Principles of Advertising Exam 1 Study Guide
Principles of Advertising Exam 1 Study Guide Mcom 214
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This 6 page Study Guide was uploaded by Kelsey Voelker on Friday September 30, 2016. The Study Guide belongs to Mcom 214 at Towson University taught by Dr. Rhee in Fall 2016. Since its upload, it has received 41 views. For similar materials see Principles of Advertising in mass communications at Towson University.
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Date Created: 09/30/16
Principles of Advertising Exam 1 SG Exam 1 Study Guide (Ch. 1-4) What is Advertising? o The structured & composed nonpersonal communication of information, usually paid for and usually persuasive in nature, about products (goods, services, and ideas) by identified sponsors through various media o A type of communication (marketing sells, advertising tells) o Typically directed to groups of people Consumers o Most is paid for by sponsors and usually persuasive o *Marketing communications: various tools of advertising goal is to communicate a product/company to public in a marketable way o Different types: Outdoor (transportation, sky) Traditional media (radio, newspaper, magazine, TV) o Advertising’s duality Represents the intersection of two key disciplines CommunicationADVERTISINGMarketing Marketing o The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. o 4 P’s of marketing mix: products pricing places promoting o Branding To identify products and their source; to differentiate them from others Public Relations vs. Advertising o Main difference: how they deal with the media Advertising utilizes media to see what is best & purchases it PR doesn’t purchas media; they build relationships with media to build with the public Have a higher credibility to public o Tools: Brochure, media conferences, press release, print, TV, etc. Functions & Effects of advertising as a marketing tool o To identify products & differentiate them from others o To communicate information about the product, its features, and its place of sale o To induce consumers to try new products & suggest reuse o To stimulate the distribution of a product o To increase product use o To build value, brand preference & loyalty o To lower the overall cost of sales The preindustrial Age Industrializing age Industrial age o Markets grew larger and became more complex o Demands for products increased o Need for advertising slowly developed o Manufacturers concerned with production o Consumer packaged goods Extra Terms o Product differentiation: seeking to portray their brands as different from & better than the competition by offering consumers quality, variety, and convenience o Unique selling proposition (USP) Features that would differentiate it from competitive products o Market segmentation Marketers search for unique groups of people whos needs could be addressed through specialize products o Positioning Proved effective in separating a particular brand from its competitors by associating that brand with a particular set of needs that ranked high on the consumer’s propriety list o Sales promotion A direct inducement offering extra incentives all along the marketing route—from manufacturers through distribution channels to customers—to accelerate the movement of the product from the producer to the consumer o Narrowcasting Delivering programming to a specific group defined by demographics and/or program content, rather than mass appeal Usually describe cable networks the opposite of broadcasting CH 2 Abundance Principle o Keeps consumers informed about alternatives (complete information) o Allows companies to compete more effectively (self-interest) by competition (many buyers and sellers) o *ad stimulates a healthy economy & helps create financially healthy consumers The Economic impact of advertising o Accounts for 2% of the US gross domestic product o Effect on the value of products: Added value comes from the consumer’s mind Products image is an inherent feature of the product itself Effect on Prices o Advertising adds value to products o Primary demand: consumer demand for a whole product category o Selective demand: consumer demand for the particular advantages of one brand over another Social Impact of Advertising o Deception in advertising Factually false considered deceptive o Puffery Exaggerated, subjective claims that can’t be proven true or false Ex. “the best” “Premier” Accepted in US market: its reasonable & people don’t believe it Case in textbook: Papa John’s vs. Pizza Hut (making false claims) o Effect on our Value System Advertising has been often criticized for degrading people’s value systems by promoting a materialistic way of life o The proliferation of advertising Too Much! Negative impact of excessive advertising = less effective ads o The Use of Stereotypes in advertising Has long been criticized for insensitivity to minorities, women, immigrants, the disabled, the elderly, and others o Offensiveness