SU Man UM naging Bac MM g Adve as a S N chelor of Amit MER ertising Strateg Case St Nishan 460 Under th Mrs. Bh f Business ty School Amity R PR g, Cele gy and tudy of P nt Jaya 08A 4 he Guidan hawana G s Adminis l of Busin y Univers RO ebrity Public Pepsi aswal 2 nce of Gupta stration ( ness, Noid sity OJE Endor city General) da ECT rsemen T nts AS SB
75
Embed
21003485 Celebrity Endorsement a Case Study on Pepsi
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
SU
Man
UM
naging
Bac
MM
g Adve
as a S
N
chelor ofAmit
MER
ertising
Strateg
Case St
Nishan460
Under thMrs. Bh
f Businessty School Amity
R PR
g, Cele
gy and
tudy of P
nt Jaya08A 4
he Guidanhawana G
s Adminisl of Businy Univers
RO
ebrity
Public
Pepsi
aswal 2
nce of Gupta
stration (ness, Noidsity
OJE
Endor
city
General)da
ECT
rsemen
T
nts
ASSB
SUMMER PROJECT*2008-11
1 | P a g e
AS
B,
NO
ID
A
Acknowledgement
After eight weeks of dedicated hard work, I am proud to have finally completed
my summer project. Working with this project has given me valuable insight on
how is an advertisement developed and how celebrity endorsement is used as a
strategy for marketing in general and in Pepsi.
First of all I would like to thank my project mentor Mrs Bhawana Gupta who has
given me valuable support and guidance on my project topic and in academic
writing through out the past eight weeks. I also present my appreciation to my
brother Shwaitang Singh, David Sandin and Patrick Widmark for providing me
with the data necessary to conduct this study.
Finally I would like to thank my supportive family and friends for always being
there throughout this project and making it possible.
Nishant Jayaswal
SUMMER PROJECT*2008-11
2 | P a g e
AS
B,
NO
ID
A
Abstra
Objective of the Project
ct
Previous studies in the area of celebrity endorsement have focused on how
consumers react to celebrity endorsement but there is limited research available when
it comes to how companies use celebrity endorsement and how they work to
reduce the risks involved in celebrity endorsement.
Our main concern will be to get the most satisfactory answer to the following
question:
1. How can the factors inducing a company’s choice of celebrity endorsement as a promotion tool are described?
2. How can the risks involved for a company in celebrity endorsement are described?
3. How can the risk reduction methods adopted by a company in celebrity
endorsement be described?
4. What is Managing Public Relation?
SUMMER PROJECT*2008-11
3 | P a g e
AS
B,
NO
ID
A
Limitations
There are many aspects within the research area of celebrity endorsement. The
topic selected for this research falls into a broad area. Therefore, limits of both time
and resources have led me to focus on some specific questions, namely on the
corporate perspective on why companies use celebrities and the risk with it and how
they describe risk reduction.
SUMMER PROJECT*2008-11
4 | P a g e
AS
B,
NO
ID
A
Methodology Types of Researches:
Exploratory Research
Descriptive Research
Explanatory Research
The study is exploratory since we have limited knowledge about the area we will do
research in. The study is also descriptive since we are doing a study with already existing
information.
Research Approach When conducting research there are different ways to address the topic. I will present and give
the reason for the way we chosen to approach our study.
My study is deductive since our frame of reference is based on existing theories. I based
my empirical data studies on theories and used them to form a base on how to analyze
the collected data.
In this study I chose the qualitative approach in order to be able to deal with research
problem and research questions stated for the thesis, the qualitative approach is suitable since
I want to obtain a deeper understanding on how factors induce companies to use celebrity
endorsers in their marketing communication, and how the risks involved can be described and
measures to decrease them. A quantitative approach is not suitable because I don’t want to
analyze the data in numbers. Therefore a qualitative study is the best approach for me
when describing the collected data in words.
Research Strategy In our study an experiment was not suitable strategy since we don’t have control over
behavioral events. Survey is not suitable either because we don’t use the questions what,
where, how many or how much. Archival records are not suitable either since we are not
SUMMER PROJECT*2008-11
5 | P a g e
AS
B,
NO
ID
A
answering question such as how many and ho w much. We are looking at present time
therefore history strategy is not suitable. The case study is generally superior when answering
how and why questions about a specific topic and when control over the relevant behavior is not
required and when research focus is on contemporary events. We will use a case study as research
strategy because it is the most suitable. By this we think that we will be able to obtain a
deeper understanding of our research area. The research is also based on present occurrences,
which are motives to using case studies.
Data Collection I had to choose a mix of Documentation; mine own observation; and physical artifacts.
Sample selection
After selecting the suitable research strategy we have to our case study chosen a company that use
celebrity endorsement in their marketing activities. The company that we have chosen for our
case study is Pepsi. To find a suitable company for our case study we searched the web
and looked in magazines for companies that were using celebrities as endorsers. After looking
at Pepsi market communications we decided that they would be a good company for our
research.
