http://smallbusiness.chron.com/definition-advertising-effectiveness-23260.html http://www.slideshare.net/mrinalkvbr/advertising-ppt-15854152 http://www.managementstudyguide.com/advertising-effectiveness.htm Key Points: As the saying goes, "a penny saved is a penny earned.

" If advertisers think of the cost for efficiency testing as an investment that prevents future costly mistakes they can think of the prevented costs as a penny earned and take full advantage of the benefits of this strategy. Pretesting can help companies improve their ads and save them money before it is too late. However, many marketers the skip pre-testing because many believe being first in the market offers them an advantage over competitors, so they forgo the research. It's safe to say that there is no general consensus, on the part of advertisers or advertising researchers, as to the best way to test advertising. Advertisement is a communication whose purpose is to inform potential customers about products and services and how to use and obtain them. Every major medium is used to deliver these messages, including: television, radio, movies, magazines, newspapers, and internet. It is often placed by an advertising agency on behalf of a company. Advertisement influence our lives in many unsuspecting ways because of rapid changes in the macro environment. These days advertising is regarded as a paid form of non-personal presentation of ideas, goods and services by an identified sponsor Testing or evaluation of advertising effectiveness refers to the managerial exercise aimed at relating the advertising results to the established standards of performance and objectives so as to assess the real value of the advertising performance. This evaluation exercise is also known as the advertising research. It is a research activity undertaken to measure the worth of the specific elements of an advertisement or the aspects of entire advertising programme. It is an attempt to know whether the message designed properly has reached the greatest number of prospects at the least practical cost. There are various types of media use for advertising these are: print media, electronic media etc. Of all the media, newspaper is considered as the backbone of advertising programme as it has continued to remain the most powerful message carrier. Of the total space, 45 percent goes to advertisements in form or the other and rest for textual matter.

Introduction:
In today's advertising world, every firm invests heavily on advertisement for making their products or services known to the target audience and to arouse the interest of target audience in firm's products or services. Advertising is done with some predefined objectives to generate awareness about product, to arouse interest in product, to change the attitude of audience towards product, to stimulate desire for product, or to make them buy the product. Advertising is of no use if the defined objectives of communication are not achieved. John Wanamaker's famous quote on advertising I know half the money I spend on advertising is wasted, but I can never find out which half. Measuring of advertising effectiveness is one of the areas of advertising about which nothing can be said for sure. This practically begs for a method to identify effective advertising campaigns, commercials, or print advertising. Since heavy amount is spent every year on advertising campaigns it becomes necessary for management to evaluate the effectiveness of advertising. Measuring advertising effectiveness is a measure to know whether the time and money invested in creating an advertisement have resulted in successful attainment of the objective of sales growth and profit maximisation to the adviser. Management wants to know the extent to which advertising programme of the enterprise has been successful. Such evaluation is called evaluation of advertising effectiveness. It is a managerial exercise to know whether the message has reached the largest number of prospect at the least cost. This is the only way to know how the advertisement is performing, is it reaching the targets and is the goal achieved. It is not at all possible to measure advertisement effectiveness accurately as there are many factors like making a brand image, increasing the sales, keeping people informed about the product, introducing new product, etc., which affect the effectiveness of an advertisement. We all know that there are some companies who advertise at very low level but still their products are a hit and some companies indulge in very heavy advertisements but they dont get desirable results. But then, there are some traditional and modern tools to measure most of the effectiveness of an advertisement through which the advertiser can or may get more and more information about how their ads and product are performing in the market.

Importance of Evaluating Advertising Effectiveness:

Evaluation of Advertising is Important because of following reasons: 1. Achieve advertising objectives: Huge amount of money is spent on advertising to increase sales and goodwill of the company. It is evident that companies want to know whether these objectives are achieved or not. This is done by measuring effectiveness of advertising. 2. Justify expenditure on advertisement: Expenditure on advertisement is justified if it produces the desire result. Measuring advertising effectiveness ensure that revenue exceed advertisement costs. The huge expenditure on advertisement is, thus justified by measuring its effectiveness. 3. Selection of advertising media: Companies have to choose amongst wide variety of advertising media for advertising their products. Measuring effectiveness of each medium helps in choosing the most effective medium that will help in achieving advertising objectives.

