The role of paid media, earned media, and sales promotions in driving marcom sales performance in consumer services

Firms deploy an array of marketing communications (marcom) tools to influence sales performance, yet critics lament that such efforts can be incredibly inefficient. This research focuses on the impact of a range of marcom inputs on sales performance. It uses a multi-media data set assembled from four industry sources to examine the joint impact of paid media, earned media, and sales promotion activity. It does so through two Frontier methodologies (Stochastic Frontier (SFA) and Data Envelopment Analysis (DEA)) to benchmark sales performance. All firms within a single industry are compared to these sales performance benchmarks to generate a sales performance gap metric that pinpoints the most effective marcom activities. The results show that paid and earned media positively influence sales performance, however, excessive sales promotion activity has a negative effect. Several scenario analyses provide actionable strategic insights for managers to more efficiently allocate marketing communications efforts.