Management of Advertising Program

everyplacesight of announce ProgramADVERTISING MANAGEMENT advertise is whatsoever paid mark of non ad hominem presentation and promotion of ideas, goods, or function by an identified sponsor. Five major conclusivenesss involve the mission, silver, message, media and measurement advertisementthe use of paid media by a seller to communicate cogent in changeion ab step up its crops, service, or organizationis a potent promotional in additionl. Advertising takes on many forms ( depicted object, regional, local, consumer, industrial, retail, carrequartette, instigant, institutional, etcetera) intentional to achieve a variety of objectives (aw atomic number 18ness, interest, preference, grass recognition, brand insistence).Advertising ratiocination- do consists of objectives move, calculate decision, message decision, media decision, and ad effectiveness evaluation. Advertisers should establish take goals as to whether the advertize is speculate to avow, rock, or remind buyers. The factors to consider when compass the advertizement calculate be ramification in the increaseion life cycle, trade conduct, competition and clutter, needed frequency, and product substitutability. The de none cipher female genitalia be established establish on what is applyable, as a percentage budget of gross revenue, ground on competitors expenditures, or based on objectives and tasks, and based on much than advanced decision models that are available.The message decision calls for generating messages, evaluating and selecting amidst them, and executing them effectively and responsibly. The media decision calls for defining the reach, frequency, and concern goals choosing among major media cases selecting specific media vehicles deciding on media timing geographical assignation of media. Finally, campaign evaluation calls for evaluating the communication and sales effects of denote, before, during, and after the advertize.Developing and managing an publicizing program (An overview)Setting the ad objectives correspond to whether the aim is to inform, remind, or persuadeDeciding on the advertising budgetfive factors to consider intromit stage in the product life cycle, merchandise share and consumer base, competition and clutter, advertising frequency, and product substitutabilityChoosing the advertising message fictive stage put across generationutilizing an inductive versus deductive framework nitty-gritty evaluation and selectionfocus on champion core interchange proposition and aim for desirability, exclusiveness and believability.Message execution bear upon depends not and when on what is said nevertheless how it is said (positioning). Creative concourse moldiness in addition realise a style, tone, and format for executing the messageSocial debt instrument review capture sure the creative advertising does not overstep social and legal normsDeciding on media and measuring effectivenessDeciding on r each (number of people exposed at least once), frequency (total number of times they are reached) and collision (qualitative value)The kin between reach, frequency and impact, specific media, media timing, geographical allocationa) Media selection chump listening, media habits, product, message, and greetDetermining the most cost-effective media to deliver the desired number and type of exposures to the objective lens audienceChoosing among major media typesb) channelise audience media habitsc) Product characteristicsd) Message characteristicse) Cost (based on cost-per- gravitational constant exposures criterion)New mediarethinking the optionsf) Commercial clutter, advertorials, infomercialsg) Result is coming death of tralatitious mass media, as we retire it more direct and consumer control comingAllocating the budgetincreasingly spent attracting attention than on the product itselfSelecting specific vehiclesmeasures accepth) Circulation, audience, effective audience, ef fective ad-exposed audiencei) CPM adjustments based on audience quality, audience-attention probability, editorial quality and ad placement policiesDeciding on the media timingj) Macro-scheduling (according to seasonal or line of merchandise trends)k) Micro-scheduling (allocating advertising expenditures within a short menstruum to obtain the maximum impact)l) Models for media timing Kuehn (if no carryover and habitual behavior then percent of sales justified)Deciding on the geographical allocationa) National versus internationalb) Spot buying (ADIs and DMAs)Evaluating advertising effectivenessa) Communication-effect querycopy testing, consumer feedback, portfolio tests, laboratory testsb) Sales-effect researchshare of voice and share of market, historical flak, data-based designc) Advertising effectiveness a summary of current researchBenefits of AdvertisingEnormous human and substantive resources are devoted to advertising. Advertising is all over in todays world .People ar e exposed to assorted forms of advertising through mixed advertising messages, media, billboards and techniques of every sort.The world(a) benefits of advertising are as follows.a) stinting Benefits of AdvertisingAdvertising can play an important role in the process by which an economic formation that is guided by ethical. It is a required part of the functioning of modern market economies, which today each exist or are emerging in many parts of the world. Advertising can be a useful tool for sustaining ethical competition that contributes to economic growth. It can help people by informing them close the availability of loveable unexampled products and operate and alterments in existing ones, service of process them to stay informed, prudent consumer decisions, contributing to efficiency and the lowering of tolls, and stimulant economic progress through the elaborateness of communication channel and trade.b) Benefits of Political AdvertisingPolitical advertising can start out a contribution economic spotlight in a market system. As free and accountable media in a democratic system help to counteract tendencies toward the monopolies, so policy-making advertising can make its contribution by informing people about the ideas and policy proposals of parties and candidates, including in the altogether candidates not previously known to the public.c) Cultural Benefits of AdvertisingBecause of the impact advertising has on media that depend on it for r change surfaceue, advertisers substantiate an opportunity to exert a positive influence on decisions about media content. This they do by b pick up and butter material of excellent aesthetics and chaste quality, and circumstancely by encouraging and making possible media presentations which are oriented to minorities whose needs efficiency early(a)wise go unserved. Moreover, advertising can itself contribute to the advance of society by uplifting and inspiring people and motivating them to ac t in charges that benefit themselves and others. Advertising can b honesten lives simply by being witty and entertaining.d) Moral Benefits of AdvertisingIn many cases social institutions use advertising to communicate their messages messages of moralistic values ,ethics ,patriotism, responsibilities toward the needy, messages concerning health and education, constructive and laborsaving messages that educate and motivate people in a variety of beneficial ways.Benefits of advertising from companys view top1. Provides entropyConsumer needs nurture about various products. The lack of information whitethorn make a consumer buy an inferior product, pay high damage etc.2. Improves brand