Advertising

10 Key excerpts on "Advertising"

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  eBook - ePub

  Essentials of Advertising

  • Robert Cluley(Author)
  • 2017(Publication Date)
  • Kogan Page

    (Publisher)

  05

  Information and value

  The economics of Advertising

  Introduction

  We closed the last chapter considering the importance of Advertising work when it comes to understanding the knowledge economy. This offers us a nice way to step outside of the Advertising industry itself to think about the essentials of Advertising more generally. In this chapter, we will pick up the economic theme and explore the economics of Advertising.

  As a body of research and theory, economics explores how people allocate scare resources. Predominantly, it focuses on the ways that buyers and sellers decide on the correct price for a product or service. However, economic ideas have informed discussions in other areas. They have, for example, been used to explain how people allocate their time and attention. Levitt and Dubner’s (2006) bestselling Freakanomics is perhaps the most recent example of this trend.

  Surprisingly, given this focus on consumer decisions, for a long time mainstream economic research overlooked Advertising. It was assumed that ‘there is no purpose’ in Advertising in competitive markets (Pigou, 1924: 173–74). If sellers wanted to increase the quantity they sold, they simply needed to lower the price of their offering. Buyers weighed up the benefits of an offering against the price and, if they found the price reduced, would buy more of the product or service. There is no need for rhetoric or persuasion.

  However, with the growth of modern Advertising, economists started to realize that Advertising does affect consumers. The question they still needed to answer is how it does so. In this regard, economists have explored the effects of Advertising on individual consumers, firms and markets. As we will see, though, despite nearly a century of work in this area, they have yet to agree on the effects of Advertising. For some, it makes markets more competitive and improves consumers’ abilities to make decisions. For others, it has the opposite effect.

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  Marketing Communication

  A Critical Introduction

  • Richard Varey(Author)
  • 2002(Publication Date)
  • Routledge

    (Publisher)

  Advertising is an integral part of ‘free-market’ economies that enables consumers and buyers to locate and compare brands and to understand distinctions and innovations among proliferating product offerings. Thus, Advertising has a vital role in helping to inform purchase decisions. Today, Advertising has a social role in connecting persons with products and images of well-being, reaching into our personal concerns about personal identity, interpersonal relationships, happiness, affluence, stereotypes, sex roles, cultural traditions, persuasion, personal autonomy, the role of business in society, and so on. Advertising is not simply a conveyor of information and persuasive messages, it is a massive and pervasive industry, afforded great prominence in our lives, that provides social communication. Today, much of our communication of attitudes, expectations, and sense of identity, is about and through objects (consumer products). In 1999, according to the Advertising Association, Advertising spend in the UK topped £15.3 billion – that's £250 for every person living in the UK, and almost 2 per cent of our GDP. This was an increase of 6.4 per cent on the previous year and the eighth consecutive annual increase. Newspaper Advertising accounted for 51.1 per cent of the total.

  Advertising is the art of making commodities communicate with us (Dichter, 1960). Arguably, much product Advertising entices us to ‘come and get me’, but ignores the other part of the bargain, the obligation to pay (Gabriel and Lang, 1995). The market, and its commercial Advertising, is not primarily a ‘want-satisfying’ mechanism: it is a ‘want-creating’ mechanism. Blythe (2000) has distinguished Advertising that is wanted by consumers because it is useful to them (sought Advertising) from advertisers’ efforts to attract attention (unsought Advertising). He suggests that classified Advertising helps people to find the products they want, whereas display advertisements distract in order to attract.

  The advent of the Internet is shaking the foundations of the Advertising-media industry. The converging telecommunication and computer technologies can definitively tie the information that consumers apprehend to the purchases they make. The rapid growth in Internet use has stimulated competitive Advertising by providing a new place, particularly for targeting young people (see Box 14.1

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  Effective Advertising Strategies for Your Business

  • Cong Li(Author)
  • 2014(Publication Date)
  • Business Expert Press

    (Publisher)

  The major problem of defining Advertising is that Advertising shares some common characteristics with other forms of marketing communication, such as sales promotion, direct marketing, and public relations. To make a clean and clear distinction between each of these activities is quite challenging. I don’t believe that I have the talent to solve this problem, and it is probably unnecessary for me to add to the existing definitions and provide another one. However, it is worthwhile for me to explain how Advertising is commonly defined in the field, and put my two cents in as to how it is related to this book.

