The Effects of Advertising on Fast-Moving Consumer Goods Markets

We have carried out a cross-sectional study of forty-two fast-moving consumer goods markets to see if we could identify factors which might correlate with weight of advertising spend. Data were collected from a widely used marketing information source and by an eighteen-shop price survey of major supermarkets. Five factors were examined—market growth rate, share of market held by the leading manufacturer, own label share, the price premium held by the leading brand over own label, and the size of the market. The extent of the price premium was found to be highly correlated with weight of advertising spend, and several other factors were also correlated with advertising weights. Rate of market growth showed no significant correlation with advertising weights.