SUMMER PROJECT*2008-11
6 | P a g e
AS
B,
NO
ID
A
Table of Content
Sr No. Topic Page No.1. Marketing Management 7 1.1 Introduction 7 1.2 History 10 2. Developing an Advertising Program 14 I Setting the advertising objectives 16 II Decision on advertising budget 18 III Choosing the advertising message 21 IV Deciding on media 24 V Evaluating advertising effectiveness 31 3. Celebrity Endorsement 33 3.1 A brief Introduction 33 3.2 Essentials of celebrity endorsement 37 3.3 Theories 40 4. Publicity 52 5. Empirical Data: Case Study of Pepsi 59 6. Data Analysis 66 7. Conclusion 69 8. Future Prospect 72 9. Appendices 73 10. References 74
SUMMER PROJECT*2008-11
7 | P a g e
AS
B,
NO
ID
A
1. Managing Advertisement 1.1 Introduction Advertising is any paid form of nonpersonal presentation and promotion of ideas, good or
services by any identified sponsor.
Advertising is a form of communication that typically attempts to persuade potential customers
to purchase or to consume more of a particular brand of product or service. While now central to
the contemporary global economy and the reproduction of global production networks, it is only
quite recently that advertising has been more than a marginal influence on patterns of sales and
production. The formation of modern advertising was intimately bound up with the emergence of
new forms of monopoly capitalism around the end of the 19th and beginning of the 20th century
as one element in corporate strategies to create, organize and where possible control markets,
especially for mass produced consumer goods. Mass production necessitated mass consumption,
and this in turn required a certain homogenization of consumer tastes for final products. At its
limit, this involved seeking to create ‘world cultural convergence’, to homogenize consumer
tastes and engineer a ‘convergence of lifestyle, culture and behaviors among consumer segments
across the world.
Advertising is the most important tool to grow your business. In fact, it not only helps your
business to grow. Advertisement is necessary also for the establishment of a business. A great
advertising strategy reflects a number of things starting from the company's objective to business
consideration, budget to brand development efforts and so on.
While making an ad you should remember that consumers buy a product because they need it. So
your ad must appeal to the rational faculty of a consumer. On the other hand the consumers
choose one brand though several brands of the same product category exist in the market. The
emotional self of a consumer dictates this. The best ad is one, which combines both reason and
emotion to drive a sale.
SUMMER
8 | P a g e
Advertise
governm
dissemin
avoid har
messages
persuade
objective
$ A
Absolut
and is av
vodka wo
Since its
growth, f
It is hard
Absolut
and has
'Absolut
produced
advertisin
$ 'S
In 2000
five year
problem
arrested e
Research
roads and
is three t
alcohol. W
R PROJECT*
e
er include n
ment agencie
nate message
rd drug. Adv
s about them
e and remind
es are includ
Absolut Vod
Vodka is th
vailable in
orldwide.
launch in 1
from 10,000
d to tell the
advertising
followed a
Perfection'
d. In 1999, A
ng campaign
Shame' - Re
Drink driver
rs and desp
was not d
every week i
h showed th
d very susce
times more
With men ca
*2008-11
not only bu
es that direc
es, whether
vertising is u
mselves, thei
d the audien
ed here.
dka
he third large
125 markets
1979, Absol
nine-liter ca
e Absolut st
campaign ha
a carefully
in 1980, so
Advertising A
ns of the twe
epublic of Ir
rs in Ireland
pite percepti
diminishing
in the Repub
at young dr
eptible to the
likely to be
ausing almos
usiness firm
ct messages
to build bra
used by busi
ir products,
nce, two exa
est internatio
s and is the
lut has achie
ases to 7.5 m
tory without
as been runn
developed s
ome seven
Age listed th
entieth centu
reland anti d
d had killed
ions to the
- 175 drun
blic.
rivers were a
e effects of a
ecome invol
st nine out o
m but also
s to target
and image f
inesses and n
services, an
amples of ad
onal premiu
e number tw
eved signifi
million nine-l
t mentioning
ning for mo
strategy. Sin
hundred Ab
he Absolut a
ury.
drink drivin
800 people
contrary th
nk drivers c
a high-risk
alcohol. At t
lved in a cra
of ten alcoho
museum, ch
public. Ads
for Coca- C
non-profit o
nd causes. A
dvertising ca
um spirit in t
wo brand of
cant worldw
liter cases in
g the marke
ore than twen
nce the lau
bsolut ads h
advertising c
ng campaig
in the prev
e drink driv
continued to
category on
the legal lim
ash than if
l-related ser
haritable or
s are cost e
Cola or to e
rganizations
Advertising is
ampaigns wi
the world
premium
wide sales
n 2002.
eting: The
nty years,
unch with
have been
campaign am
gn
ious
ving
o be
n the
mit, an 18 - 3
he or she h
rious and fata
rganizations,
effective wa
ducate peop
s to commun
s used to inf
ith very diff
mong the ten
34 year old d
had consume
al road crash AS
B,
NO
ID
A
, and
ay to
ple to
nicate
form,
ferent
n best
driver
ed no
hes.
