Advertising

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Advertising

Tom Chapmanwww.marketing101.co.ukTwitter @idlehans

Marketing Communications and Media Management

+What is Advertising ?

“Any paid form of non-personal presentation and promotion of ideas, goods or services” Kotler (1999, pg 793)

“Advertising is paid non-personal communication from an identified sponsor using mass media to persuade of influence an audience” Wells et al (1992, pg 10)

“communication via a recognisable advertisement placed in a definable advertising medium, guaranteeing delivery of an unmodified message to a specified audience in return for an agreed rate for the space or time used” Crossier (1999, pg 266)

Definitions cited by Picton & Broderick (2005, pg 594)

+ Truong & Simmons (2010, p.240)

“Harker (2008, p. 296) defines online or Internet advertising as, ‘any form of commercial content available on the internet, delivered by any channel, in any form, designed to inform customers about a product or service at any degree of depth’.

Jensen (2008) states that internet advertising consists of three primary constituents: display advertising – which includes banners, pop-ups and interstitials; search engine optimization (SEO) and search engine marketing (SEM) – including paid and unpaid SEO and SEM (e.g. Google Adwords); and, affiliate programs, where a marketer’s link (e.g. Amazon) is provided on a host’s website. A further constituent is email, paid for advertising in that most firms utilize email marketing hardware/software, and customer lists that are bought in (Merisavo & Raulas, 2004).”

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+Definitions of Advertising

What about the Media?

What is Mass Media?

Define “non-personal”

Can delivery be guaranteed?

How do you define, specify and target an audience through mass messaging and communication?

Points to consider

+Benefits and Role of Advertising

Mass audience / Large coverage

Targeting

Low unit / Marginal Costs

Useful for Brand maintenance

Useful for raising awareness

Balance of adverting spend can be related to maturity of product of market

+Advertising - Purpose

“It has generally been accepted for a long time that consumers are rarely loyal to a single brand. They tend to have a ‘portfolio’ of brands (also know as a repertoire or consideration set) to which they are loyal, switching between them as they desire. This applies even to brand leaders. Under these circumstances, the task of advertising becomes more one of maintaining a brand’s position within consumers’ consideration sets.” Pickton & Broderick (2005, pg 602)

+How Advertising Works

“For most products, and especially the frequently purchased packaged goods in which much research is interested, the consumer’s mind is not a blank sheet awaiting advertising but rather already contains conscious and unconscious memories of product purchasing and usage.” Vakratsas and Ambler (1999, pg 27)

Does advertising persuade people to buy? Strong Theory A process of: cognition – affect – behaviour

Product Trial or Experience – Weak Thoery Advertising raises awareness

Vakratsas and Ambler (1999)

+Advertising Models

Market Response Models Typically relate advertising, price, and promotion measures

directly to purchasing behaviour measures such as sales and market share.

Cognitive Information Models assumes that consumer preferences are not changed by

advertising and that consumer decisions are only rational.

Pure Affect Models focus on affective responses, the familiarity and feelings

advertisements may evoke

Vakratsas and Ambler (1999)

+Advertising Models

Persuasive Hierarchy Models introduced the concept of a hierarchy of effects, that is, an

order in which things happen, with the implication that the earlier effects, being necessary preconditions, are more important

Low Involvement Hierarchy Models The main alternative to the persuasive approach is cognition ~

experience ~ affect (CEA), though "cognition" may mean no more than passing awareness in categories in which the consumer has low involvement.

Integrative Models different hierarchies of C, A, and E are assumed, depending on

the context in which advertising operates.

Hierarchy Free Models generally presents a more person-centered view of advertising,

which can be thought of as an extension of a basic reinforcement model

Vakratsas and Ambler (1999)

+Media Types

The identification of media is probably only

as limited as our imaginations allow.

“A marketing communications medium is anything that is capable of transmitting a marketing communications message to one or more people.” Pickton & Broderick (2005, pg 104)

+Media Selection

Goals Developer Goals User Goals

Audience

Scope

Physical Context

User / Sender / Receiver Context

GAS

+Goals

These are the “why” of the whole project

Developers have to define these goals so that the system developed meets these needs – for example a training system has a totally different set of goals from a system which is advertising a product or an interactive game

+Developer Goals

Branding

Increasing traffic to a site

Real advertising

Accompanying service

Entertainment

Mixing it up

+User Goals

Getting entertainment

Physically getting something

Getting information

Communicating

+Audience

Who is your audience – works in the same way as segmentation.. A very different approach is needed depending upon the characteristics of the audience e/g young versus senior citizens

Define user group needs

What is the technological experience of the target audience?

+Scope

What is the subject?

Setting boundaries smaller

Setting boundaries larger

Choosing a topic

Communicating the topic to the user

+The physical context

Public areas

Other information sources

Environment

Audio content

+The users context

Cultural context

The user group context

Different levels of experience

Different user groups

Users with accessibility problems

Existing users

+Types of AdvertisementList Some?

