FOUNDATIONS OF

ADVERTISING

Topics: Advertising as a tool of marketing, Advertising

effects, economic and social
ADVERTISING AS A TOOL OF MARKETING

 Advertising is a tool of marketing that disseminates information about a brand which is aimed at a large number of people
at the same time using purchased space or time in various mediums.

 In the context of marketing, advertising is possibly the most important

element. It draws from the other branches such as market research,
positioning etc. to create successful persuasive communication
REAN MODEL
 Good or Great Ads Work on Two Levels

CHARA
CTERIS
TICS
OF
GREAT
Satisfy
Satisfy the
the Customer’s
Customer’s
ADS Objectives
Objectives byby Engaging
Engaging Achieve
Achieve the
the Sponsor’s
Sponsor’s
Them
Them && Delivering
Delivering aa Objectives
Objectives
Relevant
Relevant Message
Message
DUAL PROCESS OF GREAT
ADVERTISING: REACHING OBJECTIVES

Advertising
AdvertisingObjectives
Objectives Consumer’s
Consumer’sObjectives
Objectives

Satisfy
SatisfyCuriosity/Memory/
Curiosity/Memory/
Attention/
Attention/Awareness
Awareness Entertainment
Entertainment

Interest
Interest Identify
IdentifyPersonal
PersonalNeeds
Needs

Gather
GatherRelevant
Relevant
Knowledge
Knowledge Information
Information
Support
SupportRisk
RiskAssociated
Associated
Attitude
AttitudeChange
Change With
With AttitudeChange
Attitude Change

Behavioral
BehavioralChange/
Change/Trial
Trial Enhance
EnhanceNeed
NeedReduction
Reduction

Repurchase/Commitment/
Repurchase/Commitment/ Reinforce
ReinforceTrial
Trialand
and
Reminder
Reminder Need Reduction
Need Reduction
BROAD DIMENSIONS THAT
CHARACTERIZE GREAT ADVERTISING
The Ultimate Test for the Greatness of An Ad is Whether It Achieved Its Goals.

Strategy
Strategy Creativity
Creativity

Execution
Execution
ADVERTISING AS A TOOL OF MARKETING

 A brand by definition is a sign of identity, the mark or label which

differentiates one product from the other. A product acquires a certain

identity or a feel and a specific brand value because of the kind of

advertising that it creates for itself. It is this brand value which then

becomes crucial for companies to build their marketing strategies

upon.
 ADVERTISING AS A TOOL OF MARKETING

“Advertising is the discovery and communication for a brand to the target prospect.”

Therefore, advertising thus not only intends to sell but also create an aspiration towards a

certain product, and create that vital and persuasive distinction that makes it a brand. How does

advertising go about achieving it’s objectives?

 Advertising Appeals

ADVERTISING AS A TOOL OF MARKETING

 RATIONAL APPEAL
The Horlicks advertisement below shows the necessity of a child to
consume it in order to grow tall, strong and sharp.
 EMOTIONAL APPEAL
A n e m o t i o na l a ppe a l i s re l a t e d t o a n i nd i v i dua l ’s p sy c h o l o g i c a l a n d so c i a l ne e ds f o r
purchasing certain products and services.

For example : JOHNSON AND JOHNSON

P O S I T I V E E M O T I O N A L AP P E A L

Positive emotions like- humor, love, care, pride, or Joy are shown in
advertisements to appeal audience to buy that product.
NEGATIVE EMOTIONAL APPEAL
 T h i s a p p e a l i n c l u d e s f e a r, g u i l t , a n d s h a m e t o g e t p e o p l e t o d o
things they should or stop.
F o r e x a m p l e : To b a c c o k i l l s
4) HUMOR APPEAL

Humor appeal causes consumer to watch advertisement, laugh on it,

and most important is to remember advertisement and also the
p r o d u c t c o n n e c t e d w i t h h u m o r.

For example-
Happy dent White Ad - Won Cannes Award for Action,
Kit Kat - Dancing Babies Commercial,
MORAL APPEALS

Moral appeals are directed to the consume rs sense of what is right and p r o p e r. T h e s e a r e
often used to exhort people to support social and ethical causes.
MUSICAL APPEALS
 Music can be used as types of advertising appeals as ti has a certain intrinsic value and
can help in increasing the persuasiveness of the advertisement. It can also help catch
attention and increase customer recall.
 The Idea- ‘Honey Bunny’ jingle is in a very funny voice and well rhymed. It is equal to a song, and bec aus e
of t h a t c us tomer s register it easily.
TRANSFORMATIONAL APPEAL

Transformational Appeal - The idea behind this appeal is that it can

actually make the consumption experience better.

