The Advertising Handbook

Sean Brierley, Jonathan Hardy, Iain Macrury, Helen Powell

• Publisher: Routledge
• Year: 2018
• ISBN:
  9781317192275
• Edition: 4
• Topic: Business
• Subtopic: Business General
• Index: Business

The Advertising Handbook provides a critical introduction to advertising and marketing practices today. Contributions from leading international scholars and practitioners offer extended coverage of the contemporary shifts and pressures reshaping the marketing communications (or advertising and marketing) industries and their relationship to the consumer. Profiles and case studies illustrate innovation and diversification among advertising, marketing and public relations companies. Discussion questions aid learning and encourage debate about the activities and influence of advertising today.

This Fourth Edition explores the growing significance of:

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• the influence of 'Big Data' and automation in digital advertising;

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• tracking and profiling users across digital communications for targeted and personalised marketing communications;

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• the rise of media and advertising integration through sponsored content, product placement, native advertising and other forms of branded content;

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• the dynamic shifts in ad spending and media–advertising relationships across legacy media, online and social media; and

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• the complex profile of consumer behaviour that produces new challenges for brands and branding.

Fully revised and updated, this new edition of The Advertising Handbook is a comprehensive and accessible guide to contemporary advertising and marketing theory and practice, designed to meet the requirements, interests and terms of reference of the most recent generation of media and advertising students.

Part 1

Marketing practices and processes

CHAPTER 1

The development of the modern advertising industry

Joseph Turow

In the broadest sense, advertising involves attempts at persuading people to adopt certain ideas or purchase particular goods and services. The traditional definition is narrower. It limits the use of the term to messages that show up as a result of the explicit purchase of space or time on particular channels, or media. Think, for example, of a clearly-purchased newspaper announcement of a store sale, a jingle from an automobile firm clearly sponsoring a television show, and a rented outdoor billboard proclaiming the need to go to church.

Not covered by this understanding of advertising is a range of persuasive activities that are either not explicit attempts at persuasion or that don’t involve the purchase of space or time. Consider an actor who shows up on a late-night talk show to hype her recent film; a company that employs jugglers on the streets of the financial district to circulate flyers about how a firm can help you juggle your finances; a car company that creates a safety campaign for schools; and a cheese company that circulates electronic and physical coupons to likely buyers. These endeavours fall under the labels publicity, guerrilla marketing, public relations, and shopper marketing, respectively. Many practitioners use the umbrella term marketing services to describe them, as well as advertising. Understanding the development of the modern advertising industry means showing how advertising today links to all sorts of marketing services. In fact, the history of the advertising industry is also the history of bringing all these activities increasingly under the umbrella of a persuasion industry.

ADVERTISING BEFORE THE ADVERTISING INDUSTRY

An industry is a conglomeration of organizations that work together in a regularized way toward certain ends. Today’s advertising industry certainly fits this description. Creating and distributing an ad we see or hear online, in an app, in a video game, on TV, or in so many other places requires organizations specialized in different tasks: conducting research on the intended audiences; creating the persuasive messages (the actual ads); purchasing space or time; reaching audiences the advertisers want to reach; making sure the technologies being used work efficiently to deliver the ads; evaluating whether the ad succeeded in accomplishing what its creators intended; and more. But this kind of advertising system is only about 150 years old. For many centuries, advertising was a “handicraft” activity whereby one person or a few individuals put together arguments for people to purchase products or services they were selling. In the days when most shoppers could not read, sellers walked through streets barking or singing about the items they had for sale. The lines William Shakespeare gives a peddler in The Winter’s Tale reflects that as far back as the early 1600s sellers had learned that emotional hooks around love could be a good selling proposition. He has a peddler sing to his male audience that they should buy from him bracelets, necklaces, and “poking sticks of steel, / What maids lack from head to heel”. The seller’s key selling proposition: “Come, buy of me; come buy, come buy; / Buy, lads, or else your lasses cry” (Wood 1958: 19).

In the American colonies of the eighteenth century, Benjamin Franklin’s advertisement for his invention of a kind of radiator—what we know as the Franklin Stove—further shows that even in the days of handicraft advertising, copy could shrewdly go beyond the item to be sold to work on presumed psychological motivations of potential buyers. Whereas with typical fireplaces much of the heat went up the chimney and pulled warm air from the room up with it, this new approach covered the front of the fireplace and conducted heat to the stove into the room via a pipe. Knowing that because of their household roles women tended to be at home around the fireplace, he instead extolled the stove as making them look younger than they would with a traditional setup. “Great and bright fires”, he wrote, “do … very much contribute to damaging [women’s] eyes, dry and shrivel the skin, and bring on early the appearance of old age” (Wood 1958: 51).

While Franklin wrote ads for his own publications, other publishers of newspapers and magazines sold space for merchants to place their own ad copy. Periodicals were rather new in the eighteenth-century English-speaking world, and they tended to be read by merchants and other people of means. People who advertised their wares wrote the messages themselves, or they could turn to individuals who offered for a fee to help them write the copy. The seller then had to approach the publication to arrange for the ad to run and to pay the fee. Typically, the seller had to approach each publication separately. That began to change in the early nineteenth century.

In the United States, a wood salesman named Volney Palmer got the idea to offer merchants the ability to place their ads conveniently through him in a group of newspapers to which he often had exclusive space-selling rights. While merchants were expected to write the ads, they saved time and energy by paying the ad agency one sum to reach far-flung audiences. Palmer took some profit on the sales, and the first “media buying” agency was born. Before too long, others were following Palmer’s lead, and by the late nineteenth century companies sprouted up that collected a lot of data about magazines and newspapers around the country and offered to be intermediaries for advertisers that wanted to reach audiences most appropriate for their products.

