DISTANCE LEARNING CENTRE

AHMADU BELLO UNIVERSITY

ZARIA-NIGERIA.

COURSE MATERIAL

FOR

BUAD 833: ADVERTISING MANAGEMENT

MASTER IN BUSINESS ADMINISTRATION (MBA)

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 COPYRIGHT PAGE

© 2018 Distance Learning Centre, ABU Zaria, Nigeria

All rights reserved. No part of this publication may be reproduced in any form or by any
means, electronic, mechanical, photocopying, recording or otherwise without the prior
permission of the Director, Distance Learning Centre, Ahmadu Bello University, Zaria,
Nigeria.

First published 2018 in Nigeria

ISBN:

Published and printed in Nigeria by:

Ahmadu Bello University Press Ltd.
Ahmadu Bello University,
Zaria, Nigeria.

Tel: +234

E-mail:

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COURSE WRITERS/DEVELOPMENT TEAM
Chat Lot Kogi (Subject Matter Expert)
Prof. Abiola Awosika (Subject Matter Reviewers)
Halima Shuaibu
Obisesan Ayoow Emmanuel (Language Reviewer)
Nasiru Tanko Graphics
Ibrahim Otukoya
Prof. Adamu Z. Hassan (Editor)

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 Quote

“Before you look at advertising, review the strategy…. Your consumer benefit or promise,
and the support for that promise… the results of your advertising depends less on how
your product or service is positioned –how you want the consumer to think about it…..
just as in war, the strategy is half the battle, the other half is the advertising itself.

- Kenneth Roman and Lane Maas, (head of two ads agency in how to advertise)

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 TABLE OF CONTENT
Title Page
Copyright Page
Course Writers/Development Team
Table of Contents

INTRODUCTION
Preamble
i. Course Information
ii. Course Introduction and Description
iii. Course Prerequisites
iv. Course Learning Resources
v. Course Objectives and Outcomes
vi. Activities to Meet Course Objectives
vii. Time (To Complete Syllabus/Course)
viii. Grading Criteria and Scale
ix. Course Structure and Outline
x. Discussion Forum
Topical Discussions
Discussion Questions

STUDY MODULES
1.0 Module 1: Introduction to Advertising Management
Study Session 1: Advertising management: meaning, roles and scope
Study Session 2: Advertising and it types
Study Session 3: Integrated marketing communication
Study Session 4: Communication models in advertising

Module 2: Objective Setting and Budgeting for Advertisement, Market

Segmentation and Market Positioning
Study Session 1: Setting objectives and budgeting for advertisement
Study Session 2: Understanding Segmentation and positioning
Study Session 3: Choosing an advertisement agency
Study Session 4: Advertising campaign management

3.0 Module 3: Advertising laws, globalization and the future of advertising

Study Session 1: Advertising laws and ethics
Study Session 2: Regulation in advertising
Study Session 3: Advertising and society
Study Session 4: Global and advertisement
Study Session 5: Future of advertising

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 INTRODUCTION
i. COURSE INFORMATION
Course Code: BUAD 833
Course Title: Advertising Management
Semester: Second
Credit Units: 3 CU
Course Status: Core

ii. COURSE INTRODUCTION AND DESCRIPTION

Hello and a warm welcome to BUAD 833. I am highly delighted to take you on
advertising management and it is my passionate hope that you will avail
yourself the opportunity of gaining from my wealth of knowledge. The course
promises to be interesting and engaging as much as want as you. It is on this
welcoming note that I plead for your maximum cooperation and attention.
Before the class gets fully started, permit me to give you a short but insightful
overview of what the course is all about.
This course is targeted at explaining why and when advertising works rather
than how advertising is done. To achieve this set objective, the course is built
upon a basic knowledge of advertising, while also incorporating the
management component. Going by the objective, the course focuses on the
management of the marketing tools that are being utilized to disseminate
information about a brand to a large number of people at the same time by the
way of buying a space or time in one or more media of mass communication
like television, radio, internet page, magazines, and/or newspapers.

The course shall also aid your understanding of how to apply these Advertising
Management concepts, principles, and techniques as advertising managers for
the purpose of making well-reasoned decisions.
In line with this objective, the course is expected to cover the following areas:

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 1. meaning, roles and scope of Advertising Management
2. Advertising and its types
3. Integrated marketing communication
4. Communication and models in advertising
5. Setting objectives and budgeting for advertisement
6. Understanding Segmentation and positioning
7. Choosing an advertisement agency
8. Advertising campaign management
9. Advertising-Laws and Ethics
10. Regulation in advertising
11. Advertising and society
12. Global and Advertisement
13. Future of advertisement

Course Description
Advertising management is a course that will explore in detail the variety of
roles that advertising perform in marketing. This course is intended to provide a
learning experience with regards to laws, ethics and regulations in advertising,
you will also gain an understanding and appreciation of the advertising
campaign management. Additionally, the course will take a comprehensive look
at integrated marketing communication as well as communication models in
advertising, the course also will educate your level of understanding on
segmentation and positioning.

iii. COURSE PREREQUIITES

You should note that although this course has no subject pre-requisite, you
are expected to have:
1. Satisfactory level of English proficiency
2. Basic Computer Operations proficiency

