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The World of Advertising

and Integrated Brand

We need perspective on
advertising and IBP!
Technology and consumer control
are reshaping the communications
environment
The lines between entertainment
and advertising/IBP are blurring
Madison & Vine
Firms use advertising/IBP to build
brands

We need perspective on
advertising and IBP!
Firms of all sizes need and use
advertising
Advertising is just one of many tools
in IBP
Advertising/IBP do not guarantee
success8 of 10 new products fail
People have all sorts of positive and
negative (mis)perceptions about
advertising and promotion

We need perspective on
advertising and IBP!
Four criteria must be met for a
communication to be classified as
advertising:
The communication must be paid for
The advertiser must be identified
The communication must be delivered
through mass media
The communication must be
attempting to persuade

We need perspective on
advertising and IBP!

Integrated Brand Promotion (IBP)


is the process of using a wide
range of promotional tools
working together to create
widespread brand exposure.

We need perspective on
advertising and IBP!
IBP is a process
IBP uses a wide ranges of tools
including:
Advertising
Point of Purchase
(in-store) materials
Direct Marketing
(catalogs, infomercials,
email)
Personal Selling
Internet advertising
Blogs
Podcasting

Event sponsorship
Brand entertainment
(product placement on TV
shows, in movies)
Outdoor signage/billboards
Public relations
Influencer (peer-to-peer)
communications
Corporate advertising

Distinctions within
Advertising

Advertising Campaign

An integrated series of ads and promotions


that communicate a
central theme or idea

Advertisements

Specific messages designed to persuade an


audience

Model of the
Communications
Process
Fields of Experience

Source /
Sender

Encoding

Channel
MESSAGE

Decoding

Response Feedback Loop

Receiver /
Audience

Advertising as a
Communications Process:
Mass Mediated

Advertising as a
Communications Process
Production: The advertiser and social
context determine ad content.
Reception: The context of ad reception and
the audiences understanding of an ad result
in a meaningful interpretation of the ad.
Accommodation and negotiation: The ways
in which consumers interpret ads

Audiences for Advertising:


Audience Categories
Household Consumers
Business Organizations
The Trade Channel
Professionals
Government

Audiences for Advertising:


Audience Geography
Global advertising
International advertising
National advertising
Regional advertising
Local advertising

Ad in Context Example

This
This ad
ad ran
ran in
in
Italy.
Italy. Do
Do you
you
think
think this
this is
is aa
global
global or
or
international
international
ad?
ad? Whats
Whats
the
the difference?
difference?

Advertising as a
Business Process
The role of advertising in the
marketing mix
Advertising in brand management
Advertising in market segmentation,
differentiation, and positioning
Advertising in revenue and profit
generation

Advertising as a
Business Process
Definition of Marketing:

The process of planning and


executing the conception, pricing,
promotion and distribution of ideas,
goods and services to create
exchanges that satisfy individual
and organizational objectives.
American Marketing Association, 1995

The Role of Advertising


in the Marketing Mix
The Marketing Mix
Distribution

Product

Perceived
Value
Promotion

Price

The Role of Advertising


in Brand Management
Information and persuasion
Introduction of new brands and
extensions
Building and maintaining brand
loyalty/brand equity
Creating an image/meaning
Building brand loyalty in the trade
channel

Segmentation
(heterogeneous >
homogeneous)

Differentiation
(perceived as
different
or unique)

Positioning

Advertisings Role in
Segmentation,
Differentiation and Positioning

Distinct from
other brands
Occupies a
value level
External niche
vs. internal

Advertisings Role in
Revenue and Profit
Generation

Brand loyalty leads to


inelasticity of demand: less
price sensitivity to demand
Economies of scale: higher
volume results in lower unit
cost

Types of Advertising

Primary demand stimulation


Selective demand stimulation
Direct response advertising
Delayed response advertising
Corporate advertising

Ad in Context Example

Is
Is this
this ad
ad an
an example
example
of
of primary
primary or
or selective
selective
demand
demand stimulation?
stimulation?
Whats
Whats the
the difference?
difference?

The Economic Effects


of Advertising
Gross
Gross Domestic
Domestic Product
Product
Business
Business Cycles
Cycles
Competition
Competition
Prices
Prices
Value
Value

From IMC to IBP


Sp
Ev ec
en ial
ts

n
o
i
is isin
v
le ert
e
T dv
A
g

C
o
u
p
o
n
s

Coordinated
promotional
activities
reinforce one
another