The Effects of Television Advertising on Local Telephone Usage: Exploratory Data Analysis and Response Modeling

In increasingly competitive and deregulated service environments, telecommunications service providers are interested in using advertising to stimulate usage. Measuring response in telephone usage to advertising presents difficulties because the effects are likely to be small, and the usage exhibits high variability. The substantive question of whether advertising has any effect on telephone usage is addressed through a systematic analytical process that combines exploratory data analysis with formal modeling. We find that telephone usage does respond to advertising, that this response can be quantified, and that households with heavy usage of telephone service respond proportionally more than light usage households.