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 iv. COURSE LEARNING RESOURCES
You should note that there are no compulsory textbooks for the course.
Notwithstanding, you are encouraged to consult some of those listed for further
reading at the end of each study session.

v. COURSE OUTCOMES
At completion of the course, you should be able to:
1. To plan and evaluate advertising campaigns.
2. To analyse the task of advertising under contemporary conditions and also to
examine the role of advertising as it relates to other marketing functions.
3. To evaluate the various types of policies that can be employed in guiding the
advertising activity.
4. To examine the major forms of advertising problems faced by organizations,
with emphasis on the application of marketing concepts for effective
decision making.

vi. ACTIVITIES TO MEET COURSE OBJECTIVES

The course will be delivered through a blended mode entailing online tutoring,
administration of hard copies of Course Materials as well as short-termed on-
campus activities. To gain the knowledge base offered by this course, you
must, in addition to the provided materials, visit the course link on our website
where several assignments and topical issues shall be posted each week.

For each of the modules, you are expected to have read the recommended books
and give some thought to the content of the module. However, for other
sessions involving case analysis or group work and/or discussions, you are
expected to make significant contribution. There shall also be room for the
critique of individual and group work, but such should be done reasonably and
professionally as you are expected to treat your classmates and subject matter

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specialist with respect. Also, tutorials will be arranged within the two weeks on
campus activities in which questions will be clarified to enable you understand
fully what you’ve learnt.

Specifically, this course shall comprise of the following activities:

i. Studying courseware
ii. Listening to course audios
iii. Watching relevant course videos
iv. Field activities, industrial attachment or internship, laboratory
or studio work (whichever is applicable)
v. Course assignments (individual and group)
vi. Forum discussion participation
vii. Tutorials (optional)
viii. Semester examinations (CBT and essay based)

vii. TIME ( TO COMPLETE SYLLABUS/COURSE)

It is expedient that you patiently read through the study sessions, and consult the
suggested texts and other related materials. The study sessions contain self-
assessment questions to help you. As such, you are advised to devote at least 3
hours every day for this course.

viii. GRADING CRITERIA AND SCALE

Grading Criteria
A. Formative assessment
Grades will be based on the following:
Individual assignments/test (CA 1,2 etc) 20
Group assignments (GCA 1, 2 etc) 10
Discussions/Quizzes/Out of class engagements etc 10

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B. Summative assessment (Semester examination)
CBT based 30
Essay based 30
TOTAL 100%

C. Grading Scale (as appropriate for the course):

A = 70-100
B = 60 – 69
C = 50 - 59
D = 45-49
F = 0-44

D. Feedback
Courseware based:
1. In-text questions and answers (answers preceding references)
2. Self-assessment questions and answers (answers preceding references)

Tutor based:
1. Discussion Forum tutor input
2. Graded Continuous assessments

Student based:
Online programme assessment (administration, learning resource, deployment,
and assessment).

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 As you work on your research in this course and throughout your
graduate programme, here are some examples of open education
resources that will serve you well.

Open education resources

OSS Watch provides tips for selecting open source, or for procuring free or open software.

SchoolForge and SourceForge are good places to find, create, and publish open software.
SourceForge, for one, has millions of downloads each day.

Open Source Education Foundation and Open Source Initiative, and other organisation like
these, help disseminate knowledge.

Creative Commons has a number of open projects from Khan Academy to Curriki where
teachers and parents can find educational materials for children or learn about Creative
Commons licenses. Also, they recently launched the School of Open that offers courses on the
meaning, application, and impact of "openness."

Numerous open or open educational resource databases and search engines exist. Some
examples include:

 OEDb: over 10,000 free courses from universities as well as reviews of colleges and rankings of
college degree programmes
 Open Tapestry: over 100,000 open licensed online learning resources for an academic and
general audience
 OER Commons: over 40,000 open educational resources from elementary school through to
higher education; many of the elementary, middle, and high school resources are aligned to the
Common Core State Standards
 Open Content: a blog, definition, and game of open source as well as a friendly search engine for
open educational resources from MIT, Stanford, and other universities with subject and
description listings
 Academic Earth: over 1,500 video lectures from MIT, Stanford, Berkeley, Harvard, Princeton, and
Yale
 JISC: Joint Information Systems Committee works on behalf of UK higher education and is
involved in many open resources and open projects including digitising British newspapers from
1620-1900!

Other sources for open education resources

Universities

 The University of Cambridge's guide on Open Educational Resources for Teacher Education
(ORBIT)
 OpenLearn from Open University in the UK

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 Global

 Unesco's searchable open database is a portal to worldwide courses and research initiatives
 African Virtual University (http://oer.avu.org/) has numerous modules on subjects in English,
French, and Portuguese
 https://code.google.com/p/course-builder/ is Google's open source software that is designed to
let anyone create online education courses
 Global Voices (http://globalvoicesonline.org/) is an international community of bloggers who
report on blogs and citizen media from around the world, including on open source and open
educational resources

Individuals (which include OERs)

 Librarian Chick: everything from books to quizzes and videos here, includes directories on open
source and open educational resources
 K-12 Tech Tools: OERs, from art to special education
 Web 2.0: Cool Tools for Schools: audio and video tools
 Web 2.0 Guru: animation and various collections of free open source software
 Livebinders: search, create, or organise digital information binders by age, grade, or subject (why
re-invent the wheel?)

