Advertising lecture notes

Advertising -- huge industry one estimate: $250 billion -- invades every part of society -- many see it as mirroring the strengths and weaknesses of society Functions of advertising -- selling a product -- educating people about new products -- part of economic process, allowing new products to enter market, old products to reposition themselves in market -- social function -- offers opportunities -- reflects values -- informs -- provides major support for media industries Criticisms of advertising Before going any further, we should note some of the most common criticisms of advertising. These criticisms have some validity, but they also have some answers. I'll present the criticisms and leave it to you to formulate some of the answers. Advertising adds to the cost of products. Part of what we pay for when we buy a bar of soap or a new car is the advertising for that product. What if General Motors stopped spending $2.9 billion a year on

advertising and reduced the cost of its vehicles. Advertising helps sell inferior products. When you get down to it, this criticism says that advertising lies. It convinces us that products are good when they arent. It convinces us to buy an inferior product over a quality product because the inferior product has been advertised more. Advertising creates needs and desires that we would not have otherwise. We MUST have certain products that our parents were perfectly happy living without. Advertising, it is argued, often creates these "needs," which arent really needs at all. Advertising is intrusive. More and more it's getting so that everything has an ad on it or everything is an advertisement. -- sports stadiums -- digital placements -- movie placements Much advertising information is false. Sometimes they are outright lies, sometimes exaggerations, sometimes they leave false impressions, sometimes they don't have anything to do with the product. Okay, what are the counterpoints to these criticisms?

Organization of the advertising industry Advertisers advertising is part of the marketing strategy of any company; -- no product goes to market without some kind of a marketing strategy -- this strategy has to include not just advertising by distribution and a plan for sustaining the product in the market National advertisers see nationwide market for product; this began in modern terms in the 1800s (post Civil War) with growth of mail order catalogues Retail or local advertisers sell to a local (geographic)

market Web is changing local advertising; many finding they can expand their markets but at what cost?

Types of advertising -- consumer -- business to business -- professional Agencies -- organizations set up to create and place advertising; sometimes located in-house and sometimes independent -- Madison Ave. (national, international); local ad agencies -- seek clients; very competitive -- full service; media buying; creative boutiques -- increasing concentration of ownership Media final piece of the puzzle -- traditional newspaper, magazine, radio, TV -- non-traditional point of purchase, direct mail, telephone, telemarketing, movie placements, digital insertions; web targeting Evaluation media advertising -- reach how large is the audience -- frequency how many times the message is delivered -- selectivity how many potential customers are in the audience -- efficiency cost/thousand customers

Online advertising is developing but still one of the big unknowns of the advertising world; many advertisers prefer traditional (old) media, and so do agencies because that's what they're used to.

The advertising campaign Product -- product characteristics what does it do; what's the competition -- launching -- positioning and re-positioning Audience -- research -- demographics Purpose -- what is the advertising problem -- what advertising will solve the problem Medium -- which medium will bring together the audience and the solution Follow-up, evaluation -- did it work?

Advertising regulation -- First Amendment (can we really say whatever we want? No) false statements, criminal actions are not protected

-- "caveat emptor" let the buyer beware -- "caveat venditor" let the seller beware -- Federal Trade Commission broad powers political climate

Advertising management 1 st, 2nd & 3rd topic of Kurukshetra University Presentation Transcript
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Advertising management MM-301 PREVIEW

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Meaning of advertising Definition of advertising Features of advertising Functions of advertising Types of advertising What Makes an Ad Effective? Importance of advertising Benefits of Advertisement Harms done by Advertisement Role of Advertisement in Marketing Mix Aspects of Advertisement Economic Aspects Social Aspects Legal Aspects Ethical Aspects CONCEPT OF ADVERTISING

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MEANING & DEFENITION FEATURES FUNCTIONS

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MEANING

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The term advertising is derived from a Latin word Advertere which means to turn attention towards a specific thing. Dictionary meaning of advertising is to announce publicly. Thus advertising is a paid form of non personal communication with target audience through mass media such as T.V., newspapers, magazines , telephone , internet etc. Definition According to A.M.A :Advertising is any paid form of non personal presentation & promotion of goods, services or ideas by an identified sponsor. According To Philip Kotler : Advertising is non personal from of communication conducted through paid media under clear sponsorship. Features of Advertising