  An interesting question that I frequently get from my students in entry-level Advertising courses is: Why are most Advertising programs held in the communication school instead of the business school at a university? Intuitively, Advertising sounds very business-oriented, doesn’t it? Well, yes, Advertising is certainly a part of business operations. However, more importantly, in essence it is a type of communication. A classic way to describe communication is: Who says what in which channel to whom with what effect?

  2

  If you think about this description, Advertising indeed is communication. Most existing definitions of Advertising actually reflect this nature and capture some or all of the following five elements: (1) create a paid message; (2) reach more than one person; (3) include an identified sponsor; (4) use mass media; and (5) persuade.

  3

  In other words, Advertising can be regarded as a paid communication process from an identified sponsor, using mass media to persuade or influence many people. Such a definition worked well for Advertising practices before the Internet arrived. For example, a company pays for a television commercial on a national network and the Advertising message gets delivered to many consumers who watch TV and who presumably will buy the product or service advertised. The Internet, however, is a game changer. Over the past two decades, the Internet has significantly changed how companies and consumers send and receive messages. As a result, the fundamental philosophy of how Advertising works or should work has been altered.

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  Understanding Media Economics

  • Gillian Doyle(Author)
  • 2013(Publication Date)
  • SAGE Publications Ltd

    (Publisher)

  8

  Media and Advertising

   

  One of the key sources of revenue for media is Advertising. Consequently, patterns of Advertising activity exert a very significant influence over the fortunes of the media industry as a whole. This chapter is concerned with the key arguments surrounding the economic role played by Advertising, and with its impact on market structures and on consumer decision-making. It introduces you to the economic forces and factors which determine the extent of Advertising activity in an economy, examining why levels of Advertising vary from one country to another, and over time. It also considers the significant impact of digitization and growth of the Internet on patterns of Advertising. With the advent of online intermediaries such as search engines, aggregators and social networking sites, the sale of audience attention has in some cases become dislocated from investment in professionally crafted original content production. Focusing on Internet Advertising and the growth of search, this chapter considers the crucial role played by Advertising in supporting and shaping the ongoing development of media.

  After studying this chapter, you should be able to:  

  • understand why Advertising takes place;
  • identify and explain the main factors that influence the amount of Advertising activity taking place in an economy, including the significance of the Internet in bolstering Advertising, and understand why Advertising tends to be cyclical;
  • explain the determinants of the firm’s Advertising decision;
  • analyse the implications of disintermediation;
  • assess whether Advertising is a beneficial or a harmful economic force.

  THE Advertising INDUSTRY

  Advertising is ubiquitous. Its roots can be traced back to the cave but, in the twenty-first century, its reach and influence have become virtually inescapable. Over the last 60 years, an increased willingness on the part of firms to invest in building awareness of themselves and of their wares has been matched by the rapid development of the Advertising, marketing and public relations sectors. Advertising agencies have generated catchphrases, jingles and images to accompany brands that are familiar to audiences across the globe and across generations.

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  Graphic Design Solutions

  • Robin Landa(Author)
  • 2018(Publication Date)
  • Cengage Learning EMEA

    (Publisher)

  Among parity products and services, effective adver-tising could persuade you that one brand is better or more appealing than its competition. An ad campaign for a tooth-paste brand might convince you that its use would leave your teeth cleaner, brighter, healthier, or your mouth fresher smell-ing than any other. For any Advertising to affect you, to call you to action, it has to be relevant to you, and it has to be pre-sented on media channels that will reach you. In industrialized countries (and, increasingly, globally) adver-tising is part of daily life and inseparable from popular cul-ture. In many countries, Advertising is the one common experience shared by a large, diverse populace. Advertising is the pop culture vehicle with which we all come into contact and know—from branded entertainment online to mobile ads to television commercials. An advertisement or ad is a specific message constructed to inform, persuade, promote, provoke, or motivate people on behalf of a brand, entity, or cause. (In this book, entity desig-nates commercial companies, government agencies, charities, and other nonprofit organizations.) Effective Advertising is about: ➔ ➔ Participation and starting conversations with people across media channels ➔ ➔ Ideas and actions that benefit people, not just selling more product ➔ ➔ Content people care to share ➔ ➔ Building brand communities and sirens ➔ ➔ Sourcing data to inform and create useful brand apps, experiences, platforms ➔ ➔ Social campaigning that maps back to what a brand or cause promises Copyright 2019 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience.

