Advertising: Nature, Scope & Types

Definition Of Advertising

Advertising : Paid, non- personal communication through various media about a business firm, not-for-

profit organization, product, or idea by an identified sponsorin a message that is intended to Inform, Persuade Or

Influence audience.

• A complex form of communication using objectives and strategies to impact consumer thoughts, feelings, and actions.

• A form of marketing communication (all the techniques marketers use to reach their customers and deliver their messages).

Meaning Of Advertising

• Derived from original latin word ‘advertere’ which means ‘to turn the attention’.

• Advertising is a tool of mass communication.

• It makes mass selling possible.

• It is a macro concept: representing the entire advertising industry.

• It promotes the goods through information and persuasion.

Objectives Of Advertising (SCOPE)• Informative advertising Promotion that seeks to develop initial demand for a good, service, organization, person, place, idea, or cause.

• Persuasive advertising Promotion that attempts to increase demand for an existing good, service, organization, person, place, idea, or cause.

• Reminder advertising Advertising that reinforces previous promotional activity by keeping the name of a good, service, organization, person, place, idea, or cause before the public.

Advertisers coordinate advertising objectives with the product’s stage in the product life cycle.

Objectives Of Advertising• Sales • Awareness/ familiarity with brand.

Information about brand benefits / attributes – Acer laptop/ Water purifiers.

• Creation of brand image / personality – Old Spice, Axe.

• Association of feelings with brand– Cadbury celebrations.

• Reminder or inducement about brand/brand trial– Colgate whiteness meter

Linkage of brand with / experts and group norms –Pampers diaper/ Oral B.

Advertising Strategies• Advertising is a means of bringing buyers and sellers together.

• Marketers often combine several strategies to meet their objectives.

COMPARATIVE ADVERTISING

• Comparative advertising Advertising strategy that emphasizes messages with direct or indirect promotional comparisons between competing brands.

• Market leaders seldom acknowledge competing brands.

CELEBRITY TESTIMONIALS

• Use of celebrity spokespeople for products.

• Can build brand equity but can hurt brand if celebrity is hit by scandal.

RETAIL ADVERTISING

• Includes all advertising by retail stores that sell goods or services directly to the consuming public.

• Cooperative advertising Strategy in which a retailer shares advertising costs with a manufacturer or wholesaler.

INTERACTIVE ADVERTISING

• Involves two-way promotional messages transmitted through communication channels that induce message recipients to participate actively in the promotional effort.

• Changes balance between marketers and consumers.

Role of advertising• Economic function

• Creates wide market.• Social function

• Improved standard of living.• Promotes consumer welfare.

» Advertising promises a quality, and forces manufacturer to live up to the quality.

» It invests a new product with confidence- confidence about its function, quality, price and availability.

• Psychological function• It affects the personality of the consumer, his attitudes, beliefs and

opinions.

Importance and benefits of advertising• Advertisers (LIC)

• Sales turnover.• It maintains the existing market and

explores the new.• It controls the product prices.

• Middlemen (Automobile) • It guarantees quick sales.• It acts as a salesman.• It makes possible retail price maintenance.

• Salesmen (Eureka Forbes)• It creates a background.• It lightens his burden of job.• It instills self confidence and initiative.

• Consumers (choice of brand)• Acts as a driving force in decision

making.• Ensures better quality products at

reasonable prices.• It saves good deal of time.

• Society • It uplifts the living standards. • It generates gainful employment opportunities.• It provides new horizons of knowledge. (classified and job ads)• It upholds culture of a nation (reflects and influences society) .• Advertisements educates the society.

Defining Modern AdvertisingThe Evolution of Advertising

• Identification– Simple images found in ancient Babylonia, Egypt, Greece, and Rome identified a business,

manufacturer, or store.

• Information – Gutenberg’s movable type mechanized printing leading to mass communication.

• Promotion– The Industrial Revolution led to surplus goods, improved transportation, and the need for

new media.

• Sales– Advertisers became concerned about making ads that worked and defining standards of

effective advertising.

Principle: An effective advertisement is one that can be proven to

meet its objectives.

Five Basic Factors of Advertising1. Paid communication2. Sponsor is identified3. Tries to inform or persuade4. Reaches a large audience5. Message conveyed through many different kinds

of largely nonpersonal mass media

Four Components of Advertising

Four Components of Advertising

1. Advertising Strategy• The strategy is the logic

and planning behind the ad that gives it direction.

• Advertisers develop ads to meet objectives.

• Advertisers direct ads to identified audiences.

• Advertisers create a message that speaks to the audience’s concerns.