4. Selection of right promotional tool: There are a variety of promotion tool like advertising, personal selling and sales promotion to increase the sale. How and to what advertising is helpful in increasing sales can be known by measuring its effectiveness. 5. Feedback: Measuring advertising effectiveness helps to get feedback regarding acceptability of advertisement to the consumers in terms of ad design and the product. It helps in marking changes in the advertisement copy, (colour design, illustration etc.) media planning or advertisement campaigning in order to achieve the objective of advertising. 6. Strategic competitiveness: Measuring advertising effectiveness helps in designing advertising campaign that give companies an edge over competitors. Companies can outperform others if there work on feedback obtained from the market and have strategic advantage over competitors. 7. Budgeting: money allocated for advertising is satisfied only if it brings the desire benefits. This can be known by measuring the effectiveness of advertising in terms of sales and communication targets.

Method of Evaluating Advertising Effectiveness:

The goals of advertising relate either to affecting some kind of communication between the sponsor and the audience or to bring about desire sales. According to Philip Kotler, advertising effectiveness is measure by examining the following: Communication effectiveness of advertising campaign or communicationeffect research. Sales-effect of advertising efforts or sales-effect research. A. Communication -effect research: The study related to communication-effect research seeks to discover if advertising has achieved the intended communication effect. The advertising campaign is considered successful if its achieves the communication objectives which can be to create awareness for the brand, increase brand loyalty, change consumers attitude towards the product etc. the exact communication effect can be measure by knowing whether the specific objective of communication is achieved or not. If the objective is to create brand awareness, statistical models and research method are used to determine whether the advertisement has created brand awareness or not. This method is also known as copy testing. The testing can be categorised into two types. Pre-testing of advertising campaign; and Post-testing of advertising campaign. 1. Pre-testing Ads: Advertiser pre-test the efficiency of advertisements; whether they are seen, remember and recalled by the customer or not. Pre-testing determines the effectiveness of advertisement campaign before its implementation. Three major methods of ad pre-testing are; Direct Ranking Portfolio Test Laboratory Test i. Direct Ranking: There are discussions on the validity of rankings based upon consumer judgement. The controversy is whether or not such ranking

show substantial agreement with other measures of advertising effectiveness, especially with actual selling efficiency. Responses reflect the opinion that ranking frequently gives a close correlation with measurement in terms of sales. However, sometimes it fails to do so and it is difficult to predict with certain the outcome of advertising in specific instances. Customer judgement can be on the basis of the following tests: a) Memory Tests: If an individual reacts to an advertisement, it is likely that some memory of the reaction will persist, at least for a few hours. Memory tests, therefore provides a means for measuring advertising effect. It is possible to determine by such tests the extent to which the message has secured attention and interest, familiarity of public with the brand name, the slogan, current theme etc. such information may be significant and useful, although it is not as satisfactory as a detailed picture of selling efficiency. Memory tests can be measure either recognition or recall memory. In the recognition test, the individual is merely required to say whether he has or has not seen or heard the advertisement or programme under investigation. In the recall test, he has to supply some fact, such as brand name, to show that memory impression has been made or that he remembers the advertisement. I. Recognition test: The recognition memory method is usually easy, but is less reliable since there is high possibility of confusion in this method. In recent years, recognition tests have been conducted on a nation-wide scale by several research organisations. The sales people present copy of the magazine containing the advertisement to an individual and ask him if he has read it. If he has, the interviewer turns to an advertisement and asks if it was read. The responses are carefully noted. In this manner, the individuals reactions to advertisements are recorded. The data from many interviewees are tabulated and estimates are made showing effectiveness in terms of cost. The most frequent criticism of this form of recognition test is that response by consumer may involve considerable guessing and there is likely to be a certain amount of error, owing to the fact that people may think that they have seen advertising when they have merely seen other similar advertisement in the series. Though this test is based on the assumption that readers of the advertisement will buy the product they may not necessarily buy that product. People who have not actually even read the advertisement may say that they have read the advertisement to please the interviewer. In spite of the difficulties, the recognition test gives useful information, especially to the amount of attention by a campaign. II. Recall Test: There are several methods of testing memory in recall test. In one of the techniques, individuals are shown advertisement in which the brand name appears and they are asked to tell what product is advertised. A similar method is used to test the memorability of brand marks, packages and slogans. This method is frequently known as aided recall test. It helps the reader to recall the product by mentioning the specific brand. If the advertiser asks the following question to the reader: Do you recall seeing the advertisement of any shampoo in this magazine? If you do, what did that advertisement mention about the LOreal shampoo? The first question relates to unaided recall test as it mentions the product shampoo but not the brand. The second question is the aided recall as it specifically mentions the brand LOreal shampoo. The advantage of this approach is that guessing is discouraged and accuracy of memory is detected. This test shows the extent to which people from association between some features of the advertisers campaign and his

