Indirect advertising effects can have an important role, over and above incremental sales volume, according to new research.

Reported ROI typically captures the direct sales effect of advertising in the short, medium and (sometimes) long-term. But it usually misses its indirect effects, which can be transformational.

Why it matters

Good advertising increases value perceptions and grows margin for brand owners, creating pricing power of enormous commercial value. This has never been more important as we navigate double-digit consumer price inflation and the need to pass on large cost increases to customers. 

Takeaways

• ROI calculations used for planning are typically flawed...