SUMMER PROJECT*2008-11
9 | P a g e
AS
B,
NO
ID
A
Shame, an IR£500,000 anti drink driving campaign released just prior to Christmas 2000, aimed
to confront drink drivers head on. This hard-hitting and uncompromising, sixty seconds
commercial depicts graphically the potential consequences of drink driving and the terrible
shame associated with it. It has been embargoed until after the 9 pm watershed on some
television channels.
Following its launch, research showed the campaign achieved: 86% awareness, a 36%
improvement in zero alcohol safe driving perceptions, a 36% decline in the acceptability of
driving after one drink, and an increased perception that drink driving is ‘extremely shameful’
among the target audience.
Many advertisements are designed to generate increased consumption of those products and
services through the creation and reinvention of the "brand image". For these purposes,
advertisements sometimes embed their persuasive message with factual information. Every
major medium is used to deliver these messages, including television, radio, cinema, magazines,
newspapers, video games, the Internet, carrier bags and billboards. Advertising is often placed by
an advertising agency on behalf of a company or other organization.
Organizations that frequently spend large sums of money on advertising that sells what is not,
strictly speaking, a product or service include political parties, interest groups, religious
organizations, and military recruiters. Non-profit organizations are not typical advertising clients,
and may rely on free modes of persuasion, such as public service announcements.
SUMMER PROJECT*2008-11
10 | P a g e
AS
B,
NO
ID
A
1.2 History Egyptians used papyrus to make sales messages and wall posters. Commercial messages and
political campaign displays have been found in the ruins of Pompeii and ancient Arabia. Lost and
found advertising on papyrus was common in Ancient Greece and Ancient Rome. Wall or rock
painting for commercial advertising is another manifestation of an ancient advertising form,
which is present to this day in many parts of Asia, Africa, and South America. The tradition of
wall painting can be traced back to Indian rock art paintings that date back to 4000 BCE. As the
towns and cities of the Middle Ages began to grow, and the general populace was unable to read,
signs that today would say cobbler, miller, tailor or blacksmith would use an image associated
with their trade such as a boot, a suit, a hat, a clock, a diamond, a horse shoe, a candle or even a
bag of flour. Fruits and vegetables were sold in the city square from the backs of carts and
wagons and their proprietors used street callers or town criers to announce their whereabouts for
the convenience of the customers.
As education became an apparent need and reading, as well printing developed, advertising
expanded to include handbills. In the 17th century, advertisements started to appear in weekly
newspapers in England. These early print advertisements were used mainly to promote books
and newspapers, which became increasingly affordable with advances in the printing press; and
medicines, which were increasingly sought after as disease ravaged Europe. However, false
advertising and so-called "quack" advertisements became a problem, which ushered in the
regulation of advertising content.
As the economy expanded during the 19th century, advertising grew alongside. In the United
States, the success of this advertising format eventually led to the growth of mail-order
advertising.
In June 1836, French newspaper La Presse is the first to include paid advertising in its pages,
allowing it to lower its price, extend its readership and increase its profitability and the formula
was soon copied by all titles. Around 1840, Volney Palmer established a predecessor to
advertising agencies in Boston. Around the same time, in France, Charles-Louis Havas extended
the services of his news agency, Havas to include advertisement brokerage, making it the first
French group to organize. At first, agencies were brokers for advertisement space in newspapers.
SUMMER PROJECT*2008-11
11 | P a g e
AS
B,
NO
ID
A
N. W. Ayer & Son was the first full-service agency to assume responsibility for advertising
content. N.W. Ayer opened in 1869, and was located in Philadelphia. At the turn of the century,
there were few career choices for women in business; however, advertising was one of the few.
Since women were responsible for most of the purchasing done in their household, advertisers
and agencies recognized the value of women's insight during the creative process. In fact, the
first American advertising to use a sexual sell was created by a woman – for a soap product.
Although tame by today's standards, the advertisement featured a couple with the message "The
skin you love to touch".
In the early 1920s, radio equipment manufacturers and retailers who offered programs in order to
sell more radios to consumers established the first radio stations. As time passed, many non-
profit organizations followed suit in setting up their own radio stations, and included: schools,
clubs and civic groups. When the practice of sponsoring programs was popularized, each
individual radio program was usually sponsored by a single business in exchange for a brief
mention of the business' name at the beginning and end of the sponsored shows. However, radio
station owners soon realized they could earn more money by selling sponsorship rights in small
time allocations to multiple businesses throughout their radio station's broadcasts, rather than
selling the sponsorship rights to single businesses per show.
This practice was carried over to television in the late 1940s and early 1950s. A fierce battle was
fought between those seeking to commercialize the radio and people who argued that the radio
spectrum should be considered a part of the commons – to be used only non-commercially and
for the public good. The United Kingdom pursued a public funding model for the BBC,
originally a private company, the British Broadcasting Company, but incorporated as a public
body by Royal Charter in 1927. In Canada, advocates like Graham Spry were likewise able to
persuade the federal government to adopt a public funding model, creating the Canadian
Broadcasting Corporation. However, in the United States, the capitalist model prevailed with the
passage of the Communications Act of 1934 which created the Federal Communications
Commission. To placate the socialists, the U.S. Congress did require commercial broadcasters to
operate in the "public interest, convenience, and necessity". Public broadcasting now exists in the
United States due to the 1967 Public Broadcasting Act which led to the Public Broadcasting
Before launching an Advertising campaign, the organization must make several key decisions,
in terms of the objectives, budget, and strategy.