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Aggregate number of user clicks on a banner ad.Ad ClicksAd Clicks

Number of times a banner ad is downloaded to a user’s browser and presumably looked at.

Ad Views Ad Views (Impressions)(Impressions)

Percentage of ad views that are clicked upon; also called “Ad Click Rate.”Click-ThroughClick-Through

Formula used to calculate what an advertiser will pay to an Internet publisher based on number of click-throughs that a banner generates.

CPCCPC(Cost-per-click)(Cost-per-click)

Cost per thousand impressions of a banner ad. A publisher that charges £10,000 per banner and guarantees 500,000 impressions has a CPM of £20 (£10,000 divided by 500).

CPMCPM

Measurement recorded in server log files that represents each file downloaded to a browser. Since page design can include multiple files, hits are not a good guide for measuring traffic at a website.

HitHit

Number of individuals who visit a website in a specified period of time. Requires the use of registration or cookies to verify and identify unique users.

Unique UsersUnique Users

A series of requests made by an individual at one site. If no information is requested for a certain period of time, a “time-out” occurs and the next request made counts as a new visit. A 30 minute time-out is now standard.

VisitsVisits

Internet Ad Terms

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Step 1

Step 3

Step 2

Step 4

Step 5

Six Steps of the Communication Process

Step 6

Identify Target Audience

DetermineCommunication Objective

Develop Media Plan

Create the Message

Execute the Campaign

Evaluate the Effectiveness of the Campaign

+ Segmentation and Prioritization

E-Music Segmentation Example

Segment C

Segment I

Segment A Segment E

SegmentSegmentDD

Seg-Seg-mentmentGG

SegmentSegmentBB

Seg-Seg-ment ment FF

Seg-Seg-mentmentHH

Segment L

SegmentK

SegmentJ

18–29 30–44 45 and Older

MaleMale Female Female <50K 50K+

Meaningful Meaningful VariablesVariables

Actionable VariablesActionable Variables

Does not exist

High Priority

Medium Priority

Low Priority

Top 40 Listener

ClassicRockListener

RapListener

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CommunicationCommunicationCriteriaCriteria

MediaMediaCriteriaCriteria

ChooseChoose Media MixMedia Mix

Tie Back ToTie Back ToOverallOverallPlanPlan

AllocateAllocateSpendingSpending

Behavioral objectives

Available spending

Customer segments

Ability to further behavioral objectives

CPM

Ability to reach target segments

Direct mail, Internet, broadcast, print, point-of-sale, etc.

Come back 360 and tie media plan back to communications plan (e.g., will this media plan drive the trial or awareness required to deliver your bottom line)

Allocation of spending across media mix elements and time periods based on relative priority

A Process for Defining Media Choice and Mix

+ Media Scheduling Patterns

Year

Constant

Periodic

Advertising period

Continuous, same intensity

Continuous, varying intensity

Intermittent, same intensity

Intermittent, varying intensity

Ads may run through-out the year or at selected times:

Within an ad period, different media schedules may be used:

+ Exploring the Levers Across the Relationship Stages

Television, iTV Magazines and

newspapers Radio Yellow pages Billboards / outdoor

AwarenessAwareness

Television, iTV Magazines and

newspapers Radio

Exploratory /Exploratory /ExpansionExpansion CommitmentCommitment

Terminate marketing

DissolutionDissolution

Banner ads Search engines Listings Classifieds

E-mail

Direct mail Telemarketing

Permission e-mail

Website Personalized pages

Customer service Customer service

Sales force Sales force Sales force

Rich media ads and dynamic ad placement

Website

E-mail

Permission direct mail Direct mail Telemarketing

Public relations

+UK Digital Media Mix (IAB)

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+Advertising UK (IAB)

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Adspend by country forecast at current prices, 2011

Media forecasts

Notes: Local currency, current prices Source: WarcExtracted from International Ad Forecast 2011/12 (July).To click through to article, use Slide Show view

year-on-year % change

Adspend Forecast by Main Media: 2010 vs 2009

Media forecastsExtracted from Adstats: Adspend in 2010.To click through to article, use Slide Show view

Source: Warc

Year-on-year change (%), top 5 markets

Consensus Forecast: Internet Advertising Expenditure

Media forecastsExtracted from Consensus Adspend Forecast – May 2010.To click through to article, use Slide Show view

Source: Warc

Current prices, y/y % change

2010 2011

Australia 13.3 12.0

Brazil 23.4 20.2

Canada 18.3 17.7

China 28.6 39.9

France 9.7 9.9

Germany 9.3 10.0

India 28.6 18.1

Italy 12.7 15.9

Japan 6.5 8.1

Russia 22.1 23.4

Spain 11.5 13.4

UK 6.6 5.6

US 10.2 13.5

Predicted US online ad spend by format, 2015

Media forecasts

Source: eMarketer, April 2011Extracted from Adstats: Online video.To click through to article, use Slide Show view

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