Advertising Exam #1 Study Notes

• Study notes for Advertising Exam #1

Benefits & Value of a Product

• Functional: relates to the performance of a product.
• Experiential: relates to what it feels like to use a product.
• Psychological: relates to the feelings of self-esteem/status when using a brand.

IMC (Integrated Marketing Communications)

• A strategic process to develop, execute, and evaluate coordinated brand communication programs.
• Programs aim at generating short-term financial returns and building long-term brand and shareholder value.
• Targets both internal and external audiences.
• Helps develop and sustain brand identity and equity.
• Finds the right combination of communication tools and techniques.
• Defines the role and extent to which tools should be used.
• Coordinates the use of communication tools.

Brand Identity

• Combination of name, logo, symbols, design, packaging, product performance.
• Includes image associations when consumers envision the brand.

Types of Advertising Consumer Markets

• Media Advertising: cost-effective way to reach large numbers of consumers.
• National Advertising: done nationwide or in most regions of a country.
• Retail/Local Advertising: encourages consumers to shop at a specific store or use a local service.
• Primary Demand Advertising: stimulates demand for a general product class or specific industry.
• Selective Demand Advertising: creates demand for a specific company's brands.

Internal Analysis (SW)

• Capability to develop and implement promotional programs in-house.
• Brand image and its implications for promotion.
• Product's relative strengths and weaknesses.
• Reviewing previous promotional programs.
• Internal factors: strengths and weaknesses, advantages, disadvantages, selling points, benefits, packaging, price, and design.

External Analysis (OT)

• Assesses characteristics of the firm's customers, market segments, positioning strategies, and competitors.
• Includes: customer analysis, competition analysis, and environmental analysis.

Market Segmentation

• Dividing the market into distinct groups with common needs.
• Groups respond similarly to a marketing situation.
• Geographic: dividing the market by region, city size, area, and/or density.
• Demographic: dividing the market by age, sex, family size, marital status, etc.
• Behavioristic: dividing the market by usage, loyalties, or buying responses.
• Psychographic: dividing the market by personality, lifecycles, and/or lifestyles.
• Benefit: dividing the market by attributes consumers want in a product.

Positioning Methods

• Fitting a product or service to one or more segments of a broad market.
• Makes a product unique within the marketplace.
• Price vs. Quality (Value): used when cost comes secondary to quality.
• Product Attributes & Benefits: setting the brand apart from competitors on the basis of specific characteristics or benefits.
• Use/Application: associating the brand with a specific use to expand its usage.
• (Cultural) Symbols: using a cultural symbol to differentiate a product from competitors.
• Competitor: positioning a company or brand against a competitor to differentiate the brand.
• Product "Class" Competition: positioning a product against a product in another category.
• Product User: associating a brand with a type of person or group.

Brand Repositioning Strategy

• Altering or changing the position of a product or brand.
• Focus on new target markets or adjust to changing market preferences.
• Occurs because of stagnant or declining sales.
• Includes strengths and opportunities in another market.
• Difficult because of entrenched perceptions and attitudes toward the product or brand.

Advertiser (client)

• Company or organization with a product, service, or cause to be marketed.
• Pays for the IMC program.

Advertising Agency

• Specializes in the creation, production, and/or placement of communications messages.

Collateral Services

• Companies that provide a wide array of support functions.
• Used by advertisers, agencies, media organizations, and specialist organizations.
• Including: marketing research, package design, photography, video production, printers, event planning, and consultants.

In-House Agency

• Set up, owned, and operated by the advertiser.
• Benefits: reduces advertising and promotion costs and allows companies to maintain tighter control.

Ad Agency

• A service organization specializing in planning and executing advertising programs for its clients.
• Reasons to use: Highly skilled specialists, broad range of experience, objective viewpoint, specialization in industries

Types of Ad Agencies

• Full-Service: marketing, communication, and promotions services; advertising services include planning, creating, and producing campaigns.
• Creative Boutique: small agencies that provide creative services.
• Creative Boutique Advantages: more attention, access to creative talent, quick inventive work.
• Media Specialists: specialize in analyzing and purchasing ad space/time.

Creative Services

• Responsible for the creation and execution of advertisements.
• Copywriters: create ideas for ads and write headlines, subheads, and body copy.

Direct Marketing

• Services include: research, media services, database analytics, and direct mail.
• Three Main Departments: Account Management, Creative, and Media.

Sales Promotion

• Develop and manage sales promotion programs.
• Services include: promotional planning, fulfillment, premium design, tie-in coordination and catalog production.

Public Relations

• Develops and implements programs to manage publicity, image, and affairs with consumers and other relevant publics
• Such as employees, suppliers, stockholders, government labor groups, citizen action groups, and the general public.

