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Advertising
Chapter 19
Advertising and It’s Purpose
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Advertising is nonpersonal promotion
which promotes ideas, goods or services by
using a variety of media.
The average city dweller is exposed to more
than 3,000 advertising messages everyday
Advertisers control the message, where it
will be seen or heard, and how often it will be
repeated
Advertising and It’s Purpose
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Marketers can use advertising to introduce a
new business or change a company
image
Advertising can also promote a new product
or an existing one, encourage the use of a
particular service, or encourage businessto-business transactions
Two main types of advertising:
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Promotional Advertising
Institutional Advertising
Promotional Advertising Definition
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Advertising designed is to increase sales
Targets are consumers or B2B customers
Encourages potential customers to ask for
info, call for appointment, participate on
the internet, or enter a retail store.
Leads / Prospecting
Institutional Advertising Definition
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Designed to create a favorable image for a
company and foster goodwill in the
marketplace
Connecting the businesses name to a
worthy cause helps a company make a
favorable impression
Does not directly increase sales
Mass Advertising Versus Targeted
Advertising
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Mass ads enables
companies to reach
large numbers of
people
Targeted ads target
messages to select
audiences
Advertising
demonstrates
features and benefits
Types of Media
Medias - the agencies, means, or instruments used to
convey advertising messages to the public.
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4 General categories
The advertising
message and the target
audience determine the
type of media that is
used
Newspaper
Television
Opt-in email
Giveaways
Promoted
Tweets
1. Print Media
a. Newspaper advertising
b. Magazine advertising
c. Direct-mail advertising
d. Directory advertising
e. Outdoor advertising
f. Transit advertising
a. Newspaper Advertising
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Daily and Weekly
Newspapers – local
papers
Shoppers and
Alternative Newspapers
– delivered to homes
National Newspapers –
USA Today, Wall Street
Journal
b. Magazine Advertising
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Distributed locally,
regionally or nationally
Published weekly,
monthly and quarterly
Consumer or B2B
B2B are also known as
trade magazines
c. Direct Mail
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Highly focused form of advertising
Printed direct mail
Electronic direct mail
Newsletters, catalogs, coupons, samples,
circulars and invitations to sales
Carefully selecting the target
d. Directory Advertising
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A directory that accepts
advertising
Relatively inexpensive
and target all
demographic groups
Kept of a year
White Pages
Yellow Pages
e. Outdoor Advertising
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Non-standardize
outdoor signs used at
the place of business
Standardized outdoor
signs are purchased
from advertising
companies
Highly visible and
relatively inexpensive
Available 24 / 7
f. Transit Advertising
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Found on public
transportation – trains,
taxis buses, public
benches, bus stop
shelters, kiosks,
newsstands, trashcans,
subways, railroad, bus
and airline terminals
Reaches wide and
captive audiences
2. Broadcast Media
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Encompass radio and
television
Over a lifetime of 66
years – a person will
watch nearly ten years
of TV and 6 years
listening to the radio
Network and cable
a. Television Advertising
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The ultimate advertising medium for many
businesses
Combine creative elements – sight , sound,
action and color
30 to 60 spots
Infomercials promote products
Highest production costs
Small companies cannot afford
b. Radio Advertising
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Radio stations reach 96% of people age 12
and over
Radio is a mobile medium
Messages can be updated daily or hourly
Carefully target market based on type of
radio station
Presented in 10, 20, 30 or 60 second spots
Background music, jingles, slogans add
drama
3. Internet Advertising
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Is a form of advertising
that uses either email
or the World Wide
Web (www)
Small part of overall
advertising but growing
Opt-in e-mail ads,
banner ads, pop-up
ads, search engine
ads, and rich-media
video ads
4. Specialty Media
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Sometimes called
giveaways or
advertising
specialties
Relatively
inexpensive with
advertiser’s name or
logo
Located in high
visibility area
5. Other Advertising Media
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Ad supported TV screens at airports, gas
stations, health clubs and subways
Digital billboards at sports arenas
On-screen movie theater ads
Messages on diaper-changing stations,
trash cans, bathroom stalls elevators, hot
air balloons.
