CHAPTER 1
CHARACTERISTICS OF EFFECTIVE ADS
- They should satisfy consumers objectives by engaging them
and delivering a relevant message.
- The ads must achieve the advertisers objectives.
- Consumer may be interested in watching an ad for its
entertainment value or to satisfy her curiosity.
- If the ad is sufficiently entertaining, she may remember it.
3-BROAD DIMENSIONS OF AN EFFECTIVE ADVERTISING
1. Strategy every effective ad implements a sound strategy.
The advertiser develops the ad to meet specific objectives,
carefully directs it to a certain audience, creates its message
to speak to that audiences most important concerns, and
runs it in media (print, broadcast, or the internet) that will
reach its audience most effectively.
2. Creativity creative concept is the ads central idea that
grabs your attention and sticks in your memory. The lengths
to which VM owners will go in order to save their cars is a
strong creative concept.
3. Execution effective ads are well executed. That means
that the details, the photography, setting, printing, and the
production values all have been fine-tuned
THE WORLD OF ADVERTISING
Advertising a paid nonpersonal communication from an
identified sponsor using mass media to persuade or influence
an audience.
- Advertising is a paid form of communication,
although some forms of advertising, such as public
services announcements, use donated space and
time.
- Not only is the message paid for, but the sponsor is
identified.
- Most advertising tries to persuade or influence the
consumer to do something, although in some cases
the point of the message is simply to make
consumers aware of the product or company.
- The message is conveyed through many different
kinds of mass media,
- Advertising reaches a large audience of potential
consumers
- Because advertising is a form of mass
communication, it is also non-personal.
TYPES OF ADVERTISING
- Advertising is complex bec so many different advertisers try
to reach so many different types of audiences.
1. Brand advertising focuses on the development of a long-
term brand identity and image. Some TV commercials
illustrate how an ad can use humor to create brand
awareness.
2. Retail or local advertising
- Retail the message announces facts about products
that are available in nearby stores. The objective tends
to focus on stimulating store traffic, and creating a
distinctive image for the retailer.
- Local can refer to a retailer or a manufacturer or
distributor who offers products in a fairly restricted
geographic area.
3. Political advertising politicians use advertising to
persuade people to vote for them or their ideas, so it is an
impt part of the political process. Critics worry that political
advertising tends to focus more on image than on issues,
meaning that voters concentrate on the emotional part of the
message or candidate, often overlooking imprt differences.
4. Directory advertising people refer to it to find out how to
buy a product or service. The best known form of directory
advertising is the YELLOW PAGES, although there are many
other kinds of directories such as trade directories,
organization directories, etc.
5. Direct-response advertising this can use any advertising
medium, including direct mail, but the message is different
from that of national and retail advertising in that it tries to
stimulate a sale directly. The consumer can respond by
telephone or mail, and the product is delivered directly to the
consumer by mail or some other carrier. Of particular
importance has been the evolution of the internet as an
advertising medium.
6. Business-to-business advertising this includes only
messages directed at retailers, wholesalers, and distributors
and from industrial purchasers and professionals such as
lawyers and physicians to other businesses, but not to
general consumers. Advertisers place most business
advertising in publications or professional journals.
7. Institutional advertising also called corporate
advertising. These messages focus on establishing a corporate
identity or winning the public over to the organizations point
of view. Many of the tobacco companies are running ads that
focus on the positive things they are now doing.
8. Public service advertising this communicate a message
on behalf of some good cause, such as stopping drunk
driving, or preventing child abuse. These advertisements are
usually created by advertising professionals free of charge
and the media often donate the space and time.
9. Interactive advertising is delivered to individual
consumers who have access to a computer and internet.
Advertisers use web pages, banner ads, and e-mail to deliver
their messages. In this instance, the consumer can respond to
the ad or ignore it.
ROLES OF ADVERTISING
Advertising also can also be explained in terms of the 4-roles
it plays in buss and in society:
1. Marketing role the 4-Ps; (product, price, promotion, and
place) or the marketing mix.
2. Communication role it transmits diff types of market info
to match buyers and sellers in the marketplace. Advertising
both informs and transforms the product by creating an
image that goes beyond straightforward facts.
3. Economic role 2-points of view about how advertising
affects an economy.