Digital & Interactive

• Development and strategic use of various digital marketing tools.
• Includes digital media, content marketing, e-mail marketing, lead generation, database and customer relationship management, measurement, and analytics.
• Services Include: Apps, Website design, Banner ads, Video, Mobile Marketing, Social Media Campaigns

Environmental Influences on Consumer Behavior

• Culture: meanings, values, norms, and customs shared by members of society.
• Subcultures: Smaller segments with differing beliefs, values, norms and behavior patterns.
• Social Class: Homogeneous divisions in a society grouped by similar lifestyles, values, norms, interests, and behaviors.
• Reference Groups: Groups whose presumed perspectives/values are used by individuals for judgments, opinions, and actions (associative, aspirational, or dissociative).
• Situational Determinants: Specific situations that affect perceptions, preferences, and purchase behaviors.

Consumer Decision-Making Process

• Purchase Intention: reason to buy from a brand by matching purchase motives with attributes.
• Brand Loyalty: preference for a brand resulting in repeated purchases.
• Post Purchase Evaluation: Satisfaction if expectations are met/exceeded, dissatisfaction if performance is below expectations.
• Cognitive Dissonance: psychological tension after a purchase choice.

Perception Process

• Selective Perception: results from the high number and complexity of marketing stimuli.
• Selective Exposure: consumers choosing whether or not to make themselves available for marketing information
• Selective Attention: consumers choosing to focus on certain stimuli while excluding others.
• Selective Comprehension: interpreting information based on attitudes, beliefs, motives, and experiences.
• Selective Retention: not remembering all information seen, heard, or read.
• Subliminal Perception: processing without conscious awareness.
• Mnemonics: symbols, rhymes, associations, to assist learning and memory

Communication Process Model

• (1) Source/Sender → (2) Encoding → (3) Message & Channel → (4) Decoding → (5) Receiver
• Source/Sender: Person/organization with information to share.
• Encoding: Putting thoughts, ideas, information into symbolic form (verbal, graphics, music, animation).
• Message: Contains information or meaning the source hopes to convey.
• Channel: Facilitates communication between sender and receiver.
  • Non-Personal Channel: Lacks direct, interpersonal contact, includes print and broadcast.
  • Personal Channel: Between 2+ people including word-of-mouth & buzz marketing.
  • Viral Marketing: spreading relevant messages with help of consumers
  • Seeding: to start spreading the message.
• Decoding: Transforming the sender's message into thought.
• Receiver: Person who the sender shares thoughts/information with.

Cognitive Response Approach

• Thoughts that occur while reading, viewing, or hearing communication.
• Includes: counter arguments, support arguments, source derogations, source bolsters, ad execution-related, and attitude toward the Ad.

Source

• Person involved in communicating a message.
• Direct Source: spokesperson who delivers/endorses a product.
• Indirect Source: draws attention to/enhances the appearance of the ad (model).
• Source Attributes: Credibility > Internalization, Power > Compliance, Attractiveness > Identification.

Credibility

• How much the recipient sees the source as having relevant knowledge, skill, or experience.
• Source must be trusted to give unbiased, objective information.
• Internalization: receiver adopts the position advocated by the source because it is accurate and becomes part of their belief system.

Power

• Source’s ability to administer rewards/punishment
• Compliance: receiver accepts the position advocated by the source.

Attractiveness

• The similarity, familiarity, and/or likeability of the source.
• Identification: individual is motivated to seek relationship with the source, adopting same ideals or behaviors, and thus adopts similar beliefs, attitudes, or behaviors.

Message Factors

• Message Structure: Order of Presentation, Conclusion Drawing, Message Sidedness

• Order of Presentation: strongest arguments should be presented early or late but never in the middle. - Primacy Effect: Information presented first is most effective. - Recency Effect: Last arguments presented are most persuasive.

• Conclusion Drawing: Messages with explicit conclusions are easily understood and effective in influencing attitudes.

• Message Sidedness:

  • One-sided message: mentions only positive benefits, effective if audience holds a favorable opinion and is less educated.
  • Two-sided message: Presents good and bad points, effective if audience holds opposing opinions and is highly educated.
  • Refutation Appeal: presents both sides of an issue and then refutes the opposing viewpoint.
  • Pictures used to convey information or reinforce copy or message claims.

Message Appeals

• Comparative Advertising: Directly or indirectly naming competitors in an ad and comparing one or more attributes (Useful for new brands, small market share, political advertising)
• Fear Appeals: Evoke emotional response to a threat and arouse individuals to take action. - May stress physical danger/threats, social threats (disapproval/rejection). - Backfire when threat level is high (curvilinear). - Monotonic is positive: Higher levels of fear result in greater persuasion - Protection motivation: Both cognitive appraisal of information and emotional response mediate persuasion.
• Humor Appeals: can attract, hold attention, be memorable, put consumers in a positive mood but also be at risk for wearout.
  • Advantages: Aids awareness, retention, persuasion, and creates a positive mood.
  • Disadvantages: harms recall and comprehension, does not aid persuasion or source credibility.

Clutter

• Amount of advertising in a medium.
• Too many messages competing for attention.
• Not likely to go away
• Advertisers use humor, celebrities, creative approaches to break through clutter.

Study notes covering the benefits and value of a product, IMC (Integrated Marketing Communications) and Brand Identity. The benefits of a product are functional, experiential, and psychological. IMC is a strategic process to develop, execute, and evaluate coordinated brand communication programs.