Developing an advertising program is a five-step process:
1. Setting advertising objective
2. Establish a budget that takes into account stage in product life cycle, market share and
consumer base, competition and clutter, advertising frequency and product
substitutability
3. Choose the advertising message, determine how the message will be generated, evaluate
alternative message for desirability, exclusiveness and believability and execute the
message with the most appropriate style, tone, words, and format and in social
responsible manner
4. Decide on the media by establishing the ads desired reach, frequency, and impact and
then choosing the right media that will deliver the desired result in terms of circulation,
audience, effective audience, and effective ad-exposed audience
5. Evaluate the communication and sales effect of advertising
S
UMMER PROJECT*2008-11
16 | P a g e
I. Setting the Advertising Objective
Advertising is one part of the promotional mix, and therefore advertising objectives will be set in
line with overall Promotional and Marketing Objectives, which in turn will relate to the
organizations’ overall Corporate Objectives. In general, however, there are three main categories
of advertising objectives a business might set itself in terms of whether it seeks to Inform,
Persuade or Remind the target audience.
$ Inform: Informative advertising, seeks to tell the market about the product, explain how
the product works, provide information on pricing, and build awareness of both the
product and the company. Such objectives are normally pursued at the launch of a new
product, or re-launch / up-date of an existing product.
$ Persuade: Here objectives are to encourage the target audience to switch brands, make
the purchase, and create a preference in the market for the product as opposed to its
competition. Advertising of this nature is required in highly competitive markets, where a
range of products competes directly with each other. In such circumstances businesses
often seek to differentiate their product through Comparison Advertising – either directly
AS
B,
NO
ID
A
Example: The Dyson Contra rotator: The Dyson Contra rotator™ is the only 2-drum wash action
washing machine on the market. A key objective for Dyson is to inform the market about this unique
product, explaining how the product works, and its advantages over normal washing machines.
Example: Halifax 'Who gives you Extra' Campaign: The Halifax 'Who gives you Extra' campaign has been an extremely successful example of Comparative Advertising, used to Persuade savers to switch Banks. In a highly competitive market, the aim of the work is to show the extra value the bank delivers to customers across a range of financial services, and was produced by the Delaney Lund Knox Warren & Partners agency.
SUMMER PROJECT*2008-11
17 | P a g e
AS
B,
NO
ID
A
or indirectly comparing its product to that of its competitors.
$ Remind or Reinforce: Reminder Advertising is used to maintain interest and awareness
of a well-established product in the market, often in the latter stages of its product life
cycle. It is often used at the Point-of-Purchase to remind consumers of the Brand. Such
advertising is used by the likes of Coca-Cola and other leading brands, to maintain their
position in the market. Its aims to convince current purchaser that they have made the
right choice. Automobile ads often depict satisfied customers enjoying special features of
their new car.
The advertising objective should emerge from a thorough analysis of the current marketing
situation. If the product class is mature, the company is the market leader, and brand usage is
low, the proper objective should be to stimulate the usage. If the product class is new, the
company is not the market leader, but the brand is superior to the leader, then the proper
objective is to convince the market of the brand superiority.
SUM
MER PROJECT*2008-11
18 | P a g e
AS
B,
NO
ID
A
II. Deciding on the Advertising Budget
How dose the company know if it is spending the right amount? Some critics charge that large,
consumer packaged-goods firm tend to overspend on advertising as a form of insurance against
not spending enough, and that industrial companies underestimate the power of the company and
product image building and tend to under respond.
Although advertising is treated as current expense, part of it is really an investment that a builds
up intangible asset called brand equity. New brands in a global marketplace have little chance
of rivaling established brands. To create a brand from scratch requires huge investments. The
process may take years, and its probability of success is slim. Empirical research has shown that
massive sums spent on advertising are not always justified by short-term sales. The return on this
investment is translated into other less tangible brand awareness, image, and loyalty. When
$5million is spent on capital equipment, the equipment may be treated as five-year depreciable
asset and only one fifth of the cost is written off in the first year. This treatment of advertising
reduces the company’s reported profit and therefore limits the number of new product launches a
company can undertake in one year.
When $5 million is spent on capital equipment, the equipment may be treated as five year
depreciable asset and only one fifth of the cost is written off in the first year. When $5 million is
spent on advertising to launch a new product, the entire cost must be written off in the first year.
The treatment of advertising reduces the company’s reported profit and therefore limits the
number of new product launches a company can undertake in any one year.
Having identified advertising objectives, the advertising budget must be set. Determining exactly
how much a business should spend on advertising to achieve the desired level of sales, is more
an art than a science. Commonly, the decision is based on experience of expenditure on
advertising, and the sales subsequently achieved. There are however a number of factors that can
be considered in setting the advertising budget.