cipherAdvertisement helps improve brand image. Images are mental pictures of brands. The images projected are geared to match the needs and promiseations of target audience. Favorable image help in generating brand committedness and disposition to buy that brand.3. Helps in InnovationAdvertising is seen to perform this task effectively for new products. It reduces the risk of innovation. The cost of innovation can be more than recovered by the sales which advertising may generate and this encourages manufacturers to undertake research and development.4. New Product put inVarious strategies including advertising is use to make dominance buyers of new products. Advertising can be used to promote new products and to inform changes in elderly products.5. Growth of MediaAdvertising enhances the potential for increase advertising revenues. This helps in launching new publications and expanding the media.Role of advertising1. Communication with ConsumersAdvertising is a major way of establishing communication between manufacturers and other organizations providing function or trying to put across ideas and concepts, on the one hand, and customers, buyers and potential acceptors, on the other.2. PersuasionAdvertising exertions to persuade prospective buyers to buy a product/ service. In modern markets, the producer who is content with the advertising that merely identifies or informs may soon find himself in a vulnerable position.3. Contribution to economic GrowthAdvertising contributes to economic growth by helping to expand the market, particularly for new products, and by helping to develop new market segments.4. accelerator for changeCreativity inherent in advertising leads to the discovery of new relationships that can change the perception of a prospect.Functions of Advertising1. Primary FunctionsHelps to increase salesHelps to reduce overall cost of salesProvides information about the productPersuasion of customers or dealersReceptiveness of new productStimulates distribution of productsInsurance for manufacturing businessConfidence in qualityTo eliminate seasonal fluctuationTo generate awareness and revenueBuilds value, brand verity and preference2. Secondary Functions To encourage salesmen and lead them moral support To furnish information To impress executives To impress factory workers To secure better employees To capture market To have an extra edge over the market* Feeling of securityAdvertising is a social waste* Because its time consuming* It does focus on specific group only.* Waste of resources.* Consumers are deceived by advertising.* Misleading information to the public.* It affects the health by having alcohols and cigarettes advertising.* Consumers are paying for those publicizings because fess departing be added into the price of the product.* People are lured to buy products which is not needed and not within their reach. (propensity to consume)Some critics view advertising as a waste of time, talent and money In their view, not only does advertising have no value of its own, but its influence is entirely harmful and subvert for individuals and society. Sometimes advertizings depict turned assertions which create a false impact in individuals and society.a) Economic Harms of AdvertisingAdvertising can betray its role as a source of information by misrepresentation and by deny relevant facts. Sometimes the information function of media can be subverted by advertisers pressure More a good deal, advertising is used not simply to inform but to persuade and motivate to convince people to act in certain ways, buy certain products or services This is where particular abuses can occur. Brand advertising can raise serious problems. Often on that point are only negligible differences among similar products of different brands, and advertising may attempt to move people to act on the basis of irrational motives like brand loyalty, status, fashion, instead of presenting differences in product quality and price as bases for rational choice.b) Harms of Political AdvertisingPolitical advertising can support and assist the working of the democratic system, but it alike can fold it. This happens when the cost of advertising limit political competition to wealthy candidates or groups Pol itical advertising seeks to distort the views and records of opponents and unjustly attacks their reputations. It happens when advertising appeals more to peoples emotions and base instincts to selfishness, submit and hostility toward others, to racial and ethnic disfavor and the like rather than to a reasoned sense of justice and the good of all.c) Cultural Harms of AdvertisingAdvertising too can have a corrupting influence upon culture and cultural values.. In the competition to attract ever larger audiences and deliver them to advertisers, communicators can find themselves tempted in fact pressured, subtly or not so subtly to set aside high artistic and moral standards and lapse into superficiality Communicators also can find themselves tempted to ignore the educational and social needs of certain segments of the audience the very young, the very old, the poor who do not match the demographic patterns (age, education, income, habits of buying and consuming, etc.) of the kinds of audiences advertisers want to reach.d) Moral and phantasmal Harms of AdvertisingAdvertising sometimes is used to promote products and inculcate views and forms of behavior contrary to moral norms.Characteristics of advertising1. Advertising is paid form of communication.2. Advertising is non personal communication.3. Advertising has an identified sponsor.4. Advertising can be controlled.Advertising AgencyAn advertising theatrical or ad agency is a service business dedicated to creating, formulatening and handling advertising (and sometimes other forms of promotion) for their clients. An ad agency is independent from the client and provides an removed point of view to the effort of selling the clients products or services. An agency can also handle overall marketing and branding strategies and sales promotions for its clients.An advertising agency acts in the fist place as a consultant to its client, the advertiser in formulating the advertising plans and translating t hem into advertising campians. The other role of ad agency, namely placing the advertisment, articles from its traditionalistic association with the media.Typical ad agency clients imply businesses and corporations, non-profit organizations and government agencies. Agencies may be hired to produce single ads or, more commonly, ongoing series of tie in ads, called an advertising campaign.Ad agencies come in all sizes, from small one- or two-person shops to large multi-national, multi-agency conglomerates much(prenominal) as Omnicom Group or WPP Group.Some agencies specialize in particular types of advertising, such(prenominal) as brand ads or television commercials. Other agencies, especially larger ones, produce work for many types of media (creating integrated marketing communications, or through-the-line (TTL) advertising). The line, in this case, is the traditional marker between media that pay a (traditionally 15%) commission to the agency (mainly broadcast media) and the m edia that do not.Role / Functions of an advertising agency1. training the advertisement campaign2. Creation of the advertisement3. Execution or placing the advertisement in various media vehicles.4. Marketing and advertising Research5. Sales promotion6. existence relationsSTRUCTURE OF ADVERTISING AGENCIESAn agency, depending on its size, consequent likely have different