- First view - advertising is so persuasive that it decreases
the likelihood that a consumer will switch to an
alternative product regardless of the price charged.
(consumer switch, not on price advantage). By
featuring other positive attributes, and avoiding price,
the consumer makes a decision on these various
nonprice benefits.
- Second view- advertising as a vehicle for helping
consumers assess value, through price as well as other
elements such as quality, location, and reputation.
(price advantage, the lower the price, consumer will
switch)
4. Societal role in societal, it informs us about the new and
improved products and helps us compare products and
features and make informed consumer decisions. It mirrors
fashion and design trends and adds to our aesthetic sense.
Advertising tends to flourish in societies that enjoy some level
of economic abundance, in which supply exceeds demands.
In these societies, advertising moves from being
informational only to creating a demand for a particular
brand.
FUNCTIONS OF ADVERTISING
1. Provides product and brand information information
given depends on the needs of the target audience. In the
case of purchasing a new suit, needed info might be price and
outlet location. For technical products the info is likely to be
very detailed.
2. Provides incentives to take action in most instances,
consumers are reluctant to change their buying behavior.
Even if they are somewhat dissatisfied with their current
product, a habit has been established and learning about a
new product is difficult. Advertising sometimes gives the
consumer reasons switch brand, if thats the goal.
Convenience, high quality, lower price, warranties these all
might be stressed in advertising.
3. Provides reminders and reinforcement much advertising
is directed at keeping current customers. Consumes forget
why they bought a particular brand of microwave or
automobile. Advertising must constantly remind the
consumer about the name of the brand, its benefits, its value,
and so forth. These same messages help reinforce the
consumers decision. Most TV advertising provides this
function.
THE FIVE KEY PLAYERS OF ADVERTISING
1. The advertiser
2. The advertising agency
3. The media
4. The vendor
5. The audience/customer
ADVERTISER the person or organization that needs to get
out a message.
- Makes the final decisions about the target audience,
the media that will carry the advertising, the size of
the advertising budget and the length of the
campaign.
- Pays the bills.
ADVERTISING AGENCY second player in the advertising
world.
- Advertisers hire independent AGENCIES to plan and
implement part or all of their advertising efforts.
- This working arrangement is known as the agency-
client partnership.
- Advertiser uses an outside agency bec it believes the
agency will be more efficient in creating an
individual commercial or a complete campaign.
- Agencies typically have strategic and creative
expertise, media knowledge, workforce talent and
the ability to negotiate good deals for clients.
- Most large buss has advertising dept (in-house). This
dept acts as a liaison bet the marketing dept and the
advertising agency/ies and other vendors.
= In-house agency performs most, and sometimes
all, of the functions of an outside advertising agency.
THE MEDIA 3rd player.
- Is composed of the channels of comm that carry the
message from the advertiser to the audience, and in
the case of the internet, it carries the response from
the audience back to the advertisers.
- Many media will assist advertisers in the design and
production of advertisements.
- A media representative typically meets the
advertiser or the advertisers representative
(probably an ad agency) and tries to convince him
that the medium is a good delivery vehicle for the
advertisers message.
- Media delivers advertising messages in a way that is
consistent with the creative effort.
VENDORS 4th player.
- A group of service orgs that assists advertisers,
advertising agencies, and the media.
- Members of this group are also called FREELANCERS,
CONSULTANTS and SELF-EMPLOYED
PROFESSIONALS.
 - Vendors mirror the variety of tasks that it takes to
put together an ad.
- Why would the other advertising players hire a
vendor? REASONS
Advertisers may not have the expertise in
that area; they may be overloaded, or they
may want a fresh perspective.
Another reason to rely on vendors is cost:
vendors services are often cheaper than
the services of someone in-house.
TARGET AUDIENCE the final player.
- All strategy starts with the customer.
- In marketing strategy, the term target market
denotes the customer, the person who purchases
the product.
CURRENT ADVERTISING ISSUES
1. Interactive advertising technology especially interactive
technology changes the face of advertising. Ex- www, https,
dot com.
2. Integrated marketing comm (IMC) the practice of
unifying all marketing comm tools so they send a consistent,
persuasive message promoting company goals to target
audiences. Marketing comm tools include advertising, sales
promotion, direct marketing, public relations, packaging and
personal selling. IMC stats with the consumers needs and
wants.