There are five specific factors to consider when setting the advertising budget. They are as
follow:
SUMMER PROJECT*2008-11
19 | P a g e
AS
B,
NO
ID
A
1. Stage in the Product life cycle: New products typically receive large advertising
budgets to build awareness and to gain consumer trial. New products in the 'Launch' stage
of their Product Life Cycle, will normally require greater expenditure on advertising to
create product awareness, and encourage consumers to trial the product. Established
brands usually are supported with lower advertising budget as a ratio to sales. Whilst
products that have reached 'Maturity' in their product life cycle, will often require smaller
advertising budgets to achieve the level of sales required.
2. Market share and Consumer base: High- market- share brands usually require
less advertising expenditure as percentage of sales to maintain share. To build share by
increasing market size requires larger expenditure. On a cost- per- impression basis, it is
less expensive to reach consumer of a widely used brand than to reach consumer of low
share brands.
3. Competition and clutter: The number of competitors in the market, and their
expenditure on advertising competing products, will influence a business to spend to a
similar or higher degree. In a market with a large number of competitors and high
advertising spending, a brand must advertise more heavily to be heard. Even simple
clutter from advertisements not directly competitive to the brand creates a need for
heavier advertising.
4. Advertising frequency: The numbers of repetitions needed to put across the brand’s
message to consumer has an important impact on the advertising budget.
5. Product Substitutability: A product very similar to other products on the market
may require greater expenditure on advertising to differentiate it from its competitors.
Brands in a commodity class (cigarettes, beer, soft drinks) require heavy advertising to
establish a differential image. Advertising is also important when a brand can offer
unique physical benefits or features.
SUMMER PROJECT*2008-11
20 | P a g e
AS
B,
NO
ID
A
Marketing scientists have built a number of advertising- expenditure models that that consider
these factors. Vidale and Wolfe’s model called for a larger advertising budget, the higher the
sales response rate, the higher the sales decay rate (the rate at which consumer forgets the
advertisement and the brand), and the higher the untapped sales potential. Unfortunately, this
factor leaves out other important factors, such as the rate competitive advertising and the
effectiveness of the company’s ads.
John Little proposed an adaptive- control method for setting the advertising budget. Suppose the
company has set an advertising- expenditure rate based on its most current information. It spends
this rate in all market except in the subsets of 2n markets randomly drawn. In n test market the
company spends it at a lower rate, and in the other n market it spends at a higher rate. This
procedure will yield information about the average sales created by the low, medium, and high
rates of advertising that can be used to update the parameters of sales- response function. The
updated function can be used to determine the beat advertising- expenditure rate for the next
period. If this expenditure is conducted in each period, advertising expenditures will closely
track the actual advertising expenditure.
SUMMER PROJECT*2008-11
21 | P a g e
AS
B,
NO
ID
A
III. Choosing the Advertising Message
Advertising campaigns vary in creativity. William Bernbach observed:
“The facts are not enough…. Don’t forget that Shakespeare used some pretty hackneyed plots,
yet his message came through with great execution.”
Still even great execution must be updated before it gets outdated. Advertisers go through a four
steps to develop a creative strategy:
1. Message Generation
2. Message Evaluation and Selection
3. Message Execution
4. Social Responsibility Review
Message Generation
Advertising People have proposed different theories for creating an effective message.
Rosser Reeves of the Ted Bates Advertising Agencies favored linking the brand directly to a
single benefit.
Leo Burnett and his agency preferred to create a character that expressed the product’s benefits.
Whatever method is used, creative people should talk to consumer, dealers and experts. Some
creative people use a deductive framework for generating advertising messages. John Maloney
proposed one framework. He saw buyer as expecting one of four types of rewards from the
product: rational, sensory, social, or ego satisfaction. Buyers might visualize these rewards from
result-of-use experience, product-in-use experience or incidental-to-use experience. Crossing the
four types of rewards with the three types of experience generates 12 types of advertising
message.
For Example, the appeal “get clothes cleaner” is a rational-reward promise following results-of-
use experience. The phrase “real gusto in a great light beer” is a sensory-reward promise
connected with product-in-use experience.
SUMMER PROJECT*2008-11
22 | P a g e
AS
B,
NO
ID
A
How many alternative ad themes should the advertiser create before making a choice? The more
ads that are independently created, the higher the probability of finding an excellent one. Yet the
more time spent on creating alternative ads, the higher
the costs. Under the present commission system, the
agency dose not likes to go to the expense of creating
and presenting ads. Fortunately, the expense of
creating rough ads is rapidly falling due to computers.
An ad agency department can compose many
alternatives ads in short time by drawing from
computer files containing stills and video images.
Message Evaluation and Selection
A good ad normally focuses on one core selling proposition. The advertiser should conduct
market research to determine which appeal works best with its target audience. Once an
effective appeal is found, the advertiser should prepare a creative brief, typically covering one or
two pages. It is an elaboration of the positioning statement and includes: key message; target
audience; the promise; and the media to be used. All the team members working on the
campaign need to agree on the creative brief before investing in costly ads.