departments which work on the separate aspects of an work out. An account manager or the account planning department volition devise the work of these departments to insure that all the clients needs are met. The departments within a full-service agency will typically accommodateRESEARCH The research department will be able to provide clients with some details about the prospective audience of the final advertising campaign, as well as information about the market for the product being advertised. This should include specific market research which leads to a very focused ad campaign, with advertising directe d to the ideal target audience.CREATIVE SERVICES Advertising agencies employ experts in many creative fields that provide quality, professional services that conform to the standards of the industry. Copywriters provide the text for scratch ads, and the scripts for television or radio advertising. Graphic designers are responsible for the presentation of print ads, and the art department is responsible for providing the necessary images for whatever format advertisement is decided upon. Some agencies have in-house photographers and printers, while others regularly employ the services of contractors.The individuals involved in creative services are responsible for developing the advertising platform, which sets the theme and tone of the ad campaign. The advertising platform should draw upon specific, positive features of the product advertised and extrapolate the benefits the consumer could expect to receive as a result of using the product. The campaign, through the development of this platform, should prove to be eye-catching, memorable, and in some way unique. The advertising that is remembered by consumers is that which stands out from the rest it is the advertising agencys (and specifically the creative services departments) responsibility to provide this quality for their clients.The final advertising provided by an agency should be fully positive and polished. Television commercials should be produced with professionalism print ads should be attractive, informational, and attention-getting radio spots should be focused and of high audio quality.MEDIA BUYING adept of the services provided by advertising agencies is the wary placement of entire advertisements in various media, with an eye toward maximizing the potential audience. The research search conducted by the agency will inform any media-buying decisions.An agency will be able to negotiate the terms of any contracts made for placing ads in any of various media. A full-service agency will deal confidently with television, radio, newspapers, and magazines. Some agencies are also branching into direct mail marketing and point of purchase incentives some agencies have expanded into internet advertising and some agencies will also place an ad in the local yellow pages, or utilize outdoor advertising or one of the more creative avenues of incidental advertising, such as commercial signs on public buses or subways or on billboards.The media-buying staff of an advertising agency will draw on specific research done for the client, as well as on past experience with different media. Through this research and careful consideration, the agency will develop a media plan this should be a fully realized plan of attack for getting out the clients message. Some factors to be considered in the development of the media plan includeCost Per Thousand This refers to the cost of an advertisement per one thou potential customers it reaches. Media-buyers use this method to compare the various media avenues they essential choose between. For example, television ads are considerably more expensive than newspaper ads, but they also reach many more people. Cost per thousand is a straightforward way to gauge how to best die advertising dollars if a newspaper ad costs $100 and potentially reaches 2,000 customers, the cost per thousand is $50. If a television ad costs $1000 to produce and place in suitable television spots, and reaches a potential of 40,000 viewers, the cost per thousand is only $25.Reach This term is used when discussing the domain of an advertisement. The reach of an ad is the number of households which can safely be assumed will be affected by the clients message. This is normally show as a percentage of total households. For example, if there are 1,000 households in a town, and 200 of those households receive the daily paper, the reach of a well-placed newspaper ad could be expressed as 20 percent one-fifth of the households in the community can be exp ected to see the advertisement. frequence The frequency of a message refers to how often a household can be expected to be exposed to the clients message. Frequency differs widely between media, and even within the same medium. Newspapers, for example, are read less often on Saturdays, and by many more households (and more thoroughly) on Sundays. Fluctuation like this occurs in all media.Continuity The media-buyer will also need to consider the timing of advertisements. Depending on the clients product, the ads can be evenly spread out over the contrast of a day (for radio or television advertisements), a week (for radio, television, or print advertisements), or a month (radio, television, print, or other media). Of course, seasonal realities influence the placement of advertisements as well. apparel retailers may need to run more advertisements as a new school year arisees, or when new summer merchandise appears. Hardware stores may want to emphasize their wares in the weeks pre ceding the Christmas holiday. Grocery stores or pharmacies, however, qualification benefit from more evenly distributed advertising, such as weekly advertisements that emphasize the year-around needs of consumers.DAGMAR APPROACH HIERARCHY OF EFFECTS MODELRussell H Colley (1961) prepared a report for the association of national advertisers titled defining Advertising Goals for mensurable Advertising Results (DAGMAR). He developed a model for setting advertising objectives and measuring the results of an ad campaign. According to this model, communications effect is the logical systemal basis for setting advertising objective and goals against which results should be measured.In Colleys wordsAdvertising job purely and simply is to communicate to a defined audience information and a frame of mind that stimulate action. Advertising succeed or fails depending on how well it communi-cate the desired information and attitude to the right time and at the right cost. sense loreConvictionA ctionThere are no significant differences between Colleys proposed model and other important hierarchy of effects models. One important contribution of DAGMAR was its ability to clarify what continuous a good objective. According to Colley, the objective should have the undermentioned featuresStated in term of concrete and measurable communication tasks.Specify a target audience.Indicate a benchmark or standard head start point.Specify a time period for accomplishing the objective or objectives.Concrete measurable tasksThe DAGMAR approach requires that the measurement procedure should also be specified. There essential be a way to order whether the intended ad message has been communicated properly to the target audience. If the ad message communicates that brand X is the best on Q attribute, then a questionnaire may include the request, rank the following brands on best Q attribute. The responses could be quantified to mean percentage of audience who rated brand X as the best o n Q attribute.Target audienceAnother