Beware the spin

Stuff reports:

A cheesy aerobics video has helped Inland Revenue hand out $427 million in tax refunds – an increase of $50m over last year.

Really? From one video?

The department has hailed the three versions of the  2015 Tax Refund Workout video a success, despite Revenue Minister Todd McClay admitting it “wasn’t necessarily to my taste” 

Inland Revenue marketing and communications manager Andrew Stott said the refunds campaign, which cost a total of $418,000, had been criticised for “being flash”, but it had been successful.

So that’s the first piece of hard data. $418,000.

It attracted 147,000 more visitors to the campaign web page than in 2014, and resulted in a surge of tax refunds from the 2014 total of $378m. 

And 147,000 more visitors, so that is a cost almost $3 per visit. Now on average the cost per click for online advertising is around 92 cents, so that is a campaign that costs three times as much as the average campaign per visitor.

Now we have the claim of a $50 million increase in tax refunds being due to that campaign. But is it? Are those refunds only from people who visit that campaign site? I bet not. I claim a tax refund every year (as I have income protection insurance) and I’ve never been to that site.

How could we find out if these campaigns actually lead to more people claiming tax refunds? A couple of ideas.

  • One year have no campaign, and see if there is any difference in the trend for refunds
  • Have the campaign targeted at say the North Island only, and see if there is any difference in the refund trends in the North as opposed to the South Island

It is possible the campaigns are effective, but no way to know on the evidence provided.


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