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ADV 318J Entire Course Materials

by: Kaitlin Reid

ADV 318J Entire Course Materials Adv 318j

Marketplace > University of Texas at Austin > Advertising > Adv 318j > ADV 318J Entire Course Materials
Kaitlin Reid

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This bundle includes notes from all of the lectures, all of the class readings and the assigned videos. Having a grasp on the reading is paramount to succeeding in this class and these notes cover ...
Intro to advertising
Gary Wilcox
ADV 318J, Advertising, Wilcox
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This 264 page Bundle was uploaded by Kaitlin Reid on Friday January 29, 2016. The Bundle belongs to Adv 318j at University of Texas at Austin taught by Gary Wilcox in Summer 2015. Since its upload, it has received 54 views. For similar materials see Intro to advertising in Advertising at University of Texas at Austin.


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Date Created: 01/29/16
CH 2 – The Structure of the Advertising and Promotion Industry 02/26/2015 ▯ 2-1 The Advertising Industry In Constant Transition st  21 century power struggle – clutter  How can the advertising industry successfully adapt to the new technologies that consumers are willing and eager to use as they seek more control over their information environment o Solution seems to be to invest more in digital advertising o Continue to move away from traditional media o Referred to as the digital divide  Advertising in traditional media decreased by 15%  77% of advertisers said they shifted more than 70% of their advertising budget from traditional media to digital media o both of these in 2009  Digital space allows advertisers to move from interruption to engagement  Goal of advertising hasn’t changed—just medium and ways of communicating o Goal=persuasive communications directed at target audiences ▯ 2-2 Trends Affecting The Advertising And Promotion Industry  critical need to focus on the brand, its image and a persuasive, integrated presentation of that brand to the target market ▯ 2-2 A Consumer Control: From Social Media to Blogs to DVRs  Consumers now are in much greater control of the information they receive about product categories and the brands within those categories  WEB 2.0 = emphasize online collaboration and sharing among users o i.e. individuals sharing and creating content through blogs/social media/wikis/video sites  WEB 3.0 = coming, but, where computers and tablets will understand and interpret information form the Web as quickly and correctly as humans can  Social media is the most significant form of consumer control over information creation and communication  Blogs are a powerful source of BIASED consumer information o Need to pay attention to them and their power to communicate  DVRs (like TiVo) could potentially reduce ad viewership by 30% o Translates to taking $100 billon out of US advertising revenue  Creativity is one solution to advertisers regaining control ▯ 2-2 B Media Proliferation, Consolidation, and Multiplatform Media Organizations  Diversity of media options  Multiplatform Media Organizations o Best example: Walt Disney  Owns ABC, ESPN, 15 radio stations, dozens of websites, podcasts, movies, books etc….. o Basically advertisers are trying to cover all of their bases and hit up all of the potential platforms ▯ 2-2 C Media Clutter and Fragmentation Means More IBP  More ways to reach consumers than every before  Takes a lot more effort to reach the same amount of people o Results in lots of clutter o Advertisers are developing a lack of faith in advertising alone  Things such as online communication, brand placement in film and TV, point of purchase displays, and sponsorships are becoming much more attractive o Consumers don’t like clutter  Advertisers are having to rethink how exactly to communicate with consumers ▯ 2-2 D Crowdsourcing  Crowdsourcing = involves the online distribution of certain tasks to groups of experts, enthusiasts, or even consumers o Idea behind it is to get consumers more involved with and committed to a brand in a way that passive, intrusive advertising simply cannot o Example: Visa Olympics 2012 – Cheer  Had people submit videos of themselves cheering for the athletes  Facebook page served as a central hub for campaign ▯ 2-2 E Mobile Marketing/Mobile Media  Mobile media may be the most relevant trend currently affecting the advertising and promotion industry  All depends on consumer reaction  Example: Advertisers could sponsor apps or content on e-readers  Thought process: NOT “what media can I buy?” but “How are consumers behaving and how do the devices play into how they behave?”  Spending on mobile marketing is expected to grow by more than $20 billion annually by 2016 ▯ 2-3 The Scope and Structure of the Advertising and Promotion Industry  Advertising is a $400 billion business in America alone  Spending on IBP worldwide exceeds a trillion dollars/year ▯ 2-3 A Structure of the Advertising and Promotion Industry  structure is the key issue  Who does what in what order during the process ▯ 2-3 B Advertisers  Advertisers/Clients = business, not-for-profit and government organizations that use advertising and other promotional techniques to communicate with target markets and to stimulate awareness and demand for their brands  Manufacturers and Service Firms o Large national manufacturers of consumer products and services are the most prominent users of advertising and promotion  Often spend billions of dollars annually  Usually have national or global markets  Advertising/promotion = essential to creating awareness and preference for their brands o Regional and local advertisers must use as well  Couponing/samplings  Trade Resellers o Trade reseller = a general description for all organizations in the marketing channel of distribution that buy products to resell to customers  Can be retailers, wholesalers, or distributors that deal with both household consumers and business buyers at all geographic market levels  EX: Gap/Walmart/McDonalds/Acme  Use various forms of IBP to communicate with customers  Wholesalers/distributors  