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Home | Events Archive | Is the Hierarchy of Effects in Advertising Dead or Alive?
Seminar

Is the Hierarchy of Effects in Advertising Dead or Alive?


  • Series
    BDS Marketing Seminars
  • Speakers
    Koen Pauwels (Northeastern University, United States)
  • Field
    Marketing
  • Location
    Online
  • Date and time

    September 07, 2020
    14:30 - 15:00

Advertising influences purchase behavior when it changes how consumers think and feel about brands. While the hierarchy-of-effects (HoE) framework has guided advertising decisions for decades, some authors question its validity, implying the death of HoE. Indeed, to date, HoE lacks comprehensive empirical validation. This article analyzes how cognition, affect, and experience mediate advertising effects on sales, using data from 178 fast-moving consumer goods brands in 18 categories over seven years. It compares the models proposed in the literature and concludes that the concept of integrated HoE, which signifies sequentiality, holds up well. Importantly, the operating sequence varies across brands, with the most prevalent being affect → cognition → experience (ACE). Furthermore, category and brand characteristics such as hedonic versus utilitarian product category, brand differentiation, and brand market share moderate which HoE sequence is more likely to hold for a brand. The prevalence of ACE is stronger for utilitarian products and less differentiated brands. For managers, the results show that the last factor in the HoE sequence is most important in driving sales while affect is the intermediate factor most responsive to advertising.

Keywords: hierarchy of effects, advertising, sales response, intermediate factors, time-series econometrics

Biography

Koen Pauwels is Distinguished Professor of Marketing at Northeastern University, Boston and co-director of its Digital, Analytics, Technology and Automation (DATA) Initiative. Pauwels is the Senior Editor for the Journal of Marketing and the International Journal of Research in Marketing.