is advertising Nudity ads, immoral, strictly adult-oriented ads Taste is highly subjective Taste is geographic Current Regulatory Issues Affecting US advertisers freedom of commercial speech (protected) o Tobacco advertising Freedom of commercial speech? Or protecting consumers’ health? Tobacco products causing health problems Major externality o Advertising to children Not sophisticated consumers o Consumer privacy Increased interactive advertising growing consumer concern Protecting personal information on the internet Issues of cookies Self-regulation Fair information practice principles o Notice, choice, access, security, enforcement FEDERAL REGULATION AGENCIES The US Federal Trade Commission (FTC) o Major regulator of advertising in US o Defining deception Any ad that contains a misrepresentation, omission, or other practice that can mislead a significant number of consumers to their detriment whether the ad conveys a false impression o Defining unfairness When consumer is unjustifiably injured Violation of public policy o Comparative advertising Legal so long as the comparison is truthful and measurable The Food and Drug Administration (FDA) o Labeling, packaging, and branding of packaged foods and therapeutic devices Complete information o Nutritional labeling and education act (NLEA) Requires the labels to show food value Defining terms such as fresh, light, low fat, and reduced calories Set standard serving sizes The Federal Communications Commission o The FCC has jurisdiction over radio, television, telephone, satellite, cable, tv industries, and the internet o Has authority to license broadcasters Indirect control over broadcast advertising Obscenity and profanity Can restrict both the products advertised and the content of ads US patent and trademark office o Protecting intellectual property o Patent Providing incentives to invent, invest in, and disclose new technology worldwide o Trademarks Protecting investments, promote goods and services, and safeguard consumers against confusion and deception in the market place World, phrase, symbol and/or design The Liberty of Congress o Protects all copyrighted material, including advertising copyright issued to an advertiser grants the exclusive right to print, publish, or reproduce the protected ad for the life of the copyright owner plus 70 years Other Terms o Subliminal advertising Advertisements with messages (often sexual) supposedly embedded in illustrations just below the threshold of perception o Stereotypes Negative or limiting preconceived beliefs about a type of a person or a group of people that do not take into account individual differences o Ethical Advertising Doing what the advertiser and the advertiser’s peer believe is morally right in a given situation o Social Responsibility Acting in accordance with what society views as best for the welfare of people in general or for a specific community of people o Privacy rights Of or pertaining to an individuals right to prohibit personal information from being divulged to the public o Cookies Small pieces of information that get stored on your computer when you download certain websites. These can keep track of whether a certain user has ever visited a site before. o Deceptive advertising According to FTC, any ad in which there is a misrepresentation, omission, or other practice that can mislead a significant number of reasonable consumers to their detriment o Unfair advertising According FTC, advertising that causes a consumer to be unjustifiably injured or that violates public policy Market Segmentation Process o Aggregating groups of people into larger market segments based on their interest in the product’s utility Behavioristic Segmentation o Group consumers by purchase behavior o User-status variables Sole users, semi-sole users, discount users, aware nontries, trial/rejectors, repertoire users o User-rate variables Heavy users, medium users, light users o Purchase-occasion variables Need (regular/occasional) Fad (candy, computer, games) Seasons (water skis, raincoats) o Benefits-sought variables (benefit segmentation) Seeking high quality, low price, status, sex appeal, good taste o Geographic Sales by region, county size, city size, specific location, types of stores o Demographic Defining population groups by Sex, age, ethnicity, education, occupation, income, and other quantifiable factors Often combined with geographic segmentations o Psychographic Grouping people by their values, attitudes, personality, and lifestyle Target Marketing Process o Target market The group of segments the company wishes to: Appeal to Design products for Tailor marketing activities towards Determine the content, look, and feel of the ad Product life cycle o Educating customers, building wide spread dealer distribution, encouraging demand o “wean” product into market maximize market share early fight for market share minimize effort and time to maintain market
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