important feature of good objectives is the specification of a well-defined target audience. Though the primary target audience for a companys product or service is define in situation analysis, yet it may need some refining.For example, user of a product may be further categorised as heavy, medium or light users.Benchmark and degree of change soughtIt is important to know the target audiences present status with respect to responses unsettled and then determine the degree of change desired by the advertising campaign.Assessment and criticism of DAGMAR approachThe DAGMAR approach has had an enormous influence on the advertising planning process and objective setting. It has focused the advertisers attention on the important and value of using communication-based objectives as against sales based objectives to measure the impact and triumph of an ad campaign.The approach has not been totally accepted by everyone in the advertising field. A num ber of questions have been raised concerning its value as an advertising planning tool.Problems with responses hierarchySales as the advertising goalPracticality and costsInhibits creativityHierarchy-of-Effects ModelsAmong advertising theories, the hierarchy-of-effects model is predominant. It shows clear steps of how advertising works, even though it has been criticized on some points, such as that people do not exactly follow these sequences. There are various versions of hierarchy-of-effects model. AIDA model is initiatory and simplest.Awareness Interest Desire ActionAIDA model was presented by Elmo Lewis to explain how personal selling works. It shows a set of stair-step stages which describe the process leading a potential customer to purchase. The stages, Attention, Interest, Desire, and Action, form a linear hierarchy. It demonstrates that consumers must be aware of a products existence, be interested nice to pay attention to the products features/benefits, and have a des ire to benefit from the products offerings. Action, the fourth stage, would come as a natural result of movement through the startle three stages. Although this idea was rudimentary, it led to the subsequent emerging field of consumer behavior research.Hierarchy-of-effects models have many variant models. DAGMAR (Defining Advertising Goals for Measured Advertising Results) model suggests similar but different steps.Awareness Comprehension Conviction ActionDAGMAR model suggests that the ultimate objective of advertising must carry a consumer through four levels of understanding from unawareness to Awarenessthe consumer must first be aware of a brand or company Comprehensionhe or she must have a comprehension of what the product is and its benefits Convictionhe or she must arrive at the mental disposition or conviction to buys the brand Actionfinally, he or she actually buy that product.Determining the Advertising BudgetAn important goal in determining the size of an advertising budget is to maximize profits. To achieve this goal, even approximately, is a very complex problem. Many procedures or rules have been adopted to provide what appears to be a reasonable resultant from one point of view or another, but which, most people in the business would agree, are very crude at best. Hence, such approaches as percentage-of-sales, all-you-can-afford, objective-and-task and competitive-parity, are used because scientific approached either dont exist, or have not been able to prove their superiority. The difficulties of devising a scientific approach are plum well know. The multitude of factors involved and the scarceness of relevant and accurate data are only two of many which could be listed.Marginal AnalysisThe theoretical underpinning of an advertising-budget decision is based on peripheral analysis and is easily expressed. A firm would continue to add to the advertising budget as long as the incremental expenditures are exceeded by the peripheral reven ue they generate.Budgeting Decision RulesThere are several decision rules on which many firms dray in making budget decisions. Four such rules will be described. The rules are basically justified by arguing that budgets based on them are unlikely to be far from the actual optimal budget if a marginal analysis could be performed. In some cases, the rules are used in combination, the net budget being a compromise among several.* role of SalesOne rule of thumb used in setting advertising budgets is the percentage of sales. Past sales or a forecast of succeeding(a) sales can be used as the base. A brand may have devoted 5% of its budget to advertising in the past. Thus, if the plan calls for doing $40 million worth of business next year, a $2 million advertising budget might be proposed. A similar decision could be based upon market share. For example, a brand could allocate $1 million for every share point it holds.The percentage-of-sales guide is the most common approach to setting advertising budgets. If a firm or brand has been successfully over several years using the percentage-of-sales approach, it might be assumed that the decision rule yielded budgets reasonably close to the optimal, so there is little incentive to change to another approach in setting budgets. The rule does tend to make explicit the marketing-mix decision, the allocation of the budget to the various elements of the marketing program. Furthermore, it provides comfort to a prudent financial executive who likes to know that her or his firm can afford the advertising. Finally, if competitors also use such a rule, it leads to a certain stability of advertising within the industry, which may be useful. If there is a ceiling on the size of the market, it is wise to avoid precipitating a war over advertising expenditure.* All You Can giveFirms with limited resources may decide to spend all that they can reasonably allocate to advertising after other unavoidable expenditures have been allocate d. This rule usually ensures that they are not advertising too heavily, that advertising moneys are not being wasted. It thus does have some logic. Of course, if the value of more advertising could be demonstrated, extra money could usually be raised, so the limitation may be somewhat artificial.* Competitive ParityAnother guide is to adjust the advertising budge so that it is comparable to those of competitors. The logic is that the collective minds of the firms in the industry will probably generate advertising budgets that are somewhat close to the optimal. Everyone could not be too far from the optimal. Furthermore, any departure from the industry norms could precipitate a spending war.