Effectiveness in Advertising - Concept, Planning and Evaluation

Effectiveness in Advertising - Concept, Planning and Evaluation Dr. Volker Janßen SIMON w KUCHER & PARTNERS Strategy & Marketing Consultants Bonn w Cambridge/USA w Munich w Paris w Tokyo w Vienna w Zurich Bonn Office: Haydnstrasse 36 D-53115 Bonn Tel: +49 (0) 228 98 43 113; Fax: +49 (0) 228 98 43 120 E-mail: vjanssen@simon-kucher.com Bonn: May 2001 http://www.simon-kucher.com Overview Advertising Management: State of the Art A Success Chain in Advertising Planning of Advertising Decisions Evaluation of Advertising Success SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 1 -1- Overview Advertising Management: State of the Art A Success Chain in Advertising Planning of Advertising Decisions Evaluation of Advertising Success SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 2 -2- Advertising and Sales For many companies the link between the advertising budget and sales is still a riddle. ? Advertising Sales Budget “I know half of the money I spend on advertsing is wasted, I just do not know what half it is” (John Wannamaker) SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 3 -3- Levels and Influencing Factors of Advertising Success Monitoring advertising success is one of the most complex challenges in business. Influencing Factors Internally Externally Behavior of Contact Competitive Market Marketing-related Communication-related Target Audience Situation Situation Situation • Communication • Price of product Objectives • Communication e.g. habits in e.g. mood of e.g. share of e.g. information • Product quality media usage target person voice overload • Distribution of product Strategy • Advertising Objectives • Advertising Strategy Process of Decision Process Advertising Effects Advertising Pre-economic Contacts Sales Budget Effects Monitoring Advertising SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 4 -4- State of the Art in Advertising Management Different approaches regarding the optimization of advertising management can be found in the literature. Approaches on the success level • Integration of advertising decisions and effects Chain of success in Advertising ... ... Decision Process Advertising Processing Measures Approaches on the decision level Approaches on the Processing level • Step-wise models, e.g. the AIDA model • Decision-based approaches • Processing models = Direction of Usage of Research Insights SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 5 -5- Overview Advertising Management: State of the Art A Success Chain in Advertising Planning of Advertising Decisions Evaluation of Advertising Success SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 6 -6- Fundamental Demands on an Advertising Success Chain Basically there are two fundamental demands on an advertising success chain: Economic Relevance: All advertising decisions and effects which are part of the chain have to be important for buying decisions. Consistency: The structure of the chain has to be consistent, i.e. each decision and effect level must fit into the appropriate place in the chain. SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 7 -7- Advertising Decision Chain An advertising decision chain comprises strategic and tactical advertising decisions. Advertising Budget Media Strategy Creative Strategy Creative Execution Strategic Advertising Decision Media Vehicle Scheduling Structure of ADs Timing Selection Insertions Tactical Advertising Decisions = Dependance = Useful structuring of advertising decision process SIMON w KUCHER & PARTNERS (1 SKPUni X001) P 8 -8- Additional Demands on the Advertising Effects Chain Since optimizing advertising decisions is the main goal of an advertising controlling system, the following demands have to be applied to the advertising effects chain: Controlling Potential for Advertising Decisions: All advertising effects which are part of the chain have to deliver concrete hints as to what advertising decisions have to be adapted. All advertising effects which are part of the chain have to depend heavily on advertising decisions.