Marketing and Advertising Basics

Role of Marketing in Advertising

• Marketing provides the foundation for advertising
• This includes setting the tone, allocating the budget, and determining when to use advertising as a communication tool
• Marketing considers target audience perception, competitors, and brand identity

Factors Beyond Promotion

• Advertising is promotions, or the fourth P of marketing
• Product success depends on more than promotions, it also involves product, place and price
• Factors like product availability and performance impact results of advertising

Product as a Solution

• Advertising narratives often incorporate a product as a solution to daily life issues
• Knorr soups for quick snacks and shampoos for hair fall showcase the product as a solution

Distinguishing Needs, Wants and Demands

• Advertising can convert a need into a want or demand through effective projection
• Need: Hygienic, standard mineral water
• Want: Bisleri
• Demand: Qua or Himalayan water with vitamins and flavor

Need, Want, Demand Based on Financial Capacity

• Purchasing choice depends on financial capacity and intent
• Railway Neer water costs Rs 15.
• A common consumer goes for Railway Neer
• An upper middle class consumers prefers Bisleri
• An affluent consumer might buy a Himalayan in a café
• Zara clothing perception varies with financial status.

Focus of Advertising

• Advertising aims to create desire and redefine the consumer's perception of their needs, wants, and demands

Advertising Definition

• Advertising comes from "advertise," a Latin term that means "to turn to"
• Advertising is a marketing objective using creative output to influence public opinion
• This includes paid, non-personal promotion of ideas, goods, and services by a sponsor
• Advertising uses techniques and practices to persuade the public to respond positively to what is advertised
• Advertising supports sales but isn't solely responsible for this or profit

Importance of Advertising

• Advertising informs people and helps them make informed decisions when buying a particular product or service
• It is Important for both brands and consumers

Benefits of Advertising for Consumers

• Quick decision-making: Helps compare product features, price, utility, and quality
• Better quality at a reasonable price: Promotes good products and increases market competition

Scope of Advertising

• Advertising drives business profits by expanding customer product awareness
• Increased competition requires businesses to aggressively promote goods/services
• Promotion aims to increase product awareness of its benefits and drawbacks to reach the right audience

Recall and Advertising Effectiveness

• Recall is critical for effective advertising
• Factors like ad features, attention, liking, scenes, clutter, demographics, and purchase intent affect recall for TV ads
• Brands aim to be recalled when the product category arises, especially during purchase decisions

Factors Influencing Advertising Decisions

• Advertising should be used in the presence of a favorable primary demand for the product and in line with the Principle of Laissez Faire
• The primary aim is to set a brand apart and highlight what is exceptional or new

Advertising in Innovation-Driven Markets

• Advertising convinces the market of a product's necessity by highlighting its novelty and innovation
• The supply then generates demand in that situation

Advertising Objectives

• Trial: Encouraging first-time purchase of a new product using attractive ads
• Continuity: Keeping existing customers by introducing new features or updates in the product and advertising
• Brand switch: Attracting customers from competitors by convincing them to switch brands
• Switching back: Recovering previous customers through discounts or updated packaging

Product Differentiation

• Advertising highlights the novelty of a product to set it apart
• Bisleri's rebranding is an example of product differentiation in a cluttered market

Importance of Hidden Product Qualities

• Identifying hidden qualities is vital for effective product marketing
• Insurance firms appeal to family emotions, as do jewelry companies, using human relationship concepts

Emotional Appeals

• Social constructs like family, marriage, friendship, and career are key to emotionally resonate with audiences

Perceived Risks

• Address uncertainties to reassure consumers about new or potentially hazardous products
• Fair & Lovely and Garnier Men ads addressed insecurities about skin tone

Advertising Appeals

• Advertising appeals grab consumer attention and influence their feelings about a product or service
• A good appeal resonates with the audience's wants, needs, and interests

Rational Appeals

• Focus on practicality, functionality, features, and cost
• Printed and B2B ads suit factual appeals
• Automobile ads emphasize gas efficiency, and household appliance manufacturers focus on cutting utility costs

Emotional Appeals

• Persuade consumers by triggering feelings to buy, support, or donate
• Range of common emotions involve: fear, sadness, pity, anger, excitement, and joy

