8.3
Adstock & Diminishing Returns
The modelled carry-over of advertising effect after exposure, combined with the falling return on each additional unit of spend.
Simon Broadbent, “One Way TV Advertisements Work”, JMRS (1979)
What it does
Advertising effect carries forward and decays, and extra spend delivers less at the margin. The basis of every frequency, continuity and saturation decision.
When it breaks
Decay half-life and saturation point are estimated from data. With thin data they are effectively invented, and the model then confirms its own assumption.
Case
Broadbent built adstock at Leo Burnett fitting weekly TV exposure to sales response, introducing the geometric decay parameter still in use. It is now standard in open-source MMM libraries: Google's Meridian and Meta's Robyn both fit adstock decay and saturation jointly.
AMSR · Broadbent (1979) ↗In the wild
Unchecked · not part of the tier
What people have written about this tool in the last twelve months. A machine found these and nobody has read them. Everything above this line was checked by hand.
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