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Paid form Non personal Identified sponsor Any form Goods , services or ideas Can be used by any organization Speedy communication mass communication It is an art Controlled Important element of promotion-mix Functions of Advertising Primary function Secondary function Social function 1.Creates demand 2.Announces for new product or service 3. Promotes new uses of the product 4. Informs about changes 5. Helps in understanding uses 6. Reminds users 7. Creates brand preference 8. Helps to neutralize competition 1. Boost the morale of Employees 2. Supports salesmen 3. Reaches customers left by s.m 4. Helps procure better employees 5. Announces location of dealers & stockist 1.Improves standard of living 2.creates awareness 3.creates employment 4.Educates consumers 5.solves social problems 6.Circulates govt notification 7.Other social functions

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Types of Advertisement Advertising is a form of communication that typically attempt to persuade, potential to purchase or to consume more of a particular brand of product or service.

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Types of advertising

Advertising on basis of geographical area

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Local/regional National Global/international Advertising on basis of target-audience Consumer ads Industrial ads Professional ads Trader ads Advertising on basis of demand influence level Primary demand creation ads Selective demand stimulation ads Advertising to promote brand image Corporate ads Product ads

10. Local Advertisement. 11. National Advertising 12. 13. International Marketing 14. Advertising directed toward professionals such as doctors, dentists, and pharmacists, etc., who are in a position to promote products to their patients or customers. 15. 16. Consumer advertisement. 17. 18. advertising directed at commercial business customers. The advertised products are raw materials, components, or equipment needed in the production or distribution of other goods and services. 19. 20.

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Advertising on basis of diff. stages of PLC 1. Informative ads 2. Persuasive ads 3. Reminder

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Advertising on basis of timing of response Direct action ads Indirect action ads Advertising on basis of nature of appeal 1. Emotional ads Rational ads Advertising on basis of media used Print ads Audio-video ads Audio ads Other ads Classified ads Social ads

22. Out-Door Advertisement

Bill-board and message painted on the side of buildings are common forms of out-door advertising, which is often used when quick, simple, ideas are being promoted.

23. 24. 25. Brand Advertising

It is advertising with a strong emphasis on the company brand (logo and/or company name) also known as integrated marketing communications (IMC).

26. 27. Business advertisement. 28. 29. Direct advertisements 30. 31. Emotional Advertisement. 32. 33. Social advertisement.

34. Broadcast advertising

Broadcast advertising is a very popular advertising medium that constitutes of several branches like television, radio or the Internet. Television advertisements have been very popular ever since they have been introduced. The cost of television advertising often depends on the duration of the advertisement, the time of broadcast (prime time/peak time), and of course the popularity of the television channel on which the advertisement is going to be broadcasted.

35. 36. Online advertising

Online advertising is the newest and fastest growing way to advertise. The Internet now provides everything from links on sites, to banner ads on sites, to small ads on sites, to pay per click advertising.

37. 38. Radio Advertisement

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It is a small business advertising. Radio advertising can be a very effective means to attract customer to some business. New Sathi lather House, Bhiya Pizza, Fhakar rent a car

40. Institutional advertisement 41. 42. Reminders 43. 44. Importance of Advertising To manufacturers

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Increased sales Creating primary And selective demand Mass Communication Lowers prod. Cost Helps face Competition Builds goodwill Higher profits Direct mkting

Permanent demand To consumers

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Convenience Ads to knowledge Benefits of Direct mkting Products at low Price Act as reminder Better quality products To distributors

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Easy selling Less burden Increase in sales And profits Regular sales Increases morale Less bargaining Selling new products To society Increases Standard Increases Employment Source of Income to Media Increase Exports Increase NY Encourage R&D

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45. IMPORTANCE

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Creating awareness Increase sales Brand identity & Brand image Communicate a change

Increase the buzz value

46. What Makes an Ad Effective?

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If it creates an impression for a product or brand 2. If it influences people to respond 3. If it separates the product or brand from the competition

48. Economic Benefits of Advertising

Advertising can play an important role in the process by which an economic system guided by moral norms contributes to human development.

