Information content of advertising: Empirical evidence from the OTC analgesic industry

Abstract

We use data from video files of all advertisements in the OTC analgesics industry from 2001 to 2005 to measure the information content in ads. We propose a simple theoretical framework to motivate an ordered probit model of information content. We find that stronger vertical differentiation is positively associated with the delivery of more product information in a brand's advertisements: brands with higher levels of quality include more information cues. Comparative advertisements contain significantly more product information than noncomparative advertisements. Brands with higher market shares and brands competing against generic substitutes with higher market shares have less information content. Our empirical analysis examines the relationship between market variables and the information content of advertising. First, we classify and fully measure different types of advertising content, as well as the distribution of information cues, within an entire industry. KeywordsSecond, we use an ordered probit model of the number of information cues in advertisements as a function of the market share of a brand, its core vertical characteristics, and the share of the generic substitute. To motivate the selection of an ordered probit we develop a simple and intuitive framework in which firms decide how much objective information to include in an advertisement.The underlying idea behind our empirical analysis is that there exists a trade-off between objective information and other persuasion, subject to random factors intrinsic to specific ads. The amount of time spent on information-as approximated by the number of information cues-has systematic and random components.We find that stronger vertical differentiation is positively associated with more information.We also find that comparative advertisements contain significantly more information than noncomparative advertisements, and that larger brands and a higher market share of the generic version of a brand are both associated with less informative ads. Significant estimation bias results from not controlling for the endogeneity of the decision to use comparative advertising and from the endogeneity of market share.Our analysis contributes to the sparse empirical literature on the persuasive vs. informative content of advertising (see Bagwell, 2007, for a comprehensive survey). To our knowledge, the only

DIY in the DNA: Macro Context and National Myth as Enduring Advertising Discourse

“…Unfortunately, the critical literature rarely crosses the path of the largely more positivist marketing literature which offers a large body of cross-cultural and single country empirical advertising research within nationally specific cultures. This second body of research recurrently relies on a range of more or less micro tools, used individually or together, such as value orientations or advertising appeals in advertising messages from one country or several countries (AlbersMiller/Gelb 2013;Mueller 1987;Tai/Chan 2001), information content (Al-Olayan/Karande 2000; Anderson et al 2013;Martenson 1987;Tai/Chan 2001;Weinberger/Spotts 1989), advertising form (Caillat/Mueller 1996;Deighton et al 1989;Kim et al 2017;Wells 1989;Zandpour 1992), or creative strategy (Caillat/Mueller 1996;Frith/Wesson 1991;Wei/Jiang 2005;Zandpour et al 1992).…”

Message Strategy and Information Content of Advertising in Women’s Magazines in Poland

“…Information content measured in this way was the then summed up, giving a total information content score. The Resnik and Stern information classification system has been subsequently used in numerous studies relating to, inter alia, the relationship between the information content of the advertisement and the type of product being advertised (Chou, Franke and Wilcox, 1987;Abernety and Franke, 1996;Akkan, 2007;Manganello, Clegg Smith, Sudakow and Summers, 2012;Anderson, Ciliberto and Liaukonyte, 2013), culture of the recipients of the advertising message (Biwas, Olsen and Carlet, 1992;Rajaratnam, Hunt, and Madden, 1995;Herpen, Pieters, Fidrmucova and Roosenboom, 2000;So, 2004), and the medium used (Abernety and Frank, 1996). In parallel, the researchers turned their attention to changes in the content of advertising in time (Pelsmacker and Geuens, 1997;Lawson, Borgman and Brotherton, 2007).…”

Non‐Comparative and Comparative Advertising in Oligopolistic Markets

“…Recent empirical evidence suggests that firms use both non‐comparative and comparative advertising to approach consumers (see e.g. Liaukonyte, ; Anderson et al ., , ). For instance, Liaukonyte () shows that in the USA.…”

“… This result is in line with recent empirical evidence that suggest that oligopolistic firms use both non‐comparative and comparative advertising in order to promote their products (see, e.g. Liaukonyte, ; Anderson et al ., , ).…”