Estimating the Half-life of Advertisements

The author proposes a concept for measuring the lifetime of an advertisement and derives closed-form expressions for it under certain conditions and illustrates its use by applying it to the advertising of the Dockers® brand of Levi Strauss and Company.

Abstract

The effectiveness of an advertisement wears out over time; eventually, it becomes totally ineffective. The author proposes a concept for measuring the lifetime of an advertisement and derives closed-form expressions for it under certain conditions. In addition, the author distinguishes the proposed concept, the half-life of an advertisement, from the prevalent notion of the duration of advertising effects. More importantly, the information on the half-life of ads is actionable from a managerial standpoint, whereas that on the duration of advertising effect is hypothetical. To enable advertisers to estimate the half-life of their ads, the author describes an estimation approach and illustrates its use by applying it to the advertising of the Dockers® brand of Levi Strauss and Company. Substantively, the lifetime of advertisements for the Dockers® brand is about three months. Thus, advertisers are well-advised to periodically estimate the half-life of their ads, so that they can plan the timing to replace worn out advertisements.