. Initially, it was important to make sure that the indicated parameter Power Contribution measures something different, compared to the existing tool for assessing the probability of short-term sales. Short-Term Sales Likelihood(STSL), which refers to short-term sales performance. The scatter of data shown below looked encouraging. The relationship between these two indicators was noted, which seemed logical. As Bynet and Field said, if there is no short-term selling momentum, then there is no long-term effect to be expected. On the other hand, the chart shows that even strong STSL performance does not guarantee a long-term effect. This is also logical, because (as Twose and Smith have shown) the proportionality of short-term sales effects is determined by the persuasiveness of advertising, and the persuasiveness of advertising is strongly influenced by the newness of the information in the advertising message (and news gets old very quickly).

Short-Term Sales Likelihood (STSL) Probability Parameter(based on 2855 commercials from global advertising campaigns R 2 = 0.75)

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