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It is a necessary part of the functioning of modern market economies. Advertising can be a useful tool for sustaining honest and ethically responsible competition that contributes to economic growth in the service of authentic human development.

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Advertising informs people about the availability of rationally desirable new products and services and improvements in existing ones, helping them to make informed, contributing to efficiency and the lowering of prices, and stimulating economic progress through the expansion of business and trade.

All of this can contribute to the creation of new jobs, higher incomes and a more decent and humane way of life for all.

50. Benefits of Political Advertising

Political advertising can make its contribution by informing people about the ideas and policy proposals of parties and candidates, including new candidates not previously known to the public. Political advertising can make a contribution to democracy analogous to its contribution to economic well being in a market system guided by moral norms.

51. Cultural Benefits of Advertising

Advertising can itself contribute to the betterment of society by uplifting and inspiring people and motivating them to act in ways that benefit themselves and others.

Advertising can brighten lives simply by being witty, tasteful and entertaining.

52. Moral and Religious Benefits of Advertising

In many cases, too, social institutions, including those of a religious nature, use advertising to communicate their messages.

Messages of faith, of patriotism, of tolerance, messages concerning health and education, constructive and helpful messages that educate and motivate people in a variety of beneficial ways.

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THE HARM DONE BY ADVERTISING

54. a) Economic Harms of Advertising

The practice of "brand"-related advertising can raise serious problems. Often there are only negligible differences among similar products of different brands, and advertising may attempt to move people to act on the basis of irrational motives ("brand loyalty," status, fashion, "sex appeal," etc.) instead of presenting differences in product quality and price as bases for rational choice.

It makes consumers forget about there needs n only think about their wants, which makes them spend more

55. b) Harms of Political Advertising

for example, the costs of advertising limit political competition to wealthy candidates or groups, or require that officeseekers compromise their integrity and independence by over-dependence on special interests for funds. instead of being a vehicle for honest expositions of candidates' views and records,political advertising seeks to distort the views and records of opponents and unjustly attacks their reputations.

56. c) Cultural Harms of Advertising

In the competition to attract ever larger audiences and deliver them to advertisers, communicators can find themselves tempted in fact pressured, subtly or not so subtly to set aside high artistic and moral standards and lapse into superficiality, tawdriness and moral squalor

Communicators also can find themselves tempted to ignore the educational and social needs of certain segments of the audience the very young, the very old, the poor who do not match the demographic patterns (age, education, income, habits of buying and consuming, etc.) of the kinds of audiences advertisers want to reach

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Exploitation of women by advertisements:objects whose purpose is to satisfy others' appetite for pleasure or for power the role of woman as wife and mother undervalued or even ridiculed the role of women in business or professional life depicted as a masculine caricature

58. d) Moral and Religious Harms of Advertising

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it deliberately appeals to such motives such as envy, status seeking and lust. some advertisers consciously seek to shock and titillate by exploiting content of a morbid, perverse, pornographic nature. the communications media have made pornography and violence accessible to a vastly expanded audience, including young people and even children, and a problem which at one time was confined mainly to wealthy countries has now begun, via the communications media, to corrupt moral values in developing nations.

59. Role of advertising in marketing mix

Advertising is an important tool of marketing mix. Success of whole marketing programme depends on how promotional tools are coordinated with diff. components of marketing mix. Advertising is communication link b/w buyer and seller.

Advertising is used as a tool of marketing communication. It is main form of mass comm. Marketing refers to achieving organizational goals after determining needs and wants of target customers and enhancing the level of customer satisfaction along with selling the product.

An effective marketing programme blends all the components of marketing mix in a coordinated manner so as to achieve marketing objectives.

The inter-relationship of advertising and marketing is studied as under:

60. Marketing mix Product Price Promotion Place Personal selling Advertising sales promotion Direct marketing Publicity interactive marketing 61.

