Appropriation & ad agency by manish badhiye

Advertising Appropriation

Various Budgeting Methods

Several Factors influence the relationship between expenditure on promotions and sales including:

Assumpions

The goal of the promotion

Hierarchy of effects approach- Awareness, knowledge, linking, preferences, conviction , actual purchase

Threshold effect -early effect of ad are minimal Carryover effect -pdts purchased when needed Wear out effect – at a certain pt a pdt simply becomes old

/boaring. Creating promotion to add excitement are, at that pt. , difficult. The company must spend a great deal of time trying to rejuvenate the brand in some way.

Decay effect- when company stops adverting, consumers begin to forgot about company.

Random events

Setting the Total Promotion Budget The marketer must decide how much to

spend on promotion. According to the type of industry, the promotion spendings vary. E.g. 20-30%of the sales in cosmetics, 2-3%in industrial machinery.

There are basically four methods to set the total budget for advertising; affordable method percentage-of-sales method competitive-parity method objective-and-task method

Affordable Method

Setting the promotion budget at the level that management thinks the company can afford.

Small companies project their total revenues, deduct their operating expenses and capital outlays, and then devote some of the remaining funds to advertising.

This method places advertising last among expenses, therefore, ignores the effects of promotion on sales.

This method may result in either over or under spending for advertising.

Percentage-of-Sales Method

Setting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the sales price.

The advantage of this method is that it helps management think about the relationships between promotion spending, selling price, and profit per unit.

Percentage-of-Sales Method

The disadvantages are;

(1)it wrongly views sales as the cause of promotion rather than as the result,

(2) it may prevent increase in promotional spending, when the sales are falling,

(3) it does not provide any basis for choosing a specific percentage, except last year’s and competitors percentages.

Competitive-Parity Method

Setting the promotion budget to match competitor’s outlays. The company monitors competitor’s advertising or industry averages.

The disadvantages of this method are; (1) each company has its own promotional needs, therefore, the competitors’ spending may be misleading, (2) there is no guarantee that this method will prevent promotion wars.

The concept to remember is that it is not how much is spent , but rather how well the money is allocated and how effectively the marketing compaign works at retaining customers and mkt share.

Objective-and-Task Method

Setting promotion budgets based on what the company wants to accomplish with promotion.

This is the most logical budget setting where the company (1) defines specific promotion objectives, (2) determines the tasks needed to achieve these objectives, (3) estimates the total costs of performing these tasks.

The budget will be cumulative sum of the estimated cost for all objectives.

Objective-and-Task Method

This is the most difficult method to use because it is hard to understand which tasks will achieve specific objectives. E.g. if Sony wants to create 95% awareness for its new camera within 6 months, it is difficult to decide what messages and promotions to use and how much to spend.

Quantitative Model- are limited to larger organizations with strong computer and

statistical dept

Advertising Agency

Lux Soap ad featuring Leela Chitnis 1941

First and oldest ad agency in India was B. Dattaram & Co. (1905)

Sista (1934) was the first full service Indian Agency

Pears ad from the 60’s

Advertising Agencies

Provides services of highly skilled individuals Can provide an objective viewpoint of the mkt and its business. “Advertising agency is an independent business, composed of

creative and business people who develop, prepare & place advertising in advertising media for sellers seeking to find customers for their goods or services.”

Volney B. Palmer (1840) is the first known person who worked on a commission basis to sell space in newspapers.

In 1917, newspaper publisher set 15 % as standard agency commision

During the 1980s, there was a wave of acquisition & merger of ad agencies and support org. to form super-agencies.

