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Summary Tutorial 2: Marketing Channels
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Summary of articles discussed during the tutorial. Emphasis on Study Design, Results and Implications
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SESSION 2: MARKETING CHANNELSDinner, I. M., Heerde Van, H. J., & Neslin, S. A. (2014). Driving online and offline sales: The cross-
channel effects of traditional, online display, and paid search advertising. Journal of marketing research,
51(5), 527-545.
Dinner et al., discuss own- and cross-effects of three types of advertising (i.e., traditional, online, and
search advertising) on both offline and online sales.
RQ: How does advertising in one channel (e.g., online) influences sales in another channel (e.g., offline)
directly, or indirectly through intermediate search advertising metrics, namely, impressions and click through
rate.
IV: Online advertising (display, search) & traditional advertising
DV: Impressions, click-through rate, online & offline sales
Traditional Ad: Television, Print
Online Ad: Search and display ad (banner ads)
Cross-channel effect: Online advertising has an impact on offline sales
Own-channel effect: Online advertising has an impact on online sales
One reason to expect cross-effects is that customers prefer to shop in certain channels, and when they see
advertising, whether it is traditional or online, they purchase in the channel they prefer. That preferred
purchase channel may differ from the advertising medium, causing a direct cross-effect. Additionally,
products may have digital and non-digital attributes, that require physical presence. There is reason to
suspect that even if paid search advertises bring customers to the website, customers prefer to go to the store
to make the purchase.
Cross-effects of traditional/online display may be boosted or diminished by an indirect effect manifested by
its impact on paid search impressions and click though rate. Because there are two arguments:
Traditional and display Ads might increase click-through rate by raising awareness about the retailer which
would create more clicks and more online sales. VS Traditional and display ads serve as a substitute for
paid-search ads thus decreasing click-through rate.
1. Read the discussion section of the paper. Can you find an answer to the research questions of the
authors from what was written there? Were some of the unclear resolved by now?
Results:
• Positive cross-channel advertising effects exist and are almost as strong as own-channel effects.
• Online advertising is more effective than traditional advertising in terms of overall sales impact,
primarily due to the strength of its cross effects on the offline channel.
• Traditional advertising has a positive direct cross-effect on online sales, but in decreases click-through
rates of paid search ads. This effect is only partially compensated by a marginally significant positive
impact on impressions.
• Traditional advertising total cross-effect becomes less positive because of the negative indirect effect
on paid search effectiveness -> Managers face the challenge to overcome the watering of traditional
advertising effectiveness.
, • Cross-effect elasticities are almost as high as own-effect elasticities
• Online display, in particular search advertising is more effective than traditional advertising (due to
strong cross effects on offline channels)
• Traditional advertising decreases paid search click-through rates, thus reducing the net cross effect of
traditional advertising
2. Next, we focus on the conceptual part of the paper. Read the sections ‘Literature Review’, and
Hypotheses’. What is already known about the topic?
Paid-search-Ads: Search Ads – These are designed to appear when the consumer is already looking for an
answer or product. The most common form is a Google Ad, these are the paid-for results that show above
organic results when you use Google to search for something. In this stage, customers are already in the
decision-making process. Paid-search ads should indirectly affect sales through impressions and click-though
rate.
Online Display Ads: These are the ads that appear at other times. Appears like traditional marketing much
earlier and before the decision-making process. Both, traditional and online ads can have a direct effect for
both, offline and online sales because both may lead customer to a store or website.
Click-through rate: Click-through Rate (CTR) refers to the
percentage of people that click on an element that they
have been exposed to. Click-through rate is calculated by
simply dividing the number of people who clicked on a
given element by the total number of visitors to that page.
Search impression: A search impression refers to an Ad
that appeared when a relevant keyword was searched,
they do not were necessarily clicked on.
For equation 1 and 2, they look at impressions and click through
rates over time. What is captured in red and in yellow this
equation?
• They capture traditional and online display ads and cope
for the carryover effect of advertisement (AD Stock).
Different forms of advertisement build stronger
associations with the brand than others and over different
periods. Additionally capture paid search expenditure
• Variables that could drive the DV, like the Christmas
season, current trends during the study.
For equation 3 and 4 they look at Offline and Online sales, who
can explain what is captured in yellow and red -> Page 533
• They take expenditures for traditional and online ads into
consideration, the search clicks through rates
• Variables that might influence sales like competitor
advertisement, the Christmas season, trends during the
study, but also promotions and store clearance sales. Mt in
this equation takes the time span and other markets into
account.
Impressions and click-through rates
• Search Advertising expenditures have strong positive impact on the number of impressions (0,000)
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