Advertising Experiments at Ohio Art Company Group I Section C IIM Indore
Etch A Sketch
Immediate Concerns – Ohio Ohio Art Company •
Is it justified to allocate a $ 2 million budget of national advertising campaigns for Etch A sketch and Betty Spaghetty? How will Ohio Art company justify the shelf space allotted to Betty Spaghetty to the the merchandise merchandise managers?
Comparative Study of the Advertising Experiments Factors
Etch A Sketch Experiment
Betty Spaghetty Experiment
Cincinnati Charleston, Cleveland, Indianapolis, Pittsburg (4) 3 weeks November 27 27 to December December 16, 2006 TV commercials Morning and evening talk shows, daytime soaps, evening news program
Phoenix, Arizona California (1)
Control Cities Duration Time Period Mode of communication Shows
Reach of each commercial Target Audience Media Spend Cost of Developing ads GRP Average gross margin Average Retail Margin
3.7% of population in Cincinnati Adults and kids $30,150 $75,000 310 58% 36%
4 weeks June 17 to July 14, 2007 TV and Radio Commercials Cable channels like Nickelodeon and Cartoon Network; radio commercials on morning & evening commutes 1.8% of population in Phoenix Girls aged 2 -11 years $39,522 $150,000 664 56% 36%
Given Experimental Data Experiments
Etch A Sketch
Weekly Sales of Classic EAS and Doodle Doug in Cincinnati and the four control cities from December 3, 2005, to March 2, 2007. EAS – Ohio Art Media Plan from UVA-M-0752X •
Weekly Sales of Betty Spaghetty in Arizona (test – city) and California (control – city) from June 17, 2007, to July 14, 2007. Total Sales Value for BS SKUs – Go Go Glam Gl am and Color Crazy.
Analysis of Advertising Experiment Data of Etch A Sketch Analysis
Difference between Nov 2006 and Dec 2006 EAS sales in Cincinnati.
Seasonality effect can’t be
EAS sales in Cincinnati during Dec 2006 versus corresponding sales in other 4 control cities.
Disruptive Growth Trends observed. Hence no concrete conclusion can be derived from the analysis.
Comparing Dec 2006 sales to December 2005 EAS sales for Cincinnati
Data Not Available
Comparing EAS sales with that of Doodle Doug in Dec 2006 for Cincinnati
Advertisement boosted the sales of EAS
Comparing Pre and Post Advertising sales data of Cincinnati with the control cities
Advertisement boosted the sales of EAS.
Analysis of Advertising Experiment Experiment Data of Betty Spaghetty Analysis
Comparing pre and post advertisement advertisement sales in Arizona
Sufficient data unavailable
Comparing the sales per store per week of test and control cities UVA-M-0752X.xls
Growth due to advertisement was observed.
Required Data for Concrete Analysis
• • • • •
2005 Sales Data of all cities SKU wise sales data External factors influencing sales in all the cities Annual industry growth Average Impact to calculate Weighted Weighted No. of Exposures (WE = GRP X Impact)
• Yearly Sales of 2006 and 2007 • External Factors influencing sales in all cities • Annual industry growth • Average Impact Impact to calculate calculate Weighted Weighted No. of of Exposures (WE = GRP X