Advertising Facts

brain, advertising, theory of effective frequency

Advertising is a form of marketing communication used to promote or sell something, usually a business's product or service.

Commercial ads often seek to generate increased consumption of their products or services through "branding", which involves associating a product name or image with certain qualities in the minds of consumers.

In advertising, the effective frequency is the number of times a person must be exposed to an advertising message before a response is made and before exposure is considered wasteful.

Direct mail pays off! Printing and mailing may seem a more costly form of marketing compared to new email and social media techniques, but the Return on Investment (ROI) of this tried and true strategy is impossible to ignore.

48% of people retain direct mail for future reference.

Businesses need to learn cost per lead, response rates, and conversion rates, among others to have a better understanding on how they can benefit from direct mail.

Bart Simpson Knows Repetition

Successful Advertising – How many times does someone need to see an ad before buying?
The first time people look at any given ad, they don't even see it.
The second time, they don't notice it.
The third time, they are aware that it is there.
The fourth time, they have a fleeting sense that they've seen it somewhere before.
The fifth time, they actually read the ad.
The sixth time they thumb their nose at it.
The seventh time, they start to get a little irritated with it.
The eighth time, they start to think, "Here's that confounded ad again."
The ninth time, they start to wonder if they're missing out on something.
The tenth time, they ask their friends and neighbors if they've tried it.
The eleventh time, they wonder how the company is paying for all these ads.
The twelfth time, they start to think that it must be a good product.
The thirteenth time, they start to feel the product has value.
The fourteenth time, they start to remember wanting a product exactly like this for a long time.
The fifteenth time, they start to yearn for it because they can't afford to buy it.
The sixteenth time, they accept the fact that they will buy it sometime in the future.
The seventeenth time, they make a note to buy the product.
The eighteenth time, they curse their poverty for not allowing them to buy this terrific product.
The nineteenth time, they count their money very carefully.
The twentieth time prospects see the ad, they buy what is offering.
Thomas Smith[disambiguation needed] wrote a guide called Successful Advertising in 1885.[6] The saying he used is still being used today.


Direct Mail Chart The article states that since 1980, more than one hundred studies have been conducted in the United States, U.K. Taiwan, Sweden, Norway, France and Japan to explore how people read and comprehend on paper versus screens. Overwhelmingly, the studies conclude that readers prefer real paper over its electronic counterpart and achieve higher levels of comprehension and retention with paper.

True or False: Email is more effective than Direct Mail because you can tie it to online offers.

The answer is False. According to the DMA 2012 Response Rate Report, response rates for direct mail to existing customers averaged 3.40 percent, compared with 0.12 percent for e-mail, which is roughly a 30-fold difference. Smart marketers who use Quick Response codes can easily tie a Direct Mail campaign into an online offer, seamlessly tying an effective, attention getting medium with an easy way to respond.

True or False: Consumers do not like Direct Mail.

False. According to a 2011 Channel Preference Study by Epsilon Targeting, Direct Mail is actually a channel that consumers trust, with 60 percent of consumers preferring direct mail for marketing messages.

True or False: No one reads their Direct Mail, they just throw it away.

False. According to the DMA Statistical Fact Book 2012, 81 percent of consumers say they read or at least scan their direct mail. But not all Direct Mail is created equal. According to Leflein Associates, “Physical mail preferred by many,” April 2010, consumers are 70 percent more likely to open a mail piece with color text and graphics on the front before opening pieces with no headline or graphic.

True or False: Only older generations read Direct Mail, while the younger generation is moving to online only.
False. Nielsen’s Evolution of the Circular from 4Q 2011 reports that 92 percent of millennials are most influenced by direct mail. These millennials may be more message savvy, however, so marketers who really want to reach the up and coming generation should make sure they are sending relevant and personalized messages.

 

Advertising Your Brand: How Many Times Do Consumers Need to See/Hear It Before They Buy?
Mad Men-era advertising wiz, Herbert Krugman (Ted Bates, Inc., GE, and Raymond Loewy), took a special interest in consumer behavior. In order to plan efficient TV media buys, he did research in the late 1960s, on how many times consumers needed to see an ad for the same product or brand, before taking an action (i.e., buying). This is how he came up with his famous Theory of Effective Frequency for advertising.
Intuitively we know that repetition (frequency) is the basis of any learning process, and it’s no different for consumers learning about a product. However, since cost optimization is an important consideration in media planning, the issue for advertisers is to limit the frequency to the point where diminishing returns occur.
After some research, Krugman initially concluded that the magic number was three. In other words, after seeing or hearing about a product or brand three times, consumers would take an action. As he explained it,

  • “The first time someone is exposed to your ad, you attract their attention, but nothing is really taken in, thus “What is it?”.
  • The second time is when the consumer begins to engage with the relevance of the ad, and asks “So what?”
  • And the third exposure to the ad is when the viewer decides whether “This is for me”, or whether they will choose to forget it.”

Of course, a number of factors impact this ad frequency theory, for example: how well known the product or brand is already, the audience category, the complexity of the product or message, the cost structure of the product, the saturation level of the market, and more.
Later research (including some done by Krugman) suggested the number was more than 3 . For example, Canadian Grant Hicks  decided it was five touches, based on his research on financial advisors and their clients. Nielsen media guru Erwin Ephron’s work lead him to conclude it was three to five touches. More recently, a Nielsen study claims ten social media touches are needed to effect a behavior change.
Whether the number is 3 or 5 or more, the point here is that you’ve got to get your product in front of your customers multiple times in order for them to take the action you want.
Surprisingly, this isn’t always obvious to all businesses – I worked with a CEO once who wondered why the ONE direct mail campaign he approved didn’t bring in the results he wanted. And his product was fairly complex and new to the market – it would have benefitted from multiple advertising touches. Instead, he concluded that marketing wasn’t working for his product.
The great thing about digital marketing today is that there are many cost-effective ways to achieve your multiple marketing touches: email, social media, display advertising, websites, microsites, sponsorships, content marketing, etc. And you can test each channel in order to find the right combination for your customers and brand, with much less cost and effort than Herb Krugman could back in 1969 when TV, radio, and print were the primary advertising channels.
Sources for more information:

  • Herbert E. Krugman. “The Impact of Television Advertising: Learning Without Involvement” Public Opinion Quarterly, volume 29, page 349, 1965.
  • Herbert E. Krugman. “Why Three Exposures May Be Enough.” Journal of Advertising Research 12, 6 (1972): 11-14
  • Batra, Rajeev, Donald R. Lehmann, Joanne Burke, and Jae Pae. “When Advertising Have An Impact? A Study of Tracking Data.” Journal of Advertising Research 35, 5 (1995): 19-32