“Medison Avenue”

Become a symbol of advertising to the world

Advertising Agency

Some important players in the system are Clients or Advertiser- one who want to communicate Advertising Agency-

independent org. that provide one or more specialized adv .& promotion related services to assists companies in developing , preparing & executing their adv. & other promotion programs

Media organizations- Marketing communication specialist organizations And Provider of collateral services

Direct Response agencies, sales promotion agencies, package design specialist, mkting Research providers

Vidio production house, printers , photographers

Participants in the IMC Process

Marketing Communications Specialist Organization

Marketing Communications Specialist Organization

Media OrganizationsMedia Organizations

Advertiser (Client)Advertiser (Client)

Advertising AgencyAdvertising Agency

Collateral ServicesCollateral Services

Direct Response Agencies

Direct Response Agencies

Sales Promotion Agencies

Sales Promotion Agencies

Interactive AgenciesInteractive Agencies

Public Relations Firms

Public Relations Firms

Kinds of Agencies

Large agencies concentrated in relatively few pdts Small agencies Agency network

Types of Ad agencies Full Service Agencies

Specialty Agencies- ind-medical , real estate,

education, financial

Work for a function such as-

internet, Public Relation, marketing research

In house agencies

Creative Boutiques

Media Buying Agencies

Structure & Organization

What Agencies do? And how they are organized to do it?

primary services:

complete a marketing analysis develop an advertising plan prepare a creative strategy create advertising executions develop and implement a media plan handle billing and payments integrate other marketing communications

Full service agency

planning ,creating, producing, selecting media

Creating advertising


Planning advertising


Producing advertising


Performing research

Performing research

Selecting mediaSelecting media

Sales promotion and trainingSales promotion and training

Strategic market planningStrategic market planning

Trade show materials


Package designPackage design







Performing research

Performing research







Full-Services Agencies

Full Range of Marketing Communication and Promotion Services


Non-Advertising ServicesNon-Advertising Services

Public relations and publicityPublic relations and publicity

functions of full-service agenciesfunctions of full-service agencies

account managementaccount management creativecreative media planning and placementmedia planning and placement researchresearch

liaison between agency and client

responsible for understanding... the client’s business the client’s marketing needs strategy development

representing client point of view within the agency

account management

account management director management supervisor account supervisors account executives assistant account execs account coordinators traffic

account management

responsibility

the creative department is responsible for the creative department is responsible for creating and producing the print and broadcast creating and producing the print and broadcast advertisingadvertising

strategy is keystrategy is key good creative work good creative work is always guided by ais always guided by a

creative strategy creative strategy that sets forththat sets forth goals to be goals to be accomplishedaccomplished and and key message points key message points to be to be relayedrelayed

the creative department is responsible for the creative department is responsible for creating and producing the print and broadcast creating and producing the print and broadcast advertisingadvertising

strategy is keystrategy is key good creative work good creative work is always guided by ais always guided by a

creative strategy creative strategy that sets forththat sets forth goals to be goals to be accomplishedaccomplished and and key message points key message points to be to be relayedrelayed

creative department

media department

The media department has two main functions - planning and buying.

The planning group handles more The planning group handles more strategic marketing and media issues. strategic marketing and media issues.

The buying group handles media The buying group handles media negotiations and implementation.negotiations and implementation.

The planning group handles more The planning group handles more strategic marketing and media issues. strategic marketing and media issues.

The buying group handles media The buying group handles media negotiations and implementation.negotiations and implementation.

Services Provided by Agencies

Agency ServicesAgency Services

The link between agency and client

Managed by the Account Executive



Research department may design and execute research programs

Media department may analyze, select and contract media resources



Creation and execution of ads

Copywriters, artists, other specialists



Marketing ServicesMarketing ServicesAccount ServiceAccount Service Creative

ServicesCreative Services

Marketing ServicesMarketing ServicesAccount ServiceAccount Service

ArtistsArtists

Ad Agencies Have Skilled Specialists

WritersWriters ResearchersResearchers

PhotographersPhotographers Media AnalystsMedia Analysts Other SkillsOther Skills

MoreControl

MoreControl

CostSavings

CostSavings

BetterCoordination

BetterCoordination

LessObjectivity

LessObjectivity

LessExperience

LessExperience

LessObjectivity

LessObjectivity

LessExperience

LessExperience

BetterCoordination

BetterCoordination

MoreControl

MoreControl

CostSavings

CostSavings

Pros & Cons of In-House Agencies

TheIn-houseAgency

TheIn-houseAgency

+ Positive+ Positive - Negative- Negative

LessFlexibility

LessFlexibility

The Role of Creative Boutiques

CreativeBoutiquesCreativeBoutiques Provide Only Creative ServicesProvide Only Creative Services

