Generic Advertising Wearout

Abstract

Advertising wearout, defined as the declining effectiveness of a commercial or campaign associated with increased exposure, is examined from a generic advertising perspective. Generic advertising campaigns of the type typically undertaken by agricultural commodity groups differ from branded advertising in that the former seek to increase aggregate demand for a product category (e.g., beef, milk, wool) rather than the market share of a particular brand within a category. A major hypothesis addressed in this research is whether generic campaigns are subject to the same generation-satiation-decay cycles found for the more typical brand advertising campaigns. The hypothesis is examined by estimating a time-varying parameter model using data from the first fourteen years of an advertising campaign for fluid milk. Results suggest that the cycles predicted by wearout theory do exist in the case of specific generic thematic appeals. However, other phenomenon, such as a "learning curve" on the part of campaign managers, may be more important in explaining overall changes in effectiveness of generic advertising campaigns over time.