Legal help

 New Media Rights is trying to help digital creators use public domain or open materials legally.
They have guides on how to use free and open software materials in various fields.

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 ix. COURSE STRUCTURE AND OUTLINE
Course Structure
WEEK/DAYS MODULE STUDY SESSIONS ACTIVITY

1 Study Session 1 1. Read Courseware for the corresponding Study Session.

Advertising Management: 2. Listen to the Audio on this Study Session
Meaning, roles and scope 3. View any other Video/U-tube (https://goo.gl/jGwuuK )
4. View referred Animation ( https://goo.gl/dn3n3T )

2 1. Read Courseware for the corresponding Study Session.

Study Session 2 2. Listen to the Audio on this Study Session
Advertising and its types 3. View any other Video/U-tube (https://goo.gl/xM3fpX )
4. View referred Animation (https://goo.gl/FEJHZt )

3 1. Read Courseware for the corresponding Study Session.

2. Listen to the Audio on this Study Session
Study Session 3 Integrated 3. View any other Video/U-tube (https://goo.gl/ZR44M7 )
Marketing Communication 4. View referred Animation (https://goo.gl/Km9kBo )
4 1. Read Courseware for the corresponding Study Session.
Study Session 4 2. Listen to the Audio on this Study Session
MODULE 1 Communication Models in 3. View any other Video/U-tube (https://goo.gl/NmkaRq )
Advertising 4. View referred Animation (https://goo.gl/exZ5R9 )
5 1. Read Courseware for the corresponding Study Session.
Study Session 1 2. Listen to the Audio on this Study Session
Setting objectives and
budgeting for advertisement 3. View any other Video/U-tube (https://goo.gl/dMhfaC )
4. View referred Animation (https://goo.gl/bFY68n )

6 1. Read Courseware for the corresponding Study Session.

Study Session 2 2. Listen to the Audio on this Study Session
Understanding
segmentation and 3. View any other Video/U-tube (https://goo.gl/LBKH1W )
positioning 4. View referred Animation (https://goo.gl/iZGAEe )

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7 MODULE 2 1. Read Courseware for the corresponding Study Session.
Study Session 3 2. Listen to the Audio on this Study Session
Choosing the advertisement
agency 3. View any other Video/U-tube (https://goo.gl/GkEWPU)
4. View referred Animation (https://goo.gl/Go8iza )

8 Study Session 4 1. Read Courseware for the corresponding Study Session.

Advertisement campaign 2. Listen to the Audio on this Study Session
management
3. View any other Video/U-tube (https://goo.gl/Eddiob )
4. View referred Animation (https://goo.gl/irbB5A)

9 1. Read Courseware for the corresponding Study Session.

Study Session 1 2. Listen to the Audio on this Study Session
Advertisement law and
ethics 3. View any other Video/U-tube (https://goo.gl/55HaU7 )
4. View referred Animation (https://goo.gl/VN32ny )

10 1. Read Courseware for the corresponding Study Session.

Study Session 2 2. Listen to the Audio on this Study Session
Regulation in advertisement 3. View any other Video/U-tube (https://goo.gl/XRjYxn )
4. View referred Animation (https://goo.gl/no4LJW )
11 1. Read Courseware for the corresponding Study Session.
Study Session 3 2. Listen to the Audio on this Study Session
Advertising and society
3. View any other Video/U-tube (https://goo.gl/cRfpM9 )
4. View referred Animation (https://goo.gl/cQLvtf )

12 1. Read Courseware for the corresponding Study Session.

MODULE 3 Study Session 4 2. Listen to the Audio on this Study Session
Global and advertisement 3. View any other Video/U-tube (https://goo.gl/oP5CN4 )
4. View referred Animation (https://goo.gl/aAkRtf )
13 1. Read Courseware for the corresponding Study Session.
Study Session 5 2. Listen to the Audio on this Study Session
Managing the future of
advertisement 3. View any other Video/U-tube (https://goo.gl/PyHzPc )
4. View referred Animation (https://goo.gl/PdgWpv )

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Week 14 REVISION/TUTORIAL

Week 15 & 16 SEMESTER EXAMINATION

You are to forward all assignments within the stipulated through the programme dashboard

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Course Outline
Module 1: Introduction to Advertising Management
Study Session 1: Advertising management: meaning, roles and scope
Study Session 2: Advertising and it types
Study Session 3: Integrated marketing communication
Study Session 4: Communication models in advertising

Module 2: Objective Setting and Budgeting for Advertisement, Market

Segmentation and Market Positioning
Study Session 1: Setting objectives and budgeting for advertisement
Study Session 2: Understanding Segmentation and positioning
Study Session 3: Choosing an advertisement agency
Study Session 4: Advertising campaign management

Module 3: Advertising Laws, Globalization and the Future of Advertising

Study Session 1: Advertising laws and ethics
Study Session 2: Regulation in advertising
Study Session 3: Advertising and society
Study Session 4: Global and advertisement
Study Session 5: Future of advertising

viii. DISCUSSION FORUM

You will be required to participate in two types of discussions. They are;

Topical Discussions
These are weekly topics which I shall post on the MBA dashboard. The topics will
centre on contemporary issues and/or current events in the discipline at the time of
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the posting. You are expected to study and contribute to such discussions as your
contribution in these sessions is necessary.