3. Consumer power today consumers dont have to endure
the harangues of car dealers. Instead, they can visit a car
manufacturers Web site or an Internet auto dealers site,
find a fair car price, and order the car to specification.
Retailers and manufacturers respond to consumer demand
for info access or they risk losing buss. Consumers are
basically smarter and they know they have many more
CHOICES, this gives them additional leverage over the
advertiser.
4. Globalization affects advertising. Whether to practice
global or local advertising. Debate: Cultural issues.
Niche marketing instead of marketing to the masses, they
target market segments. New technologies enable advertisers
to reach groups of consumers by using selective media, such
as the internet, databases and e-mail.
EVOLUTION OF ADVERTISING
Age of print
1441- Johannes Gutenberg creates movable type
Mid-1400s printed handbills
1472- first ad in English Pyes of salisbury
1600s- newpaper emerge
1622- first ad in londons weekly relations news
1655- first use of the term advertising
1704- First US newspaper to carry ads
1841 Volney Plamer becomes first ad sales agent (Boston)
1850 George P. Rowel becomes first ad space wholesaler
(Boston)
Industrial Revolution and Emergence of Consumer Society
1850s first branded items such as Bakers chocolate appear
in stores
1864- J. Walter Thompson forms JWT agency, first acct
executive
1872 First Wards illustrated mail order catalog
1879- Procter & Gamble introduces Ivory soap
1880s John Powers pioneers copywriting; focuses on news
1888- George Eastman creates first Kodak Camera
1890s- Earnest Elmo Calkins and Ralph Holder develop image
copy
1890s Lord & Thomas agency forms
Modern Advertising Era
1904-1940s Albert Lasker pioneers reason why copy
1905- John E. Kennedy describes advertising as salesmanship
in print
1905-1930s Claude Hopkins develops scientific mail-order
copy testing
1906- Pure Food and Drug Act
1908- beginning of celebrity endorsements- Pepsi uses ad
famed racecar driver Barney Oldfield
1912 Truth in Advertising movement
1914- FTC Act passed
Age of Agencies
1917- American Ass. Of Advertising agencies formed
1918 Stanley & Helen Resor develop acct services, brand
names, and status appeals
1923- Young & Rubicam agency formed
1930s Radio advertising surpasses magazines as leading
advertising medium
CHAPTER 2 THE ECONOMIC, SOCIAL, AND REGULATORY
ASPECTS OF ADVERTISING
* A countrys level of ad spending is typically proportional to
its standard of living
* The economic effect of advertising is like the opening break
shot in billiards
Economic Effects of Advertising
1. Value of Products
2. Prices
3. Competition
4. Consumer Demand
5. Consumer Choice
6. Business Cycle
7. Abundance Principle
Added Value
- Links brand image to the product
- Educates consumers about product uses
- Satisfies psychic and symbolic wants and needs
Effect on Prices
- Advertising is paid for by the buying consumer controls the airing of obscenity and profanity and can restrict
- Amount spent on advertising is typically small compared to the products advertised and the content of ads
total cost of production 4. Patent and Trademark Office
- Advertising is part of a mass-distribution system Other Sources of Regulation
- In industries subject to price regulation, advertising has no - State and local governments
effect on prices - Better Business Bureau
Effect on Consumer Demand - National Advertising Review Council
- Stimulates primary demand - Regulation by media
- Influences selective demand - Regulation by consumer groups
Social Impact of Advertising - Self-regulation
- Deception Deception - Any ad that contains misrepresentation,
- Subliminal Advertising omission, or any other practice that can mislead a significant
- Value System number of reasonable consumers is considered deceptive by
- Proliferation of Advertising the FTC
- Use of Stereotypes Unfair advertising - occurs when a consumer is unjustifiably
- Offensiveness injured or there is a violation of public policy
Deception in Advertising: Unfair and Deceptive Advertising Practices
Puffery - When advertisers try to persuade consumers to buy - False promises
a service or product through a sales presentation that rely on - Incomplete description
exaggerations, superlatives and on opinions with vague - False and misleading comparisons
claims of little credible evidence - Bait-and-switch offers
Social Responsibility - doing what society views as best for - Visual distortions and false demonstrations
the welfare of people in general or for a specific community - False testimonials
of people - Partial disclosure
Current Regulatory Issues -Small-print qualifications
- Freedom of Commercial Speech Information the FTC considers:
- Tobacco Advertising - Substantiation
- Advertising to Children - Endorsement Testimonials
- Consumer Privacy - Affirmative Disclosure
Childrens Advertising Review Unit (CARU) reviews and CHAPTER 3 THE ADVERTISING INDUSTRY
evaluates child-directed advertising * This chapter discusses the basic tasks of both the client and
CARUs Guidelines for Advertising to Children the advertising agency, the roles of suppliers and the media,
- Consider audience maturity the ways agencies acquire clients and are compensated, and
- Realize power of imagination the overall relationship between the agency and the client.