Don’t have as much need for mass media advertising  Instead rely on trade publications, direct advertising, trade directories, direct mail, personal selling and the internet  Federal, State, and Local Governments o Invest millions of dollars into advertising annually o IBP wise closer to $2 billion o Concentrated in two areas  Armed forces recruiting  Social issues  Social and Not-for-Profit Organizations o Common at the local, state, and national level o Raises awareness, seek donations, and attempt to shape behavior (deter drug use/promote self breast exams etc) o Organizations like this use mass media advertising and things like direct mail to promote their causes and services o Advertising goals are the same as big corporations = stimulate demand and disseminate information ▯ 2-3 C The Role of the Advertiser in IBP  advertising and promotion play a large role in the structure of the advertising industry  important role played by advertisers before the services of an agency are enlisted  ADVERTISERS ROLE IS TO: o Fully understand and describe the value that the firm’s brand(s) provides to users o Fully understand and describe the brand’s position in the market relative to competitive brands o Describe the firm’s objectives for the brand in the near term and long term (i.e. brand extensions, international market launches) o Identify the target market(s) that are most likely to respond favorably to the brand o Identify and manage the supply chain/distribution system that will most effectively reach the target markets o Be committed to using advertising and other promotional tools as part of the organization’s overall marketing strategy to grow the brand  After all those conditions are met, then it is time to enlist the help of the agency o To help creatively develop the market for the brand ▯ 2-3 D Advertising and Promotion Agencies ▯ Advertising Agencies  Organization of professionals who provide creative and business services to clients in planning, preparing, and placing advertisements  House a collection of professionals with very specialized talent, experience, and expertise that simply cannot be matched by in- house talent  July 27, 2013 o Merger between Omnicom and Publicis (#2 and #3 biggest advertising firms globally) o Created the largest advertising agency globally  Types of jobs in an agency o Acoount planners o Marketing specialists o Account executives o Media buyers o Art directors o Graphic designers o Lead account planners o Chief executive officers o Chief financial officers o Chief technology officers o Chief marketing officers o Creative directors o Sales promotion and event planners o Copywriters o Direct marketing specialists o Radio and television producers o Web developers o Researchers o Interactive media planners o Artists o Social media experts o Public relations specialists  Advertising agency is a business ▯ Full Service Agencies  Typically includes an array of advertising professionals to meet all the promotional needs of clients  Not necessarily huge firms  Just do it all ▯ Creative Boutiques  Typically emphasizes creative concept development, copywriting, and artistic services to clients  Can bring great expertise when trying to reach very specific markets  Act as idea factories ▯ Digital/Interactive Agencies  Help advertisers prepare communications for new media such as the internet, mobile marketing, and interactive television  Focus on ways to use Web-based solutions for direct marketing and target market communications  Many firms have consolidated all their IBP needs, including interactive media, with their main full-service agency  In house agency advantages/disadvantages o Greater coordination and control in all phases of the advertising and promotion process o Also cheaper—don’t have to give an agency commission o Lack of objectivity o Highly unlikely that the talent in-house could match that of a agency ▯ Media Specialists  Organizations that specialize in buying media time and space and offer media strategy consulting to advertising agencies and advertisers  Become more complex with the proliferation of media options and extensive use of promotional tools beyond advertising  Since media specialists usually buy a ton of media time, they usually can get time for a cheaper price than an agency or advertiser could  Can also provide insight into the media strategy too ▯ Promotion Agencies  Specialized agencies focused strictly on promotion  Handle everything from sampling to event promotions to retail promotional tie-ins  Many full service agencies have a branch devoted to promotion ▯ Direct Marketing and Database Agencies  Aka direct response agencies  Provide a variety of direct marketing services  Maintain and manage large databases of mailing lists as one of their services  Can design direct marketing campaigns that use either: o Mail or telemarketing o Direct response campaigns using all forms of media  Fulfillment centers = ensure that customers receive the product ordered through direct mail  Help design and execute direct response advertising campaigns using traditional media  Can also prepare infomercials ▯ Sales Promotion Agencies  Specialists that design and then perate contests, sweepstakes, special displays, or coupon campaigns for advertisers  Can specialize in consumer sales promotion o Will focus on price-off deals, coupons, sampling, rebates and premiums  Can also specialize in trade-market sales promotions o Designed to help advertisers use promotions aimed at wholesalers, retailers, vendors and trade resellers o Experts in designing incentive programs, trade shows, sales force contests, in-store merchandising and point of purchase materials ▯ Event-Planning Agencies  Event sponsorship can also be targeted to household consumers or the trade market  Event-Planning agencies and organizers are experts in finding locations, securing dates, and putting together a team of people to pull of a promotional event: audio/visual people, caterers, security experts, entertainers, celebrity participants, or whoever is necessary to make the event come about successfully  Often will also take over the advertising of the event / publicity ▯ Design Firms  Very important job  Rarely involved in strategy planning, BUT intimately involved in the execution of the advertising or IBP effort  Help the firm create the visual impressions of a firm’s adverting materials  Also help with the firm’s logo / other visual representations that promote an identity for a firm  Also help design most of the materials used in supportive communications such as the package design, coupons, in-store displays, brochures, outdoor banners for events, newsletters and direct mail pieces ▯ Public Relations Firms  Manage an organization’s relationships with the media, the local community, competitors, industry associations and government organizations  Most advertisers do not like to handle their own public relations because: o PR requires highly specialized skills and talent not normally found within the company ranks o Managers are too close to PR problems and may not be capable of handling a situation, particularly a negative situation, with measured public responses o & this is why advertisers turn to outside PR firms ▯ 2-3 E Agency Services  offer a wide range of services  most important aspect is for the advertiser and the agency to negotiate and reach an agreement on the services being provided before any agency is hired  word of caution: many companies are cutting advertising budgets and its directly affecting advertising firms o Because of this, the types of services commonly offered by advertising and promotion agencies may not apply to every agency nowadays ▯ Account Services  Determine how the brand can benefit most from advertising and IBP  Account Services = entail identifying the benefits a brand offers, its target audiences, and the best competitive positioning, and then developing a complete plan o Can provide basic marketing and consumer research, but in general the client should bring that info to the table o Knowing the target segment, the brand’s values, and the positioning strategy are really the responsibility of the advertisers o Also work with the client to translate cultural and consumer values into advertising and promotional messages o Work with media services to develop an effective media strategy for determining the best vehicles for reaching the targeting audiences o Keep everyone on schedule and under budget ▯ Marketing Research Services  Locating studies (conducted by commercial research organizations) that have bearing on a client’s market or advertising and IBP objectives  Research group will help the client interpret the research and communicate these interpretations to the creative and media people  If no studies can be found, research can be conducted by the agency itself  Many agencies put the account planner in charge of the research effort o Position is on par with account executive ▯ Creative and Production Services  Comes up with the concepts that express the value of a company’s brand in interesting and memorable ways  Develops the message that will be delivered through advertising, sales promotion, direct marketing, social networks, mobile marketing, event sponsorship, or PR  Creative group in an agency will consist of: o Creative director o Art director o Illustrators o Designers o Copywriters  Production services o Include producers  Take creative ideas and turn them into advertisements, direct mail pieces, and other IBP materials  Generally manage and oversee the endless details for the production for the finished advertisement or other promotion effort ▯ Media Planning and Buying Services  Advertising agencies provide services similar to those of specialized agencies  Central challenge is to determine how a clients message can most effectively and efficiently reach the target audience  3 positions: o media planner o media buyer o media researcher o THIS is where most of the client’s money is spent – IMPORTANT ▯ Administrative Services  Agencies have to manage their own business affairs  Have personnel departments, accounting and billing departments, sales staff, traffic etc  Traffic department is super important o Responsible for monitoring projects to make sure deadlines are met ▯ 2-3 F Agency Compensation  usually and traditionally based on a commission or mark up system  promotion agencies usually work on a fee based/contract system o occasionally commission based  Clients have begun demanding more for lower prices o Agencies are starting to push back on clients that are demanding a fee structure for services that are lower than the cost to produce the services ▯ Commissions:  Traditional method of agency compensation  Typically 15% and 16% for outdoor media  Nowadays its more common to see agencies and advertisers negotiate percentages levels of commission ▯ Markup Changes  Also can be referred to as a cost-plus  In many instances an agency will turn to outside contractors for art, illustration, photography, printing, research and production  System came about mostly because many promotion agencies began providing services that did not use traditional media (which the traditional commission system is based on)  Typical markup is 17.65 to 20% ▯ Fee System  The advertiser and the agency agree on an hourly rate for different services provided  MOST COMMON basis for promotion agency compensation  Another version  fixed fee system or contract system o Imperative that the advertiser and the agency agree exactly on what services will be provided by what departments in the agency, over what specified period of time o Also must agree upon which supplies, materials, travel costs, and other expenses will be reimbursed beyond the fixed fee o This system has great potential for causing riffs in agency- advertiser relations o Analysts believe this is a flawed system o Hard to measure “work hours” - easier to measure “value of the materials the agency is creating for the client” ▯ Pay-for-results  Incentive-based compensation that base the agency’s fee on the achievement of agreed-on results o Usually these results are things like:  Awareness  Brand identification  Brand feature knowledge among target audiences ▯ 2-3 G External Facilitators  organizations or individuals that provide specialized