Discussion Questions
These are pre-determined topics to be assigned to groups of students who would
develop a thesis around the topics, submit the thesis to an assigned forum where all
participants will interact and pass comments so as to add to the knowledge and
move the conversation forward.

Relevant Discussion questions are presented under the corresponding Study Unit
while the schedule of response is available on the MBA page of the ABU DLC
Website.

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 STUDY MODULES
1.0 MODULE 1: Introduction to Advertising Management
Contents:
Study Session 1: Advertising management: meaning, roles and scope
Study Session 2: Advertising and it types
Study Session 3: Integrated marketing communication
Study Session 4: Communication models in advertising

STUDY SESSION 1
Advertising management: Meaning, Roles and Scope
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Advertising Management: Meaning, Role and Scope
2.2 Features of Advertising
2.3 Objectives of Advertising
2.4 Importance of Advertising.
2.5 Advertising management.
2.6 The brand and the marketing mix
2.7 Role and Scope of Advertising/Advertising Management
3.0 Tutor Marked Assignment
4.0 Study Session Summary and Conclusion
5.0 Self-Assessment Question and Answers
6.0 Additional Activities
7.0 References/Further Reading

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Introduction
You are welcome to this study session. In this study session, you will be
introduced to the subject matter of advertising management. Thus, the meaning,
role and scope of advertising management shall form the basis of our discussion in
this study session.

1.0 Learning Outcomes:

At the end of this study session, you should be able to:
1. Define advertising
2. List the features of advertising and objectives of advertising
3. Discuss the role and scope of advertising management

2.0 Main Content

2.1 Advertising Management: Meaning, Role and Scope
‘What does advertising mean to you? Is it a marketing device for attracting
customers or just a means of entertaining and amusing people? I am waiting
for your response please!!!’
American Marketing Association defines advertising as “any paid form of non-
personal presentation and promotion of ideas, goods and
services by an identified sponsor". According to Webstar,
“Advertising is to give public notice or to announce
publicity”. In the same vein, Gardner puts Advertising as
“the means of mass selling that has grown up parallel
with and has been made necessary to mass production”.
Going by the definitions given above, it is obvious that Advertising is used for
communicating business information to the present and prospective customers. It
usually provides information about the advertising firm, its product qualities, place
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of availability of its products, etc. Advertisement is indispensable for the sellers
and most importantly for the buyers. In this modern age of large scale production,
producers cannot imagine accelerating the sales of their products without
advertising them. Indeed, Advertisement supplements personal selling to a great
extent. Advertising has been attributed great importance in this modern world
where tough competition in the market and fast changes in technology have
affected the choice and taste of prospective customers.

2.2 Features of Advertising

1. Communication: Advertising is a form of mass communication being
dispatched to the masses. It is a non-personal communication because it is
addressed to masses.
2. Information: Advertising informs the buyers about the benefits they would get
from a particular product. Hence, the information given should be complete
and true.
3. Persuasion: The advertiser hopes to create a favourable attitude which will lead
to favourable actions. Any advertising process attempts at converting the
prospects into customers. Thus, it is an indirect salesmanship and essentially a
persuasion technique.
4. Profit Maximization: True advertising does not attempt at maximising profits
by increasing the cost, but rather by promoting the sales. This way, it is not
expected to result in increase in the price of the product. It has a higher sales
approach rather than the higher-cost approach.
5. Non-Personal Presentation: Salesmanship is personal selling whereas
advertising is non-personal in character. Advertising is not meant for an
individual but for all. There is absence of personal appeal in advertising.

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6. Identified Sponsor: A sponsor may be an individual or a firm who pays for the
advertisement. The name of reputable company may increase sale or products.
For example, a product may have good market because of its identity with a
reputable corporate body.
7. Consumer Choice: Advertising facilitates consumers’ choice. It enables
consumers to purchase goods as per their budgetary requirement and choice.
Right choice makes consumer happy and satisfied.
8. Art, Science and Profession: Advertising is an art because it represents a field
of creativity. It is a science because it has a body of organized knowledge.
Advertising is now treated as a profession due to the emergence of different
professional bodies and formulation of code of conduct for members.
9. Element of Marking Mix: Advertising is an important element of promotion
mix. Advertising has proven to be of great utility and importance to sales
promotion. It is based on this acknowledgement that large manufacturers spend
heavily on advertising.
10. Element of Creativity: A good advertising campaign involves lot of creativity
and imagination as creativity makes way for successful campaign. Positive
outcomes are generated only when the message of the advertiser matches the
expectations of consumers.

In-Text Question 1:
What are the features of advertising?

2.3 Objectives of Advertising

‘Why in your opinion do companies make advert placements?’