Ceilings and floor graphics
Electronic shelf ads
Supermarket-cart displays
6. New Media
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Interactive and Internet-driven
Uses electronic media devices such as
Wed-enabled small screen iPods, cell
phones, laptops, and video games to reach
increasing mobile populations
Advertisers go to those places to find
their target market customers – blogs,
vlogs, video and audio newscasts, RSS
news feeds and social networking
MEDIA PLANNING AND
SELECTION
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The process of selecting the appropriate
advertising media and deciding the time or
space in which the ads should appear to
accomplish the marketing objectives
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3 basic questions
1) Can the medium present the product and the
appropriate business image;
2) Can the desired customers be targeted with
the medium;
3) Will the medium get the desired response
rate?
Media Rates
Section 17.2
A. MEDIA MEASUREMENT
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Audience – number of homes or people
exposed to an ad
Impression – a single exposure to an
advertising message
Frequency – the number of times an
audience sees or hears an advertisement
Cost per thousand (CPM) The media cost
of exposing 1,000 readers or viewers to an
advertising impression – comparison tool
B. MEDIA RATES
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Use a set format defined in terms of time or
space
Based on geographic location
Standard Rate and Data Service – look up
rates
Audit Bureau of Circulations (ABC) – verify
circulation rates
1. NEWSPAPER RATES
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Two types of advertising – classified ad or
display ad
Classified ads pay by the word or line
Display ads – larger than classified ads and
cost is based upon the amount of space used
and the ad’s position in the newspaper
Quote rates by the column inch
FACTORS THAT AFFECT
NEWSPAPER RATES
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Day of week ad runs
Where the ad appears
in the paper
Run-of-paper rates
allows the newspaper
to place the ad where
ever they feel it would
fit
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Guaranteed or
preferred locations
Color use in ad
Frequency of the ad
Open rates versus
contract rates
COMPARING RATES
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Use CPM to compare ad rates
Cost of the ad x 1,000/Ciculation = CPM
$500 x 1,000/500,000 = $1 per 1,000 readers
$600 x 1,000/300,000 = $2 per 1,000 readers
Does ad reach target market?
2. MAGAZINE RATES
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Based on circulation, the
type of readership and
production techniques
Bleed – half or full page ads
are printed to the very edge
of the page, leaving no
white border – charge 15%
– 20% more
You use the CPM to
compare costs
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Cheapest ad is black &
white. Color is more
expensive
Premium position refers to
ad placement
Rate discounts – based on
frequency or commission
(% of sales given by the
magazine to the ad agency
for placing the ad for
advertiser
3. ONLINE RATES
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Based upon the type of
format the customer desires.
Banner ads
Rich-media enhanced
banner ads
Button ads
Interstitial ads
CPM rate based on number
of viewers
Rates vary based on the
volume of monthly page
views
4. RADIO RATES
Types of Radio Advertising
1. Network radio advertising
2. National spot radio ad
3. Local radio advertising
Spot radio refers to geographical
area where an ad runs
Spot commercial are ad
messages of one minute or
less on network or spot radio
Drive time and run-of schedule
(ROS) allows a radio station to
decide when to run the ad.
5. TELEVISION RATES
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Rates vary with the
time of day. Prime time
(7:00 p.m.-10:00 p.m.)
most expensive
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Advertisers try to play
their messages during
the time slots that
enable them to reach
the most customers
D. PROMOTIONAL BUDGET
FOUR METHODS
Promotional Budget considers not only the cost for developing and
placing or airing advertising but also the cost of staffing the
department or campaign.
4 Common promotional budgeting methods are:
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Percentage of sales method – budget based on a percentage of
past or anticipated sales
2.
All you can afford method – first pay all expenses then apply
remainder of funds to promotional activities
3.
Following the competition method – advertiser matches its
competitor’s promotional expenditures
4.
Objective and task method – company determines goals,
identify steps to meet goals and determines cost for promotional
activities to meet goals