- Promote child-appropriate products only The Organizations in Advertising
- Consider advertising as a learning tool Four (4) distinct group:
- Support parent-child relationships 1) Advertisers (client)
- Avoid stereotyping 2) Advertising Agencies
- Promote positive behavior 3) Suppliers
Regulating Organizations 4) Media
1. Federal Trade Commission A. Advertisers (client) are the companies sponsor
Remedies Enforced by the FTC: advertising for themselves and their product
Consent decree 4 Main Types of Local Advertisers
Cease-and desist order 1) Dealers of Local Franchisees of national companies (ex.
Corrective advertising McDonalds)
2. Food and Drug Administration The FDA strives to ensure 2) Stores that sell a variety of branded merchandise, usually
that consumers have complete information by ensuring that on a nonexclusive basis (ex. convenience stores, grocery and
products are labeled truthfully dept. stores)
3. Federal Communications Commission seeks to protect 3) Specialty businesses and services (banks, insurance
the publics interest and to encourage media competition; brokers, restaurants, music stores, salons, travel agencies,
etc.)
4) Governmental and Nonprofit organizations (municipalities,
utility companies, political candidates)
2 Types of Advertisers:
- Regional Advertisers (ex. Groceries and department stores,
lottery)
- National Advertisers (ex. Procter and Gamble and Johnson
& Johnson)
* The basic principles of advertising are the same in both local
and national advertising. However, local advertisers have
special challenges stemming from the day to day realities of
running a small business. As a result, local and national
advertisers differ in terms of focus, time orientation and
resources.
B. Advertising Agencies help the advertisers plan, create
and prepare ad campaigns and other promotional materials
Types of Agencies:
- Local Agencies
- Regional and National Agencies
- International Agencies have offices and affiliates in major
communication centers around the world and can help their
clients market globally or internationally
- Full Service Agencies supplies both advertising and non-
advertising in all areas of communication and promotion
- Specialized Service Agencies this was create to assist
advertisers to promote their product uniquely. Services
provided are as follows: Creative boutiques, Media Buying
Services, Interactive agencies.
* A large companys advertising department may be
centralized or decentralized . Each structure has
advantages and disadvantages.
* Centralized organization is the most typical and
maybe structured by product, sub function of
advertising, end user or geography.
* Decentralized department are typical of large,
subsidiaries, products, countries, regions and/or
brands
C. Suppliers both assist the advertisers and agencies in
preparing adverting materials
- Important suppliers include art studios, web design houses,
printers, engravers, film and video production houses and
research companies.
* Art Studio design and produce artwork and
illustrations for advertisements. Usually small
organizations with as few as three or four
employees. Similar to art studios, web design
houses employ specialist expert in web-based
technologies and can design ads and web pages that
are both effective and cost efficient
* Printer and Related Specialist printers who
produce brochures, stationery, business cards, sales
promotion materials and point of purchase displays.
They employ or contract with highly trained
specialist.
* Film and Video Houses few agencies have in-house
TV production capabilities. Small agencies often
work with local TV stations to produce commercials.
But the large agencies normally work with
independent production houses that specialize in
film or video production.
* Research Companies closely allied to advertising
and is an important tool for marketing professionals.
Most firms use independent research companies or
consultants. Advertisers are concerned about the
attitudes of their customers, the size of potential
markets and the acceptability of their product that
why they highly consider researchers to conduct a
study.
D. Media to carry the advertisers message to the target
audience
Classification of Advertising Media
1) Print Media any commercially published, printed
medium such as newspaper and magazines, etc.
