Quantifying the Ripple: Word-of-Mouth and Advertising Effectiveness

John E. Hogan, Katherine N. Lemon and Barak Libai

Journal of Advertising Research, 2004, vol. 44, issue 03, pages 271-280

Abstract: In this article the authors demonstrate how a customer lifetime value approach can provide a better assessment of advertising effectiveness that takes into account postpurchase behaviors such as word-of-mouth. Although for many advertisers word-of-mouth is viewed as an alternative to advertising, the authors show that it is possible to quantify the way in which word-of-mouth often complements and extends the effects of advertising. The authors provide a simple approach to the measurement of postpurchase word-of-mouth sales effects and demonstrate how firms may be underestimating advertising effectiveness by ignoring such effects. Their approach illustrates how customer lifetime value models can provide an important tool to assess the long-term effects of advertising campaigns.

Date: 2004

Downloads: (external link)
http://journals.cambridge.org/abstract_S0021849904040243 link to article abstract page (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cup:jadres:v:44:y:2004:i:03:p:271-280_04

Access Statistics for this article

More articles in Journal of Advertising Research from Cambridge University Press
Address: The Edinburgh Building, Shaftesbury Road, Cambridge CB2 2RU UK
Series data maintained by Mike Eden ().