brand name. However, there is no positive relationship between the recall score and resulting sales out of it. b) Attention Test: Advertisers recognise that in order to present their message effectively, they should secure the attention of people whom they wish to influence. Measures of attention are, thus of considerable importance in judging the effectiveness of advertisement. It is customary to measurer attention after the event, in terms of memory. Advertisers, for example, devised a method where they could expose advertisement to people in waiting rooms and other public places. The test was so conducted that individuals observed did not know they were being tested. The investigators recorded the relative amount of attention secured by various advertisements, indicated by time spent in looking at them. For a long series of advertisements, the advertiser was able to show close correlation between attention and returns. These tests are not widely used because of difficulties in their administration. The chief advantage of these tests is that they make possible pre-testing. The chief criticism is that measures of attention value of an advertisement are not positively related to making a sale.

ii. Portfolio Test: Consumers are asked to view a portfolio of ads, taking as much time as they need. Then they are asked to recall all the ads, and their contents aided or unaided by the interviewer. Their recall level indicated the advertisements ability to have its message understood and remember. iii. Laboratory Test: In these tests, equipments are used to measure physiological reactionheartbeat, blood pressure, perspiration to an advertisement. These tests measure an ads attention-getting power but reveal nothing about its impacts on beliefs, attitudes or intensions. The advertiser creates a laboratory situation similar to that of real life like a super-market. A simulator super market is created and the test is conducted in an artificial environment. Rough layouts of advertisement are printed and given to a selected group of customers to know their reaction to the product. Though response, the laboratory conditions are not similar to actual market conditions and to that extent, may not get the desire response from buyers. 2. Post-Testing Ads: Advertiser are also interested in finding the overall communication impact of a complete advertising campaignwhether it has increased brand awareness, started brand preference, etc. the advertiser draws a random sample of consumers after the campaign to assess its communication effects. There are two approaches for post-testing ads: i. Recognition Tests: These test aim at measuring the degree of memorability of methodology used. The test begins by asking the readers whether they have seen or read the specific issue of the magazine which carried the advertisement. The readers are classified into three categories; (a) Noted: Percentage of readers who have seen the advertisement. (b) Associated: Percentage of readers who have seen and read parts of the advertisement. (c) Read Most: Percentage of readers who reported they had read more than 50% of the advertisement reading matter.

The result of recognition test helps in ascertaining the extent to which companys advertisement has made communication impact. ii. Recall Tests: Under the recall test, qualifying readers are shown the magazine cover and with the help of a deck of cards bearing names of different brands, they are asked to state which brand advertisement has been seen by the reader, and he is asked to recall everything he can remember about each advertisement identified by him. B. Sales-Effect Research: Under this method, effectiveness is measured by its influence on sales. If advertisement results in increased sales, it means it is effective. However, measuring sales response is difficult because sales depend on many factors other than advertising also. The above method may give the advertiser some idea about the effectiveness of advertisement but in actual practice, it is difficult to measure sales effect of advertisement. This method should be used when advertising is the major factor contributing to sale and when sales are the immediate outcome of advertising keeping other internal and external factors as constant. Very few attempts are made to measure the sales effect of advertising in any system manner. They have primarily been in the area of measuring the required number of exposures for a campaign. Colin McDonalds study in the UK in the 1960s is considered to be one of the pioneering works in this area. He studied the effect of advertising on brand switching. His study led to the popular minimum two exposure practice of campaign planning. More recently, John Phillip Jones measured the shortterm effect of advertising on purchase. He has defined the term STAS (Short Term Advertising Strength) to conclude that ads work even with one exposure. Moreover, campaigns which are effective in the short-run are also effective in the long-run. This research is likely to affect the way in which advertising is planned, executed and evaluated.