* Objective and TaskObjective and task, more an approach to budgeting than a simple decision rule, is used by two-thirds of the largest advertisers. An advertising objective is first established in specific terms. For example, a firm may decide to attempt to increase the awareness of its brand in a certain population segment to 50 percent. The tasks that are requited to accomplish this objective are then detailed. They might involve the development of a particular advertising campaign exposing the relevant audience an average of the five times. The cost of obtaining these exposures then becomes the advertising budget. This approach assumes that there is a causal flow from advertising to sales. In effect, it represents an effort to introduce intervening variables such as awareness or attitude, which will presumable be indicators of future sales as well as immediate sales.Steps1. Task Definition The objective of the advertising programme, are to be defined. The objectives may be to Close an immediate sale change magnitude sales Create awareness Building company goodwill and corporate image.2. Determining the type of strategy, media, and amount of exposuManagement of Advertising ProgramManagement of Advertising ProgramADVERTISING MANAGEMENTAdvertising is any paid form of nonpe rsonal presentation and promotion of ideas, goods, or services by an identified sponsor. Five major decisions involve the mission, money, message, media and measurementAdvertisingthe use of paid media by a seller to communicate persuasive information about its products, services, or organizationis a potent promotional tool. Advertising takes on many forms (national, regional, local, consumer, industrial, retail, product, brand, institutional, etc.) designed to achieve a variety of objectives (awareness, interest, preference, brand recognition, brand insistence).Advertising decision-making consists of objectives setting, budget decision, message decision, media decision, and ad effectiveness evaluation. Advertisers should establish clear goals as to whether the advertising is supposed to inform, persuade, or remind buyers. The factors to consider when setting the advertising budget are stage in the product life cycle, market share, competition and clutter, needed frequency, and produ ct substitutability. The advertising budget can be established based on what is affordable, as a percentage budget of sales, based on competitors expenditures, or based on objectives and tasks, and based on more advanced decision models that are available.The message decision calls for generating messages, evaluating and selecting between them, and executing them effectively and responsibly. The media decision calls for defining the reach, frequency, and impact goals choosing among major media types selecting specific media vehicles deciding on media timing geographical allocation of media. Finally, campaign evaluation calls for evaluating the communication and sales effects of advertising, before, during, and after the advertising.Developing and managing an advertising program (An overview)Setting the advertising objectivesaccording to whether the aim is to inform, remind, or persuadeDeciding on the advertising budgetfive factors to consider include stage in the product life cycle, market share and consumer base, competition and clutter, advertising frequency, and product substitutabilityChoosing the advertising messagecreative stageMessage generationutilizing an inductive versus deductive frameworkMessage evaluation and selectionfocus on one core selling proposition and aim for desirability, exclusiveness and believability.Message executionimpact depends not only on what is said but how it is said (positioning). Creative people must also find a style, tone, and format for executing the messageSocial responsibility reviewmake sure the creative advertising does not overstep social and legal normsDeciding on media and measuring effectivenessDeciding on reach (number of people exposed at least once), frequency (total number of times they are reached) and impact (qualitative value)The relationship between reach, frequency and impact, specific media, media timing, geographical allocationa) Media selection target audience, media habits, product, message, and costDe termining the most cost-effective media to deliver the desired number and type of exposures to the target audienceChoosing among major media typesb) Target audience media habitsc) Product characteristicsd) Message characteristicse) Cost (based on cost-per-thousand exposures criterion)New mediarethinking the optionsf) Commercial clutter, advertorials, infomercialsg) Result is coming death of traditional mass media, as we know itmore direct and consumer control comingAllocating the budgetincreasingly spent attracting attention than on the product itselfSelecting specific vehiclesmeasures includeh) Circulation, audience, effective audience, effective ad-exposed audiencei) CPM adjustments based on audience quality, audience-attention probability, editorial quality and ad placement policiesDeciding on the media timingj) Macro-scheduling (according to seasonal or business trends)k) Micro-scheduling (allocating advertising expenditures within a short period to obtain the maximum impact)l) Models for media timing Kuehn (if no carryover and habitual behavior then percent of sales justified)Deciding on the geographical allocationa) National versus internationalb) Spot buying (ADIs and DMAs)Evaluating advertising effectivenessa) Communication-effect researchcopy testing, consumer feedback, portfolio tests, laboratory testsb) Sales-effect researchshare of voice and share of market, historical approach, experimental designc) Advertising effectiveness a summary of current researchBenefits of AdvertisingEnormous human and material resources are devoted to advertising. Advertising is everywhere in todays world .People are exposed to various forms of advertising through various advertising messages, media, billboards and techniques of every sort.The General benefits of advertising are as follows.a) Economic Benefits of AdvertisingAdvertising can play an important role in the process by which an economic system that is guided by ethical. It is a necessary part of the functionin g of modern market economies, which today either exist or are emerging in many parts of the world. Advertising can be a useful tool for sustaining ethical competition that contributes to economic growth. It can help people by informing them about the availability of desirable new products and services and improvements in existing ones, helping them to stay informed, prudent consumer decisions, contributing to efficiency and the lowering of prices, and stimulating economic progress through the expansion of business and trade.b) Benefits of Political AdvertisingPolitical advertising can make a contribution economic situation in a market system. As free and responsible media in a democratic system help to counteract tendencies toward the monopolies, so political advertising can make its contribution by informing people about the ideas and policy proposals of parties and candidates, including new candidates not previously known to the public.c) Cultural Benefits of AdvertisingBecause of the impact advertising has on media that depend on it for revenue, advertisers have an opportunity to exert a positive influence on decisions about media content. This they do by supporting material of excellent aesthetics and moral quality, and particularly by encouraging and making possible media presentations which are oriented to minorities whose needs might otherwise go unserved. Moreover, advertising can itself contribute to the betterment of society by uplifting and inspiring people and motivating them to act in ways that benefit themselves and others. Advertising can brighten lives simply by being witty and entertaining.d) Moral Benefits of AdvertisingIn many cases social institutions use advertising to communicate their messages messages of moral values ,ethics ,patriotism, responsibilities toward the needy, messages concerning health and education, constructive and helpful messages that educate and motivate people in a variety of beneficial ways.Benefits of advertising f rom companys view point1. Provides informationConsumer needs information about various products. The lack of information may make a consumer buy an inferior product, pay high price etc.2. Improves brand imageAdvertisement helps improve brand image. Images are mental pictures of brands. The images projected are