Humor Appeals

• Connect through laughter to improve recollection, evaluation, and purchase intention
• Advertising must link a product with humor
• Humor at someone else's expense can cause resentment

Sexual/Sensual Appeals

• Attract attention but don't always increase sales
• Successful sex appeal ads target demographics
• Fragrances use sex appeal, suggesting it helps women find their dream man, but overly overt images can detract from the intended message

Bandwagon Appeals

• Leverages the consumer's need to belong, emphasizing what consumers might miss
• Medical ads highlight endorsement by professionals for product effectiveness
• Can backfire if the desire to fit in affects rational decision-making

Types of Advertising

• Brand
• Industrial
• Classified
• Financial
• Political
• PR
• Surrogate
• Public service

Brand Consumer Advertising

• Common ads employ design and copy to engage consumers daily
• Divided into ATL, BTL, and TTL

ATL (Above The Line)

• Advertising uses mass media for broad engagement and reach
• Involves radio, TV, newspapers, and magazines

BTL (Below The Line)

• Advertising is personal and uses targeted platforms
• Includes handbills, roadshows, and point-of-sale promotions
• More cost-effective but has less reach

TTL (Through The Line)

• Advertising primarily uses mass-engagement digital platforms
• Provides ATL-like reach with BTL cost efficiency

Advertising Expenditure and Strategy

• Larger companies use ATL for high budgets, while smaller companies use BTL
• Advertising choices should align with consumer targets and desired recall

360-Degree Advertising

• Reaches consumers wherever they are, using all media and channels
• Integrates traditional marketing and online tools to understand the customer journey
• Aims to ensure a brand doesn't miss any consumer segment, considering channel preferences

Industrial Advertising

• Focused ads target niche markets like cement, steel, and tractors, appealing directly to potential buyers
• In the Indian market, advertising drives people, giving brands an advantage and increasing recall

Classified Advertising

• The oldest form of advertising with no pictorials
• Organized by subject and consisting of listings by text only

Financial Advertising

• Covers banks, savings, mortgages, insurance, and investments
• Includes company reports, new share prospectuses, and security investment records

PR Advertising

• PR advertising builds brand image and consumer relationships
• This includes in-film advertising and influencer-driven content
• Brand Ambassadors like Lilly Singh have promoted products through content or sketches

Political Advertising

• Communicates information to influence voters
• Political consultants and campaign staff create these ads
• Many countries regulate political messaging through broadcast media

Surrogate Advertising

• Duplicates a brand's image to promote another product
• It substitutes one product for another under the same brand name
• Used when the original product is restricted, such as alcohol and tobacco in India
• Bagpiper Soda and Royal Challenge Golf Accessories indirectly promote alcoholic beverages

Public Service Advertising

• Uses commercial advertising for non-commercial purposes
• Used as a tool to improve social welfare, increase knowledge, shift attitudes and strengthen support for measures
• PSA campaigns are more effective when the target group is highly committed to issues

Ethical Principles in Advertising

• Ethical advertising principles should be an obligation
• This is because consumers criticize dishonest or misleading messages
• Principles prevent restrictions on advertising distinctiveness
• Compliance builds brand value

International Code of Advertising Practice

• Created by contractors, advertisers, and media representatives
• Cover morality, honesty, truthfulness, social responsibility, protecting children/young, and personal rights

Core Advertising Ethics

• Morality: Ads should not use verbal/visual elements against general moral principles
• Honesty and Truthfulness: Do not abuse consumer trust or present misleading content, expect trust in brands
• Social Responsibility: Ads must not discriminate on race, national origin, or undermine human dignity
• Children and Young People: Do not present children in harmful activities or exploit their inexperience

Additional Ethical Considerations

• Consumer rights: Respect consumer rights; no coercion, respect consent, and avoid unwanted products
• Online Behavioural Advertising: Transparency is required regarding personal data collection and usage

Self-Regulation in Advertising

• Ensures ads are honest, truthful, decent, safe, and fair
• An advertising eco-system agrees on standards and prompt handling of non-compliant ads protects consumer interests

Standards Council of India (ASCI)

• The Advertising Standards Council of India (ASCI) was established in 1985 to maintain advertising self-regulation and ensuring consumer protection
• ASCI is supported by advertisers, advertising agencies, and media
• The Consumer Complaints Council leads self-regulation through respectful work