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The fundamental purpose of advertising is to sell something (be it a product, a
service or an idea). In addition to this general objective, advertising is also used by
modern business enterprises for certain specific objectives which are listed below:
1. To introduce a new product by creating interest for it among the prospective
customers.
2. To support personal selling programme. Advertising maybe used to open
customers' doors for salesman.
3. To reach people who are not accessible to salesman.
4. To enter a new market or attract a new group of customers.
5. To outsmart fellow competitors in the market and also to increase the sales as
seen in the fierce competition between Coke and Pepsi.
6. To enhance the goodwill of the enterprise by promising better quality products
and services.
7. To improve dealer relations. Advertising supports the dealers in selling the
product. Dealers are attracted to products that are effectively advertised.
8. To warn the public against imitation of an enterprise's products.

2.4 Importance of Advertising.

‘Does advertisement influence your decision to buy a product’.
Advertising has become an essential marketing activity in this modern era of large
scale production and fierce competition in the market. It performs the following
functions:
1. Promotion of Sales: It promotes the sale of goods and services by informing
and persuading the people to buy them. A good advertising campaign helps in
winning new customers, both in the national as well as in the international markets.
2. Introduction of New Product: It is used for introducing new products to the
market. A business enterprise can introduce itself and its product to the public
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through advertising. A new enterprise can't have an impact on the prospective
customers without the mechanism of advertising. Advertising enables quick
publicity in the market.
3. Creation of Good Public Image: It builds up the reputation of the advertiser.
Advertising enables a business firm to communicate its achievements in an effort
to satisfy the customers' needs. This increases the goodwill and reputation of the
firm which is necessary to favourably fight against competition in the market.
4. Mass Production: Advertising facilitates large-scale production. Advertising
encourages production of goods in large-scale because the business firm knows
that it will be able to sell on large-scale with the help of advertising. Mass
production reduces the cost of production per unit by the economical use of various
factors of production.
5. Research: Advertising stimulates research and development activities.
Advertising has become a competitive marketing activity. Every firm tries to
differentiate its product from the substitutes available in the market through
advertising. This compels every business firm to conduct more researches for
discovering new products and their recent mode of utilization. If a firm fails to
engage in research and developmental activities, such firm will be out of the
market in the near future.
6. Education of People: Advertising enlightens the people about new products and
their uses. Advertising message about the utility of a product enables the people to
widen their knowledge. Indeed, advertising has helped people in adopting new
ways of life and giving-up old habits. It has contributed a lot towards the
betterment and advancement of the standard of living of the society.
7. Support to Press: Advertising is an
important source of revenue to the

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publishers and magazines. It helps to increase the circulation of their publications
by selling them at lower rates. People are also benefited because they get
publications at cheaper rates. Advertising is also a source of revenue for TV
network. For instance, Doordarshan and Zee TV earn millions of rupees by placing
ads (i.e. advertisements) before, in between and after various programmes. Such
income could be used for increasing the quality of programmes and also for
extending their coverage.

In-Text Questions 2:
What are the importance of advertising?

2.5 Advertising Management.

‘Can you guess what advertising management literally means? If you can’t,
check the meaning of the two words (advertising and management) in you
dictionary’

Advertising management is the process of overseeing campaigns that seek to

inform and attract consumers to a particular good or service. This process begins
with the first stages of the market research that helps to create the advertising
strategy and moves on to the development of the general outline for the campaign,
the creation of a specific plan of action and the launching of the completed project.
Without effective advertising management, ad campaigns and public relations
efforts tend to founder and produce little or no results.

Effective advertising always begin by engaging in sound advertising research. The

research helps to identify the section of the consumer market that is most likely to
positively respond to a given product. In order to identify these niche markets
24
within the larger group of consumers, researchers will not only seek to understand
what appeals to these buyers, but also why those goods and services have that
inherent appeal. The data collected from the research can then be used to enhance
the marketability of products and address other issues relating to function and
packaging.

The next phase of the advertising management process has to do with deciding
exactly how to apply the data collected during the research stage. Here, the basis
for deciding on what forms of advertising are most appropriate begins to take
shape. Depending on the distinctiveness of the products and the nature of the niche
markets that the campaign will seek to connect with, advertising services such as
print media, and radio, television or the Internet may be deemed the most
appropriate options.

Once the niche markets are identified and the most appropriate advertising media
for the campaign are determined, advertising management focuses on the creation
of the specifics of the overall campaign. This may involve such elements as the
development of print ads for use in magazines and newspapers, audio campaigns
for radio advertising, or commercials appropriate for television broadcast or
streaming across the Internet. Because any given campaign may use several
advertising options, the process of advertising management also involves making
sure all strategies complement one another and present a unified public image to
consumers.

To perform better in advertising management, it is necessary to possess the proper

training. Advertising training is often a combination of formal education and the
experience derived from working under the direction of more seasoned
25
professionals who have learned over time how to identify and interact with
consumers in order to secure the data needed to structure a campaign. While
creativity and inspiration are always vital elements in any advertising campaign,
the ability to organise and view the greater picture are essential to managing the
process and launching a campaign that will successfully reach the right consumers
and generate the desired amount of revenue during the lifetime of the campaign.

In-Text Question 3:
What is advertising management?