Message Execution
The message’s impact depends not only on what is said, but often more important, on how it is
said. Some ads aim for rational positioning and other for emotional positioning. The choice of
headlines and copy can make a difference in impact.
In preparing an ad campaign, the advertiser usually prepares a copy strategy statement describing
the objective, content, support, and tone of the desired ad. Any message can be presented in
Gillette: The best a man can get
Is an example of a message which
draws attention to the brand’s
position as the market leader, and the
emphasis it places on quality,
reminding and reassuring the
audience, with use of celebrity
endorsement
SUMMER PROJECT*2008-11
23 | P a g e
AS
B,
NO
ID
A
number of execution style: slice-of-life, lifestyle, fantasy, mood or image, musical, personality
symbol, technical expertise, scientific evidence, and testimonial. “Marketing insight: Celebrity
Endorsements as a Strategy” focuses on the use of testimonials. The communicator must choose
an appropriate tone for the ad. Memorable and attention-getting words must be found. The
themes listed on the left would have had much less impact without the creative phrasing on the
right.
Theme Creative Copy 7-Up is not a cola The Un-Cola (7-Up) Milk is good for you Got Milk? (Milk industry) Our technology can help you do almost anything
Where do you want to go today? (Microsoft)
No hard sell, just a good car. Drivers Wanted (Volkswagen) We don’t rent as many cars so we have to do more for our costumers
We try harder
Red Roof Inns offer inexpensive lodging “Sleep cheap at Red Roof Inns”
Creativity is specially required for headlines. There are six basic types of headlines:
News (“New Boom and More Inflation Ahead… and What You Can do About it”)
Question (“Have You Had It Lately”)
Narrative (“They Laughed When I Sat Down at the Piano, but Then I started to Play!”)
Command (“Don’t Buy until You Try All Three”)
1-2-3 ways (“12 Ways to Save on Your Income Tax”)
How-what-why (“Why They Cant Stop Buying”)
Format elements such as ad size, color, and illustration will affect an ad’s impact as well as its
cost. A minor rearrangement of mechanical elements can improve attention getting power.
Larger- sized ads gain attention, though not necessarily by as much as their difference in cost.
Four-color illustration increases ad effectiveness and ad cost.
In addition the tone of the advertisement will need to be established, which can be either positive
or negative. The advert may therefore promote positive feelings of fun, contentment, and
happiness or take on a more negative, somber, or even threatening tone. Unfortunately the reality
SUMMER PROJECT*2008-11
24 | P a g e
AS
B,
NO
ID
A
of advertising is such that recent research has claimed that even the best planned and executed
advertisements may only be noticed by less than 50% of the audience, and only approximately
30% will actually recall the main message of the advert.
Ads are more effective when there message is congruent with their surrounding. People are more
likely to believe a TV or radio to become more positively disposed towards the brand when the
ad is placed within a program they like.
In recent times critics have bemoaned the spate of bland ads and slogans and in particular the
frequent use of the no referential “it,” as in “Coke is it”; Nike’s popular “just do it”. Why do so
many ads look or sounds like? This is because many companies want comfort, not creativity.”
Social Responsibility Review
Advertisers and their agencies must be sure their “creative” advertising dose not oversteps social
and legal norms. Most marketers work hard to communicate openly and honestly with
consumers. Still abuses occur, and public policy makers have developed a substantial body of
laws and regulations to govern advertising.
Advertisers must not:
$ Make false claims
$ Demonstrate falsely
$ Indulge into bait-and-switch advertising that attract buyer under false impression
SUM
MER PROJECT*2008-11
25 | P a g e
AS
B,
NO
ID
A
VI. Deciding on Media
After choosing the message, the advertiser’s next task is to choose media to carry it. The steps
here are deciding on desired reach, frequency, and impact; choosing among major media types;
selecting specific media vehicles; deciding on media timing; and deciding on geographical media
allocation. Then the results of these decisions need to be evaluated.
This again has four components. They are:
1. Deciding on reach, frequency and impact
2. Choosing among major media types
3. Selecting specific vehicles
4. Deciding on media timing
5. Deciding on geographical allocation
Deciding on Reach, Frequency and Impact
Media selection is finding the most cost effective media to deliver the desired number and types
of exposures to the target audience. The new task is to find out how many exposures, E*, will
produce a level of audience awareness of A*. The effect of exposures on audience awareness
depends upon on the exposures’ reach, frequency and impact.
Reach (R): The number of different persons or households exposed to a particular media
schedule at least once during a specified time period.
Frequency (F): The number of times within the specified time period that an average person or
household is exposed to the message.
Impact (I): The quantitative value of an exposure through a given medium.