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ADVERTISING AND PRODUCT Advertising and type of product Advertising and stage of product life cycle Advertising and product quality Advertising and branding Advertising and packaging Advertising and product positioning ADVERTISING AND PRICE If price is high then high-status appeal If price is low then economy-appeal ADVERTISING AND PLACE (DISTRIBUTION)

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4. ADVERTISING AND OTHER PROMOTIONAL TOOLS Sales promotion Personal selling Publicity Direct marketing 5. ADVERTISING AND COMPETITION 6. ADVERTISING AND MARKET SEGMENTATION Concentrated marketing Differentiated marketing Undifferentiated marketing

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Making Consumers Aware of Products and Services Providing Consumers With Information to Use to Make Purchase Decisions

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Encouraging Consumption and Fostering Economic Growth

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(i) Effect on production cost and prices Advertising as an expense that increases the cost of products Increased differentiation (ii) Effect on distribution cost (iv) Effect on demand (v) Effect on competition Barriers to entry Economies of scale (vi) Effect on consumers choice Differentiation Brand Loyalty (vii) Effect on business cycles (viii) Effect on national income (ix) Effect on employment (x) Effect on standard of living

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Economic objections No increase in real demand Reduces consumers choice Wastage of natural resources Creates monopoly Increase in cost and price

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Advertising as a part of firms marketing effort operates in the society. It has to therefore follow the social norms. Key areas of debate regarding society and advertising are: Deception Manipulation

Taste

70. 11/08/10 Deception : it refers not only to the information content in advertising but may also arise from misplace emphasis in presentations. According to federal trade commission of the USA- Advertising as a whole must not create a misleading impression although every statement, separately considered, may be literally truthful 71. 11/08/10 Manipulation :- The freedom of choice of consumers is restricted by the power of advertising since it can manipulate buyers into making a decision against their will or interest. Manipulation is done through emotional appeals. These companies can utilize advanced and very scientific advertising techniques and thus make an impression on consumers. 72. 11/08/10

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Taste :- Sometimes ads are offensive, tasteless, irritating, boring and so on. Sources of distaste Sexual Appeals Shock advertising

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Untruthful or deceptive advertising General mistrust of ads Deliberately untruthful or misleading vs. puffery Problems often more at local level rather than national Effect on culture Effect on media Materialism Effect on children Stereotyping in advertising Portrayal of women Gender stereotyping Portrayal of women as sex objects Role portrayal of women to reflect changing role in society Blacks and Hispanics Gays Elderly

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Social objections

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Control of advertisers over media Wrong appeals Create artificial product differentiation Moral degradation Other objections Some examples of the Advertisements with social aspects:Grow-more-trees advertisements Drink milk Eat healthy food, eat eggs Mothers milk is best for the baby Say no to drugs every time Get your child vaccinations in times

76. (III) Legal aspects of advertising

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The government in each country has to make sure that advertisements appearing do not flaunt of their rules & regulations. It should not:show anti-national feelings contain misleading information about the product Violate government rules

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Some examples of the Advertisements with legal aspects:Get your car checked for pollution Drinks & driving do not mix Weight, price, manufacturing date, date of expiry should be mentioned on the packing case

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Ethics Defined System of moral principles Good or bad

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Right or wrong Fundamentally rooted in what people believe to be right or wrong. Beliefs stem from the systematising, defending and recommending concept of... Behaviour

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Ethics are the moral standards against which behavior is judged Key areas of debate regarding ethics and advertising are: Truth in advertising Advertising to children Advertising controversial products

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Ethics in Strategy Formulation Advertisement persuade the people to buy their products. It sometime entertain or educate the people. Some advertisers use slippery tactics.

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Advertising to ChildrenIssues Advertising promotes superficiality and materialism in children. Children are inexperienced and easy prey. Persuasion to children creates child-parent conflicts. What does the literature say about kids abilities to process persuasive information?

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Advertising Controversial Products Critics question the targeting of minorities.

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Tobacco, alcohol, gambling and lotteries are product categories of greatest concern. How does the concept of primary demand provide insights here? What does the literature say about advertisings impact on these product categories?

86. What do you think? Advertising = Market Power Advertising = Market Information Or both?

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Advertising affects consumer preferences and tastes, changes product attributes, and differentiates the product from competitive offerings. Advertising informs consumers about product attributes but does not change the way they value those attributes.

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What do you think is the biggest benefit of advertising? What do you think is the biggest problem with advertising? What do you think is the best example of bad advertising? What do you think is the best example of good advertising? Big Questions

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