Decay Effects in Online Advertising: Quantifying the Impact of Time Since Last Exposure on Branding Effectiveness

William J. Havlena
Dynamic Logic

Jeffrey Graham
Starcom MediaVest Group

INTRODUCTION

By the end of 2004, the online advertising business had grown to $2.7 billion (Interactive Advertising Bureau, 2005). While much of the investment in the medium has been related to direct response and search-based advertising, a substantial percentage has been devoted to brand-building activities and sponsorships.

Because the internet is an emerging medium and has grown within an environment of increasing demand for accountability, online advertisers have used a variety of methods to measure the efficacy of online advertising. While direct response advertisers have direct financial measures to judge ROI, many brand advertisers, particularly when employing the internet experimentally, have found direct-to-sales measures infeasible. For that reason, some have employed attitudinal measures such as brand awareness and purchase intent to measure the effectiveness of their online advertising.