SUMMER
26 | P a g
R PROJECT*
g e
*2008-11
R
rat
Relation betw
te and audien
Relationsh
awareness
reach
ween produc
nce awarene
hip between
s level and e
h and frequen
ct trial
ess level
audience
exposure
ncy
AS
B,
NO
ID
A
SUMMER PROJECT*2008-11
27 | P a g e
AS
OI
DA
B,
N
The above figures show the relationship between audience, awareness and reach. Audience
awareness will be greater, higher the exposures’ reach, frequency and impact. The relationship
between reach, frequency, and impact is captured in the following concepts:
$ Total number of exposures (E): This is the reach times average frequency; that is, E = R
x F
$ Weighted number of exposures (WE): This is the reach time average frequency times
average impact that is WE = R x F x I
The media planer has to figure out the most cost effective combination of reach, frequency, and
impact. Reach is most important when launching new products, flanker brand extensions of well
known brands, or infrequently purchased brands; or going after an understood target market.
Frequency is most important where there is a strong competitor, a complex story to tell, high
consumer resistance, or a frequent purchase cycle.
Choosing among media types
The media planner has to know the capacity of major media types to deliver reach, frequency,
and impact. The major advertising media along with their costs, advantages and limitation are
profiled below.
Medium Advantages Limitation Newspapers Flexibility; timeliness; good local
market coverage; broad acceptance; high believability
Short life; poor reproduction quality; small “pass along’ audience
Television Combines sight, sound and motion; appealing to the senses; high attention; high reach
High absolute cost; high clutter; fleeting exposure; less audience selectivity
Direct Mail Audience selectivity; flexibility; no ad competition within the same medium; personalization
Relatively high cost; “junk mail” image
Radio Mass use; high geographic and demographic selectivity; low cost
Audio presentation only; lower attention than television; no standardized rate structure, fleeting exposure
SUMMER PROJECT*2008-11
28 | P a g e
AS
B,
NO
ID
A
Magazines High geographic and demographic selectivity; credibility and prestige; high quality reproduction; long life; good pass along readers
Long ad purchase lead time; some waste circulation; no guarantee of position
Outdoor Flexibility; high repeat exposure; low cost; low competition
Limited audience selectivity; creative limitation
Yellow Pages
Excellent local coverage; high believability; wide reach; low cost
High competition; long ad purchase lead time; creative limitations
Newsletters Very high selectivity; full control; interactive opportunities; relative low cost
Cost could run away
Brochures Flexibility; full control; can dramatize messages
Overproduction could lead to run away costs
Telephone Many users; opportunity to give a personal touch
Relative high cost unless volunteers are used
Internet High selectivity; interactive possibilities; relatively low cost
Relatively new media with a low number of users in some countries
Media planners make their choice among media by considering the following variables:
• Target-audience media habits: For example, radio and television are the most effective
media for reaching teenagers
• Product characteristics: Media types have different potentials of demonstration,
visualization, explanation, believability, and color.
• Message characteristics: Timeliness and information content will influence media choice.
• Cast: Television is very expensive, whereas newspaper advertising is relatively
inexpensive. What counts is the cost-per-thousand exposures
Given the abundance of media, the planner must first decide how to allocate the budget to major
media type.
SUMMER PROJECT*2008-11
29 | P a g e
AS
B,
NO
ID
A
Selecting specific vehicles
The media planner must search for the most cost effective vehicles within each chosen media
type. In making choices, the planner has to rely on measurement services that provide estimates
of audience size, composition, and media cost. Audience has several possible measures:
Circulation: The number of physical units carrying the advertising.
Audience: The number of people exposed to the vehicle has pass-on readership, then the
audience is larger than circulation.
Effective audience: The number of people with target audience characteristics exposed to
the vehicle.
Effective ad exposed audience: The number of people with target audience characteristics
who actually saw the ad
Several adjustments have to be applied to cost-per-thousand measure.
1. The measure should be adjusted for audience quality
2. The exposure value should be adjusted for the audience-attention probability
3. The exposure value should be adjusted to the magazine’s editorial quality
4. The exposure value should be adjusted for the magazine’s ad placement policies and
extra services
Deciding on media timing
In choosing, the advertiser faces both a macro scheduling and micro scheduling problem.
Macro scheduling problem involves scheduling the advertising in relation to seasons and
business cycle.
Micro Scheduling problem calls for allocating advertising expenditures within a short
period to obtain maximum impact.
In launching a new product, the advertisers have to choose among ad continuity, concentration,
flighting, and pulsing.
SUMMER PROJECT*2008-11
30 | P a g e
AS
B,
NO
ID
A
Continuity is achieved by scheduling exposures evenly throughout a given period
Concentration calls for spending all the advertising money in a single period
Flighting calls for advertising for some period, followed by a hiatus with no advertising,
followed by a cycle is relatively infrequent and with seasonal items
Pulsing is continuous advertising at low weight levels reinforced periodically by waves of
heavier activity.
Deciding on geographical allocation
A company has to decide how to allocate its advertising budget over space as well as over time.
SUMMER PROJECT*2008-11
31 | P a g e
AS
B,
NO
ID
A
V. Evaluating advertising Effectiveness
Good planning and control of advertising depends on measure of advertising effectiveness. Yet
the amount of fundamental research on effectiveness is appallingly small. Most measurement of
advertising effectiveness deals with specific ads and campaigns. Most of the money is spent b
agencies on pretesting ads, and much less is spent on evaluating their effectiveness. Most
advertisers try to measure the communication effect of an ad – that is its potential effect on
awareness, knowledge, or preference. They would also like to measure the ad’s sales effect.