2.6 The Brand and the Marketing Mix

Advertising is just one of the marketing activities of a company and also part of the
range of communications that can support a brand. As a business discipline,
Marketing can be thought of as the essential interface between a business and its
customers or consumers. The essence of marketing is to ensure that the business is,
as far as possible, providing customers with what they want, rather than simply
trying to impose the available products on them. In other words, with the aid of
market research, it acts as a conduit for consumers’ demand to reach the
manufacturer. Thereafter, it has to turn this demand into profitable sales and ensure
that the customers are satisfied sufficiently to buy again or, at least not reprehend
the company to all their friends.

To do this, the business deploys a range of tools and techniques, collectively

known as the marketing mix which include product formulation and variation;
packaging; sales literature; the sales force, selling either direct to consumers or to

26
retail distributors; pricing; sales promotion; direct mail; advertising; and market
research.
In particular, it usually aims to do this through the use of branding. The distinction
between a product and a brand is important because it explains much of what
marketing tries to do, and much of the use of advertisements.

A product is simply something that may be offered to potential buyers. It may be

goods of its kind, but will not be systematically presented in a way that
distinguishes it from its competitors. A brand, on the other hand, is a product
whose producer has made every effort to make it uniquely desirable to potential
buyers, consistently using every element in its presentation to do so. If this is done
well, it makes the brand difficult to compete against not necessarily because it is
technically superior (though it may be), but because it has acquired an aura (a
'brand image') which makes it appear better than its competition.

A brand is created by all the elements of the

marketing mix working together consistently to
create a positive prejudice in people's minds.
While a mere product is simply a means of
fulfilling a physical need of customers, a brand
has a place in customers’ minds. Indeed, it has been said that brands only exist in
the minds of consumers. Certainly, a successful brand is seen by its market as
having both rational and emotional characteristics that combine into a coherent and
distinctive picture.

2.7 Role and Scope of Advertising/Advertising Management

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Clearly, advertising is just one of the constituents of the mix that goes to build the
brand. Advertising exists to promote sales. In the case of off-the-page direct
response ads, they actually do sell things, but mostly the process is less direct than
this.

Advertising is mainly about brands. It is designed either consciously or

unconsciously to create and strengthen consumer’s impressions of the brand
advertised, so that they will be more likely to buy it, or to buy it more often. An
apparent exception to this is public service advertising, where governments use ads
for a variety of purposes that are essentially non-commercial in character.

However, a brand does not have to be advertised through media advertising. It is

perfectly possible to devote the marketing budget to having salespeople knocking
on consumer's doors or telephoning them to make a sales pitch, or to concentrate
entirely on persuading suitable retailers to put the brand on their shelves so that the
packaging and presentation will sell itself to visitors coming to the store. The task
of the marketing manager is to weigh up the costs and the likely benefits of
alternative uses for the budget, and act accordingly. If advertising can be avoided,
this can save a lot of money for other purposes.

What is reasonably certain is that doing this will limit the brand's reach.
Advertising is an ideal tool for reaching large numbers of people economically.
There is a growing view that mass advertising and mass marketing are no longer
the way forward for most consumer businesses. However, it is equally true that the
available alternatives have their limitations. People still like to buy brands of which
they have heard, and which they believe to be popular in some sense. Media

28
advertising is still the cheapest way of making sure that a brand is broadly known
and recognized.

In-Text Question 4:
What is the difference between a product and a brand?

4.0 Conclusion/Summary
In this study session, we discussed the concept of advertising management. We
were able to understand the meaning of advertising, the features of advertising, the
meaning of advertising management, the role and scope of advertising
management.

5.0 Self-Assessment Questions

1. Analyse the definition of advertising
2. Explain the feature and objectives of advertising
3. What is the importance of advertising?
4. Discuss what you understand by brand and marketing mix
5. Describe the role of advertising management
6. Discuss the scope of advertising management

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/jGwuuK Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/dn3n3T and critique it in the discussion
forum

29
In-Text Answers 1:
1. Communication 8. Art, Science and Profession
2. Information 9. Element of Marking Mix
3. Persuasion 10. Element of Creativity.
4. Profit Maximization
5. Non-Personal Presentation
6. Identified Sponsor
7. Consumer Choice

In-Text Answer 2:
1. Promotion of Sales
2. Introduction of New Product
3. Creation of Good Public Image
4. Mass Production
5. Research
6. Education of People
7. Support to Press.

In-Text Answer 3:
Advertising management is the process of overseeing campaigns that seek to
inform and attract consumers regarding a particular good or service.

In-Text Answer 4:
A product is simply something that may be offered to potential buyers. it may
be goods of its kind, but will not be systematically presented in a way that
distinguishes it from its competitors. A brand, on the other hand, is a product
whose producer has made every effort to make it uniquely desirable to
potential buyers, consistently using every element in its presentation to do so.

30
7.0 References
Belch, George E. and Belch, Michael A. (2001). Advertising and Promotion: An
Integrated Marketing Communication Perspective, (5th Edition). Boston:
McGraw-Hill Irwin.
Fadipe, S. (2002): Advertising Practice with Nigerian Orientation. Lagos: Christ
Publishers.
Jefkins, F. (1987), Introduction to Marketing, Advertising and Public Relations.
London and Basingstoke: Macmillan Publishers Ltd.
Kenneth E. Clow and Donald Baack (2007). Integrated Advertising, Promotion,
and Marketing Communications (Third Edition). Pearson Education, Inc.
Prentice Hall.
White, Roderick (2000). Advertising (4th Edition). London: McGraw-Hill
Publishing Company.

