Measuring the economic effectiveness of place advertising in China

The economic effectiveness of place advertising is a valuable inquiry for both policy makers and marketers. Our study aims to answer the research question of whether or not a significant and localized targeted place brand communication effort is associated with the generation of measurable economic benefits therein. The results indicate that there is a significant positive correlation between place advertising and tourist expenditure based on the data of place-brand advertising campaigns within 31 provinces in China over the period from 2005 to 2015. Further, this study indicates a relationship between the level of advertising spend and the consequential positive impact on tourist expenditure: each 1% increase in advertising spend generates a 0.013% increase in tourist expenditure. The novel concept model presented in this paper aids practitioners to better understand the effect of advertising and promotional place communication in the wider context of local economic planning and national development policy.