Last week I shared some facts and figures related to whether or not purchasing an advertising slot on the Super Bowl telecast would be considered "a good deal." We considered Audi as our example company for this illustration. Based on the estimated price tag of up to $3 million for a 30-second spot and an estimated audience of 93 million (our reference point from last year's number), we calculated that Audi would be reaching its audience at a cost of slightly more than 3 cents each. That sounded like a pretty attractive price!
So, now we need to build in some realism to our purchase evaluation. First, given that not all of us viewers have $38,400 (mid-point MSRP for an entry-level A4 model) sitting idly by in our bank accounts for such a purchase, we need to begin by figuring out what proportion of the 93 million viewers are actually within our potential market. For the sake of simplicity, let's "assume" that 25% of our 93,000,000 viewers (a pretty ambitious assumption) have the means to purchase an A4. That takes us down to only 23,250,000 individuals we really are interested in reaching who are likely to be part of our Super audience.
Our cost to reach that group now jumped to 12.9 cents each, which is still decent. Here, though, is where the concept of "information processing" comes into play. In order for an advertising message to have a lasting impact on a consumer, it has to surpass all sorts of obstacles that we consumers present, making meaningful communication from an advertiser a difficult thing indeed. The steps look something like this:
And an incoming message has to gain our attention, be processed accurately, believed, and saved in long-term memory (i.e., retention) in order for it to impact a future purchase decision. So, let's again assume a 25% success rate for each of these stages--and if you think that's too low, try to estimate how many commercials you can recall from the last evening you spent watching TV. Not a pretty picture.
Using those estimates, we move from 23,250,000 (exposure) to 5,812,500 (attention) to 1,453,125 (comprehension) to 363,281 (acceptance) to 90,820 (retention). Now, how much is that ad costing per person that has processed and remembered our message? Our initial 3 cents per viewer cost just jumped to slightly more than $33.
Actually, this could still be a good deal, given the company revenue we're looking at on each Audi purchase. But it does illustrate an important lesson that we have to consider when we're purchasing an ad. Will that advertisement actually reach a significant number of our targeted consumers, and can we effectively communicate our desired message in a way that is remembered until consumers are ready to make that actual purchase decision?
It's certainly one reason that makes the field fo advertising far more complicated than the average Joe considers it to be. It's also one of the reasons that advertising executives often look like they may not be getting enough sleep at night.