1. and its importance to Marketing
ADVERTISING
and its importance to Marketing

2. About Advertising
Average person is exposed to more than 2,000 advertisements a week
Main Purpose is to present a message that encourages the customer to buy the product or accept the ideas
Costs are usually lower than other types of promotion
Businesses must choose appropriate mode of advertising, then the content, for their target market
Can “presell” products before shopping ever starts

3. Drawbacks to Advertising
Cannot focus on individual needs because same message is conveyed to all customers
Some forms can be too expensive
Inefficient – not everyone exposed is a potential customer
Messages are often short

4. Types of Media for Advertising
Print
Newspaper
Magazine
Direct-Mail
Directory
Outdoor
Transit
Broadcast
Television
Radio
Online
Banner Ads
Interstitial
Web Pages
Other
Specialty – promotional items
Sports Arena Billboards
Movie Theater Ads
Hot Air Balloons and Blimps
Instant Coupon Machines

5. Print Media Oldest form of advertising Written Newspaper Magazine
Direct-Mail
Directory
Outdoor
Transit

6. Newspaper Ads Can be daily or weekly
Can be local, regional or national
Classified
Grouped by specific category
Pay by word or line
Display
Creative illustration of product
Mix of art, photographs, headlines, copy, and logo
Advantages
Large readership with a high level of involvement by the consumer
Circulation is known, so businesses can target living area or special interests
Cost is low
Timely and can change easily
What are some disadvantages?

7. Magazine Advertising Classifications
Local, regional, national
Weeklies, monthlies, quarterlies
Consumer or business/trade

8. Magazine Advertising
Can target their audiences because they know circulation and characteristics of readers
Have longer life span
More likely to be remembered
Print quality is better
People keep magazines longer
Variety of presentation formats
What are the disadvantages?

9. Direct-Mail Advertising
Can be newsletters, catalogs, coupons, samplers, price lists, invitations, reply cards
Done by mailing list or in with bill
Highly selective and control timing
Can use incentives
Disadvantages
Low response level
List becomes dated
Cost is high due to production, postage, buying mailing list

10. Directory Advertising
White and Yellow Pages
Relatively inexpensive
Found in 98 percent of American households
Printed yearly – how is this an advantage and a disadvantage
Common for local service business

11. Outdoor Advertising Highly visible 24-hour a day message
Can be located to reach specific target markets
Limited viewing time
Government regulations

12. Transit Advertising Printed posters found inside commuter trains
Exterior posters on outside of taxis and buses
Posters in the station itself
Economical
Defined urban market

13. STOP HERE

14. Newspaper Rates Quoted by column inch (1” wide x 1”deep)
If a column is $17 per column inch and the advertisement is 4 inches wide by 3 inches deep, then
17 x 4 x 3 = $204
Called classified because they are grouped by specific category
Usually pay for classifieds by word or line

15. Factors that affect rates
Run of paper – where the ad is placed in the publication. Does the paper choose or the advertiser choose?
Use of color
Frequency of advertising
Open rate varies when the ad runs
Contract rate
Cost per thousand readers rate

16. Which costs more?
Guaranteed run – Advertiser chooses the last page of the publication
Run of paper – the newspaper places ad where it has room

17. Which costs more?
Black & White ad
Color ad

18. Which costs more? Advertisers who run ads at least once every month
Advertisers who run ads just during tax season

19. Which costs more? Open Rate Contract Rate
$28 per column inch on Thursday
$31 per column inch on Saturday
$35 per column inch on Sunday
Contract Rate
Bulk space
Guarantees that a minimum number of inches will be used during a 12-month period
Yearly Frequency
Guarantees that an advertiser will use a minimum number of column inches each week for 52 weeks

20. Assuming you are using the cost per thousand (CPM) rate:
Which costs more?
Advertising with the Chicago Times with a circulation of 500,000
Advertising with the Chicago Tribune with a circulation of 300,000

21. Magazine Rates
Based on circulation, quality of readership, production technique
Bleed – costs 15 to 20% more
Color – every time color is added, rates increase; four color most expensive
Premium position – Back cover, Inside first page
Frequency discounts –Rate per issue decreases as frequency increases
Commission rate –given by magazine to advertising agency
CPM

