What is Advertising?

• Advertising is a means of communication with the users of a product or service.

Advertisements are messages paid for by those who send them and are intended to
inform or influence people who receive them, as defined by the Advertising
Association of the UK.

• Advertising is a marketing tactic involving paying for space to promote a product,

service, or cause. The actual promotional messages are called advertisements, or
ads for short. The goal of advertising is to reach people most likely to be willing to
pay for a company’s products or services and entice them to buy.

• The activity or profession of producing advertisements for commercial products or

services.

• In today's world, advertising uses every possible media to get its message through.
It does this via television, print (newspapers, magazines, journals etc), radio, press,
internet, direct selling, hoardings, mailers, contests, sponsorships, posters, clothes,
events, colours, sounds, visuals and even people (endorsements).
 Divided into four broad periods:
• The premarketing era – The period from prehistoric times to the
eighteenth century. During this time, buyers and sellers
communicated in very primitive ways.
• The mass communication era – From the 1700s to the early
decades of this century, advertisers were able to reach large
segments of the population through mass media.
• The research era – In recent years advertisers increasingly have
been able to identify narrowly defined audience segments
through sophisticated research methods.
• The interactive era – Communication will increasingly be
controlled by consumers who will determine when and where
they can be reached with promotional messages.
 Roles of Advertising
• Marketing
• Communication
• Economic
• Societal
 The Marketing Role
• Marketing process and target market

• 4 Ps of Marketing/ Marketing Mix

• IMC (Integrated Marketing Communication)

• Above the line spending and Below the line spending

 The Communication Role
• It transmits different types of market information to match buyers and
sellers in the marketplace.

• Advertising both informs and transforms the product by creating an image

that goes beyond straight forward facts.

• Prospect identification

• Consumer motivations

• Advertising execution

• Media Planning

• The advertising budget

 The Economic Role
• Market Power Model – Considers advertising to be a means of persuasion that
increases product differentiation and decreases consumers willingness to
substitute competing alternatives. Reduces the price elasticity of demand.
• Economic of Information Theory – The basic premise in this model is that
advertising provides information about alternatives and increases price elasticity
so that a small change in price creates a large change in the product demand.
• Advertising can increase price elasticity by increasing the number of substitute
brands considered.
• The more substitutes the consumers believe exist, the more price sensitive they
are.
• In product markets where consumers have to rely on memory to generate
alternatives, advertising may increase price elasticity.
• In product markets where consumers rely on point-of-purchase information, the
net effect of increased advertising by brands may reduce price elasticity.

• Advertising and Profitability

 The Societal Role

• Consumers – Providing information about products and services that

they otherwise would not have heard about. Aids the consumer in
making the best decision about the products that will solve some
problem.
• Advertising has an expanded ability to provide even better information to
selected consumers about specialised product categories.
• Promotes greater choice for the consumers
• Provides a means for new products to enter the marketplace and
therefore, increases the number of products available to consumers.
• Buyers will have greater input in the marketing process due to
advancement in technology and interactive media.
• Creates an environment where products are designed for the consumer
rather than forcing consumers to accept what is available .
 The Societal Role
• Business – Advertising provides efficiencies in communicating
to mass audiences.
• Without advertising, many businesses would not be able to
bring new products to the attention of enough consumers fast
enough to make the enormous cost of creating, developing,
manufacturing and distributing these products practical.
• Contributing in launching new products.
• Increasing the sale of existing brands.
• Maintaining the sale of mature brands.
 The Societal Role
Plays both a micro and macro role

• The intended result of most advertising is to contribute to the

profitable sale of products and a continuing economic expansion
that presumably is a benefit for society as a whole.
• It informs us about new and improved products and teaches us how
to use these innovations.
• It helps us compare products and features and make informed
consumer decisions.
• Advertising moves from being a simple informational service to
being a message that creates a demand for a particular brand.
• Growing emphasis concerning advertising’s responsibility as a mirror
and monitor of society.
 Functions of Advertising
• Provides product and brand information
• Provide incentives to take action
• Provide reminders and reinforcement
• Promotion of Sales
• Support to Production System
• Public Image
• Increasing Standard of Living
• Support to Media
 Types of Advertising
• Advertising to the Consumer
• Advertising to Business and Professions
• Non Product Advertising
• Government Advertising
 Advertising to the Consumer

• Brand/ National Advertising

• Retail/ Local Advertising
• Political Advertising
• Directory Advertising
• Direct-Response Advertising
• End-Product Advertising
 Advertising to the Consumer
• Brand/ National Advertising
It refers to advertising by a marketer of a trademarked product (brand) or
service sold through different outlets, in contrast to local advertising.
Focuses on the development of a long-term brand identity and image.