geared to match the needs and expectations of target audience. Favorable image help in generating brand loyalty and disposition to buy that brand.3. Helps in InnovationAdvertising is seen to perform this task effectively for new products. It reduces the risk of innovation. The cost of innovation can be more than recovered by the sales which advertising may generate and this encourages manufacturers to undertake research and development.4. New Product LaunchVarious strategies including advertising is used to make potential buyers of new products. Advertising can be used to promote new products and to inform changes in old products.5. Growth of MediaAdvertising enhances the pote ntial for raising advertising revenues. This helps in launching new publications and expanding the media.Role of advertising1. Communication with ConsumersAdvertising is a major way of establishing communication between manufacturers and other organizations providing services or trying to put across ideas and concepts, on the one hand, and customers, buyers and potential acceptors, on the other.2. PersuasionAdvertising attempts to persuade prospective buyers to buy a product/service. In modern markets, the producer who is content with the advertising that merely identifies or informs may soon find himself in a vulnerable position.3. Contribution to Economic GrowthAdvertising contributes to economic growth by helping to expand the market, particularly for new products, and by helping to develop new market segments.4. Catalyst for changeCreativity inherent in advertising leads to the discovery of new relationships that can change the perception of a prospect.Functions of Advertising1. Primary FunctionsHelps to increase salesHelps to reduce overall cost of salesProvides information about the productPersuasion of customers or dealersReceptiveness of new productStimulates distribution of productsInsurance for manufacturing businessConfidence in qualityTo eliminate seasonal fluctuationTo generate awareness and revenueBuilds value, brand loyalty and preference2. Secondary Functions To encourage salesmen and lend them moral support To furnish information To impress executives To impress factory workers To secure better employees To capture market To have an extra edge over the market* Feeling of securityAdvertising is a social waste* Because its time consuming* It does focus on specific group only.* Waste of resources.* Consumers are deceived by advertising.* Misleading information to the public.* It affects the health by having alcohols and cigarettes advertising.* Consumers are paying for those advertisements because fess will be added into the price of the product. * People are lured to buy products which is not needed and not within their reach. (propensity to consume)Some critics view advertising as a waste of time, talent and money In their view, not only does advertising have no value of its own, but its influence is entirely harmful and corrupting for individuals and society. Sometimes advertisements depict false assertions which create a false impact in individuals and society.a) Economic Harms of AdvertisingAdvertising can betray its role as a source of information by misrepresentation and by withholding relevant facts. Sometimes the information function of media can be subverted by advertisers pressure More often, advertising is used not simply to inform but to persuade and motivate to convince people to act in certain ways, buy certain products or services This is where particular abuses can occur. Brand advertising can raise serious problems. Often there are only negligible differences among similar products of different brands, and advertising may attempt to move people to act on the basis of irrational motives like brand loyalty, status, fashion, instead of presenting differences in product quality and price as bases for rational choice.b) Harms of Political AdvertisingPolitical advertising can support and assist the working of the democratic system, but it also can obstruct it. This happens when the costs of advertising limit political competition to wealthy candidates or groups Political advertising seeks to distort the views and records of opponents and unjustly attacks their reputations. It happens when advertising appeals more to peoples emotions and base instincts to selfishness, bias and hostility toward others, to racial and ethnic prejudice and the like rather than to a reasoned sense of justice and the good of all.c) Cultural Harms of AdvertisingAdvertising also can have a corrupting influence upon culture and cultural values.. In the competition to attract ever larger audiences and deliver them t o advertisers, communicators can find themselves tempted in fact pressured, subtly or not so subtly to set aside high artistic and moral standards and lapse into superficiality Communicators also can find themselves tempted to ignore the educational and social needs of certain segments of the audience the very young, the very old, the poor who do not match the demographic patterns (age, education, income, habits of buying and consuming, etc.) of the kinds of audiences advertisers want to reach.d) Moral and Religious Harms of AdvertisingAdvertising sometimes is used to promote products and inculcate attitudes and forms of behavior contrary to moral norms.Characteristics of advertising1. Advertising is paid form of communication.2. Advertising is non personal communication.3. Advertising has an identified sponsor.4. Advertising can be controlled.Advertising AgencyAn advertising agency or ad agency is a service business dedicated to creating, planning and handling advertising (and sometimes other forms of promotion) for their clients. An ad agency is independent from the client and provides an outside point of view to the effort of selling the clients products or services. An agency can also handle overall marketing and branding strategies and sales promotions for its clients.An advertising agency acts in the fist place as a consultant to its client, the advertiser in formulating the advertising plans and translating them into advertising campians. The other role of ad agency, namely placing the advertisment, articles from its traditional association with the media.Typical ad agency clients include businesses and corporations, non-profit organizations and government agencies. Agencies may be hired to produce single ads or, more commonly, ongoing series of related ads, called an advertising campaign.Ad agencies come in all sizes, from small one- or two-person shops to large multi-national, multi-agency conglomerates such as Omnicom Group or WPP Group.Some agen cies specialize in particular types of advertising, such as print ads or television commercials. Other agencies, especially larger ones, produce work for many types of media (creating integrated marketing communications, or through-the-line (TTL) advertising). The line, in this case, is the traditional marker between media that pay a (traditionally 15%) commission to the agency (mainly broadcast media) and the media that do not.Role / Functions of an advertising agency1. Planning the advertisement campaign2. Creation of the advertisement3. Execution or placing the advertisement in various media vehicles.4. Marketing and advertising Research5. Sales promotion6. Public relationsSTRUCTURE OF ADVERTISING AGENCIESAn agency, depending on its size, will likely have different departments which work on the separate aspects of an account. An account manager or the account planning department will coordinate the work of these departments to