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Chapter Two
A User’s Manual: Advertising, Promotion and
Marketing Essentials
Here’s Your Chapter Roadmap
1. Relate how the background and history of U.S.
advertising impacts modern advertising and
its clients.
2. Define the various types of advertising and
promotion found in today’s marketplace.
3. Describe the four cornerstones of marketing
(e.g., the 4 Ps—product, price, place, and
promotion).
Here’s Your Chapter Roadmap (Cont’d.)
4. Identify three types of advertising agencies
and discuss when each type of advertising
agency might be appropriate for an
advertising client.
5. Explain the structure of advertising agency
compensation methods.
6. Classify the various types of clients with
which advertising agencies might interact.
7. Review the advertising careers mentioned and
personally rate the careers.
Advertising is Old – Advertising is New
• Advertising is non-personal communication from an
___________ sponsor that intends to ________, _________,
and/or r ___________.
• Advertising is going through a ___________ where its
forms and disciplines are merging and evolving into a
“new” advertising.
Advertising is Old – Advertising is New
• How is advertising different from other forms
of marketing communication?
1). Advertising is non-personal communication.
2). Advertising comes from an identified sponsor.
3). Advertising informs.
4). Advertising persuades.
5). Advertising reminds.
Advertising is no longer just about ads. Messages
originate with YOU!
The Evolution of U.S. Advertising
• Colonial Americans saw ads on posters and in
newspapers.
• Advertising coincided with the Industrial
Revolution.
• Technologies enabled mass production—
companies had to sell inventory so they
“advertised”.
• Railroads carried newspapers and magazines
from coast to coast thereby creating a national
media format for advertisers.
• Technology made mass media more and more
possible.
Media Channels in Advertising
• Print advertising: newspapers, magazines, direct mail,
and specialty print media (e.g., booklets)
• Direct mail: sent directly to people’s homes via
brochures, letters, and catalogs.
• Broadcast TV (television) is the most widely-known
broadcast medium and can be subdivided into:
–
–
–
–
–
Major Networks
Independent Stations
Cable
Broadband
Satellite
• Radio, the first broadcast medium, can be local or
network.
Media Channels in Advertising
• ___________ advertising (out-of-home) is ______
often seen on billboards, transit posters, gas
pumps, and even park benches.
• Point-of- __________ (POP) displays refer to
displays ___ to cash registers. POP cash register
tapes contain coupons and entry in sweepstakes.
• Online advertising via the Internet includes
such items as ___________ and b __________.
Dig Deeper
Check out Kraft at: http://www.kraft.com/switch-site.htm
• What could the company do to increase the appeal of
this site?
• If you wanted to appeal to consumers who spend a lot
of time browsing online, what changes might you
make?
Consumer-Generated Media & WOM
• Consumer-generated media is created by
consumers. Some popular examples
include blogs, forums, and message
boards.
• Word-of-Mouth (WOM) is associated
with verbal, informal communication
between two people. Today, it also
includes buzz and viral marketing efforts.
How Do Advertisers Get People Talking?
• Ad-supported content is created or
modified to feature products or services.
• Product placement builds an advertiser’s
product or logo directly into the plot and
scenes of a TV show or movies.
• Branded entertainment is when an ad
agency works on behalf of its client to
develop programming for TV or cable.
What Is Marketing?
• Marketing is the activity, set of institutions,
and processes for creating, communicating,
delivering and exchanging offerings that have
value for customers, clients, partners, and
society at large.”
• Most successful organizations today practice
the marketing concept; marketers first identify
the customers’ needs and then provide
products or services that satisfy those needs.
What Is Marketing?
• The marketing ______
consists of the tools the
organization uses to
create a desired
________ among a set of
predefined __________.
Elements of the Marketing Mix
Promotional Strategies
• Promotional pull strategies aim ads at
the ultimate customer, not at the channel.
• The goal is to convince the ultimate
customers that they want the product,
thereby creating a “pull” demand from
the customer through the channel.
Promotional Strategies
• Programs designed to motivate channel
members to stock a manufacturer’s
products are promotional push
strategies.
• These programs include inducements for
the channel partner to promote a given
manufacturer’s products.
Types of Agencies
• Full-service agencies provide clients
with all the services they need for the
entire advertising function.
• Full-service agencies are known for
planning, creating, producing, placing,
researching, evaluating, and assessing the
advertising effort for clients.
Types of Agencies
• Limited-service agencies focus on one
aspect of the creative process, such as
production work or media buying.
• In-house agencies are used by companies
when they want to retain control over
advertising.
How Are Agencies Compensated?
• The traditional 15% ___________ system
generates a commission (15%) from the media
for advertising placed by the ___________.
• The _______-fee arrangement is agreed upon
by clients and their agencies up front.
• ______________ fees are based on the success of
the campaign.
15% Commission Example
Types of Clients
• Advertisers can be grouped into three main
categories:
– Manufacturers and service providers (Boeing or
Bank of America)
– Trade resellers (Best Buy or Starbucks)
• Wholesalers
• Retailers
– Government and social organizations (United Way)
How Agencies Link to Clients
• Account managers identify the benefits a brand
offers and formulate the promotion plan.
• Account planners obtain or conduct research
that will help clients understand their markets
and audiences.
• The creative services staff develop the concepts
and messages that will catch consumers’
interest and attention.
• Media buyers and media planners evaluate the
multitude of options available for ad
placement.
Job Functions Outside the Agency
• Examples of advertising professionals found
outside the agency include:
• Art studios and design firms
• Film/video companies that produce video and
film
• Web designers
• Printers
• Sales promotion agencies to handle sales
promotional items and events
• Research companies
Careers in Advertising
• Careers in advertising generally fall into one of four
categories:
• Account services
– Account managers act as the client’s representative
at the agency
• Creative services
– Art directors - develop artistic strategy for the
campaign.
– Copywriters - responsible for the words of the
campaign.
– Production staff - select photos and oversee printing,
filming, or recording.
Careers in Advertising (Cont’d.)
• Media services
– Media planners gather information about peoples’
viewing or reading habits.
– Media buyers purchase advertising space and
negotiate prices.
• Market research
– Marketing researchers learn all they can about
target customers and their habits.
– Media jobs include the advertising director who
heads the advertising sales department and oversees
advertising policies and staff.
Corporate Advertising
• Brand managers are responsible for a brand’s:
– Marketing strategy
– Business planning
– Marketing research
• Brand managers develop and implement
campaigns best suited for the brand and
oversee the selection and work of any outside
agencies used by the corporation.
SS+K Organization
SS+K: How They Work