American Association of Advertising Agencies (AAAA)

• A U.S. trade association for advertising
• It has 700+ agency members across 1,300 offices, controlling over 85% of U.S. ad spending
• The foundation promotes industry interests and diversity

Advertising Standards Authority (ASA)

• Independent UK regulator ensuring ethical advertising
• ASA and CAP are committed to transparent, proportionate and accountable advertising standards

Determinants of Advertising Impact

• Recall and frequency depend on brand consideration of advertising aspects

Intensity

• The extent of the investment of time, money, and effort in marketing

Ad Expenditure

• Company budget allocation for pre-production, production, and post-production

Media Planning

• Determining where, when, and how often to run ads to increase engagement and maximize ROI
• Distributes ad spend across online and offline channels like broadcast, print, or native content

Exposure

• The level of advertising employed, from constant promotion to seasonal ads

Rating and Reach

• Understanding the target market and households exposed to an ad based on the product type and for niche products

Frequency

• How often the advertisement occurs

Key Factors in Advertising Placement

• Where to place ads, which channels, broadcast frequency, types of magazines, and fitting advertising to audience is important
• Every medium should fit specific markets, meaning advertisers must consider frequency
• Relates to media planning

Gross Rating Point (GRP)

• The GRP is defined as how much advertisements impact people
• Includes the reach multiplied by the frequency

Integrated Marketing Communications (IMC)

• IMC unifies marketing communication elements like public relations, social media, audience analytics, business development principals, and advertising
• This results in a consistent brand identity and runs across distinct media channels

Conclusion: Advertising as a Tool

• Advertising is one of the tools to conduct marketing
• Communications effectiveness is determined by integrating different tools
• Advertising has proven to be one of the most impactful medias for the general public and remains a top option

Advertising Agency Defined

• The American Association of Advertising states this as and independent organization of creative people and business people who specialize in developing and preparing market plans, advertisements, and other promotional tools

Role of an Advertising Agency

• Advertising agencies help in building effective and goal-oriented advertising campaigns

Functions of an Advertising Agency

• Generating and executing advertising campaigns
• Creating promotional ideas
• Designing advertisements across media such as print, radio, television, and online mediums
• Coordinating the media planning and buying of ads
• Commissioning marketing research/surveys
• Provides services to enter and and succeed to a potential client

Primary Services of Advertising Agencies

• Analyzing marketing
• Developing an advertising plan, creating strategies, and implementation of media and advertisement plans
• Handling billing and payments
• Integrating marketing communications

Advantages of Advertising Agencies

• Specialized in creative communication that influences buyer behavior
• Buys media in bulk for better rates
• Run ads at the best times/places to minimize waste
• Finetune a client’s target market
• Execute mass market promotional campaigns

Disadvantages of Advertising Agencies

• If the agency does not have good communication skills, problems often occur
• The media buying discounts will not be taken advantage of due to being within’ and agency

Goals and Objectives of Advertising

• Who is being targeted?
• What makes clients unique?
• What is its position to similar products?
• How to convey the clients product?
• Which medium should they use?
• Product or Service designed

Departments at an AD agency

• Account Management: Acts as a liaison between agencies and clients
• Account Planning and Research: Designs the marketing and strategies
• Creative Development and Production: This is the main creative department
• Media Planning and Buying: Reserves media space
• Other services: Performs anything else like film production, financial services, etc…

Types of Advertising Agencies

• Creative Boutiques: These focus agencies charge a fee for the services they perform
• Modular Agencies: These agencies charge for actual completed work
• Specialist Advertising Agencies: Undertakes work on advertising in certain areas
• Full-Service Agencies: Range of marketing services
• In-House Agencies: Those companies own their agencies completely
• Media Planning and Buying Agencies: These agencies buy media spots in bulk to place ads for public consumption
• Research Agencies: This helps brands recognize if they should brand their advertising for consumption

Examples of Advertising Agencies in India

• Ogilvy & Mother
• JWT
• Mudra Communications
• FCB
• Ulka Advertising Ltd
• Grey Worldwide
• Lowe Lintas
• McCann
• Publics Worldwide