insure that all the clients needs are met. The depart ments within a full-service agency will typically includeRESEARCH The research department will be able to provide clients with some details about the prospective audience of the final advertising campaign, as well as information about the market for the product being advertised. This should include specific market research which leads to a very focused ad campaign, with advertising directed to the ideal target audience.CREATIVE SERVICES Advertising agencies employ experts in many creative fields that provide quality, professional services that conform to the standards of the industry. Copywriters provide the text for print ads, and the scripts for television or radio advertising. Graphic designers are responsible for the presentation of print ads, and the art department is responsible for providing the necessary images for whatever format advertisement is decided upon. Some agencies have in-house photographers and printers, while others regularly employ the services of contractors.T he individuals involved in creative services are responsible for developing the advertising platform, which sets the theme and tone of the ad campaign. The advertising platform should draw upon specific, positive features of the product advertised and extrapolate the benefits the consumer could expect to receive as a result of using the product. The campaign, through the development of this platform, should prove to be eye-catching, memorable, and in some way unique. The advertising that is remembered by consumers is that which stands out from the rest it is the advertising agencys (and specifically the creative services departments) responsibility to provide this quality for their clients.The final advertising provided by an agency should be fully developed and polished. Television commercials should be produced with professionalism print ads should be attractive, informational, and attention-getting radio spots should be focused and of high audio quality.MEDIA BUYING One of the se rvices provided by advertising agencies is the careful placement of finished advertisements in various media, with an eye toward maximizing the potential audience. The research search conducted by the agency will inform any media-buying decisions.An agency will be able to negotiate the terms of any contracts made for placing ads in any of various media. A full-service agency will deal confidently with television, radio, newspapers, and magazines. Some agencies are also branching into direct mail marketing and point of purchase incentives some agencies have expanded into Internet advertising and some agencies will also place an ad in the local yellow pages, or utilize outdoor advertising or one of the more creative avenues of incidental advertising, such as commercial signs on public buses or subways or on billboards.The media-buying staff of an advertising agency will draw on specific research done for the client, as well as on past experience with different media. Through this rese arch and careful consideration, the agency will develop a media plan this should be a fully realized plan of attack for getting out the clients message. Some factors to be considered in the development of the media plan includeCost Per Thousand This refers to the cost of an advertisement per one thousand potential customers it reaches. Media-buyers use this method to compare the various media avenues they must choose between. For example, television ads are considerably more expensive than newspaper ads, but they also reach many more people. Cost per thousand is a straightforward way to evaluate how to best spend advertising dollars if a newspaper ad costs $100 and potentially reaches 2,000 customers, the cost per thousand is $50. If a television ad costs $1000 to produce and place in suitable television spots, and reaches a potential of 40,000 viewers, the cost per thousand is only $25.Reach This term is used when discussing the scope of an advertisement. The reach of an ad is the number of households which can safely be assumed will be affected by the clients message. This is usually expressed as a percentage of total households. For example, if there are 1,000 households in a town, and 200 of those households receive the daily paper, the reach of a well-placed newspaper ad could be expressed as 20 percent one-fifth of the households in the community can be expected to see the advertisement.Frequency The frequency of a message refers to how often a household can be expected to be exposed to the clients message. Frequency differs widely between media, and even within the same medium. Newspapers, for example, are read less often on Saturdays, and by many more households (and more thoroughly) on Sundays. Fluctuation like this occurs in all media.Continuity The media-buyer will also need to consider the timing of advertisements. Depending on the clients product, the ads can be evenly spread out over the course of a day (for radio or television advertisements), a week (for radio, television, or print advertisements), or a month (radio, television, print, or other media). Of course, seasonal realities influence the placement of advertisements as well. Clothing retailers may need to run more advertisements as a new school year approaches, or when new summer merchandise appears. Hardware stores may want to emphasize their wares in the weeks preceding the Christmas holiday. Grocery stores or pharmacies, however, might benefit from more evenly distributed advertising, such as weekly advertisements that emphasize the year-round needs of consumers.DAGMAR APPROACH HIERARCHY OF EFFECTS MODELRussell H Colley (1961) prepared a report for the association of national advertisers titled defining Advertising Goals for Measured Advertising Results (DAGMAR). He developed a model for setting advertising objectives and measuring the results of an ad campaign. According to this model, communications effect is the logical basis for setting advertising objectiv e and goals against which results should be measured.In Colleys wordsAdvertising job purely and simply is to communicate to a defined audience information and a frame of mind that stimulate action. Advertising succeed or fails depending on how well it communi-cate the desired information and attitude to the right time and at the right cost.AwarenessComprehensionConvictionActionThere are no significant differences between Colleys proposed model and other important hierarchy of effects models. One important contribution of DAGMAR was its ability to clarify what continuous a good objective. According to Colley, the objective should have the following featuresStated in term of concrete and measurable communication tasks.Specify a target audience.Indicate a benchmark or standard starting point.Specify a time period for accomplishing the objective or objectives.Concrete measurable tasksThe DAGMAR approach requires that the measurement procedure should also be specified. There must be a wa y to determine whether the intended ad message has been communicated properly to the target audience. If the ad message communicates that brand X is the best on Q attribute, then a questionnaire may include the request, rank the following brands on best Q attribute. The responses could be quantified to mean percentage of audience who rated brand X as the best on Q attribute.Target audienceAnother important feature of good objectives is the specification of a well-defined target audience. Though the primary target audience for a companys product or service is describe