The World of Advertising and Integrated Brand Promotion Chapter 1 The World of Advertising and Integrated Brand Promotion Copyright © 2006 Thomson Business and Economics. All rights reserved.
The World of Advertising We Need to have Perspective! Firms use advertising to build brands. Firms of all sizes need and use advertising. Advertising is just one tool in Integrated Brand Promotion (IBP). Advertising and promotion do not guarantee success. People have all sorts of positive and negative (mis)perceptions about advertising and promotion. Copyright © 2006 Thomson Business and Economics. All rights reserved.
What is Advertising? Three criteria must be met for a communication to be classified as advertising: The communication must be paid for. The communication must be delivered through mass media. The communication must be attempting to persuade. Copyright © 2006 Thomson Business and Economics. All rights reserved.
Distinctions within Advertising Advertisements Specific messages designed to persuade an audience Advertising Campaign An integrated series of ads and promotions that communicate a central theme or idea Integrated Brand Promotion (IBP) Coordinating promotional tools with advertising to build and maintain brand awareness, identity, and preference Copyright © 2006 Thomson Business and Economics. All rights reserved.
Integrated Brand Promotion (IBP) Coordinated promotional activities reinforce one another. Special Events Television Advertising C o u p n s Copyright © 2006 Thomson Business and Economics. All rights reserved.
Communication: Human Communication Process NOISE Source Encoding Message Channel Decoding Receiver Feedback to be decoded by a receiver Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Stern Model Source Message Receivers Within the text of the advertisement Author Persona Sponsor Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Source Dimensions Legally responsible Has a message Sponsor Author Persona Copywriter, art director, or creative group Creator is invisible to audience Real or imaginary spokesperson Represents the sponsor Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Stern Model Source Message Receivers Within the text of the advertisement Author Persona Sponsor Literary form Autobiography Narrative Drama Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Message Dimensions Autobiography Narrative Drama “I” tell a story about myself to “you,” the imaginary audience Third person tells a story about others to imagined audience Characters act in front of imagined audience Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Stern Model Source Message Receivers Within the text of the advertisement Author Persona Sponsor Literary form Autobiography Narrative Drama Actual consumers Implied Sponsorial Feedback Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Communication: Receiver Dimensions Implied consumers Sponsorial consumers Actual consumers Ad texts presume an audience Ad uses implied consumers, not real ones Gatekeepers who decide if the ad will run Sponsor’s executives People in the real world who comprise the target audience Copyright © 2006 Thomson Business and Economics. All rights reserved. McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.
Audiences for Advertising Household Consumers Business Organizations The Trade Channel Professionals Government Copyright © 2006 Thomson Business and Economics. All rights reserved.
Audience Geography Global International National Regional Local Copyright © 2006 Thomson Business and Economics. All rights reserved.
Advertising as a Business Process: Role of Advertising in Marketing and Brand Promotion Advertising and the marketing mix Advertising in brand development and management Advertising in market segmentation, differentiation, and positioning Advertising in revenue and profit generation Copyright © 2006 Thomson Business and Economics. All rights reserved.
The Marketing Mix Perceived Value Product Distribution Promotion Price Copyright © 2006 Thomson Business and Economics. All rights reserved.
Advertising in Brand Development and Management Information and persuasion Introduction of new brands—extensions Building brand loyalty/brand equity Creating an image/meaning Building brand loyalty in the trade channel Copyright © 2006 Thomson Business and Economics. All rights reserved.
Advertising’s Role in SDP Marketing Positioning Segmentation (heterogeneous > homogeneous) Differentiation (perceived as different or unique) Distinct from other brands Occupies a “value” level Copyright © 2006 Thomson Business and Economics. All rights reserved.
Revenue and Profit Generation Economies of scale: higher volume results in lower unit cost Brand loyalty leads to inelasticity of demand: less price sensitivity to demand Copyright © 2006 Thomson Business and Economics. All rights reserved.
Types of Advertising Primary demand stimulation Create demand for product category New to the world products Selective demand stimulation Create demand for a particular brand Copyright © 2006 Thomson Business and Economics. All rights reserved.