A selective review of the literature on advertising effectiveness revealed no generalizable results for setting advertising budget decisions. The primary problem is a lack of knowledge as to how advertising, as input, affects an output, such as sales. All Navy advertising expenditures for 1976 and 1977 were allocated to counties by month for 1976 and 1977 and supplemented with recruiting and environmental data to examine the relationship between advertising and enlistments. Total advertising expenditures were moderately related to total enlistments (R sq = .442), but this relationship was found to be the result of management planning and allocation of resources and goals. When advertising and enlistments were made rate variables, there was no linear relationship because the rate of advertising increased rapidly without a corresponding increase in enlistment rates. A fourth root transformation of advertising rates permitted application of a linear regression model where advertising was found to be the most significant predictor of enlistment rates. Recommendations are made for further studies and actions to evaluate and increase advertising effectiveness.