For example- Amway products

 DIRECT APPEAL
 Direct Appeals - Direct a ppea ls clearly communicate w it h t h e consumers about a
given need. These extol t h e advertised brand a s a product which s a t i s f i e s t h a t need.
INDIRECT APPEAL
Indirect Appeals – Indirect Appeals do not emphasize a human need, but allude to a need.
SOCIAL APPEAL
Social factors cause people to make purchases and include such aspects as
recognition, respect, etc.
 BANDWAGON APPEAL
 This type of advertising appeal is meant to signify that since everybody is doing something you
should be a part of the crowd as well. It appeals towards the popularity aspect or coolness of a
person using that particular product/service.

Here McDonald appeals to its customers that they have served millions and billions of
customers. This encourages the customers to try out McDonald product
HUMOR
APPEAL
FEAR
APPEAL
ADVENTURE
APPEAL
THE SOCIAL APPEAL
THE ENDORSEMENT APPEAL
THE BRAND APPEAL
THE STATUS
APPEAL
ROMANCE
APPEAL
PROBLEM - SOLUTION
APPEAL
TESTIMONIAL APPEAL
SCARCITY APPEAL
DURABILITY APPEAL
 ADVERTISING AS A TOOL OF MARKETING

Brand Differentiation: Communicating the Difference

An advertisement needs to communicate a difference for the brand i.e.

something which sets it apart from it’s competitors. The difference

may be as simple as a special or new feature or color, function, a

perception of exclusivity or ‘for the masses’, a business ethic.

Brand Differentiation:
Brand Differentiation:
Brand Differentiation:
Brand Differentiation: How to Differentiate Your Business?

 Broad Differentiation Strategy

 Focused Differentiation Strategy

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

What is a Broad Differentiation Strategy?

When a company wants to target a wide range of customers, it will adopt a

broad differentiation strategy.

This implies that the company intends to cover a large market with similar

needs and develop similar products. They would also upgrade an existing

product but with enhanced features.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

What is a Broad Differentiation Strategy?

A broad differentiation strategy sets to build a brand or business that
distinguishes itself from the competitors and focuses on a wide range
of consumers. Companies that follow a broad differentiation strategy
apply the “prestige for masses” approach. Examples of such companies
are BMW and Apple. These brands focus on developing innovative products
for the broad market. Consumers purchase their products at premium
prices because of their unique characteristics - the driver’s
experience for BMW or the elegant design and user experience for Apple.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

Broad Differentiation Strategy

It works by creating unique products and services that will attract a large customer base.

Companies that are successful with this strategy achieve it by being unique
enough to have an edge on their competitors but broad enough to appeal to a
market of millions or more.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

Differentiation strategies can be traced to Porter’s generic strategies for achieving

competitive advantage in a market segment.

ADVERTISING AS A TOOL OF
MARKETING
Brand Differentiation: Porter’s generic strategies

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Porter’s generic strategies

Cost Leadership Strategy: Companies targets a narrow segment of a market and provide
products or services at the lowest prices relative to what competitors offer. This

Cost Focus Strategy: Companies target a broad market by offering products at prices
below their competitors.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Porter’s generic strategies

Focused differentiation strategy: Brands appeal to a narrow (focused) audience by being

more relevant and specific to a certain segment of the market than broader-based
competitors.

Broad differentiation strategy: Companies target a large market segment, often in their
millions using unique product characteristics to gain competitive advantage.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

What is a Focused Differentiation Strategy?

If the former strategy is not applicable for some companies, they can

opt for a focused differentiation strategy. A firm choosing this

strategy targets a specific/niche segment of the market. They can

target one or more market segments at the same time. But, they will

have to produce custom products for different markets.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

Focused Differentiation Strategy.

Coca-Cola is a perfect example of this differentiation strategy. For

instance, they offer diet cola, canned, and bottled drinks. Thus,

serving three different markets at the same time.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

1. Price Competition:

Lowering prices is one of the most common strategies that companies use to

increase market share for a product. If their competitors also lower their prices,

a price war begins.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

2. Product Differentiation:

Product differentiation is the most evident and noticeable type of differentiation

strategy. Customers tend to differentiate a product by its physical appearance.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

2. Product Differentiation:
Organizations use this strategy to make their product design unique.

A few common ways to differentiate a product are:

 Unique product features

 Product performance

 Product efficacy

 Consumer opinion ADVERTISING AS A TOOL OF

MARKETING
 Brand Differentiation: Communicating the Difference

3. Service Differentiation:
In simple words, service differentiation means creating an unusual way to serve

customers.

