Behavioral Perspectives (to the subject of how advertising works)


Behavioral perspectives emphasize a consumer's actual purchasing activity by relating advertising, price, and promotional measures directly to substantial performance measures, such as sales, market share, and brand choice (Vakratsas and Ambler, 1999). Behavioral perspectives are also called the "market response" models because they mostly make use of market-level data, such as advertising expenditures, gross rating points, brand sales, or market share, instead of individual-level data.


	Advertising elasticities are dynamic and decreased during the product life cycle (Arora, 1979). - An increase in the advertising expenditures for a new product produces a higher sales increase than for an established product. There is an "S-shaped" relationship between advertising expenditures and brand sales (Leckenby and Wedding, 1982). - There are increasing returns to an advertisement over a consequential range of expenditures before an inflection point occurs and diminishing returns set in. There exists a "message-vehicle gap" in advertising. - Even though an audience is exposed to a certain media vehicle at a certain point of time, it does not guarantee that the audience is also exposed to a certain advertisement that is delievered by the media vehicle at that time (Abernethy, 1991). - Instead of mere exposure to media that delivers an advertisement, the exposure to the ad-message is actually required for the ad to have a direct impact on consumption behavior.


	Short-term effects of advertising (Assmus et al., 1984; Tellis, 1988) - Controlling for other influential variables, such as the ad-quality or price, each input of advertising can generate a proportional response within a short period of time. - There is a simultaneous nature of the relationship between sales and advertising; not only are sales influenced by advertising, but advertising is also influenced by sales. Long-term effects of advertising (Palda, 1966; Clarke, 1976; Leone, 1995) - Continued brand preference, though probably maintained by satisfaction with the quality of the product, may have its origin in the action of a single, long-forgotten ad. - Most advertising effects dissipate after three to fifteen months. Advertising Response Functions (Simon and Arndt, 1980) - Returns of advertising are usually diminishing no matter how much money is spent. - Many firms are overadvertising even though the marginal advertising response is very low in a considerable number of situations. *"Three-Exposure Rule" (Krugman, 1972; Naples, 1979)* - In general, around three exposures to an advertisement within a purchase cycle are adequate to lead to or maintain the desired level of brand awareness or brand attitude. - While the "three-exposure rule" is an average tendency, smaller or new brands should have a higher frequency than larger or established brands do.