ADV3000

ADV3000

TEST 1

JUNE 7, 2007

THE ADVERTISING WORLD

The marketing concept

A business philosophy where the organization determines the needs of the target markets and satisfies those needs at a profit

Marketing Mix

i. Product- The bundle of positive attributes the consumer receives in a transaction

ii. Price-what the consumer must give up in order to receive the product

iii. Place- all issues related to the system of distribution

iv. Promotion- all methods used to inform and persuade the target market about products that are available at some price and in some place

4 Ps

Decisions about product, price and place must precede those pertaining to promotion (however, remember that everything starts with research)

Resource allocation across the elements must achieve a balance between product development and promotions.

Promotions Mix

A model of communications alternatives

1. Mass vs. personal communication.

i. Mass communication consists of advertising and publicity

ii. Personal communication consists of sales and word of mouth

2. Paid s. free communication

i. Paid communication (advertisement) provides control—because you pay you can control the message, delivery of the message, what is being said and where is it said

ii. Free communication (publicity) provides credibility—because it is somebody else communicating your message, you cannot control the delivery, nor what is being said and where is it is said.

Different companies use differing levels of each part of mix. Some companies focus more on mass communication putting different emphasis on advertising and publicity while some other focus more on personal communication putting different emphasis on sales and word of mouth.

Advertising is a form of paid mass media communication. It is any paid form of mass nonpersonal (not face to face) presentation of ideas, goods or services by an identified sponsor.

Advantage of paid advertising is control of:

Message: what is being said about the product or service

Delivery of message: how it is being delivered.

Timing of delivery of the message: because you pay, you can decide when the advertising is aired or published.

Low cost to reach each person: even though advertising itself seems expensive, the cost to reach each person is low because of its ability to reach a great amount of people at once which minimizes its relative cost.

Disadvantages are:

High absolute cost

—advertising is inexpensive as to reach each person yet it is still expensive because its cost reaches millions of dollars.

Low credibility

—because it is a paid form of communication, it is not as credible as unpaid form. It is hard to believe in something that is fully controlled by those who pay for it.

—people don’t trust it. Consumer knows it is just one side of the story, a cynical look.

To avoid or minimize the disadvantages you need to build credibility in advertising.

Public Relations—public relations is a mediator between the publics and the management.

Publicity—media time and space (print media) that the organization that are in direc communication with potential consumers. It is a lot more credible that advertising because it is a part of a story and it is not paid for. It is delivered by some source of authority (local news paper, news). 9 out of 10 it is positive

Personal Selling—sales personnel representing the organization that are in direct communication with potential consumers, paid personnel, high tech personnel becomes more important etc. This increase the cost of reaching one person

Word of mouth—opinions about the products from people you respect. It is a free face to face contact (friends, family, and co-workers). It plays the biggest role with products subjective in nature like restaurants, movies, hair stylist.

Decision Sequence Model—a process used in advertising as a way to guide the creative process toward sound strategy and execution.

Components:

Situation analysis—facts finding stage

It is research based analysis of all the internal and external factors that affect the organization. In advertising as in public relations most actions should start with careful research.

Consumer—it is important to know who the consumer is and what consumers the company needs to target. It is impossible to target all potential consumers with the same message.

Product category—it is important to know what category a product fall into in order to be able to create a message.

Company—what are the needs of the company and how it wants to be perceived.

Macro-environment—things that affect company in a large picture for example economics.



	ADV3000 ADV3000 TEST 1 JUNE 7, 2007 THE ADVERTISING WORLD The marketing concept A business philosophy where the organization determines the needs of the target markets and satisfies those needs at a profit Marketing Mix i. Product- The bundle of positive attributes the consumer receives in a transaction ii. Price-what the consumer must give up in order to receive the product iii. Place- all issues related to the system of distribution iv. Promotion- all methods used to inform and persuade the target market about products that are available at some price and in some place 4 Ps Decisions about product, price and place must precede those pertaining to promotion (however, remember that everything starts with research) Resource allocation across the elements must achieve a balance between product development and promotions. Promotions Mix A model of communications alternatives 1. Mass vs. personal communication. i. Mass communication consists of advertising and publicity ii. Personal communication consists of sales and word of mouth 2. Paid s. free communication i. Paid communication (advertisement) provides control—because you pay you can control the message, delivery of the message, what is being said and where is it said ii. Free communication (publicity) provides credibility—because it is somebody else communicating your message, you cannot control the delivery, nor what is being said and where is it is said. Different companies use differing levels of each part of mix. Some companies focus more on mass communication putting different emphasis on advertising and publicity while some other focus more on personal communication putting different emphasis on sales and word of mouth. Advertising is a form of paid mass media communication. It is any paid form of mass nonpersonal (not face to face) presentation of ideas, goods or services by an identified sponsor. Advantage of paid advertising is control of: Message: what is being said about the product or service Delivery of message: how it is being delivered. Timing of delivery of the message: because you pay, you can decide when the advertising is aired or published. Low cost to reach each person: even though advertising itself seems expensive, the cost to reach each person is low because of its ability to reach a great amount of people at once which minimizes its relative cost. Disadvantages are: High absolute cost —advertising is inexpensive as to reach each person yet it is still expensive because its cost reaches millions of dollars. Low credibility —because it is a paid form of communication, it is not as credible as unpaid form. It is hard to believe in something that is fully controlled by those who pay for it. —people don’t trust it. Consumer knows it is just one side of the story, a cynical look. To avoid or minimize the disadvantages you need to build credibility in advertising. Public Relations—public relations is a mediator between the publics and the management. Publicity—media time and space (print media) that the organization that are in direc communication with potential consumers. It is a lot more credible that advertising because it is a part of a story and it is not paid for. It is delivered by some source of authority (local news paper, news). 9 out of 10 it is positive Personal Selling—sales personnel representing the organization that are in direct communication with potential consumers, paid personnel, high tech personnel becomes more important etc. This increase the cost of reaching one person Word of mouth—opinions about the products from people you respect. It is a free face to face contact (friends, family, and co-workers). It plays the biggest role with products subjective in nature like restaurants, movies, hair stylist. Decision Sequence Model—a process used in advertising as a way to guide the creative process toward sound strategy and execution. Components: Situation analysis—facts finding stage It is research based analysis of all the internal and external factors that affect the organization. In advertising as in public relations most actions should start with careful research. Consumer—it is important to know who the consumer is and what consumers the company needs to target. It is impossible to target all potential consumers with the same message. Product category—it is important to know what category a product fall into in order to be able to create a message. Company—what are the needs of the company and how it wants to be perceived. Macro-environment—things that affect company in a large picture for example economics.