Every company's motto is "serve the customer." So what makes this one

unusual? But customer service has evolved drastically. People want you to

present impeccable service with no wait time.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

3. Service Differentiation example:

McDonald’s is the perfect example of service differentiation. Setting aside a few exceptions,

they serve the same way in every outlet of theirs. Their service differentiation is “consistent

quality.” Whether you are in New York or Bangalore, the taste and presentation of food remain

the same. For instance, their french fries will have the same amount of salt, size and be served

fresh everywhere.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

4. Distribution Differentiation:

This is a strategy for companies to differentiate themselves from a group of competitors.

Companies can create a personal distribution channel and manufacture products to make them

available to dealers, distributors, and retailers using this strategy.

A company that focuses on distribution differentiation must concentrate on the supply chain as

well. This helps in maintaining standardized distribution channels to create a competitive

advantage.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

5. Relationship Differentiation:

Companies creating excellent customer relationships is the best way to

differentiate themselves from their competitors. Using a relationship

differentiation strategy, companies can build a good relationship with sales

representatives, employees, and technical representatives.

ADVERTISING AS A TOOL OF
MARKETING
 Brand Differentiation: Communicating the Difference

6. Image Differentiation:

Image differentiation is a combination of multiple differentiation strategies.

It simply means to innovate a reputed brand image. A company must master all

departments such as product quality, customer service, and product

performance to build a different and unique brand image.

ADVERTISING AS A TOOL OF
MARKETING
 Advertising effects: Economic and Social

Advertising is a potent and pervasive force that profoundly influences our society in

multiple ways. It serves as a means of communication, education, information, and

entertainment, yet it also carries adverse consequences.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Economy can be referred as elements which keep a nation in force. Factors such as

demand, supply, production, service, money, infrastructure, human resources, etc. come

under the term economy. Advertising is an industry which strongly affects many of

these factors to a material extent. Let's understand some of the factors getting affected

due to advertising.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Advertising enhance Product Value: Through continuous advertising, a product earns

a recognizable recall value in the market. This is because, people start remembering and

resonating the product when they continuously watch the advertisement. This builds the

value of the product in the market, enhancing its life. When a product attains value in

the market, it tends to survive long, thereby spearheading towards growth and

achieving other milestones.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Advertising enhance Profits: With regular advertising, a brand can expect a rise in

sales. This because advertising makes the product known and marketable. With more

sales, a company can aim for higher profits. At such phase, the company can also save

its cost due to high economies of scale and reap the benefits of having an effective cost

of production.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Advertising affects Product Price: Advertising is a cost which cannot be compromised.

A company has to spend well on in advertising campaigns based on several factors such
media, geographical reach, technology, etc. so as to penetrate most. This is surely going
to add up a lot of penny towards marketing and selling the product to the final consumer.
Hence, the advertiser is bound to recover this cost from the customers. So, advertising
shifts product prices to the higher side.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Product Life Cycle: Every product has to pass through several stages during its life
span. Since inception, primary focus is on survival and growth. This happens only
because of timely and appropriate advertising techniques followed by the organization.
With regular advertising, there can be stronger penetration in the market and more
conversions. This can take the brand to higher levels of product life cycle. However,
from another perspective, advertising can also help a falling brand from getting
withdrawn from the market after its decline.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Production and Distribution Cost: Advertising creates a favorable impact on

demand, which pushes production and hence, distribution. With high production, a
company can optimally utilize its fixed cost, thereby controlling the overall cost. On
the other hand, to cater high demands, the company may have to extend its supply. This
is where there will be a rise in distribution cost. But to note, this rise in distribution cost
compensates the increase in sales.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Consumer Demand: Demand is a desire backed by ability and willingness to pay.