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  Marketing Management

  • Dawn Iacobucci(Author)
  • 2021(Publication Date)
  • Cengage Learning EMEA

    (Publisher)

  All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. 194 be devised to capture whether that goal was attained. A marketing research project could easily measure the pre- and post-Advertising attitudes in the relevant target segment to see whether the attitudes have been enhanced. But when the goal is to strengthen the brand image, the CEO cannot be flipping through this quarter’s sales figures, hoping to see an increase. That is a mismatch between the goal and its assessment, and it would be unfair to whine that Advertising wasn’t working. So what is Advertising? Why do we need it? And how do we do it well? 11-1 What Is Advertising? Advertising is the primary means by which a company communicates with its customers about its products, brands, and position in the marketplace. Product, price, and place also signal a brand’s positioning, and certainly all these signals need to tell a coherent story. If ads claim that a brand is an exclusive, premium brand, the product needs to be of high quality, priced relatively high, and distributed relatively exclusively. But while the rest of the marketing mix is important, Advertising is the most direct communication link. For many people, the word “Advertising” connotes television commercials, and certainly this is a fun form of Advertising. TV commercials and print ads (in magazines, billboards, online banners and pop-ups) represent much of the typical Advertising budget. But compa-nies advertise their brands in everything they do, including event sponsorship, social media activities, the packaging that encloses their products, etc.

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  Discourse and Communication

  New Approaches to the Analysis of Mass Media Discourse and Communication

  • Teun A. van Dijk(Author)
  • 2011(Publication Date)
  • De Gruyter

    (Publisher)

  For example, within a given country it is common to find what might be considered highly fanciful Advertising for consumer goods such as toothpaste, detergents, or soft drinks, and highly technical messages dealing with construction equipment, medial supplies, or computer services. The advertisers themselves can include huge multinational firms, special interest groups, local shop keepers and individuals. Their intents can range from altering behavior to affecting the way people think about a particular social or economic position. The results of their efforts can range from enormously influential to a waste of the advertiser's money. It is not, then, a subject that lends itself to oversimplification. Advertisements 9 5 The Forms of Advertising A very basic sweep of Advertising's many faces would reveal at least eight basic forms. They are: — Advertising by producers of consumer goods to reach individuals. This is often called general or national Advertising, because it involves Advertising from a single company (the producer of the good or service) to an audience over a large geographic area — a region, or perhaps an entire country. Media used may be magazines, radio, television, newspapers, outdoor, cinema, direct mail, transit, etc. The purpose is generally to attempt to encourage preference for a particular brand. (An example would be a typical advertisement for Coca-Cola.) — Advertising by producers of consumers goods to reach retailers and wholesalers. The same companies that attempt to reach individual consumers also often advertise to retailers to encourage them to stock the product that the retailers would then sell to individuals. This is often a very important form of Advertising, frequently combined with personal selling, because the competi-tion for retailer shelf space is quite strong. Media used would include direct mail and hihgly specialized trade magazines such as Drug Topics, Supermarket News, Farm Supplier , etc.

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  Advertising, Society, and Consumer Culture

  • Roxanne Hovland, Joyce M. Wolburg(Authors)
  • 2014(Publication Date)
  • Routledge

    (Publisher)

  American Demographics put it, new media consumers will ‘be more tolerant of Advertising because it will be more appropriate and customized.’ In other words, Advertising would cease to be perceived as an exogenous intrusion endured because it is believed to subsidize the cost of media. Instead it will be something sought out by consumers because of its relevance. (1997, 142)

  According to Standard & Poor’s Industry Trends, “The increasing availability of accurate consumer data via tracking and marketing research firms has enabled advertisers to better target their audiences. It is now possible to microtarget select segments of the population in the development of marketing campaigns, thus improving the effectiveness of those campaigns” (2007).

  Given how Advertising has changed and its increasing similarity to other communication forms, it’s easy to see why Advertising is regularly confused with other aspects of marketing and communication. However, what distinguishes Advertising from other promotional tools may be a question of degree. To a much greater degree than other marketing elements, Advertising has the following characteristics:

  1. It is paid for.

  2. The sponsor is identified.

  3. It appears in a nonpersonal medium of some kind.

  4. It is intended for a particular audience.

  5. The advertiser attempts to control the content, placement, and timing of the message.

  6. The purpose of the message may not only be to inform and persuade but also to cultivate a relationship with an audience.