Full-Service Agencies May Subcontract With Creative Boutiques


Provide Only Creative ServicesProvide Only Creative Services



Other Functions Provided by the Internal Client Departments

Other Functions Provided by the Internal Client Departments

Specialize in Buying Media, Especially Broadcast Time


Agencies and Clients Develop Media Strategy

Agencies and Clients Develop Media StrategyAgencies and Clients Develop Media Strategy

Agencies and Clients Develop Media Strategy



Media Buying Can Be Specialized

Media Buying Services Media Buying Services

Media Buying Organizations Implement the Strategy and Buy Time and Space

Media Buying Organizations Implement the Strategy and Buy Time and Space

DirectMailDirectMail

Data BaseManagementData BaseManagement

ResearchResearch

CreativeCreative

Media ServicesMedia Services

CreativeCreative

Media ServicesMedia Services

ResearchResearch

DirectMailDirectMail

Data BaseManagementData BaseManagement

Direct Response Agency Activities

DirectResponseAgencies

DirectResponseAgencies

ProductionProduction

Great Advertising is:

Relevant Provocative Credible Consistent Memorable

General Characteristics of Major Media Types

Media Advantages Disadvantages

Television Offers mass coverage.High level of reach. Combined impact of sight, sound, and motion. Prestige value. Low cost per exposure.Attracts attention.

Offers low selectivity.Short span of message life.High cost.High production costs.Creates advertising clutter.Waste coverage.

Radio Local coverage.Lower cost.High frequency.Focused segment selection.Low production costs.

Only audio.Noise.Low on attention getting.Message short lived.

Newspapers Mass coverage. Low cost, large space. Short lead time for ad placing. Ad position choice possible. Good for current ads. Reader controls exposure.Coupons can be inserted.

Short life of advertisement.Clutter.Low attention getting.Poor production quality.Selective exposure.

Cont…


Magazines Potential for focused segmentation.

Very good production quality.

Longevity of message.

High information content.

More readers per copy.

Long lead time for ad placing.

Only visual.

Low frequency.

Lack of flexibility.

Outdoor Good for specific location.

High repetition.

High visibility.

Short exposure time.

Short message.

Poor image.

Direct mail High level of selectivity.

Reader controls exposure.


Opportunity for repeat exposures

High cost per contact Clutter.

Often thrown as junk mail.

Internet User controlled.

Increased attention and involvement.

Limited creative capabilities.

Organization chart







Performing research

Performing research













Performing research

Performing research







Full-Services Agencies



Non-Advertising ServicesNon-Advertising Services

Public relations and publicityPublic relations and publicity

Full Service Agency Organization Chart

Board of Directors

President

Vice-precedents,Creative Services




DirectorsMediaWriters

Artdirectors Print

Production

TVproduction

Accountsupervision

Account executive

Research SalesPromotion

Officemanagement

Finance

Personal

Services Provided by Agencies

Agency ServicesAgency Services













Marketing ServicesMarketing ServicesAccount ServiceAccount Service Creative

ServicesCreative Services

Marketing ServicesMarketing ServicesAccount ServiceAccount Service

Used in 30% of ads. Excellent in capturing attention. Score high in recall tests. Should be related directly to customer

benefit.

