Why Advertising Equity is Your New Favorite KPI

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It's getting quite hard to force people to watch advertising. If you're watching tv or riding the subway, ads may get through to you if you really like them. If not, then your smartphone is only an arms length away and you'll opt for that instead. Ads on Instagram, Facebook, YouTube, or Snap are no better. Here you can just keep merrily scrolling past my expensive ads or click skip ad. Even if I could force you to watch my ad it would be a very bad idea since I'd only piss you off. 

This is why there is a KPI that has sailed up to become one of the most important ones around – "willingness to approach" which measures how willing your are to consume a certain piece of communication. Willingness to approach is the function of emotional reward on the one hand and familiarity on the other. Multiply these two and you get advertising equity.

Advertising equity is the function of emotional rewards and familiarity. It is basically the advertising equivalent of how hooked you are on House of Cards.

Advertising equity is the function of emotional rewards and familiarity. It is basically the advertising equivalent of how hooked you are on House of Cards.

It's basically the advertising equivalent of how hooked you are on your favorite HBO-series. The first episode is going to be a tough sell, the second... maybe, the third... I'm starting to like this a little bit. Once you get to season 4 you are going to call in sick for work just to watch the season finale.

And that is an interesting dynamic in a world where it's getting pretty darm hard to reach people with marketing messages. Could we do something similar in the ad world? Could we become the HBO of marketing? If you play your advertising equity game right the answer is yes.

Key ConceptsWalter Naeslund