22. Broadcast Media People are more likely to believe broadcast than print
Merely for entertainment – doesn’t require reading
Average person spends 10 years watching television by age 70
Average person spends 6 years listening to the radio by age 70
Good availability, but more expensive

23. Television Advertising
Has sound, action and color
Prime time – between 7 and 10 pm
30 to 60 second spot
Appealing to large companies with widespread distribution
Directed to a specific audience
Infomercials are exceptions minute advertisement
Great for demonstrating a product’s features and benefits
Catch phrases and jingles?
News, comedy, sports, history, movies or science directed

24. Television Ad Costs
Highest production cost of any media and high dollar cost for time used
Actual audience size is not assured
Some people leave the room during commercials
More expensive for Class AA time (primetime)
Rates are based on viewership

25. Radio Advertising
Wide audience – 96% of all people over age 12 in one week
Best times?
Hint: Drive Time
15, 30 or 60 second slots
Effective because of announcer, background music, jingles, slogans and sound effects
Can select an audience by choosing stations
Messages can be changed easily
Three types – network, national spot, and local
Best times – in morning on the way to work or early evening on the way home

26. Radio Advertising Disadvantages
Short life span – once broadcast, it is over
Lack of visual involvement (that’s why you need a catchy jingle)

27. Radio Ad Costs Each radio station determines rates by time of day
Run of schedule is cheapest
Drive time advertising is expensive
Target audiences, audience size, weekly package plans

28. Online Advertising Advertising messages on the Internet
Most appear as banner ads
Button ads are also popular
Interstitial ads – pop ups that must be closed first
Response rates are low
Selling effectiveness is still uncertain
Relatively inexpensive

29. Other Media Ads in movie theaters or video rentals
Specialty
Items given away with no obligation
Printed with company name and address
Likely to be placed with high visibility
Distribution is limited
Fairly inexpensive
Sports Arena Billboards
Ads in movie theaters or video rentals
Hot air balloons and blimps
Skywriting
Supermarket cart displays
Instant coupon machines

30. Selection of Promotional Media
Depends on the product, the habits and lifestyles of target, types of media available in the area
Three questions
Does the medium have the ability to present the product and the appropriate business image?
Does the medium have the ability to target the desired customers?
Does the medium have the ability to obtain the desired response rate?

31. Which Media? African-American fashion dolls for children ages 7-12
New line of rain jackets
Vitamins
Movie
Watch that costs $1,500
Computers and computer equipment
Legal services
Used Cars

32. Promotional Budget Methods
Percentage of Anticipated Sales
Budget a percentage of last year’s sales
Little financial risk
All you can Afford
After all other expenses are paid
Objective to build sales and reputation in the beginning
Short time only
Following the Competition
Planned according to market share
Weak because it is based on other’s promotional strategies
Objective and Task
Determines goals and plans how to reach and determines the cost
Most effective of the four

33. Other Activities
Display print ads around room and have students look, close eyes, and tell which they remember (p.334)
Institutional advertising graphic and question ( p. 336)
Find an example of a print or broadcast ad you do not like – state what elements you don’t like, what you would do to improve the ad, despite the dislike of the ad, do you think it is effective? (p. 340)
Select a magazine and a section of a newspaper that both contain full page ads and answer the following: promotional or institutional; appealing to a want, need or both; target audience; elements that appeal to target; familiar product – other ad campaigns. (p. 341)
I’m a Pepper – read p. 348 and develop a slogan for next decade (p. 348)
Select a magazine and determine circulation; characteristics of readership; products advertised; products advertised matched to target (p. 347)
20 minutes for tv or radio during different intervals – list time, what products, and other questions (p. 349)

34. Outside Book Activities
(Ad Hall of Fame)
Analyze classified ads (TBE 5/99)
Computer presentation to make a commercial (TBE 9/00)
Sell me your idea (TBE 3/3)
Create an Ad Campaign (TBE 1/99)