LECTURE 8 International Corporate Advertising

Introduction This chapter discusses the role and importance of corporate advertising as a key corporate communication function in the globalised and developing country. As a powerful strategic communication tool, today, corporate advertising campaigns are being given considerable attention by global corporation worldwide. Interestingly, corporate advertising is always associated with the corporate image and corporate branding of the corporation as it is aimed at promoting the company, rather than its products or services

Corporate Advertising: Some Perspectives There are perceptual debates over whether corporate advertising should be seen as a promotional mix from a perspective of integrated marketing communication (IMC)(Belch & Belch, 1998) OR focused on corporate image and corporate branding from a perspective of corporate marketing (Gregory & Wiechmann, 1999)

Corporate Advertising: Some Perspectives The debates continously confuse many practitioners who still perceive corporate advertising as a tactical tool to hit the ground running in short-term planning. Many practitioners also still cannot differentiate between corporate advertising and product advertising, though both are considered as paid advertising.

Corporate Advertising: Some Perspectives Importantly, corporate advertising, from a perspective of reputation management, must be aligned with strategic communication policy set by top management. This must be seen beyond Integrated Marketing Communication (IMC) or marketing side Thus, corporate advertising will be more valued if properly conducted by strategic communicators at the Department of Corporate Communication.

Corporate Advertising: Some Perspectives Van Riel and Fombrun (2007) argued that the success of corporate advertising campaign largely depends on the right tool and framework analysis used by corporation aligning them with approaches of reputation management. Unlike other communication tools such as publicity, sales, marketing communication, and product advertising, corporate advertising must be viewed in a broader concept by considering the public policy and corporate social responsibility in a macro-external environment.

Corporate Advertising: Concepts & Functions Defining Corporate Advertising Corporate advertising is aimed at promoting the overall awareness of a company as well as enhance its brand image to its various stakeholders. Thus, the main idea is to strengthen a company’s reputation (Park et al, 2000) Argenti (2007: 87) defined corporate advertising as “paid use of media that seeks to benefit the image of the corporation as a whole rather that its products or services alone”

Defining Corporate Advertising

Corporate Advertising: Concepts & Functions There is a significant different between corporate advertising (managed by the corporate communication department) and product advertising (carried out by the sales and marketing department) as illustrated in Figure 7.0 (Argenti, 2007)

Corporate Advertising: Concepts & Functions Underlying Function of Corporate Advertising Corporate advertising is perceived as a key tool in presenting the corporate identity of the organization to its strategic constituencies. Its functions to promote the organization’ s character and personality that assess the overall communications strategy through several types of corporate advertising such as image advertising, advocacy advertising and cause related advertising (Park et al, 200, Argenti, 2007, Belch & belch, 1999)

Corporate Advertising: Concepts & Functions The study by Park et al (2000) showed that with the rise of customer sophistication, the corporate advertising is one of the pivotal drivers in formulating and implementing strategy development and perception management for today’s global corporation. Today’s corporation should pay substantial attention to, and continue investing in corporate advertising campaign as an improved marketing communication strategy to reach out to existing customers and potential stakeholders

Strategic Objectives of Corporate Advertising According to O’Guinn at al (2202: 74), there are several objectives of corporate advertising that enhance the corporate image and reputation’ 1. To build the image of the firm among its various stakeholders such as customer, investors, employees and general public 2. To improve morale of existing employees and attract new skilled employees 3. To convey strategically more coherent corporate messages by expressing the firm’s concerns over social, political or environmental issues 4. To better position the firm’s products against global competition.

Types of Corporate Advertising In a successful corporate advertising campaign, a firm implements one of theses types of corporate advertising (O’Guinn et al, 2000) 1. Image advertising 2. Advocacy advertising 3. Cause-related advertising

Corporate Image Advertising Corporate image advertising is the most popular of strategic communication campaign planning that is frequently used by global corporation to promote the corporate personality and character to their wider stakeholder.

Corporate Image Advertising There are several methods that can be used to achieve the objectives; 1. Creating image-building in the stakeholders mind 2. Providing sponsorship to create an image as a good corporate citizenship 3. Recruiting talented and skilled employees (brainpower) 4. Generating more investment in the firm For example, the giant Korean electronic firm, Samsung, recently invested 120 million pound to run a global branding campaign by appointing the WPP group, a global and reputable communication agency (Benady, 2004, in Trench & Yeomans, 2006: 511)

Advocacy Advertising The firms creates corporate advertisement ‘to propagate ideas and reveal controversial social issues of public importance’ which may attract sponsors. They are not designed to promote the corporate image but importanctly, ‘adopting a position on a particular issue’ concerning with social, business or environment that may affect directly and indirectly the organisational image. For example, Avon’s policy on animal testing has alerted many cosmetic companies to consider this corporate value in its policy development

Cause-related advertising The firm creates corporate advertisements to sponsor charities or non-profits organization for the purpose of creating a win-win situation. For example, the diversified global financial services corporation, American Express, supports the restoration of the Statue of Liberty by raising funds accounting for USD1.7 million.

Measuring Corporate Advettising Campaigns 1. Attitude Survey To observe the perception of stakeholders about the ads 2. Corporate Advertising Strategy An E-fluential corporate advertising study 3. Focus Group Research To examine qualitatively ‘what investors want to seein the ads and how they are react after ads are developed’

Summary Corporate advertising is considered a market driven which is used to formulate, implement and evaluate a strategic corporate communication policy to achieve organization objectives Aligning with today’s customer sophistication and high-tech tehcnology complexity, corporate advertisng is a new approach to reach and satisfy brilliant stakehilders, but local sentivity mist be prioritised, particularly in Asian countries which are rich in multiculturalism

SCL-Review Based Activity 1.Based on the any Television Commercial (TVC) shown on any TV Channels, explain the investment done by the organisation in their corporate adverting campaign? 2. Discuss the communication strategy to reach their existing customer and potential stakeholder?