AdEvaluator™ is a program that evaluates scientifically whether and how much an advertising campaign boosts sales and profits.

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Requirements: AdEvaluator™ requires the Python 3 programming language and several widely used Python add-on packages. AdEvaluator™ was developed using the Anaconda Python distribution with Python 3. The Anaconda distribution includes Python 3 and all add-on packages required by AdEvaluator™. Install Anaconda with Python 3 to run AdEvaluator™.

Short Explainer Video

Quick Start Instructions

Extract the AdEvaluatorFolder with the program and sample sales data files from the AdEvaluator™ ZIP File.

Double-click on AdEvaluator.bat in Windows Explorer to launch the AdEvaluator™ GUI on Microsoft Windows. You may need to grant permission to run the program since it is downloaded from the Internet.

DOS> eval_adv sales_seed_113.csv

to run from the Windows/DOS command line. eval_adv -h to get a detailed help message on running from the command line. eval_adv.bat is a DOS batch file that in turn runs the Python code on Windows.

On Mac OS X, Linux, and other Unix variants:

shell> python eval_adv.py -gui

to launch the AdEvaluator™ GUI.

shell>python eval_adv.py sales_seed_113.csv

to run from the Unix shell command line.

shell> python eval_adv.py -h

to get command line help.

Note: AdEvaluator™ is better tested on Windows 10 with the Anaconda Python 3 distribution installed (the primary development platform).

How to Tell Scientifically if Advertising Boosts Sales and Profits

Half the money I spend on advertising is wasted; the trouble is I don’t know which half.

John Wanamaker, (attributed)
US department store merchant (1838 – 1922)

Between $190 billion and $270 billion is spent on advertising in the United States each year (depending on source). It is often hard to tell whether the advertising boosts sales and profits. This is caused by the unpredictability of individual sales and in many cases the other changes in the business and business environment occurring in addition to the advertising.

AdEvaluator™ is a free open-source software (FOSS) program that uses sales reports from common accounting programs such as QuickBooks to quickly evaluate if a new advertising, sales, marketing, or public relations campaign or method boosts sales and profits.

The sales report should be exported in comma separated values (CSV) format. AdEvaluator™ imports sales reports in CSV format.

AdEvaluator™ reads the sales report, constructs a statistical model of the sales with and without advertising from the periods with and without advertising in the sales report, and simulates a full year of business operation with and without the advertising many times to evaluate the risks and rewards of the advertising. It reports the fraction of the simulated years of business operation with a profit change both with and without the advertising, showing both the frequency of changes due to chance alone without advertising and with the advertising.

The above profit projection is derived from simulated sales data (show below) in which an advertising campaign boosts average sales from three units per day to three and one half units per day. The campaign costs five hundred dollars per month. The price of the units is $90.00 each. The marginal cost of additional sales of units is zero — such as for a professional service like accounting or legal advice. Despite the increase in average sales, there is considerable random variation in daily sales which makes it difficult to evaluate the effectiveness of the advertising and the risks and potential rewards of continuing or canceling the advertising — a common problem.

The green plus signs above show the percent of simulations with the advertising. The annual profit increase or decrease is on the horizontal axis. The blue circles above show the percent of simulations with no advertising and with the annual profit increase or decrease on the horizontal axis.

AdEvaluator™ also computes and reports Welch’s T statistic, a measure of the difference between two data sets in a statistical sense, and the derived probability that the two periods are the same in a statistical sense (have the same average daily sales) as a point of reference. Welch’s T statistic assumes that the two periods have a Bell Curve distribution (also known as the Normal or Gaussian distribution) for the probability of the daily sales. This is at best only approximately true for many types of sales data — hence AdEvaluator™ uses computer simulations of sales based on the empirical probability distributions from the actual sales data.

AdEvaluator™ is free, open-source software available subject to the GNU General Public License (GPL) version 3.0. This means that the user can view, inspect, and audit the source code to see what the program is doing, step by step if necessary, and fully evaluate whether it is applicable to their business and data.

Disclaimer

AdEvaluator™ is designed for cases with a single product or service with a constant unit price during both periods. AdEvaluator™ needs a reference period without the new advertising and a test period with the new advertising campaign. The new advertising campaign should be the only significant change between the two periods. AdEvaluator™ also assumes that the probability of the daily sales is independent and identically distributed during each period. This is not true in all cases. Exercise your professional business judgement whether the results of the simulations are applicable to your business.

AdEvaluator Professional™, for which we charge a fee, can handle more complex cases with multiple, possibly continuous changes during the period of interest. AdEvaluator Professional™ will be available for general use in 2019. Please feel free to contact us if you have a more complex case you would like evaluated: ceo@mathematical-software.com

AdEvaluator Professional™ uses our Math Recognition technology to automatically identify good multidimensional mathematical models. The Math Recognition technology is applicable to many types of data, not just sales and advertising data. It can for example be applied to complex biological systems such as the blood coagulation system which causes heat attacks and strokes when it fails. According the US Centers for Disease Control (CDC) about 633,000 people died from heart attacks and 140,000 from strokes in 2016.

About Me

John F. McGowan, Ph.D. solves problems using mathematics and mathematical software, including developing gesture recognition for touch devices, video compression and speech recognition technologies. He has extensive experience developing software in C, C++, MATLAB, Python, Visual Basic and many other programming languages. He has been a Visiting Scholar at HP Labs developing computer vision algorithms and software for mobile devices. He has worked as a contractor at NASA Ames Research Center involved in the research and development of image and video processing algorithms and technology. He has published articles on the origin and evolution of life, the exploration of Mars (anticipating the discovery of methane on Mars), and cheap access to space. He has a Ph.D. in physics from the University of Illinois at Urbana-Champaign and a B.S. in physics from the California Institute of Technology (Caltech).