Reasons why Companies should Measure Advertising Effectiveness:

1. Avoiding Costly Mistakes: This means that companies are spending thousands if not millions of dollars each year to advertise, but it doesnt mean that it is being spent wisely. The only way to ensure that this money is not being wasted on ineffective advertising programs is to continuously evaluate the effectiveness of the chosen programs and to ensure that these programs are achieving their intended purpose. 2. Evaluating Alternative Strategies: Not only is it important to evaluate the effectiveness of the chosen method, but also the opportunity costs of choosing that method. Often after companies have chosen a method, they focus their attention exclusively on that method ignoring the potential profits that would have come about if they went with an ulterior method. A good evaluation program will be able to analyse the effectiveness and the opportunity costs of the chosen method. 3. Increasing the Efficiency of Advertising: Often after companies choose a particular method, they become attached to that method and lose sight of the initial goal they were aiming for. Because the marketers know what the intended message of that chosen program is, they expect their customers to know that message as well. A

continuous evaluation of the chosen program will ensure that the message the consumers are receiving from this program is aligned with the message the marketer intended to send. Reasons why companies often DON'T measure Advertising Effectiveness: 1. Cost: the most common reason that companies provide for not measuring their advertising effectiveness is the cost of conducting a measurement program. Often companies believe that the money used for measuring their advertising effectiveness can better spend on creating more advertisements or improving their product. Although this might possibly be true, lets consider the flip side; if the company does not measure the effectiveness of its current advertising program, they will not know if this program reaches their desired audience, sends the desired message or meets its intended goals. Being able to increase the advertising budget or improve the product will not help the company if the message is sent to the wrong audience or if the message that is comprehended by the consumers is different from the message that the company intended to send. As a result even the slightest evaluation effort can go a long way in ensuring that the desired message is sent to the appropriate audience and hence saving the company thousands if not millions of dollars. 2. Research problems: As we will see in the sections to come, the evaluation process can be very complicated, time intensive and confusing for a company that is trying to start such an effort. In addition, it can very difficult to isolate and evaluate the effects of only one of the companys marketing efforts; as a result managers often cannot justify the costs if they cant pin point the contribution of each of their marketing efforts. For example, it might be very difficult to isolate the contribution of the companys banner ad program from their overall marketing effort as a consumer might not necessarily make a purchase based on what they see in banner ads, but consider a variety of factors (brand image, pervious experience with the company, or an on TV) when making a purchase decision. However, although it might be true that we cannot pin point the dollar contribution of one program, research can be used to evaluate the communication, reach and other factors associated with each advertising method. 3. Disagreements on what, when and where to test: There are a variety of methods used when determining what, where and when to measure the effectiveness of an advertising program. Choosing the appropriate measurement method depends largely on the industry the firm is in, the objectives of the program based on GOPST analysis and the person that will be analyzing the results. For example, sales managers may want to measure the contribution of the advertising program on sales, whereas top executives may be interested in the effects of the program on the companys image. These differences often lead to a great deal of confusion between the mangers and might lead them to abandon the evaluation program altogether. However, there is no rational reason for this conflict as we will later see, each of the measurement tools work to achieve a different objective.

Conclusion:

References: Rajput N and Vasishth N.., Advertising & Personal Selling, Himalaya Publishing House, New Delhi, 2011. http://www.managementstudyguide.com/advertisingeffectiveness.htm http://www.witiger.com/ecommerce/MeasuringMarketingEffective ness.htm http://www.managementstudyguide.com/advertisingeffectiveness.htm http://www.enotesmba.com/2012/07/mba-notes-advertisementevaluation.html