May 26, 2011

Part Science, Part Religion

Advertising is part science and part religion.

The science part works like this. We run ads with an offer for tires -- 4 tires for the price of three, this weekend only. We know how much the ads cost. We know how much the discount costs us. We know how much revenue we would have generated without the offer. We know how much we generated with the offer. It's simple math to figure out the ROI.

The religion part works like this. We put up a billboard for our cola. We know how many "impressions" it creates, but we have no idea whether or not it really made an impression. There is no offer. There is very little, if anything, to measure. Why do we do it? Religion. We have faith that in the fullness of time those who advertise do better than those who don't. We can't prove that any given "brand" message leads to any given product sale, but we believe.

Advertising has two purposes -- sales and insurance.

The short term purpose of advertising is sales. That's what the tire ad does.

The long term purpose is insurance. That's what the cola billboard does.

The sales part is science. We measure what we put out and what we take in.

The insurance part is religion. We have faith that our efforts today will be rewarded tomorrow.

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