Communication-effect research seeks to determine whether an ad is communicating effectively.
Called Copy Testing, it can be done before the ad is put into media and after it printed or
broadcast. There are three major methods of advertising pretesting. The consumer feedback
method ask consumer for their reaction to a proposed ad. Portfolio test ask consumer to view or
listen to a portfolio of advertisements taking as much as they need. Consumers are than asked to
recall to all ads and their content, aided or unaided by the interviewer. Laboratory test use
equipment to measure by physiological reactions- heartbeat, blood pressure, pupil dilation,
galvanic skin response, perspiration- to an ad; or consumer may be asked to turn a knob to
indicate their moment-to-moment liking or interest while viewing sequence material.
The sale impact is easiest to measure in direct marketing situations and hardest to measure in
brand or corporate image building advertising. Companies are generally interested in finding out
whether they are overspending or under spending on advertising.
A company’s share of advertising expenditures produce a share of voice that earns a share of
consumers’ minds and heart and ultimately, a share of market.
SUMMER
32 | P a g
R PROJECT*
g e
*2008-11
AS
B,
NO
ID
A
SUMMER P
33 | P a g e
ROJECT*2008-11
AS
B,
NO
ID
A
3. Celebrity Endorsements 3.1 A brief introduction
Shahrukh Khan, Mahendra Singh Dhoni, Amir Khan, Sachin Tendulkar, these names have
become symbols of the role of endorsers in advertising. Firms spend millions of dollars to sign
up celebrities to endorse their products. This is not a recent phenomenon and goes way back
in time to the late nineteenth century. From a marketing communication perspective it is
important that companies design strategies to create competitive differ entail advantages for
the company’s products or services. Marketing activities back up other elements in the
marketing mix such as product design, branding, packaging, place and pricing in order to
create positive awareness in the minds of the consumers. To achieve this, the use of celebrity
endorsers is widely used as a marketing communication strategy.
For Example
Nike is known around the world for being one of the most iconic brands. It was recently ranked
as the world’s 31st most valuable brand in terms of its brand value – USD10.8 billion – by the
annual Business Week’s global top 100 brand survey. In spite of many market maneuvers (such
as the recent merger between Adidas and Reebok), Nike has remained the leader in its category.
Nike is also very well known for another aspect and that is its consistent use of celebrities to
endorse the brand. In fact one of the most successful collaborations between a brand and a
celebrity is that of Nike and Michael Jordan. So successful was the collaboration that Nike and
Jordan launched a new brand variant called the Air Jordan line of sport shoes. Nike pulled off a
very similar coup in the sports industry when it joined forces with the ace golfer Tiger Woods to
enter the golf category with its apparel, equipment and accessories. Nike had no experience in
golf before. Moreover, golf being a very elite game, it was generally considered that a brand like
Nike would not be very successful. This might have probably been true had Nike chosen the
traditional path to building its equity in the golfing arena. But Nike chose to associate with the
best golfer in the world and have him endorse the brand. As is known today, Nike has emerged
highly successful in golf.
SUMMER PROJECT*2008-11
34 | P a g e
AS
B,
NO
ID
A
This channel now being used by many brands around the world raises some crucial questions
about ways brands are built and also about the impact such collaborations have on branding. Is
associating with a leading celebrity the easiest way to build a brand? Should celebrity
endorsement be the principal channel of brand communications? How can brands decide on
potential brand endorsers? What are the advantages and disadvantages of such endorsements? Is
celebrity endorsement always beneficial to the brand? How a celebrity does enhance a brand
image?
Celebrity branding is a type of branding, or advertising, in which a celebrity uses his or her status
in society to promote a product, service or charity. Celebrity branding can take several different
forms, from a celebrity simply appearing in advertisements for a product, service or charity, to a
celebrity attending PR events, creating his or her own line of products or services, and/or using
his or her name as a brand. The most popular forms of celebrity brand lines are for clothing and
fragrances. Many singers, models and film stars now have at least one licensed product or
service which bears their name.
Lately there has been a trend towards celebrity voice-overs in advertising. Some celebrities have
distinct voices which are recognizable even when they not present on-screen. This is a more
subtle way to add celebrity branding to a product or service. And example of such an advertising
campaign is Sean Connery voice-over for Level 3 Communications.
More recently, advertisers have begun attempting to quantify and qualify the use of celebrities in
their marketing campaigns by evaluating their awareness, appeal, and relevance to a brand's
image and the celebrity's influence on consumer buying behavior.
For Example
Omnicom agency Davie Brown Entertainment has created an independent index for brand
marketers and advertising agencies that determine a celebrity’s ability to influence brand affinity
and consumer purchase intent. According to the Wall Street Journal, the Davie-Brown Index
(DBI) will "enable advertisers and ad-agency personnel to determine if a particular public figure
will motivate consumers who see them in an ad to purchase the product advertised."