With continuous advertising, short term as well as long term demand can be created .
This is because advertising facilitates mental and physical preparedness for audience,
encouraging them to buy the product either now or over a period of time.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Competition: Advertising is an effective tool for mitigating competition. Brands have

to advertise to present themselves to the audience. When many brands from a particular
sector advertise, it create strong competition. So as to compete in the market,
advertising at regular intervals becomes a necessity. A good example can be ads shown
by Nirma, Tide, Arial and Surf Excel. Each of these brands have to advertise to manage
competition form their rivals.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Market Expansion: Advertising helps a brand to not only survive but also grow.
Continuous advertising enables a brand to create and increase demand for itself, which
facilitates market expansion. With wide advertising, a brand can enter into more
geographical areas, thereby spreading its business circle and customer-ship.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Economic Growth: Advertising is a strategic industry providing opportunities and

upliftment to many. In simple words, its not only the advertiser who grabs the benefit
of advertising, but the society and other supporting enterprises as well. Many job and
business opportunities emerge through advertising, which directly and indirectly boosts
an economy.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Standard of Living: Advertising makes viewers aware about the various offerings
made in the market by various brands. This enables an easy and smooth purchase for
the buyers and facilitates a better standard of living. This involves mainly luxury /
premium goods. For example, advertising by Sabhasachi on television channels mainly
delivering entertainment programmes has penetrated the idea of fashion and luxury
clothing for wedding and other auspicious occasions, thereby sparkling the standard of
living index of many individuals.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Brand Image: Brand image is a very important performance indicator for any brand.
With a favorable brand image, a company can derive more sales and consumer trust.
This brand image enhances with appropriate and timely advertising. In fact, advertising
like advocacy advertising also enables a brand to mitigate crisis, if any. A classic
example is of the brand Nike which gained momentum in the early 1990s through their
"Just Do It" campaign. Nike made a dramatic route in the US market by focusing more
on the endorser than the product itself.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the economy

Consumer Choice: Advertising facilitates consumer choice. Consumers can see a

variety of options available to them in the market and can take decision upon buying.
Advertising by several brands do create a problem of choice for the consumers, but it
also extends understanding alternatives and choosing the best product as per consumer
wish.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Advertising is a powerful tool not only for communication but also for persuading

the right person to take an action. With an ocean of media, advertising gets

scattered and delivered in various eyes in various forms. During this process,

several factors existing in a society are considered, which in turn affects consumer

behavior.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Information: Advertising throws light in the dark. When a product or a service is

advertised, it is actually a transmission of information from the seller to the potential

buyer. But one need to remember that not every information is a solution. A society

marks progress when right information is delivered, which intend people to stay aware

and beware.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Solution: Advertising of certain products stands as a solution for many. Not every
products and service is developed with an intent to provide solution for an ultimate
buyer. There are products which may be harmful or inappropriate for viewers. But
when a problem is resonated to a product, it automatically becomes a solution. For
example, soaps do not add beauty, they only clean dirt from the body and adds a
temporary fragrance. When a soap is advertised as a product adding glow and beauty to
a person's face, it may become inappropriate for the user. The user may buy with an
intent of getting beauty on face.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Creation of realistic / unrealistic desire: Advertisements create desire in the viewer's

minds. Such desires can either be true or even an unnecessary one. Realistic desires
lead to a genuine purchase. But unnecessary desires lead to flop purchase, which may
seem to be exploitative.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Altering Consumer Behavior and Attitude: Advertisements have the power to alter
people's mind and actions. A good advertisement can surely stuff in positive vibes and
thoughts with depiction of message in the most moral way. But ads using inappropriate
mediums and messages tend to exploit and manipulate people's mind which can create
terrible consequences in the internal and external surrounding. For example, ads
showing violence has a tendency to promote violence which can either encourage
people to commit violence. Such ads may also trigger people emotionally and mentally.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Advertising Promotes Materialism: Materialism is a belief that certain consumer

goods and services provide the greatest source of satisfaction in life. Advertising helps
a product to be placed in such a way that it can promote status symbol, success,
achievement, power, etc. which can encourage its demand and consumption. But the
same can be harmful to the society as materialism tends to ruin people's relationships,
increase anxiety and depression levels and can also create a less satisfactory feel upon
using a particular product compared to other.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Advertising promotes consumption of unhealthy / questionable products: At times,

a product may not be suitable or appropriate for a person. Precisely, it may be beyond a
person's affordability or may not be useful or may be harmful or may even confuse
buying decision. An advertisement can also affect a person's thought process and may
tend tend to influence personal characteristics like selfishness, manipulative, over
spending, stereotyping, hatred to a particular person / place / animal / thing, etc.

ADVERTISING AS A TOOL OF
MARKETING
 Impact of advertising on the Society

Advertising is deceptive (misleading) and manipulative: At times, certain

competitive products can be promoted in an inappropriate way that can adversely
impact the thought process of the viewers. Some ads tend to create confusion among
the viewers with tall claims or false comparison or unlimited benefits subject to
condition (which is of course, never displayed). Such ads mainly aim for instant sales
compromising the real needs of the consumers.

ADVERTISING AS A TOOL OF
MARKETING