services to advertisers and agencies ▯ Marketing and Advertising Research Firms  Perform original research for advertisers using focus groups, surveys, or experiments to assist in understanding the potential market or consumer perceptions of a product or service  Also can collect data and have that information available for a fee ▯ Consultants  Specialize in areas related to the promotional process  Can seek out marketing consultants for assistance in the panning stage regarding market segment behaviors and macro-economic and cultural trends  Can offer expertise to both advertisers and agencies  3 new types of consultants have emerged in recent years o database consultant  help firms identify and then manage databases that allow for the development of intergrated marketing communications programs  particularly helpful in launching/planning couponing or direct mail (email) campaigns o website development and management  typically have the creative skills to develop websites and corporate home pages and the technical skills to advise advertisers on managing the technical aspects of the user interface o consultant that works with the firm to integrate information across a wide variety of customer contacts (including social media activities) and to organize all this information to achieve customer relation management (CRM)  can also advise on image strategy, market research procedure, and process and account planning  most common role for consultants is to focus on marketing, creative or technical issues ▯ Production Facilitators  Offer essential services both during and after the production process  Production is the area where advertisers and their agencies rely most heavily on external facilitators o Think photographers, video producers, etc  Also digital agencies that assist with the development of video and animation for both online and traditional media applications ▯ Software Firms  New and complex category of facilitator in advertising and promotion  Offer the kind of expertise that is so esoteric that even the most advanced full service agency would have to seek their assistance ▯ 2-3 H Media Organizations  Available media: o Broadcast  TV  Major Networks  Independent Stations  Cable  Broadband  Radio  Network  Local  Satellite o Interactive Media  Online Computer Services  Home-Shopping Broadcasts  Interactive Broadcast Entertainment Programming  CD-ROMs  Internet  Smartphones  E-readers o Media Conglomerates  Multiple Media Combinations  Time Warner  Liberty Media  Comcast  Disney  Clear Channel  Hearst Corp o Print  Magazines  By geographic coverage  By content  Direct Mail  Brochures  Catalogs  Videos  Newspapers  National  Statewide  Local  Specialty  Handbills  Programs o Support Media  Outdoor  Billboards  Transit  Posters  Directories  Yellow Pages  Electronic directories  Premiums  Keychains  Calendars  Logo clothing  Pens  Point of Purchase Displays  Film and Program Brand Placement  Event Sponsorship ▯ 2-3 I Target Audiences  keep in mind that advertisers advertise to advertisers ▯ ▯ CH 3 - The History of Advertising and Brand Promotion 01/31/2015 ▯ 3-1 The Rise of Advertising  Advertising is a product of modern times and modern media  Advertising came to be mostly because of: o The rise of capitalism o The Industrial Revolution o The Emergence of Modern Branding o The rise of modern mass media ▯ 3-1 A The Rise of Capitalism  Capitalism warrants that organizations compete for resources, or capital, in a free-market environment  A competition for resources exists, which causes a need to stimulate demand for a product o Advertising is used to stimulate demand  When the Western world chose to use capitalism as the foundation for the economic system, a foundation was laid for advertising to become a large part of the business environment 3-1 B The Industrial Revolution  Industrial Revolution = an economic force that yielded the need for advertising o Began in about 1750 in England, but spread to North America and progressed slowly until about 1800  War of 1812 boosted American production o The idea of interchangeable parts, the perfection of the sewing machine, & the Civil War set the scene for industrialization  Principle of limited liability = restricts an investors risk in a business venture to only his or her own shares in a corporation rather than all personal assets o This helped accumulate large amounts of capital which financed a large part of the Industrial Revolution o Population tripled, modernity gave way to the rise of urbanism and advertising 3-1 C The Emergence of Modern Branding  Branding = the strategy of developing brand names so that manufacturers consumer attention on a clearly identified item o Brands command a higher price than a commodity o Branding requires advertising o Brand demand also gives marketers power over retailers ▯ 3-1 D The Rise of Modern Mass Media  National magazines made national advertising possible which made national brands possible, etc.  For the most part, mass media are supported by advertising ▯ 3-2 The Eras of Advertising ▯ 3-2 A The Pre-industrialization Era  17 Century – ads were printed in newsbooks (precursor to newspapers) as the last page o they were mostly informational in nature  in the US, first ad was in 1704 in the Boston News Letter  Advertising grew in popularity during the 18 century o However, it changed little for the next 70 years  Advertising was more similar to the classified section in a newspaper today than it was to advertising today ▯ 3-2 B The Era of Industrialization (1800-1875)  Dailies = what newspapers were first called  First advertising agency (in Philly) basically just solicited orders for advertising and collected payment from advertisers o Readily embraced by merchants o Newspaper advertising volume soared  At this point, there were no rules, regulations, or laws in place o Advertisers could outright lie, deceive, cheat etc o Advertising was considered an embarrassing profession by many segments of society  Banks considered advertising a sign of financial weakness ▯ 3-2 C The “P.T. Barnum Era” (“there’s a sucker born ever minute”)  After the Civil War, modern advertising began  Consumer