Humor Appeal

6-45

Message Appeal Options

FearAppealsFearAppeals

• May stress physical danger or threats to health

• May identify social threats

• Can backfire if level of threat is too high

• May stress physical danger or threats to health

• May identify social threats

• Can backfire if level of threat is too high

ComparativeAdsComparativeAds

• Especially useful for new brands

• Often used for brands with small market share

• Used often in political advertising

• Especially useful for new brands

• Often used for brands with small market share

• Used often in political advertising

HumorAppealsHumorAppeals

• Can attract and hold attention

• Often the best remembered

• Put consumers in a positive mood

• Can attract and hold attention

• Often the best remembered

• Put consumers in a positive mood

Humor Appeals

The Role of Humor in Advertising

Attract attention Enhances liking of ad and brand Does not hurt comprehension Does not harm persuasion Does not enhance source credibility Nature of product affects the appropriateness

of using humor

The Role of Humor in Advertising

Effective only when consumers’ evaluations of advertised brand are already positive

Effect of humor can differ due to differences in audience characteristics

Humorous message may be so distracting that receivers ignore the message contenttent

Humor Appeals

Does not aid persuasion in generalDoes not aid persuasion in general

ConsCons

May harm recall and comprehensionMay harm recall and comprehension

May harm complex copy registrationMay harm complex copy registration

Does not aid source credibilityDoes not aid source credibility

Is not effective in bringing about salesIs not effective in bringing about sales

May wear out faster than non-humorous adsMay wear out faster than non-humorous ads

Aids attention and awarenessAids attention and awareness

ProsPros

May aid retention of the messageMay aid retention of the message

Creates a positive mood and enhances persuasionCreates a positive mood and enhances persuasion

May aid name and simple copy registrationMay aid name and simple copy registration

May serve as a distracter, reducing counter arguingMay serve as a distracter, reducing counter arguing

Humor in advertising

A lot of people simply don't have a sense of humor. You lose them immediately, and the potential size of your market shrinks.

It is commonly misinterpreted. Many people will not get the joke.

And humor often insults someone. They may simply get angry because they don't get the joke. This is fire we are playing with. Your market size just shrunk again.

Advertising is about getting attention. The best ways to get attention with advertising are with strong visuals, powerful headlines, and humor.

First, people like funny things It puts them in a good mood, and it creates a more comfortable atmosphere and a more positive image for your company

Advertising humor works best with established and commonly purchased products.

But corporate image and industrial advertising are serious business. Unknown, risky, expensive, or sensitive products are not normally suited to the lighter touch of advertising humor.

Advertising humor also needs to be well suited to its audience. If your customers don’t get the joke, then the joke will be on you.

Advertising humor also needs to be product specific. We have all seen funny ads we liked so much that we forgot what was being sold.

And advertising humor has a relatively short life. The first time we see it we may laugh out loud. But after a while, although we still may smile at the joke, it’s not so funny any more. Funny ads need to be replaced periodically

Will advertising humor work in your ads? Absolutely – if you can make it appropriate to your products and customers, if they understand it, if it is related to your business or message, and if you change your ads frequently enough so that they don’t wear out.

1. Comparison - Putting two or more elements together to produce a humorous situation.

2. Personification - Attributes human characteristics to animals, plants and objects.

idea, Rin3. Exaggeration - Overstating and magnifying something out of

proportion.fevicol ,4. Pun - Using elements of language to create new meanings,

which result in humor. Curcure5. Sarcasm - According to Reick, sarcastic comments or situations

are classified as silliness.cloromint

Comparison

6. Silliness - silliness ranges from making funny faces to ludicrous situations

7. Surprise - Includes all advertisements where humor arises from unexpected situations. The advertisement Surprise - Includes all advertisements where humor arises from unexpected situations.

Dish wash bars ,Ambuja Cement

Humor Appeals

Does not aid persuasion in generalDoes not aid persuasion in general

ConsCons

May harm recall and comprehensionMay harm recall and comprehension

May harm complex copy registrationMay harm complex copy registration

Does not aid source credibilityDoes not aid source credibility

Is not effective in bringing about salesIs not effective in bringing about sales

May wear out faster than non-humorous adsMay wear out faster than non-humorous ads

Aids attention and awarenessAids attention and awareness

ProsPros

May aid retention of the messageMay aid retention of the message

Creates a positive mood and enhances persuasionCreates a positive mood and enhances persuasion

May aid name and simple copy registrationMay aid name and simple copy registration

May serve as a distracter, reducing counterarguingMay serve as a distracter, reducing counterarguing

Advertising Copy (IMP)

Copy refers to written material which is to be set in type for the print media or spoken by announcers for broadcast commercials.