• Retail/ Local Advertising

Advertising by a merchant who sells directly to the consumer. It focuses on
the store where a variety of products can be purchased or where a service
is offered. It emphasizes price, availability, location and hours of operation.

• Political Advertising
Advertising used by politicians to persuade people to vote for them, so it is
an important process in countries that permit candidate advertising. It is an
important source of communication for voters, critics are however
concerned that it tends to focus more on image than on issues.
 Advertising to the Consumer
• End-Product Advertising
Building consumer demand by promoting ingredients in a product. Most
commonly used by manufacturers of ingredients used in consumer
products. Builds consumer demand for an ingredient that will help in the
sale of a product.

• Direct-Response Advertising
It can use any advertising medium, including direct mail, but the message is
different from that of national and retail advertising in that it tries to
stimulate a sale directly. The consumer can respond by telephone or mail
and the product is delivered directly to the consumer by mail or some other
carrier.

• Directory Advertising
It is called directory because people refer to it to find out how to buy a
product or service. The best known form of directory advertising is the
Yellow Pages, although many different kinds of directories perform the
same function.
 Advertising to Business and
Professions
• Business-to-business advertising includes messages directed at
retailers, wholesalers and distributors as well as industrial purchasers
and professionals such as lawyers and physicians.

• Advertisers place most business advertising in business publications

or professional journals.

• B2B ad messages tend to be factually oriented with few emotional

appeals. The appeals are very profit oriented.

• B2B buying process is very different from consumer buying process –

Purchase Collaboration, Purchase Cycles and Purchase Scale.
 Advertising to Business and
Professions

• Trade Advertising
• Industrial Advertising
• Professional Advertising
• Corporate/ Institutional Advertising
 Advertising to Business and
Professions
• Trade Advertising
Advertising directed to the wholesale or retail merchants or sales agencies
through whom the product is sold. It emphasizes product profitability and
the consumer advertising support retailers will receive from manufacturers.
Objectives of Trade advertising:
Gain additional distribution
Increase Trade support
Announce consumer promotions

• Industrial Advertising
Addressed to manufacturers who buy machinery, equipment, raw materials
and the components needed to produce goods they sell.
Directed at a very specialized and small audience. Advertising in
appropriate industry publications, direct mail, telemarketing and personal
selling.
 Advertising to Business and
Professions
• Professional Advertising
Directed at those in professions such as medicine, law or architecture who
are in a position to recommend the use of a particular product or service to
their clients.
The primary difference between professional and other trade advertising is
the degree of control exercised by professionals over the purchase decision
of their clients.

• Corporate/ Institutional Advertising

Advertising done by an organization speaking of its work views and
problems as a whole, to gain public goodwill and support rather than to sell
a specific product.
The messages focus on establishing a corporate identity or winning the
public to the organization’s point of view.
Groups targeted include ultimate consumers, stockholders, financial
community, government leaders and employees.
 Non Product Advertising
• Idea Advertising
Advertising used to promote an idea or cause rather than to sell a product
or service. It is often controversial.

• Public Service Advertising (PSA)

PSA communicates a message on behalf of some good cause such as
stopping drunk driving or preventing child abuse. Usually created for free
advertising professionals and the media often donate the space and time.

• Service Advertising
Advertising that promotes a service rather than a product. Basic principles
of service advertising include:
Feature tangibles
Feature employees
Stress quality
 Government Advertising
• Advertisements created by the government for various forms
of propaganda and public policy messages.
• The federal government spends millions of dollars each year
promoting an array of agencies including the volunteer armed
forces, consumer protection programs and environment and
health initiatives.
• State governmental agencies also have seen the advantage of
advertising in reaching the citizens with beneficial services
such as savings plans for higher education.
 Interactive Advertising
• It is delivered to individual consumers who have access to a
computer and the Internet.

• Advertisements are delivered in web pages, banner ads and

so forth.

• In this instance, the consumer can respond to the ad, modify

it, expand it or ignore it.