culture = a way of life centered on consumption o Ushered in around 1875-1918  Advertising became a full fledged industry at this point  Founders/visionaries/artists that played principal roles in the establishment of the advertising business: o Albert Lasker – head of Lord and Thomas (agency) o Francis W. Ayer – founder of N.W. Ayer o John E. Powers – most important copywriter of the period o Earnest Elmo Calkins – champion of advertising design o Claude Hopkins – influential in promoting ads as “dramatic salesmanship” o John E. Kennedy – creator of “reason why” advertising  Many of these men were the sons of preachers  By 1900 the practice of branding had become the norm o Advertising was motivated by the need to sell the vastly increased supply of goods brought on by mass production and mass consumption  Pure Food and Drug Act = passed in 1906, required manufacturers to list the active ingredients of their products on their labels o Didn’t effect advertising too much because advertisers could still say basically anything  Ads of this era: o Had more copy (words) o Little color o Little photography o Plenty of exaggeration (and some lies)  The world in which these ads lived in: o Period of rapid urbanization o Massive immigration o Labor unrest o Significant concerns about the abuses of capitalism o Age of the suffrage movement o Age of silent movie pictures o Age of mass culture o World was changing rapidly  Advertisers had something to solve every new problem ▯ 3-2 D The 1920’s (1918-1929)  After WW1, advertising found respect, fame, and even glamour  The government began using advertising for policy and action post ww1  Roaring 20s – standard of living improved for most people, self pleasure was normal and advertising gave people permission to enjoy  There “happened to be a product with a cure for just about any social anxiety and personal failing” o With side effects and remedies for the side effects  Chain of needs = needs lead to products; new needs are created by the unintentional side effects of modern times and new products; even newer products solve even newer needs …  Advertisers discovered that women were responsible for 90% of household purchases o Became advertising’s primary target  Science and technology began to have a role in advertising o They were kind of the new religion of the modern era  Ads became more visual in the 20s o Showed “slices of life” o How to fit in with the “smart crowd” o How to be urbane and modern o How not to fall victim to the perils and pressure of the new fast-paced modern world o Began constructing relationships between people and branded products  Did this by depicting social settings and circumstances into which people and things fit  Ex Standard Plumbing commercial  Bruce Barton o Leader of BBDO, best-selling author of a book that depicted Jesus as the archetypal ad man  Helped people who were struggling with the “no excess” ideals of religion rationalize consumerism ▯ 3-2 E The Depression (1929-1941)  Hit hard  created possibly the last generation of unselfish Americans  Forever changed the way people thought about: o Government o Money o Spending o Saving o Credit o Advertising  Public now saw advertising as something more suspect, something that had tempted and seduced people into the excesses for which now they were being punished o Advertising industry’s response only made things worse  Advertising industry’s response o Adopted a “no-frills” advertising style o Harsher, more cluttered, inappropriately sexual, and often egregiously unethical ads became the norm  Clients wanted their moneys worth  Agencies crammed tons of info into one ad  Or used dramatic sex appeals  Played on the anxieties and vulnerabilities of troubled people  These ads kind of worked short term, but their long term effect was suppppppa negative  People resented advertising  Became wiser to their techniques  Government began passing laws regulating advertising  Between 1938-1930 the FTC issued 18 injunctions against advertisers  Radio as a medium for advertising o During the 30’s radio stations quadrupled o It was in its “heyday as a news and entertainment medium”  Remained so until the 1950s when TV came o Created a sense of community with people thousands of miles away from each other o Ushered in the idea of broadcasting o Socialized consumers to depend on a connection to distant characters, programs, brands, and the idea that there were people out there who shared a connection with you ▯ 3-2 F World War II and the 1950s (1942-1960)  WWII helped adverting regain its image partially because of the association of patriotism with advertising  Coca-Cola probably benefitted the most o “Get Coke to the front lines” campaign  “have a Coke” = now were allies  Americans were still very skeptical of adverting o Thought that some of the US marketing execs that did propaganda for the war came over to the regular advertising world and were going to manipulate society again o Rise of communism and association with mind-washing scared people o Everyone was suspicious of everything (think McCarthyism, Red Scare etc)  The 1950s were about fear, and advertisers capitalized on that o Went both ways, cause people were fearful of ads, too o This is when subliminal advertising fears originated o Subliminal advertising = advertising alleged to work on a subconscious level  James Vicary 1957 o Convinced the world (and the advertising world) that he had developed a technique that made consumers do whatever he wanted  “drink coco-cola” “eat m and m” in movie thing  full of shit, made a ton of money, and ran away before everyone figured it out  but people still feared that advertisers were able to control consumers  1950s o sex sex sex sex sex  from Freudian pop psychology to strict gender roles, conformity, and the nuclear family  advertising exploited again  TV developed  led to first “kid-market”  Created a youth culture  baby boomers  Economic growth  Emergence of suburbs/white picket fence  Not advertising’s golden age  Faith in science 3-2 G The Creative Revolution (1960-1972)  Cultural revolution of the 1960s effected advertising  Advertising remained relatively