Product management

Roymond Vernon (1966) and Seev Hirsch (1967) systematically put forth the product cycle approach in an effort to increase understanding of trade theory and introduce dynamics into trade. One of the model's major premises is that a country which has a strong competitive position in a particular industry at a given point in time may well lose this position when the industry enters into a new phase. This approach has been accepted as an established theory though it still remains inadequately tested. The television industry is the largest segment of the consumer electronics industry which has been frequently cited as an evidence to support the product cycle theory. The whole life of monochrome television in the United States was nicely explained by the product cycle theory. But it seems that the development of color television does not tell the same story.

The purpose of this research is to determine whether optimal ad placement and page context can significantly impact advertising effects, by extending hemispheric processing theory. This study contributes to the marketing literature by 1) addressing theoretical conflicts regarding optimal hemispheric ad placement (more favorable effects with leftward photo ads and rightward text ads; Janiszewski 1988) and page context (matching activation from "priming" of opposing brain hemispheres Janiszewski 1990), 2) by evaluating multiple advertising effects in relation to mere exposure rather than focusing primarily on attitudes (Janiszewski 1988, 1990), and 3) by addressing an important knowledge gap regarding optimal Web advertising (Dahlen, Rasch and Rosengren 2003). A growing amount of money is being spent on Internet advertising, with revenues totaling $12.5 billion in 2005, up more than 30 percent over 2004 (IAB 2006). However, banner ad click-through rates are low (between .1 and .2 percent for standard ads; DoubleClick 2007) and only 10% of business executives believe that banner advertising is highly effective in generating new business (Forrester 2006). Advertisers continue to use banner ads, perhaps because the "branding" benefits are not limited to clickthroughs (Briggs and Hollis 1997). While numerous ad-related factors have been previously studied (e.g., ad context creative factors, recall/recognition effects, repetition), to the author's knowledge no research has examined the effect of banner ad placement on advertising outcomes such as attention, recognition, brand attitude and purchase intention.