“Super Bowl commercials often feature the best and most creative work of advertising agencies,” says Rucker. “A lot of effort goes into designing and delivering Super Bowl spots, and that makes them a spectacle that people want to be a part of.”
But the world of advertising has changed dramatically over the past decade, and not just with the shift from big-budget ads to online influencers. Kellogg’s Marketing Department faculty has researched trends in diversity, artificial intelligence, ad campaign metrics, and the effectiveness of TV ads in today’s media landscape.
Read the highlights from their research below and be sure to tune in for the annual Super Bowl ad review by teachers Tim Calkins and Derek Rucker on February 9.
1. Diversity in advertising has great benefits
Conventional wisdom says that ads should target the most likely customers. For example, cosmetics ads often only show young women using their product, while beer ads are more likely to show men.
But a study by marketing professor Aparna Labroo and colleagues found that presenting a diverse group of people in an ad has several specific benefits. More specifically, consumers who saw more diversity—in terms of different ages, races, genders, or nationalities—in a brand’s ads were willing to pay more for that brand’s products.
The reason? People believed that brands that displayed diversity in their ads offered a greater variety of products and were overall more creative.
“If an ad shows people who look different, consumers seem to instinctively believe that those people must have different needs, and that a company that caters to such different needs must be more innovative and creative,” says Labroo. “And consumers who think this way are more willing to use the product and pay more for it.”
2. Artificial intelligence will make advertising more personal—and persuasive
Thanks to the Internet, we’re all used to targeted ads that mine our browsing data to create a personalized promotion. But with the advent of new artificial intelligence tools, these customized ads will become even more ubiquitous, according to the assistant professor of marketing Jacob Tiny.
“This particular influence tactic, personalized persuasion, will now be more scalable and widely deployed than ever before,” says Teeny.
But how do consumers react to these AI-generated appeals? In a series of studies, Teeny and his colleagues at Columbia and Stanford tested advertising messages written by ChatGPT aimed at people with specific personality traits, such as extroversion or conscientiousness. They found that people with these traits preferred tailored messages to generic ads—even when they were told they were generated by AI.
This is good news for companies experimenting with AI-based marketing. But for the rest of us, this new messaging limit requires everyone to be even more careful about what they read online, says Teeny.
“We’re going to be overwhelmed by things that we naturally feel drawn to,” he says. “So we may need to take a second step to actually investigate the source or the plausibility of the message — whether it’s a consumer product or a political news article.”
3. Active ads keep viewers’ attention
If you think TV commercials are getting louder, faster and busier, you’re not just getting old. A Kellogg study of more than 27,000 ads found that ad energy has increased over time and that higher energy ads kept viewers watching.
Lakshman KrishnamurthyA. Montgomery Ward, Professor of Marketing at Kellogg, and colleagues adapted a measure of “energy” from Spotify to assess the auditory and visual intensity of TV commercials. They found that this metric increased by 33 percent between 2015 and 2018, reflecting a shift toward louder and more intense ads.
The researchers also found that viewers are not bothered by this noisy approach. Overall, the higher energy levels resulted in fewer people tuning in after checking the network, day of the week, and time slot the ad aired.
The increase in power may be related to a 2010 law that prevented ads from using a higher volume than the programs they surround.
“Advertisers now know they can’t increase the volume of their ads, so they’re looking for other ways to get viewers’ attention,” says Krishnamurthi. “Our research shows that increasing ad energy can do this, and now advertisers can continue to tailor their ads to find the right fit.”
4. Make sure you know what you’re measuring
The ultimate metric that most marketers swear by is return on ad spend, or return on ad spend (ROAS). But when Kellogg’s Eric Anderson and Brett Gordon Looking at the growing digital advertising sphere of retail-media networks, they found that small decisions about how ROAS is calculated can make a big difference.
In theory, retail media networks should make this calculation simple. Pioneered by giants like Amazon and Walmart, the model places sponsored links on the “digital shelf” of an online shopping site. These platforms can then measure which users saw the ads and link that exposure to potential purchases.
And yet, Anderson and Gordon caution that platforms may use very different methods to calculate a campaign’s results. This is a problem when advertisers want to compare performance between platforms.
To illustrate this point, researchers examined the impact of common return on advertising investment (ROAS) assumptions using data from the retail media network of a large grocery chain. They found that seemingly small decisions can make a huge difference—up to 63 percent, when four different methodological choices were combined.
“When seemingly common, defensible options move ROAS by 63 percent, that can overturn a ban,” says Gordon.
To improve data consistency, the researchers suggest a set of questions advertisers should ask platforms before working with them.
“When you’re spending your ad dollars, you should be dictating what you want to do in the calculation,” Anderson says.
5. TV advertising may not be worth it
It can be prestigious for a company to run an ad during the Super Bowl or other high-profile broadcasts or events. But do the rewards justify the huge cost?
When marketing professor Anna Tuchman And two colleagues analyzed the impact of television commercials on sales of more than 200 consumer packaged goods, finding that the impact was often dismal.
The companies in their sample spent an average of $10.5 million per year on advertising for each product. But the return on investment for TV ads was negative for more than 80 percent of the products tested.
They also found that the median advertising elasticity—how much sales would increase if a company doubled its TV ads—was just one percent, much lower than previous estimates.
Tuchman speculates that consumers today may not pay as much attention to TV ads. Because many people are now reading on their phone or tablet during commercial breaks, viewers can often be exposed to an ad, “but you didn’t even notice because you were so engrossed in your phone,” Tuchman says.
“It seems that companies are really over-advertising and would be better off reducing their advertising spend,” he concludes.