• Advertisers run ads in the most effective media.

2. Creative Idea• The creative concept is the

central idea that grabs the consumer’s attention and sticks in memory.

• Planning strategy requires creative problem solving.

• Research involves creativity.• Buying and placing ads

requires creative thinking.

3. Creative Execution• Effective ads are well

executed reflecting the highest production values in the industry.

• Clients demand the best production the budget allows.

4. Media Planning/Buying• Television, Internet, magazines, and other media are used to reach

a broad audience.• Deciding how to deliver the message requires creativity.

Principle: In advertising how you say something and where you say it is just as

important as what you say.

Place in marketing mix

• Part of promotion mix in MM.• Dependent on other variables for its existence.• Advertising: An important component of marketing mix.• With other elements of promotion mix advertising leads to a successful

marketing programme.• Advertising promotes non-commercial ventures also.

Roles of Advertising

Marketing Role

Communication Role

Economic Role

•Marketing is the process a business uses to satisfy consumer needs and wants through goods and services.

Societal Role

•Advertising is a form of mass communication.

•Two main views about advertising, either the market power model or the economics of information theory.

•Informs us about new and improved products, teaches us how to use these innovations, etc.

The Key Players: The Advertiser

• Wants to send out a message about its business• Initiates effort by identifying a problem that advertising can solve• Selects the target audience, sets the budget, and approves the ad

plan • Hires the agency

– Agency of record (AOR) does the most business; manages other agencies

• Agencies have the strategic and creative expertise, media knowledge, talent, and negotiating abilities to operate more efficiently than the advertiser.

• Some large advertisers have in-house departments.

Key Players: Agency

• Media are channels of communication that carry the message to the audience

• They’re vehicles, but also large media conglomerates like Time Warner and Viacom.

Key Players: Media

Principle: Mass media advertising can be cost effective because the costs are spread over the large

number of people the ad reaches.

• Group of service organizations that assist advertisers, agencies, and the media in creating and placing ads by providing specialized services

• Artists, writers, photographers, directors, producers, printers, freelancers, and consultants

Key Players: Suppliers

Insert

• People to whom an ad is directed—their responses determine if advertising is effective.

• Targeting is the process of identifying the people in the desired audience.

• Interactive technology allows ads to be customized to the target audience’s individual needs.

Key Players: Target Audiences

InteractiveAdvertising

Public ServiceAdvertising

InstitutionalAdvertising

Business-to-Business

Advertising

Brand Advertising

Retail or LocalAdvertising

PoliticalAdvertising

Direct-ResponseAdvertising

DirectoryAdvertising

Types of Advertising

Interactive Advertising

Types Of Advertising

• Geographical spread• National (HUL), • Local (Ads in Delhi Times, Meerut Jagran )and • Global (Sony)

• Target group• Consumer ( Groceries, Beauty Care etc.)• Industrial (machinery, equipment) • Trade (for intermediaries) • Professional (Consumers are not responsible for buying choice Eg. Office automation,

Library books)

• Product advertising• Pioneer advertising: To stimulate primary demand of the product category.• Competitive advertising: To stimulate immediate buying / highlight benefits of

product. • Retentive advertising: To retain customers.

• Service advertising • Highlight emotion and utility Eg. Idea/ emphasize tangible aspects.Master Card

Types Of Advertising

Institutional advertising (SBI)• To make the company known• To make its products/services known• To make its achievements known• To make its achievements known• To make socio-political/moral statements

Public relations advertising (Reliance Foundation)• Represents the management and communicates the policies, problems and

performances to the public. Public service advertising (Polio Campaign, Sarv Saaksharta Abhiyaan))

• Social responsibility of advertising agenciesFinancial advertising

• Promoting capital issuesInternational advertising

• Response to global marketing

Type Purpose

Institutional Promotes organizational images, ideas, and political issuesAdvocacy Promotes a company’s position on a public issueProduct Promotes products’ uses, features, and benefitsPioneer Tries to stimulate demand for a product category rather

than a specific brand by informing potential buyers about the product

Competitive Points out a brand’s special features, uses, and advantages relative to competing brands

Comparative Compares two or more brands on the basis of one or more product characteristics

Reminder Reminds consumers about an established brand’s uses, characteristics, and benefits

Reinforcement Assures users they chose the right brand and tells them how to get the most satisfaction from it

5 Advertising Decisions

• What are the advertising objectives? (Mission)• How much can be spent ? (Budget)• What message should be sent ? (Media)• What media should be used? (Media)• How should the results be evaluated ? (Measurement)