conservative/capitalist  So much more creativity came into ads though o Creative began to have much more of a say in advertising agencies  1960s advertising learned that “chasing cool” was a good direction to go in o had to attach itself to youth, rebellion, hipness, revolution = Gucci  Creative Revolution and its image associated with: o Leo Burnett o Ogilvy & Mather o Doyle Dane Bernbach o Wells Rich and Green  Pepsi sucked when they advertised taste, but when they began advertising it as something that young people drink they made progress  Love/hate relationship with advertising and its impact on culture began being portrayed in art/movies/songs 3-2 H The 1970s (1973-1980)  End of the cultural revolution  Age of disco, polyester, blow and driving 55 & America’s age of self doubt  Ads of this generation became more sexual in nature, were less artistic, more racially integrated, and used more hard-sell tactics  Social Shifts o Second wave of American feminism o Self doubt of western democracies o Who am I / what is real questions o Me me me me me time  Action for Children’s Television = a lobbyist group formed to limit the amount and content of the advertising directed at children  FTC and the National Advertising Review Board began establishing higher standards  Several firms were subjected to legislative mandates and fines because their advertising was judged to be misleading o Warner-Lambert (said Listerine could prevent/cure colds) o Campbell’s (for putting marbles in the bottom of a soup bowl) o Anacin (said that aspirin could relieve tension)  Race Issues o 1970s minorities began challenging the hiring and promotion practices of many firms in the courts o “specialty” agencies were created  Burrell Advertising (Thomas J Burrell)  “positive realism”  people working productively; people engaging in family life…being well rounded…and thoughtful; people caring about other people; good neighbors, good parents…people with dreams and aspirations; people with ambition” (69)  “whites are easier to reach through black advertising than vice versa” Burrell  Uniworld (Byron Lewis) o John H. Johnson  Founder of “Ebony” magazine  Made black publishing, marketing, and advertising possible  Very important and highly regarded person  Growth in communications and technology o Development of the VCR, cable TV, laser disc player o With greater options for consumers, advertisers began learning about how to reach more specific audiences  Youth Culture o Generation was more cynical and ambivalent about consumption o Anti-consumption ideas brought to life by British punk and American alternative bands o More ironic and cynical than the 60’s, but ideas the same  Finding authenticity, identity, and meaning in a sea of consumption and ads ▯ 3-2 I The Designer Era  The political, social and advertising landscape changed when Reagan was elected  Conservatives became the mainstream  America, Great Britain and the West in general experienced a profound political and consumption shift o Berlin wall fell down, more people available to buy  Explosion of designer goods o Everything became about public consumption status and markets o Social class consciousness  TV Advertising began changing o Started being influenced by rapid-cut editing style of MTV with a very self conscious character o Growth and creative impact of British agencies (Saatchi and Saatchi)  Saatchi & Saatchi  Realized first that politics, culture, and products all resonate together  Eighties ads were visually “in your face” 3-2 J The E-Revolution 1993-2000  Internet advertising became viable around 1993, or at least mid 90s  Scary moments for those invested in traditional marketing o May 1994 Edwin Artzt CEO Proctor and Gamble  TV advertising may not have a place in the new world being created—on demand, pay per view” etc  o May 1995 William T Esrey CEO Spring  Clients are going to hold agencies more accountable for results  We know the technology exists now to measure more precisely  Interactive media = media that allow consumers to call up games, entertainment, shopping opportunities, and educational programs on a subscription or pay per view basis  Internet was not able to yield precise measurements of ROI o Too many variables, too much noise, too many delayed effects and too many uncertainties about who is online o Clients still demanding “results”  Agencies began moving out of New York  Culture of the 90s in relation to advertising o “advertising has us chasing cars and clothes, working jobs we hate so we can buy shit we don’t need. We’re the middle children of history, man. No purpose or place. We have no Great War. No Great Depression. Our Great War’s a spiritual war…Our Great Depression is our lives. We’ve all been raised on television to believe that one day we’d all be millionaires and movie gods and rock stars. But we won’t. And we’re slowly learning that fact. And we’re very pissed off” Fight Club o advertising style turned fast, self consciously hip ▯ 3-3 Consumer Access, Connections, Branded Entertainment, and the Great Recession (2000-present)  “dot com” bubble burst in 2000  First “try” at online advertising didn’t go so well o Online advertising couldn’t flourish until companies became more sophisticated at using new media to generate sales  Web 2.0 o More pull than push  Get consumers to seek you out, or bump into you on the web and have them come to you  Consumer Generated Content = advertisements for products produced either in part or completely by their end users. The recent explosion of consumer-generated content is largely due to the advent of content-sharing Internet websites (like YouTube) that essentially enable anyone to post (and view) video content  The Great Recession of December of 2007 to June 2009 o Many advertisers cut their ad budgets o Many decided to invest more in branded entertainment and nontraditional advertising and brand promotion  These practices are now institutionalized o Social media have made brand communities and personal identity projects the stuff of e-commerce ▯ 3-4 Branded Entertainment  Branded entertainment = the blending of advertising and integrated brand promotion with entertainment, primarily