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ADVERTISINGDon’t park under this ad!
LET’S THINK…Why do businesses advertise?
What are brand name products?What are the benefits and costs of brands for consumers?
How can informative advertising help you make a good decision?
A FEW MORE QUESTIONS…
Who pays for advertising?
How does advertising benefit the consumer?
Magazines
Commercials
Movie Preview
Product Placement
Billboards
Freebies
Bumper Stickers
Sporting Fields
Internet
Events
Stores
WHERE DO WE SEE ADVERTISING?
THE AVERAGE
AMERICAN IS
EXPOSED TO 3,000 ADS
EACH DAY!
WHO DOES ADVERTISING TARGET? Age
Race
Gender
Profession
Others:
BRAND ADVERTISINGIf you remember their name, you’ll buy their products
Slogans, Jingles, logos Lets take a look at some classics…..Classic Slogans and Jingles
Now let’s test you slogan knowledge!
BRAND ADVERTISING
BenefitsLoyaltyTime
CostsIncrease price of product
INFORMATIVE ADVERTISINGInforms you about a products features and benefits.
Complex items or technical products Appeals to your need for intellectual information
Infomercials!!!
INFORMATIVE ADVERTISING
Cadillac Commercial
Mac vs. PC
Mazda Protégé 5
COMPARATIVE ADVERTISINGComparing Products to competitors! Shows competitors weaknesses and showcases the best qualities of the brand being advertised
EX: Tooth Whitening, paste vs. strips
COMPARATIVE ADVERTISING
4 out of 5 Dentists Agree (old school!)
Teeth Whitening
Charmin Toilet Paper
PERSUASIVE ADVERTISINGAppeals to your emotions to buy
Doesn’t provide much useful information Owning this product will make you…Happier More successful More satisfied
Ignore these, evaluate reality
PERSUASIVE ADVERTISING
Tide to go
Cadillac (Kate Walsh)
MORE ON ADVERTISINGHow much was a 30-second spot during
last year’s Super Bowl? $2.6 Million
Businesses spend $200 billion a year in advertising.
In 2005…Pepsico spent $1.8 BILLION on advertising!Coke spent $2.1 BILLION!
CONSUMER PROBLEMS WITH ADSFTC defines Deception as a material “representation, omission, or practice that is likely to mislead a (reasonable) consumer…to the consumer’s detriment
Fraud is a deliberate deception that, with full knowledge of the perpetrator, misleads or gains an unfair advantage and results in financial loss to the consumer
DECEPTIVE PRACTICE
Deceptive advertisingDeliberately misleads consumers
PUFFERY
Using claims or descriptions to exaggerate (“puff up”) a product’s reputation or appeal“New”“Unique”“Extra-strength”“Super-strength”
FACTUALLY WRONG – penalties but hard to prosecute vague but difficult to prove
SALES PRICESSALES PRICES
Implies a bargainLower prices than customary
Before it can go on sale a retailer must sell the item regularly at the nonsale price
COMPETITIVE PRICINGRetailer cannot legally say that its prices are lower than a competitor’s without actual proof
Only imply lower pricesDo not provide proof
TRADING UPPractice of convincing customers to buy
a higher-priced item than they originally intended
i.e., VCR - $300 and sales person shows you a $500 VCR
More features – Do you need these features?
Nothing illegal about this practiceGenerally the retailer makes a bigger profit on more expensive items
Be prepared to say NO!!!
DECEPTIVE PRACTICEExamplesCompanies may advertise sales at 50% off. However, the company first marks the product way up and then marks them down 50% so that they still make a profit.
LOSS LEADERThe item priced below cost to attract you to the store
Retailer will lose money if you only buy that item, but it gets you to the store in hopes of purchasing other items
FTC (FEDERAL TRADE COMMISSION)Most important federal consumer protection agency
Responsible for protecting consumers from unfair or deceptive business practices, such as misleading information in advertising or product labels.
FINAL THOUGHTS
Each advertisement should…Target a specific groupThis is your TARGET MARKET
Fit into ONE type of adInformative, comparison, persuasive
MORE ADVERT
ISEMENTS
!
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