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Determinants of Temporal Variations in Advertising Effectiveness

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  • Chung, Chanjin
  • Kaiser, Harry M.

Abstract

This article develops a varying-parameter advertising model which specifies advertising parameters as a function of variables representing advertising strategies and market environments to explain the varying nature of the advertising responses. Unlike prior models, this model allows researchers to examine the sources of change in advertising effectiveness over time. The model is applied to the New York City fluid milk market for the period from January 1986 through June 1995. Results indicate that advertising strategies and market environments play important roles in determining advertising effectiveness. Particularly, demographic factors were more important than economic factors. The results also suggest that when a market is in an unfavorable or unsaturated condition, advertising generally becomes more important and effective.

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Bibliographic Info

Paper provided by Cornell University, Department of Applied Economics and Management in its series Research Bulletins with number 122689.

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Date of creation: Apr 1998
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Handle: RePEc:ags:cudarb:122689

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Related research

Keywords: determinants; generic advertising effectiveness; milk; time-varying parameters; Marketing;

References

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  1. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
  2. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
  3. Hendry, David F, 1986. "Econometric Modelling with Cointegrated Variables: An Overview," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 48(3), pages 201-12, August.
  4. John D. Jackson, 1997. "Effects of Health Information and Generic Advertising on U.S. Meat Demand," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 13-23.
  5. Kinnucan, Henry W., 1986. "Demographic Versus Media Advertising Effects On Milk Demand: The Case Of The New York City Market," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 15(1), April.
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Cited by:
  1. Maynard, Leigh J., 2000. "Empirical Tests Of The Argument That Consumers Value Stable Retail Milk Prices," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 18(2).
  2. Chung, Chanjin & Kaiser, Harry M., 2000. "Do Farmers Get An Equal Bang For Their Buck From Generic Advertising Programs? A Theroetical And Empirical Analysis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(01), July.

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