film, music, and television programming o Product placement o Brand becomes the star of the program o Great because it avoids consumers running into their well trained resistance mechanisms to avoid ads o Also gets more first amendment rights because it is seen as artistic speech and not commercial speech o Can be referred to as Madison & Vine (Streets in NYC and LA) ▯ 3-5 The Value of History  although it may seem like it, fundamentally advertising hasn’t really changed  it still is a paid attempt to persuade  traditional advertising is still prevalent ▯ ▯ CH 6 – Market Segmentation, Positioning, and the Value Proposition 04/03/2015 ▯ 6-1 STP Marketing and Advertising  very few marketers market to everyone o too expensive and wasteful  SEGMENT their market instead  Then TARGET that segment with advertising and IBP  Then POSITION their brand for that segment o Position = attempt to give a brand a certain meaning relative to its competition  STP marketing approach = using segmentation, targeting, and positioning together  In most product categories, different consumers are looking for different things o Companies must take advantage of the sales potential represented by different customer segments  develop and market different brands for each segment ▯ 6-2 Segmenting Markets  step 1 = breaking down large broader markets into more manageable submarkets or customer segments (market segmentation) o need to identify a segment with common characteristics that will lead the members of that segment to respond distinctively to a marketing program o identify the media the segment uses so that they can best get messages to the segment ▯ 6-2 A Usage and Commitment Level  common way to segment markets is by consumer’s brand commitment or usage levels o consumers that purchase more and more frequently are called heavy users, committed users, or lead users o not uncommon to find that heavy users in a category account for the majority of a product’s sales and thus become the preferred or primary target segment o makes sense to get to know these consumers  sometimes, though, these consumers do not need any more encouragement to continue consuming  might have different motives to consume than another consumer o brand freaks = consumers who are so committed to the brand that their consumer behavior towards it borders on the pathological  still considered valuable due to their knowledge of the brand and their presumed social influence which can be used to create branding and advertising ▯ 6-2 B Switchers and Variety Seekers  often buy what is on sale or choose brands that offer discount coupons or other price incentives  costly target segment o much can be spent in getting their business merely to have it disappear just as quickly as it was won ▯ 6-2 C Emergent Consumers  offer the organization an important business opportunity  in most product categories there is a gradual but constant influx of first time buyers o reason why varies by product category o includes purchase triggers  puberty  college graduation  marriage  a new baby  divorce  a new job  a big raise  retirement  motivated by many different factors o share one common characteristic  brand preferences are still under development o targeting emergent with messages that fit their age or social circumstances may produce modest results short term, but can eventually develop brand loyalty  Point of Entry Marketing = developing advertising campaigns to win with first time users ▯ 6-2 D Demographics  Demographic segmentation = widely used in selecting target segments and includes basic descriptors such as age, gender, race, marital status, income, education and occupation o Easier to choose media to effectively reach segment when information about segment is known and available  Demographic information has two specific applications o 1. Commonly used to describe or profile segments that have been identified with some other variable o 2. Used frequently as the starting point in market segmentation ▯ 6-2 E Geographic Location  geographic segmentation may be conducted within a country by region, by state or province, by city, or even by neighborhood  climate and topographical features yield dramatic differences in consumption by region for products o also not so obvious differences like eating habits, entertainment preferences, recreational activities etc  geodemographic segmentation = identifies neighborhoods (by zip codes) around the country that share common demographic characteristics o PRIZM (potential rating index by zip marketing)  Identifies 62 market segments that encompass all the zip codes in the US  Systems like this are very popular because of the depth of segment description they provide, along with their ability to precisely identify where the segment can be found ▯ 6-2 F Psychographics and Lifestyle  Psychographics = a term that advertisers created in the mid 1960s to refer to a form of research that emphasizes the understanding of consumer’s activities, interests, and opinions (AIOs) o Tool to supplement demographic data o Usually results in lifestyle segmentation  Because of the focus on consumers’ AIOs  Lifestyle or psychographic segmentation can be customized with a focus on the issues germane to a single product category or it may be pursued so that the resulting segments have general applicability to many different product or service categories ▯ 6-2 G Benefits Sought  benefit segmentation = target segments are delineated by the various benefit packages that different consumers want from competing products and brands ▯ 6-2 H Segmenting Business-to-Business Markets  advertising is more prevalent in consumer markets  products and services that are commonly promoted to business customers around the world: o smartphones o overnight delivery o Web hosting o Consulting services o Wide array of business machines and computer support services  Can be segmented using normal segmentation tactics o However things like lifestyle and psychographic segmentation doesn’t transfer over well  NAICS (North American Industry Classification System) o Helpful in identifying categories of businesses and then pinpointing the precise locations of