31
 STUDY SESSION 2
Advertising and Its Types
Section and Subsection Headings
Introduction
1.0 Session Learning Outcomes
2.0 Main Content
2.1 Advertising and Its Types
2.2 Classification of Advertising
2.3 Types of Advertising
3.0 Tutor Marked Assignment
4.0 Study Session Summary and Conclusion
5.0 Self-Assessment Question and Answers
6.0 Additional Activities
7.0 References/Further Readings

Introduction
This study session builds on the foundational knowledge you gained in the
previous session. In this session, you will be made to understand the meaning of
advertising and its different types.

1.0 Learning Outcomes:

At the end of this study session, you should be able to:
1. understand the different types of advertising
2 differentiate the different types of advertisements
3 understand the essentials for the Success of Financial Ads

32
2.0 Main content
2.1 Advertising and Its Types
Different authors have classified advertising in different ways. According to Philip
Kotler, advertising can be classified on the following basis:
(a) Geographical Area: National, Regional or Local.
(b) Content: Product Advertising, Brand Advertising, Institutional Advertising.
(c) Type of Appeal: Factual and Emotional.
(d) Audience: Consumer, Industrial, Trade.
(e) Sponsor: Manufacturer, Middlemen, Manufacturer -
middlemen, private.
(f) Intended Effort: Direct Action and Delayed Action.
(g) Level of Demand Influence: Primary Product Level,
Selective Brand Level.

2.2 Classification of Advertising

Management scientists have classified advertising using different criteria such as
the following:
I) Classification on the basis of area coverage:
Using this criterion, advertising may be classified into the following four
categories. (1) local, (2) regional, (3) national, and (4) international advertising.
1. Local advertising: It is also known as “retail advertising”. It is undertaken by
local retail stores, departmental stores, co-operative stores that sell consumers’
goods and durables such as cloth, saris etc. It is directed at local customers. The
media used for local advertising are shop decorations, local newspapers,
magazines, posters, pamphlets, hoarding, new signs, local cinema houses, etc.

33
2. Regional advertising: It has wider coverage when compared to local
advertising. It covers a particular region (which may be one state or more) or the
people from the same linguistics background using one common product. It is
undertaken by the manufacturer or the regional distributor of a product. The media
used for regional advertising include regional newspapers, magazines, radio,
regional T.V., outdoor media, etc. It is considered to be an ideal form of
advertising for launching and marketing a new product in a specific region.

3. National advertising: It is generally sponsored by manufacturers of branded

goods for broadcasting advertising messages to consumers all over the country.
Almost all possible mass media, including national newspapers, radio and
television network, are employed for national advertising. Product services and
ideas which have demand all over the country are suitable for national advertising.

4. International advertising: This type of advertising is undertaken by multi-

national companies (i.e. those companies that operate in more than a country).
Exporters generally advertise their products and services in foreign countries
where ready markets are available. For instance, Air India airlines, and other
multinational companies advertise their products and services all over the world.
Also, Coca-Cola and Pepsi are advertised globally because of the sales and
availability of these products all over the world. International advertising is
extremely expensive, involving the services of professional advertising agencies in
different countries.

34
II. Classification on the basis of audience
On this basis, advertising may be classified into the following four categories: (1)
consumer advertising, (2) industrial advertising, (3) trade advertising, and (4)
professional advertising.
1. Consumer advertising: This type of advertising is directed to the ultimate
consumers of a product. Ultimate consumers are individuals who buy or use
consumable products or services (such as toilet soap, toothpaste, toothbrush, tea,
textiles etc.) for themselves and their families. All types of consumer products
need continuous and extensive advertising on T.V., radio, press, and other media
houses.

2. Industrial advertising: This type of advertising is directed at industrial users or

customers by manufacturers and distributors of industrial goods such as machinery,
plants, equipment, spare parts and components. Such advertisements usually
appear in trade journals, trade dictionaries, business magazines and so on. The
appeal made is tactual and rational.

3. Trade advertising: This kind of advertising is employed by manufacturers

and/or distributors to influence and persuade wholesalers and dealers (retailers) to
stock and sell the goods of the advertiser by offering incentive schemes to them, or
by inviting dealership for their products(s).

4. Professional advertising: It is directed at professionals like doctors, professors,

engineers and others, who are expected to recommend, prescribe, or specify the
advertised products to ultimate consumers. This is done through professional
journals and representative of the advertisers.

35
III. Classification on the basis of media
Following this criterion, advertising may be classified into the following
categories: (1) Print media advertising; (2) electronic, or, broadcast media
advertising; (3) outdoor media advertising.

1. Print media advertising: The print media consists of newspapers, magazines,

journals, handbills, etc. The survival and continuous circulation of most
newspapers and journals depends on the revenue generated through advertising. As
of today, Print media advertising is the most popular form. Hence, the revenue
derived by mass media from advertising has been tremendously increasing year
after year. Print media appeals only to the sense of sight, i.e. eyes.