  This still leaves a lot of potential overlap between what we’ve defined as Advertising and other elements of marketing and promotion. To a large degree, this is unavoidable. A caveat must therefore be added: Whenever Advertising is alleged to be having an impact on consumers and/or culture, it must be determined (if possible) that Advertising is truly responsible. Very often, overly broad generalizations are made about the effects of Advertising that lump Advertising and other aspects of marketing together. Just as it’s easy to confuse Advertising with the principles of classical liberalism that inspired it, it’s easy to confuse Advertising with other elements of marketing and promotion.

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  Marketing and Semiotics

  New Directions in the Study of Signs for Sale

  • Jean Umiker-Sebeok(Author)
  • 2012(Publication Date)
  • De Gruyter Mouton

    (Publisher)

  Like the Navajo films, Advertising can be used as a vehicle for understanding the structures of reality within a culture. 442 John F. Sherry, Jr. Marketing is at once the most potent agent of cultural change and of cultural stability at work in the contemporary world, and the ways in which this dynamic tension is both fueled and harnessed comprises an intrinsically interesting field of inquiry. Because Advertising is designed expressly to exploit this tension, does so with such variable results, and is attended by complications and sequelae both unanticipated and undetected by its publics (Pollay 1986), it is especially worthy of investigation. Whether the globalization of markets which we are currently witnessing is, on the one hand, a desirable, irreversible trend resulting in improved life chances for all participants, and which should be catalyzed and managed by standardized marketing interventions (Levitt 1983), or, on the other hand, is an undesirable, ethnocentric conception of progress which disrupts the ecological, social, and psychological balance of its unwilling conscripts (Barnet and Müller 1974; Bodley 1982), and which therefore should be arrested or redirected by enlightened social policy, it is in any case morally imperative that we investigate the Advertising upon which it is predicated. Such investigation must proceed dispassionately and avoid being merely another insightful jeremiad on the symbolic underpinnings of an irrational economic system (e.g., Henry 1956; Inglis 1972). Greyser (1972) has provided us with a catalyst for this kind of study by encouraging exploration of Advertising's nature and content, its macroeconomic effects, and its influence on society's values and lifestyles. A recent article (Lammon and Cooper 1983) reminds us once again that our relationship to Advertising is both proactive and reactive—we 'do unto' Advertising and Advertising 'does unto' us—without articulating what it is that people do with Advertising.

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  Advertising Transformed

  The New Rules for the Digital Age

  • Fons Van Dyck(Author)
  • 2014(Publication Date)
  • Kogan Page

    (Publisher)

  Part one The essence of Advertising today Passage contains an image 01 What is effective Advertising?

  E verybody has an opinion about Advertising. That should come as no surprise, since Advertising is omnipresent in our lives. Some embrace Advertising as an inextricable part of our popular culture, putting the individual’s freedom of choice first. Others are radically opposed and believe Advertising is destroying our world. But what makes Advertising effective today?

  Companies continue to invest massively in Advertising: about US $497 billion (382 billion euros) in 2012, or 3.3 per cent more than in 2011. This represents about the size of the gross domestic product (GDP) of a Western country like Belgium. The biggest investment in Advertising per capita is made in Switzerland ($744 per person), followed by Norway ($602 per person), Australia ($580 per person) and the United States ($512 per person). For 2013, global ad spending was expected to rise by 4 per cent.

  1 ,

  2

  Advertising is not new – evidence of its use can be found in Ancient Egyptian, Greek and Roman times. Yet even today, the discussion about how Advertising works, what its role and return is for brands and companies continues to be a hot topic in and outside scientific circles:

  • What is the current state of play?
  • How does Advertising really work?
  • What is the difference between Advertising, sales promotion and word of mouth?
  • Does Advertising need to focus on loyal customers or on ‘new’ customers?
  • What are the short- and long-term effects for brands?

  The Advertising paradox

  New neuroscientific and psychological evidence has brought fresh insights into how our brains work and how Advertising works in our brains. Advertising creates memories and recalls them, working on a less conscious and emotional level than was traditionally thought. This is one of the insights presented by marketing authority Byron Sharp in his book3 How Brands Grow: What marketers don’t know

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