Includes all the elements of an advertising message whether printed or broadcast.

Print media – heading, subheads, pictures captions slogans and body copy even trade mark company logo

Radio commercials – sound effects and music in addition to the words spoken in the ad message

T V commercials – includes the words to be spoken by the character in the script, plus music and sound effect, actions

Visualization & layout Visualization – is concerned with the creation of an

idea which will appeal to the consumer or the target audience.

Layout – deals with the arrangement of various elements in the ads

Elements of ad copy

Headline – if the headline idea fails to attract the prospect to the message & the pdt , the remaining part of the ad are wasted

Questions Statement from celebrities Warning and appeals

Subheads-expands or amplify the headline idea Body copy -stimulates linking and preference for a

pdt

, Explains, logically and rationally, pdt attributes, features & pdt values & give convincing argument in favor of claim about the superiority of the advertised pdts

Fact& figures about pdts, test result,gurentees of satisfactory performance

Emotional / rational appeals

Closing idea

call to action

Buy now

Visit today our stockiest

Festival discount

Not literally copy Style of copy

Account Brief (Short note)

The is a document that outlines the information and objectives to inspire the creative idea. Creative briefs may take different forms and include a variety of elements, including describing what the advertising is trying to achieve, identifying the main idea to be communicated, and outlining the target audience for that idea.

Proposing the Big Idea requires client agreement that the idea is right. Thus, both the advertising agency and the client must agree upon the final brief. The best briefs are written by account planners collaboratively with input from the client, account team, and creative director. One of the key functions of the SS+K brief is to come up with a single essential thought that summarizes the idea that will convince consumers to do what it is that the communication aims to do. Every agency has a proprietary brief template it uses to spell out the types of content it will need to include, such as specifying the audience, the product features, media placement ideas, and key point.

The Five M’s of Advertising Model

In developing an advertisement program, marketing managers must always start by identifying the target market and buyer motives. They can make that with five major decisions which you can see in the model.

The Five M’s of Advertising Model

Mission Money

Media

Message

Measurement

The Five Ms of Advertising

Mission

Objectives can be classified by aim: Inform Persuade Remind Reinforce

Developing and Managing the Advertising Campaign

Factors considered when budget-setting: Stage of product life

cycle Market share and

consumer base Competition and clutter Advertising frequency


Mission Money

Factors considered when choosing the advertising message: Message generation Message evaluation

and selection Message execution Social responsibility

review


Mission Money Message

Developing media strategy involves: Deciding on reach,

frequency, and impact Selecting media and

vehicles Determining media

timing Deciding on

geographical media allocation


Mission Money Message Media

Evaluating advertising effectiveness Communication-

effect research Sales-effect

research


Mission Money Message Media Measurement

Unit 5 Evaluation Monitoring & Control


Media Advantages Disadvantages

Television Offers mass coverage.High level of reach. Combined impact of sight, sound, and motion. Prestige value. Low cost per exposure.Attracts attention.

Offers low selectivity.Short span of message life.High cost.High production costs.Creates advertising clutter.Waste coverage.

Radio Local coverage.Lower cost.High frequency.Focused segment selection.Low production costs.

Only audio.Noise.Low on attention getting.Message short lived.

Newspapers Mass coverage. Low cost, large space. Short lead time for ad placing. Ad position choice possible. Good for current ads. Reader controls exposure.Coupons can be inserted.

Short life of advertisement.Clutter.Low attention getting.Poor production quality.Selective exposure.

Cont…


Magazines Potential for focused segmentation.

