In Search of Advertising ROI: The Impossible Dream versus "Bounded Rationality"

This paper describes the search for tools to measure advertising ROI and uses the work of Paul Gerhold, the marketing researcher, to explain some of the difficulties over time.

In Search of Advertising ROI: The Impossible Dream versus “Bounded Rationality”

Gale Metzger

Advertising Research Foundation

What do we know about the payout from advertising investments? Well-schooled advertisers know their general return, and they learn more with every ad campaign that is properly planned and tracked.

In 1961, the Association of National Advertisers published a manual, Defining Advertising Goals for Measured Advertising Results [DAGMAR], which provided an informed method to knowing advertising’s return on investment (ROI). DAGMAR was so popular that it was reprinted nine times; not good enough, however, to satisfy those who search for a...

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