in situation analysis, yet it may need some refining.For example, user of a product may be further categorized as heavy, medium or light users.Benchmark and degree of change soughtIt is important to know the target audiences present status with respect to responses variable and then determine the degree of change desired by the advertising campaign.Assessment and criticism of DAGMAR approachThe DAGMAR approach has had a n enormous influence on the advertising planning process and objective setting. It has focused the advertisers attention on the important and value of using communication-based objectives as against sales based objectives to measure the impact and success of an ad campaign.The approach has not been totally accepted by everyone in the advertising field. A number of questions have been raised concerning its value as an advertising planning tool.Problems with responses hierarchySales as the advertising goalPracticality and costsInhibits creativityHierarchy-of-Effects ModelsAmong advertising theories, the hierarchy-of-effects model is predominant. It shows clear steps of how advertising works, even though it has been criticized on some points, such as that people do not exactly follow these sequences. There are various versions of hierarchy-of-effects model. AIDA model is initiatory and simplest.Awareness Interest Desire ActionAIDA model was presented by Elmo Lewis to explain how per sonal selling works. It shows a set of stair-step stages which describe the process leading a potential customer to purchase. The stages, Attention, Interest, Desire, and Action, form a linear hierarchy. It demonstrates that consumers must be aware of a products existence, be interested enough to pay attention to the products features/benefits, and have a desire to benefit from the products offerings. Action, the fourth stage, would come as a natural result of movement through the first three stages. Although this idea was rudimentary, it led to the later emerging field of consumer behavior research.Hierarchy-of-effects models have many variant models. DAGMAR (Defining Advertising Goals for Measured Advertising Results) model suggests similar but different steps.Awareness Comprehension Conviction ActionDAGMAR model suggests that the ultimate objective of advertising must carry a consumer through four levels of understanding from unawareness to Awarenessthe consumer must first be aware of a brand or company Comprehensionhe or she must have a comprehension of what the product is and its benefits Convictionhe or she must arrive at the mental disposition or conviction to buys the brand Actionfinally, he or she actually buy that product.Determining the Advertising BudgetAn important goal in determining the size of an advertising budget is to maximize profits. To achieve this goal, even approximately, is a very complex problem. Many procedures or rules have been adopted to provide what appears to be a reasonable answer from one point of view or another, but which, most people in the business would agree, are very crude at best. Hence, such approaches as percentage-of-sales, all-you-can-afford, objective-and-task and competitive-parity, are used because scientific approached either dont exist, or have not been able to prove their superiority. The difficulties of devising a scientific approach are fairly well know. The multitude of factors involved and the scarcity of relevant and accurate data are only two of many which could be listed.Marginal AnalysisThe theoretical underpinning of an advertising-budget decision is based on marginal analysis and is easily expressed. A firm would continue to add to the advertising budget as long as the incremental expenditures are exceeded by the marginal revenue they generate.Budgeting Decision RulesThere are several decision rules on which many firms dray in making budget decisions. Four such rules will be described. The rules are basically justified by arguing that budgets based on them are unlikely to be far from the actual optimal budget if a marginal analysis could be performed. In some cases, the rules are used in combination, the net budget being a compromise among several.* Percentage of SalesOne rule of thumb used in setting advertising budgets is the percentage of sales. Past sales or a forecast of future sales can be used as the base. A brand may have devoted 5% of its budget to advertising in t he past. Thus, if the plan calls for doing $40 million worth of business next year, a $2 million advertising budget might be proposed. A similar decision could be based upon market share. For example, a brand could allocate $1 million for every share point it holds.The percentage-of-sales guide is the most common approach to setting advertising budgets. If a firm or brand has been successfully over several years using the percentage-of-sales approach, it might be assumed that the decision rule yielded budgets reasonably close to the optimal, so there is little incentive to change to another approach in setting budgets. The rule does tend to make explicit the marketing-mix decision, the allocation of the budget to the various elements of the marketing program. Furthermore, it provides comfort to a prudent financial executive who likes to know that her or his firm can afford the advertising. Finally, if competitors also use such a rule, it leads to a certain stability of advertising w ithin the industry, which may be useful. If there is a ceiling on the size of the market, it is wise to avoid precipitating a war over advertising expenditure.* All You Can AffordFirms with limited resources may decide to spend all that they can reasonably allocate to advertising after other unavoidable expenditures have been allocated. This rule usually ensures that they are not advertising too heavily, that advertising moneys are not being wasted. It thus does have some logic. Of course, if the value of more advertising could be demonstrated, extra money could usually be raised, so the limitation may be somewhat artificial.* Competitive ParityAnother guide is to adjust the advertising budge so that it is comparable to those of competitors. The logic is that the collective minds of the firms in the industry will probably generate advertising budgets that are somewhat close to the optimal. Everyone could not be too far from the optimal. Furthermore, any departure from the industry n orms could precipitate a spending war.* Objective and TaskObjective and task, more an approach to budgeting than a simple decision rule, is used by two-thirds of the largest advertisers. An advertising objective is first established in specific terms. For example, a firm may decide to attempt to increase the awareness of its brand in a certain population segment to 50 percent. The tasks that are requited to accomplish this objective are then detailed. They might involve the development of a particular advertising campaign exposing the relevant audience an average of the five times. The cost of obtaining these exposures then becomes the advertising budget. This approach assumes that there is a causal flow from advertising to sales. In effect, it represents an effort to introduce intervening variables such as awareness or attitude, which will presumable be indicators of future sales as well as immediate sales.Steps1. Task Definition The objective of the advertising programme, are to b e defined. The objectives may be to Close an immediate sale Increase sales Create awareness Building company goodwill and corporate image.2. Determining the type of strategy, media, and amount of exposu