Very good production quality.

Longevity of message.


More readers per copy.

Long lead time for ad placing.

Only visual.

Low frequency.

Lack of flexibility.

Outdoor Good for specific location.

High repetition.

High visibility.

Short exposure time.

Short message.

Poor image.

Direct mail High level of selectivity.

Reader controls exposure.


Opportunity for repeat exposures

High cost per contact Clutter.

Often thrown as junk mail.

Internet User controlled.

Increased attention and involvement.

Limited creative capabilities.

MEASURINGADVERTISING

EFFECTIVENESS

RatingServices

Sales andExpense Analysis

TestMarketing

ControlledTests

RecallTests

Pre-testing and post-testing:

Used to help in judging the effectiveness of the advertising strategy or medium

Pre-testing is used to increase likelihood of creating the most effective advertising messages. This helps in spotting any communication gaps or flaws in the ad message content before it is used

Post testing is important to evaluate the success or otherwise of an individual ad or the whole campaign after it has run.

Evaluation of Advertising Effectiveness

Advertising agencies usually pretest ads or commercials and also conduct post-

testing. Some major pre-testing and post-testing methods are mentioned briefly.

Pre-Testing Methods

Print Advertising

Direct Questioning

Focus Group

Portfolio Test

Order-of-Merit Test

Cont…

Methods for Pre-testing:

Print Advertising

Direct Questioning:

The researcher using this method asks respondents specific questions about the ads such as What does the ad say to you? Does the ad tell you something new and different about the product, service or the company? Do you believe what this ad says to you? What is your perception of the product or service this ad tells you about? Do you like the advertisement ?

Focus group:

A group of 8 to 10 people who are potential users of the product or service, participate in a moderated but freewheeling discussion and interview. Lasts for about one hour and supervised by a trained moderator who provides direction and control.

Portfolio test: One group of respondents is exposed to a portfolio of test ads interspersed with other ads. Another group sees the portfolio without the test ads Paired comparison test: Respondents compare each ad in a group

Order of merit test: Respondents see two or more alternative ads and arrange them in rank order

Mock Magazine tests: Ads to be tested are “stripped into” into a magazine which is left with respondents for a specified time.

Direct Mail Test: Two or more ads are mailed to different potential customers on a mailing list to test which ad attracts more orders.

Pre-Testing Methods

Television and Radio Advertising

Central Location Test

Clutter Test

Trailer Test

Pre-testing for television and radio:

Central Location test: Respondents see TV test commercials in a central location such as shopping centre

Clutter tests: Test commercials along with non competing commercials are shown to respondents

Trailer Tests: respondents see to commercials at trailers at shopping centers and receive coupons for the advertised products

Live telecast Tests: Test commercials are shown on closed circuit or cable TV and subsequently respondents are interviewed by telephone.

Post-Testing Methods

Recall

Recognition

Inquiry

Post –testing methods:

Recall Unaided Recall: respondents are asked without prompt whether they read saw or heard ad messages

Aided recall: Respondents are shown certain ads with the name of the sponsor or brand concealed and then asked if their previous exposure was through reading, viewing or listening

Recognition:

refers to whether a respondent cam recognize an advertisement as having seen before. Such tests are conducted by mail survey in which questionnaires are mailed to 1000 households picked from a mailing list or telephone book. Provides mechanism for breaking a print ad into important elements such as headline, visual, copy and how these are remembered by by a sample of respondents.

Inquiry:

refers to checking the effectiveness of ads appearing in various print media on the basis of which consumers respond by requesting for more information. The inquiry may depend on phone calls from interested persons, coupons returned or requests for free samples Researchers can test advertisements’ attention getting value, readability, comprehension

Day- after- recall –

most popular method of post-testing in broadcast media. Measure of effectiveness is always the number of people who can recall the ad. Respondents may be asked simple question as “While watching programme A last knight, did you see a commercial for (brand name) ?”

Date post:	04-Aug-2015
Category:	Marketing
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