2) Electronic Media radio and television used to called the
broadcast media
3) Digital Interactive Media this allows audience to
participate actively and immediately and one example of this
is the use of internet
4) Social Media term for sites where the prime motivation
for audience consumption is audience-created content
5) Direct mail advertising when companies mail or email
their advertising directly to prospective customers without
using one of the media forms (ex. simple letter, brochures,
samples etc.)
6) Other Media as progress continues, so will the
proliferation of new media (ex. advertising appears on CDs
and DVDs, computers can put callers on hold and play pre
recorder sales messages, etc.)
CHAPTER 4 SEGMENTATION
Marketing - The business process that management uses to
plan and execute the conception, pricing, promotion, and
distribution of its products, whether they be goods, servicer,
brands, or even ideas. The ultimate purpose of marketing is
to create exchanges that satisfy the perceived needs and
wants of individuals and organizations.
Utility - The products ability to satisfy both functional needs
and symbolic wants. One of the primary role of advertising is
to communicate this utility.
Exchange: The purpose of Marketing and Advertising
- The traditional, theoretical core of marketing.
- Any transaction in which one person or organization trades
something of value with someone else in exchange.
Market Segmentation Process
- A two-step strategy of identifying groups of people with
certain shared needs and characteristics within the broad
markets for consumer or business products combining these
groups into larger market segments according to their mutual
interest in the products utility.
Types of Markets
1. CONSUMER MARKETS usually sponsored by the producer
of the product or service, these ads are typically directed at
consumers, people who buy product for their own or
someone elses personal use.
2. BUSINESS MARKETS reach people who buy goods and
services that they resell, use to conduct they business, or use
to manufacture another product.
Segmenting the Consumer market: Finding the right niche
- Behavioristic Segmentation
USER-STATUS VARIABLE can be identified by
categories such as:
Sole users
Semisole
Discount users
Aware nontriers
Trial / Rejectors
Repertoire
USAGE-RATE VARIABLES marketers measure
peoples usage rates to define consumers as light,
medium, or heavy users of products.
PURCHASE OCCASION VARIABLES distinguished by
when they buy or use a product or service
BENEFITS SOUGHT VARIABLES seek various
benefits in the product they buy high quality, low
price, good taste, health concious.
- Geographic Segmentation
Targets are being segmented or grouped according
to their needs, wants, and purchasing habits that
differ from one region of a country to the other
regions. Marketers analyze geographic data, study
the sales by region, country size, city size, specific
locations, and types of stores.
- Demographic Segmentation
A way to define population groups by their statistical
characteristics: sex, age, ethnicity, education,
occupation, income, and other quantifiable factors.
It is often combined with geographic segmentation
to select target markets for advertising.
(Geodemographic Segmentation)
- Psychographic Segmentation
Use to define consumer markets for ceratain
products that appeal to emotions and cultural values
that might be persuasive to others.
Target market is group by their values, attitudes,
personality, and lifestyle. They classify people
according to what they feel, what they believe, the
way they live, and the products, services, and media
they use.
The Target Marketing Process
Determines the content look and feel of its
advertising.
Identify or assess which of he newly created
segments offer the greatest potential and which can
be most successfully penetrated.
The Marketing Mix
Marketers and Advertisers generally tries to shape
their basic product into a total product concept: the
consumers perception of a product or service.
4Ps ( product/ price / place / promotion )
Product Life Cycle
There are 4 major stages in the product life cycle:
INTRODUCTION new products are
introduced to the market.
GROWTH volumes of sales begins to rise
rapidly . It is characterized by rapid market
expansion as more and more customers
purchase their products.
MATURITY market becomes saturated
with competing products and the number
of new customers get smaller.
DECLINE obsolescence of the products,
new technology, and changing consumer
taste if not revitalized.
Product Positioning - The basic goal of positioning strategy is
to own a word that establishes the product in the prospects
mind.
Product Differentiation - Product differentiation creates a
product difference that appeals to the preferences of a
distinct market segments.
Product Branding - Combination of name, words, symbols, or
design that identifies the product and its source and
distinguishes it from competing products. Without brands,
consumers couldnt tell one product from another, and
advertising them would be nearly impossible.