Happy Bday, MDC! Cheers 2 first 4

Happy to celebrate my birthday this Friday at the 20th anniversary of the conference I founded: Marketing Dynamics! Grateful to the organizer Yakov Bart and all the participants, I was especially proud of my four coauthors who did such an excellent job presenting our research:

1) Does ad spend increase with user ratings? Evidence from Amazon

Davide Proserpio (Amazon), Daniela Yu (Amazon) 

2) When and where should the government advertise for support of its anti-pandemic actions Lina Welke (ESSEC), Raoul Kübler (ESSEC)

3)  From Representation to Reception: Evaluating the Impact of Diversity in TV Advertising on Consumer Purchase Intention Gijs Overgoor (Rochester Institute of Technology), Gokhan Yildirim (Imperial College London), Yakov Bart

4) Optimizing Digital Out-of-Home Advertising: A Field Experiment Shun-Yang Lee (Northeastern University), Yakov Bart (Northeastern University)

For all 4 papers, please comment below this post for me to send you more specifics. Here's my trailer to whet your appetite:

1) User ratings drive ad spending, which deserves credit for the sales bump

Your sales go up with higher perceived product quality, but is that all there is to the story? Daniela Yu and Davide Proserpio show that sellers increase their ad spending when their Amazon review rating jumps to the next half-star (e.g. 4 to 4.5), and that this ad increase deserves part of the credit for the overall sales bump.

The method of regression discontinuity cleverly uses the fact that consumers observe rounded user ratings when browsing the product category. The actual quality difference between a 4.24 and a 4.25 star-rated product should be negligible, so we can interpret the ad spent and sales difference as caused by the rounding jump.

2) While COVID increased stress, lockdowns lowered it across US cities

Raoul took us first down memory lane when the pandemic increased our stress levels:

 A common criticism of lockdowns was that they led to increased stress and other mental strain. However, Twitter data across US cities (with very different lockdown restrictions) consistently shows that, while stress levels increased with COVID cases and deaths, lockdowns actually REDUCED stress levels.

 This reduction was more substantial in situations with lower costs of staying in, and lower benefits of going out, e.g. high commuting times.

3) Minority representation in TV ads only helps purchase under low attention

Gijs painted a nuanced picture of how consumer purchase intent for your brand changes with minority representation in your TV ads. Specifically, the 'Black actors' share of Advertising' (BASOA) has increased after the George Floyd murder and subsequent public attention to racial equity.

However, our analysis consistently shows that consumers react more positively to such representation (in their brand purchase intent) when they pay LESS attention to the ad, as measured by the ATR75 attention score. Before George Floyd's murder, this effect meant that purchase intent significantly increased under low ad attention, and stayed flat under high ad attention. Afterwards, this effect meant that purchase intent stayed flat under low ad attention, but significantly DECREASED under high attention.

 4) Digital billboards enable maximum search impact by controlling frequency

Representing the best university in the US Northeast, Shun-Yang revealed the power of digital out-of-home (OOH) in driving customer action.

In a Florida field experiment with digital billboards, we used the random arrival of drivers passing by exactly during the 8 seconds when the ad was shown versus right before/after to create experimental variation:

Consumer exposure to the digital billboard ad significantly increased and sped up the brand's website visitation, especially with repeated exposure. Interestingly, the ad effects show wearin (peaking after a day), wearout of several days, and weariness against too many exposures.

 Optimizing ad exposure intensity based on this ad response curve, reveals that a more frequently refreshed ad display decision yields significant efficiency gains, with DOOH advertising being an order of magnitude more efficient than traditional OOH advertising. Specifically, we propose an ad schedule to minimize consumer fatigue from frequent exposure, while still maximizing reach.  

So there you go: the first 4 awesome papers from the 20th Marketing Dynamics Conference! Stay tuned next week for my selection of best papers from folks smart enough NOT to work with me :-) And after work, we had so much fun showing off beautiful Boston: