Download Advertising MANAGEMENT Lecture 1

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ADVERTISING MANAGEMENT
Lecture I
Concept Presentation
Prof Soumitra Mookherjee
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BASIC CONCEPTS
Advertising is the paid, non-personal communication of information about
products or ideas by an identified sponsor through the mass media in an
effort to manipulate customer behavior.
Advertising is non-personal because it's a fantasy that selects one part of
the target audience. It communicates information about products or ideas.
Advertising is used to publicize a product, service, or idea.
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BASIC CONCEPTS
Advertising is a form of communication intended to persuade an
audience to purchase or take some action upon products, ideas, or
services.
It includes the name of a product or service and how that product or
service could benefit the consumer, to persuade a target market to
purchase or to consume that particular Brand.
These messages are usually paid for by sponsors and viewed via various
media.
BASIC CONCEPTS
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Commercial advertisers often seek to generate increased consumption of
their products / services through branding, which involves the repetition of an
image or product name.
Non-commercial advertisers who spend money to advertise items other than a
consumer product or service include political parties, interest groups, religious
organizations and governmental agencies.
Nonprofit organizations may rely on free modes of persuasion, such as public
service announcement.
Public service advertising: The advertising techniques can be used to inform,
educate and motivate the public about non-commercial issues, such as
HIV/AIDS, political ideology, energy conservation and deforestation.
BASIC CONCEPTS
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Advertising may influence consumers in many different ways, but the primary
goal of advertising is to increase the probability that consumers exposed to an
advertisement will behave or believe as the advertiser wishes.
Advertising is used by:
commercial firms trying to sell products and services;
politicians and political interest groups to sell ideas or persuade voters;
Not-for-profit organizations to raise funds, solicit volunteers, or influence the
actions of viewers.
Governments seeking to encourage or discourage particular activities, such a
wearing seatbelts, participating in the census, or ceasing to smoke.
OBJECTIVES OF ADVERTISING
Objectives of advertising
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To make an immediate sale.
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To build primary demand.
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To introduce a price deal.
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To build brand recognition or brand insistence.
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To help salesman by building an awareness of a product
retailers.
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To create a reputation for service, reliability or research strength.
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To increase market share.
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FUNCTIONS OF ADVERTISING
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The primary objective of advertising is to persuade, it may achieve
this objective in many different ways.
An important function of advertising is the identification function,
that is, to identify a product and differentiate it from others.
this creates an awareness of the product and provides a basis for
consumers to choose the advertised product over other products.
FUNCTIONS OF ADVERTISING
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Another function of advertising is to communicate information about
the product, its attributes, and its location of sale.
The third function of advertising is to induce consumers to try new
products and to suggest reuse of the product as well as new uses;
this is the persuasion function.
FUNCTIONS OF ADVERTISING
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Different benefits are important to different customers.
Thus, to realize its full potential as a persuasive tool, advertising
must often be tailored to emphasize those benefits that are important
and meaningful for a particular type of customer or a particular use
of the product.
Examples : Monetary Benefit if purchased
Special attributes/features creating consumer appeal
Acts as a substitute or alternative
Products/ services offering convenience
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CLASSIFICATION OF ADVERTISING
Classification based on function
Informative advertising This type of advertising informs the customers about the
products, services, or ideas of the firm or organization. Examples: Vishal Megamart is
offering 2 kg sugar for every Rs. 1,000/- purchase everyday.
Persuasive advertising This type of advertising persuades or motivates the
prospective buyers - Example: “Buy one, get one free”.
Reminder advertising This reminds the existing customers to become heavy users of
the products and this helps in keeping the brand name alive in the minds of existing
customers.
Negative advertising This type of advertising dissuades target audience from
purchasing products which would not only harm them but also the society in general.
Example: “ Cigarette smoking is injurious to Health”
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CLASSIFICATION OF ADVERTISING
Classification based on Geographical Presence
Global advertising It is executed by a firm in its global market
niches. Reputed global magazines like Far Eastern Economic Review,
Span, Economist, Fortune, Futurist, Popular Science, etc. Also, popular
brands like Sony, Philips, Etc are advertized globally.
National advertising It is executed by a firm at the national level
to increase demand of its products and services throughout the
country. Examples: BPL (Believe in the best). Whirlpool Refrigerator
(Fast Forward Ice Simple) etc, Airtel (Express Yourself), etc
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CLASSIFICATION OF ADVERTISING
Regional advertising: If the manufacturer confines his advertising
to a single region of the country. Examples: Advertisements of
regional newspapers where these newspapers are circulated. Eg.
The Assam Tribune (only for the NE region) etc.
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CLASSIFICATION OF ADVERTISING
Classification based on targeted markets
Consumer product advertising This is done to impress the ultimate
consumer. Examples: Advertisements of Intel, Kuttons (shirt), Lakme
(cosmetics) etc.
Industrial product advertising: This is also called Business-toBusiness Advertising, - Where advertisement is directed towards the
industrial customer. Advertising not very frequent as for FMCG
Trade advertising This is done by the manufacturer to persuade
wholesalers and retailers to sell his goods.
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CLASSIFICATION OF ADVERTISING
Classification based on targeted markets
Professional advertising This is executed by manufacturers/
distributors to influence professionals, and they try to reach these
professionals under well-prepared programmes. Doctors, engineers,
teachers, purchase professionals, civil contractors, architects are the
prime targets of such manufacturers.
Financial advertising: Banks, financial institutions, and corporate
firms issue advertisements to collect funds from markets.
e.g. SBI 9.75% Infrastructure Bonds for mobilizing funds
TYPES OF ADVERTISING
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Digital advertising
Television advertising / Music in advertising
The TV commercial is generally considered the most effective massmarket advertising format. Relatively more expensive
An infomercial is a long-format television commercial, typically five
minutes or longer. The main objective in an infomercial is to create
an impulse purchase, so that the consumer sees the presentation
and then immediately buys the product through toll-free telephone
number or website. E.g. TELE-SHOPPING
TYPES OF ADVERTISING
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Radio advertising
Radio advertising is a form of advertising via the medium of radio.
While radio has the obvious limitation of being restricted to sound,
this medium is popular in many commercial cities where customers
witnessing long car rides get reminded continuously.
Online advertising
Online uses the Internet and World Wide Web for the expressed
purpose of delivering marketing messages to attract customers.
Examples of online advertising include contextual ads that appear
on search engine results pages, Social network advertising, online
classified advertising, and e-mail marketing, including e-mail spam.
TYPES OF ADVERTISING
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Physical advertising
Press advertising describes advertising in a printed medium such as
a newspaper, magazine, or trade journal. This encompasses
everything from media with a very broad readership base, to more
narrowly targeted media such as local newspapers/ trade journals.
A form of press advertising is classified advertising,.
Billboard advertising: Billboards are large structures located in
public places which display advertisements to passing pedestrians
and motorists. E.g. Airlines, Real Estate Firms, Consumer Products, etc
TYPES OF ADVERTISING
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In-store advertising
In-store advertising is any advertisement placed in a retail store. It
includes placement of a product in visible locations in a store, and
advertisements in places as shopping carts, in-store video displays.
Coffee cup/ Momento advertising
Coffee cup advertising is any advertisement placed upon a coffee
cup that is distributed out of café, or drive-through coffee shop.
This form of advertising is popular in USA, Europe, Australia, etc
TYPES OF ADVERTISING
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Celebrity branding/ Endorsements
Advertisers often advertise their products - when celebrities share
their favorite products or wear clothes of specific brands.
Celebrities are often involved in advertising campaigns such as
television or print adverts to advertise products. May be dangerous
– if mistake by a celebrity is detrimental to the Brand Image.
e.g. Abhishek Bachan – IDEA
Shah Rukh Khan – DISH TV
Parker Pen – Amitabh Bachan
EPSI – Cricket Sportstars
TYPES OF ADVERTISING
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Word of Mouth Advertising
While some argue that word of mouth is not advertising because
it's free, this form of promotion is one of the most credible and
priceless assets of any business.
Great option for creating referrals and expanding customer base.
e.g.
HOTELS, EDUCATION CENTRE, AIRLINES, HOSPITALS, MOVIES
FOOD PRODUCTS, ELECTRONIC GOODS
SOCIAL IMPACT OF ADVERTISING
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Advertising has positive as well as negative social/economic
impacts on society.
Assorted techniques are enforced for persuading consumers that
they want the product which is being advertised. These techniques
usually give attention to the benefits to the consumers rather than
focusing on the actual products.
There are various blames that advertising is causing a negative
social impact on the lives. The unfavorable judgment for advertising
is that it hales the public to buy things that they go not really want.
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SOCIAL IMPACT OF ADVERTISING
Advertisers also think that there are positive impacts of advertising.
For example, it can be used to generate awareness about which
product is OK and which one public should say NO. It educates
people about what is good and puts a ceiling on the harmful
products like smoking and drinking etc.
There are not only social benefits of advertising, but also some
economic advantages. Without advertising, the media, including
newspapers, television and radio would never be financially strong.
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SOCIAL IMPACT OF ADVERTISING
The major economic negative aspect of advertising is that it boosts
the price of goods and services.
The source of this contention is that, when organizations subsidize
the mass media with advertising, we, the purchaser, subsidize
advertising by compensating a grossly increased price for heavily
advertised goods and services. E.g. FMCG, Consumer Durables, Food
Products, etc
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POSITIVE EFFECTS OF ADVERTISING
The positive side of advertising is that it makes you aware that a
product/service is available.
New & improved products are developed continuously and public
cannot keep track of these developments. Therefore, constant
reminders necessary for inducing customers to purchase.
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POSITIVE EFFECTS OF ADVERTISING
Advertisement may convey the following messages:
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Better and cheaper than the competitor's product
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easier to use than the competitor's product
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More prestige value than any similar product
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Lasts longer the competitor's product
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it's made of superior parts or ingredients
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it's healthier for you
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it's stronger, faster acting, etc
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POSITIVE EFFECTS OF ADVERTISING
Advertisements are useful because they keep us up to date on the
improvement of existing products and the creation of new ones. This is
all very good as long as the message given is true in real life.
Unfortunately many advertisements,, tell us a product or service is
good only to find out after purchase that it is not good at all. This is
definitely not good.
Therefore, reputation is key for building TRUST & CONFIDENCE
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NEGATIVE EFFECTS OF ADVERTISING
After sale we may discover that the ad failed to inform us about any
or all of the following:
• Made of substandard materials
• Tastes bad and is made from leftovers and rejected materials
• Far too expensive and should cost 10% of what it does
• Some ingredients or additives such as preservatives, colorings, etc.
have been banned in your country due to adverse impact on health
MEDIUM OF ADVERTISING
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Virtually any medium can be used for advertising.
Commercial advertising media can include wall paintings, billboards, street furniture components,
printed flyers and rack cards, radio, cinema and television adverts, web banners, mobile telephone
screens, shopping carts, web popups, skywriting,
bus stop benches, human billboards, magazines, newspapers, sides of buses, banners attached to or
sides of airplanes ("logojets"), in-flight advertisements on seatback tray tables or overhead storage
bins, taxicab doors, roof mounts and passenger screens,
Musical stage shows, subway platforms and trains, elastic bands on disposable diapers,doors of
bathroom stalls,stickers on apples in supermarkets, shopping cart handles (grabertising), the opening
section of streaming audio and video, posters, and the backs of event tickets and supermarket
receipts.
Any place an "identified" sponsor pays to deliver their message through a medium is advertising.