Evaluating advertising effectiveness

It was considered 3 or 4 decades ago that evaluation advertising effectiveness is not easy holds true even today. Despite all the efforts made over the last three or four decades to make advertising amenable to management concepts of goal setting, control and evaluation, there are still vague areas when one comes to evaluating the results of advertising.

If ‘sale’ is the main objective, measurement of advertising results has to pinpoint the increase in sales that has accrued on account of advertising. Exact measurements become difficult because ‘sales’ is the result of so many other factors in addition to advertising. Even when communication is the goal, measurement of effectiveness becomes difficult; it can at best be measured around an audience’s ability to recognize and recall the message.

Despite this, firms resort to evaluation of advertising results. They try to assess how far the sales task and the communication task have been accomplished by advertising.

Evaluating how far the communication task has been accomplished:

The methods used for this evaluation are the same as those employed in ‘copy testing’.

The main point to be remembered is that methods to evaluate the advertisement’s ability to create awareness, or gain recognition, or ensure recall.

Evaluating how far the sales task has been accomplished:

The most commonly-used method for evaluating how far advertising has accomplished the sales task is to correlate past sales to past advertising expenditures with the help of statistical techniques. This method has some limitations, especially in the highly fluctuating market conditions, wherein ‘past sale’ was the result of several factors other than advertising.

Besides, past sales, or historical data-based method, market tests are also used to get an idea of the sales effect of a campaign. In such cases, before launching a campaign, certain territories are kept as test markets and are exposed to different level[s of exposure to the campaign. The results in such test markets are computed to get an idea of the impact of the campaign on the sales in these markets.

When a firm resorts to direct mail campaign, measurement of sales impact becomes more feasible. It is a situation where normally short-term and immediate sale is generated, and it lends for the measurement of sales against the advertising effort.