these organizations ▯ 6-3 Prioritizing Segments  segmenting markets typically yields a mix of segments that vary in their attractiveness to the advertiser  have to decide on criteria to choose which segments to prioritize  fundamental criterion = what the members of the segment want versus the organization’s ability to provide it o identify organization’s strengths and weaknesses o to serve a target segment an organization may have to commit substantial resources to acquire or develop the capabilities to provide what the segment wants  if the price tag is too high, company must find another segment  another consideration: size and growth potential of the segment o segment size is a function of the number of people, households, or institutions in the segment plus their willingness to spend in the product category  important to remember that the number of people in a segment of heavy users may be relatively small, but their extraordinary usage rates can more than make up for their small numbers  also important to look at potential growth and the forecasted ROI for the segment  third criterion: the competitive field o competitive field = companies that compete for the segments business  does the competition have particular expertise or a bigger budget that would allow it to serve the segment more effectively?  Niche marketing: “smaller is better” segmentation principle o Relatively small group of consumers who have a unique set of needs and who typically are willing to pay a premium price to the firm that specializes in meeting those needs o Small size of the market often means that it would not be profitable for more than one organization to serve it o Most likely will continue to grow in popularity as the mass media splinter into a more and more complex and narrowly defined array of specialized vehicles  Specialized cable programming attracts small and very distinctive groups of consumers  Provides advertisers with an efficient way to communicate with market niches ▯ 6-4 Targeting  once an organization has decided on a segment, they must figure out how to target them  main idea: to efficiently deliver the branding effort to the chosen segments o efficiency is more of a goal than a reality o efficiency is often sacrificed for clarity of brand meaning ▯ 6-4 A Positioning/Repositioning  where the “fun is”  where you craft the meaning of the desired brand  think of the brand’s meaning relative to other brands ▯ 6-4 B The Bahr-InterBrand Positioning Opportunity Method  InterBrand is the world’s largest and most successful brand consultancy  Model: o Four factors represented by overlapping circles  Relevance: Where is the strong consumer connection? What is the revealed need(s) of consumers?  Differentiation: Can the brand stand out as significantly different than others?  Credibility: Will consumers believe it?  Stretch: Will the brand’s meaning have continued relevance in changing times? Will it foster brand extensions? o Where the four factors meet is considered the best opportunity 6-4 C Essentials for Effective Positioning Strategies  Any sound positioning strategy includes several essential elements o Based on meaningful commitments of organizational resources to produce substantive value for the target segment o Consistent internally o Feature distinctive and simple themes The Themes  Deliver on the Promise o Organization must be committed to creating substantive value for the customer  Ads can create expectations  need to deliver  There’s Magic in Consistency o Positioning strategy must be consistent internally and consistent over time  Everything must work in combination to reinforce a distinct perception in the consumer’s eyes about what a brand stands for  Make the target segment your obsession  Ex: airline that emphasizes on time reliability don’t invest in luxury waiting lounges, invest in preventative maintenance and state of the art baggage handling facilities o Consistency over time is also important  Make It Different Simply o In a world where consumers are expected to ignore, distort, or forget most of the ads they are exposed to, complicated, imitative messages have no chance of getting through o Basic premise of a positioning strategy must be simple and distinctive if it is to be communicated effectively to the target segment ▯ 6-5 Working With A Value Proposition And A Brand Platform  Brand proposition = value proposition, brand promise, or a brand platform o Can be easy to lose sight of what a brand stands for when focusing on the target segment o If the people who create the advertisement for a brand get consumed about the brand’s desired identity, then the consumer will too o Best way to capture one’s strategy is to articulate the value proposition  Value Proposition = a natural extension of concepts that are already familiar  consolidates the emphasis on customer benefits o It is a simple sentence that clearly states what value the brand will be to the customer o Aka brand promise/brand platform : core idea that frames an ambition or aspiration for the brand that will be relevant to target audiences over time ▯ 6-5 A Now, Making It Happen  starting point of STP marketing = identifying who the customers or prospects are and what they want  then specifying the brand’s value proposition o should consider both what a brand has stood for or communicated to consumers in the past AND what new types of value or additional benefits one wants to claim for the brand going forward  final: consider the various persuasion tools that may be deployed as part of the campaign ▯ ▯ CH 7 – Advertising Research 03/10/2015 ▯ Introduction  Advertising research defined: any type of research that aids in the development, execution, or evaluation of advertising and promotion  Advthtising research really began to flourish and expand in the mid 20 century o 3 basic reasons for growth in research:  1. The popularity of, naiveté toward, and overconfidence in “social science” during this time legitimized anything called science or research, particularly psychological methods  2. Other agencies had research departments  bandwagon effect 


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