Sales Impacts of Location Based Advertising Using Wireless Communication Technology

Abstract:

Using wireless communication technology, location-based advertising (LBA) is booming recently. Most LBA researches are cross-sectional analysis studying only contemporaneous impacts, which might seriously underestimate advertisings’ efficacy in the long run. Complementary to these researches, we employ a company archival dataset to explore LBA’s and PUA’s (Pop-up Advertising) sales impact in both contemporaneous and long run terms. The developed dynamic structural equation model reveals that (1)in terms of magnitude, LBA’s efficacy is stronger than that of PUA both contemporaneously and accumulatively; (2) in terms of persistent time, while LBA only have contemporaneous impact, PUA’ s impact lasts for 9 days. Theses empirical findings would help managers to allocate advertising budget efficiently while using wireless communication technology.

• Periodical: Applied Mechanics and Materials (Volumes 268-270)
• Pages: 1741-1747
• DOI: https://doi.org/10.4028/www.scientific.net/AMM.268-270.1741
• Online since: December 2012
• Authors: Zong Jin Liu, Yang Yang, Zheng Fang, Jing Cai
• Keywords: Location Based Advertising (LBA), Pop-up Advertising (PUA), Sales Impact, Wireless Communication Technology

References

[1] G. C. Bruner II and A. Kumar, Attitude toward location-based advertising, Journal of Interactive Advertising, 7, 2(2007).

DOI: 10.1080/15252019.2007.10722127

[2] I. Nitzan and L. Barak, Payments as a Virtual Lock-in: Customers' Profitability over Time in the Presence of Payments, presented at the Marketing Science Conference, Houston, Texas (2011).

[3] B. Libai, E. Muller, and R. Peres, The Social Value of Word-of-Mouth Programs: Acceleration versus Acquisition, Marketing Science, 11(2009).

[4] X. Luo, Quantifying the long-term impact of negative word of mouth on cash flows and stock prices, Marketing Science, 28, 1(2009).

DOI: 10.1287/mksc.1080.0389

[5] M. G. Dekimpe and D. M. Hanssens, Sustained spending and persistent response: A new look at long-term marketing profitability, Journal of Marketing Research, 36, 4(1999).

DOI: 10.2307/3151996

[6] B. J. Bronnenberg, V. Mahajan, and W. R. Vanhonacker, The emergence of market structure in new repeat-purchase categories: The interplay of market share and retailer distribution, Journal of Marketing Research, 37, 1 (2000).

DOI: 10.1509/jmkr.37.1.16.18723

[7] V. Dragan and T. Morozan, Discrete-time Riccati type equations and the tracking problem, ICIC Express Letters, 2, 2(2008).

[8] K. Pauwels and D. M. Hanssens, Performance regimes and marketing policy shifts, Marketing Science, 26, 3(2007).

DOI: 10.1287/mksc.1060.0267

[9] L. Xia, M. Xia, and L. Liu, LMI conditions for global asymptotic stability of neural networks with discrete and distributed delays, ICIC Express Letters, 2, 3( 2008).

[10] V. Shankar and S. Balasubramanian, Mobile marketing: A synthesis and prognosis, Journal of Interactive Marketing, 23, 2( 2009).

[11] T. Ambler, Marketing and the bottom line: the marketing metrics to pump up cash flow. London: FT Press(2003).

[12] R. T. Rust, K. N. Lemon, and V. A. Zeithaml, Return on marketing: Using customer equity to focus marketing strategy, Journal of marketing, 68, 1(2004).

DOI: 10.1509/jmkg.68.1.109.24030