Information Content of Advertising: Empirical Evidence from the OTC Analgesic Industry
38 Pages Posted: 25 Jul 2010 Last revised: 18 Dec 2012
Date Written: December 18, 2012
We empirically study the information-persuasion trade-off in advertising using data on the information content of advertisements, which we measure with the number of information cues in ads. We propose a simple theoretical framework to motivate an ordered probit model of information content. We find that stronger vertical differentiation is positively associated with the delivery of more product information in a brand’s advertisements: brands with higher levels of quality include more information cues. Next, comparative advertisements contain significantly more product information than self-promotional advertisements. Finally, brands with higher market shares and brands competing against strong generic substitutes have less information content.
Keywords: Information Content, Advertising, Comparative Advertising, Content Analysis, Ordered Probit.
JEL Classification: L13, M37, L65
Suggested Citation: Suggested Citation