Pushing the business of media buying forward was the industrial revolution. A new era of mechanization in England, Europe and the United States led to the mass production of goods. Factory activity sent materials to the manufacturing process in an automatic, continuous stream. The new approach changed business. In the United States the manufacturing capacity increased sevenfold between 1865 and 1900. Plants turned out things—toothpaste, corn flakes, safety razors, cameras, soap—that hadn’t previously existed or that had been handmade. Industrial competition encouraged the creation of brands—not just soap but “Ivory” or “Colgate”. Still, to make profits on a particular soap brand or any other mass-produced item, a manufacturer had to ensure that hordes of shoppers were quickly made aware of the products and persuaded to buy them. The solution was to advertise to huge numbers of people through the newspapers and magazines that were becoming popular as more and more people learned to read. The periodicals, in turn, made themselves attractive to readers by keeping their prices very low and making most of their money through selling ads. By the early twentieth century in the United States, big-city newspapers were delivering hundreds of thousands, even millions, of people a day to their advertisers, and weekly and monthly national magazines were also sporting many ads, often in color.

THE GROWTH OF THE AD INDUSTRY

The modern advertising industry developed in sync with the rise of the mass-market periodicals. As manufacturers began to market branded products and as department stores reached out to huge urban populations, those firms wanted help creating advertisements that would stand out among the competition. Consequently, in addition to their media buying work, and art departments, and by around 1910, the task of preparing advertisements had become their central responsibility. Along with the agency’s creation of the ad came its work on the ad “campaign”, which included early forms of market research and media planning. Into the 1920s the number of advertising agencies grew, organized around the three basic areas of media planning, creative, and research. Although most remained relatively small businesses with one office, a few established branches that served major clients in several cities within the United States and outside.

J. Walter Thompson was the largest of these, dating back to 1877 (when Thompson bought an agency that itself had started in 1864). Initially, the company made its money by being the exclusive buyer of ad space in many American magazines; by 1889, it is said to have placed 80 per cent of the advertising in the United States. The firm opened an office in Detroit in 1909, placing advertisements for a number of bicycle and automobile manufacturers, including Ford. In 1899 it opened a London office to be “sales broker for the American offices [of companies] who hoped to get business from European clients who wanted to sell in the States” (Collier 2017). Along with the rest of the advertising business, J. Walter Thompson expanded to create advertisements and conduct market research. The expansion applied to its London outpost, which turned full service in 1916 (Collier 2017).

J. Walter Thompson’s Helen Resor was among the ad industry executives who in 1914, as part of their growing research concerns, helped establish an independent organization, the Audit Bureau of Circulation, to verify the size of a periodical’s audience. The Audit Bureau’s emphasis on sheer audience size reflected the audience approach of the era. A sense that “men” or “women” or “children” could use a product was about as detailed as most national advertisers got in customizing their appeals. One can find reports of audience segmentation and targeting by advertisers early in the twentieth century—to reach, for example, farmers, college students, religious people, and various occupations (Turow 1997: 27–28). Nevertheless, many marketers did stress reaching “the masses”, and that desire became even stronger with the development of advertiser-supported radio in the United States during the 1920s. Unlike the UK and many other countries, radio in America developed primarily as a for-profit business supported by advertising. The US government’s decision to make radio broadcasting a commercial activity did not come without resistance from educational and labor organizations that feared their voices would be marginalized in such a system. Although some concessions were made to non-commercial interests in the 1920s and 1930s, during that period radio broadcasting emerged as firmly connected to the advertising industry.

In fact, US advertising agencies grew in employees and social power with the rise of the new medium. In radio, most shows were owned by the advertiser and often produced by the firm’s ad agency. The radio networks carrying the shows principally sold the time to advertisers; the agencies primarily shaped the nature and arrangement of material on the network schedules. To support the goal of delivering large audiences to their clients’ programs, ad agencies supported the growth of ratings companies that through various technologies estimated the number of people listening to each program. The AC Nielsen Company’s “audimeter”, which detected the frequencies (and therefore programs) to which radios in a representative sample of US homes were tuned, eventually became the dominant arbiter of audience size.

Although radio forced advertising practitioners to generate audio-visual forms of persuasion, many of the rhetorical tacks they used had been honed in print vehicles, particularly magazines and newspapers. As in those media, two quite different approaches, the hard sell and the soft sell, took hold. Hard sell advertising aims to get a person to purchase a product or service in the short term. The ads typically involve a barrage of facts and specific logical reasons for purchasing a product. They also give the audience a way to buy it immediately or get more information. In magazines, newspapers, and through circulars delivered through the mail, that meant attaching a coupon to the ad, which a person could send back for the product, a free sample, or more information. Radio hard sell commercials used a similar technique, urging people to purchase the product immediately in a local store or to write to the company for a free sample. Soft sell takes a different approach. Instead of a barrage of facts and encouragements to act immediately, this sort of advertising attempts to evoke positive emotional responses that the audience will associate with the advertised brand (Advertising Age 2003a).

Some advertising analysts posit that the difference between hard sell and soft sell is rooted in different assumptions regarding the ways people respond to persuasion—through reference to supposedly rational facts or through reference to emotions. In practice, the two forms of selling led to a majo...