2. Electronic or broadcast media advertising: Electronic or broadcast media

consists of (i) radio, (ii) television, (iii) motion pictures, (iv) video, and (v) the
internet. The radio is audio in nature as it appeals only to the sense of sound (ears).
Radio advertising is more effective in rural areas, as compared to urban regions.
Television, as an advertising medium, is more attractive and effective because it is
an audio-visual medium that appeals to both the senses of sight and sound (i.e.
eyes and ears). Different methods(such as spot announcements, sponsored
programs, etc.) are used for broadcasting advertising messages. However,
broadcasting media are very expensive forms of advertising.
Advertising is also done through movies, video, and the internet.

3) Outdoor media:
This includes posters, neon signs, transit, point of purchase (POP), etc. Outdoor
advertising can be a good supporting media to other forms of advertising. It is a
good form of reminder advertising, most especially the POP advertising.
36
4) Other media:
This includes direct mail, handbills, calendars,
diaries, cinema advertising, internet and so on.
These miscellaneous media can play an
important supporting role to the major media
such as television and newspapers.

In-Text Question 1:
What is professional advertising?

IV. Classification on the basis of function:

1. Direct action and indirect action advertising: Direct action advertising is
utilised to obtain immediate response or action on the part of target audience.
Examples of this form of advertising are discount sales advertising, sale along with
free gift offers, and mail-order coupon sales etc. The media used is mostly
newspapers and television.

Indirect action advertising is sponsored to influence and attract the audience to the
advertised brand. The advertiser expects the target audience to prefer his brand to
his competitors’ whenever a buying decision arises in future.

2. Primary and selective advertising: Primary Advertising is sponsored by trade

association or by cooperative groups for the purpose of creating generic for
products and services. For example, the Coffee Board may promote more
consumption of coffee through advertisement. Selective Advertising is organised
37
by marketers of branded products. The advertiser intends to create selective
demand for his brand. Examples include Pepsi Cola, Coca Cola.

3. Product and institutional advertising: Product or Service advertising is

undertaken to promote the sale of products and services, branded or unbranded.
Institutional advertising is aimed at building the name and goodwill of an
organization. It is also known as corporate advertising or image advertising. It is
mostly initiated by large firms.

In-Text Question 2:
What is primary and selective advertising?

V. Classification on the basis of advertising stages

Using this criterion, advertising may be classified into three different categories as
follows: (1) advertising at pioneering stage, (2) advertising at competitive stage,
and (3) advertising at retentive stage.
1. Advertising at pioneering stage: Advertising at pioneering stage is arranged to
make the audience fully aware of the new brand of product and also to inform,
influence, and persuade them to buy or use it by highlighting its unique features.

2. Advertising at competitive stages: Once the brand survives the introductory

stage, it is expected that the brand will soon face a stiff competition from other
well established brands in the market. At this stage, competitive advertising is
undertaken to promote sales effectively.

3. Advertising at retentive stage or reminder advertising: When the product has

captured a large share of the market, retentive advertising is undertaken to maintain
38
or retain its stable position in the market as long as possible. Moreover, if the same
product is passing through the declining stage in the market, this type of
advertising is used to remind the buyers about the product.
Hence, it is also known as “reminder advertising”.

In-Text Question 3:
Management scientists have classified advertising using different criteria, what are they?

2.3 Types of Advertising

Advertising is also classified according to their functions and role. Some of the
important classifications of advertising are as follows:
1. Social advertising: Social Advertising is done by non-commercial
organizations such as trust, societies, associations etc. The main objective of Social
Advertising is to work for social cause. Advertisements for collecting donations for
war victims or for victims of natural calamities, sales of tickets for a show etc. are
examples of Social Advertising.

2. Political advertising: Political advertising is sponsored by political parties to

motivate the general public in favour of the ideology of the party in question.
Political advertising is intensively made during election periods so as to get the
support and votes of the electorate. Such advertising promotes plans and policies of
the concerned party. It also tries to expose weaknesses of the opposition with a
view to convincing prospective electorate to vote for a party’s candidates. Some
political advertisements are also made to assist the Government to implement its
schemes for rehabilitation and national reconstruction.

39
3. Advocacy advertising: We often come across advocacy advertisement on the
use of family planning methods, conservation of scarce resources and maintaining
green environment. An extreme example occurred in the 1960s, when a private
citizen bought a two-page advertisement in the New York Times at a cost of
$12,000 to offer his peace plan for ending the war in Vietnam. In 1974, Mobil Oil
Company began advocacy advertising concerning the need for offshore oil drilling
to alleviate the energy crisis that existed at the time. NBC accepted the television
commercial, but ABC and CBS did not, because of the controversial nature of the
topic. As a result, Mobil Oil Company took out full-page newspaper ads, which
reproduced in print the visuals and text from the commercial.

This is designed to alert people to the fact that such ads are not editorials or
informational pieces, but are specific advertisements. Companies can place
advocacy advertisement on billboards, in print magazines and newspapers, online,
and on television.

4. Advertising by Google
Examples:
Ponds Age Miracle: Looking young is now really easy Get Ponds tips and tricks!
www.Ponds.
Use Olay Total Effects: www.Olay.in/SkinCare
Tips for Beautiful Skin: Get the right beauty tips for your skin from the Experts.
Apply Now! KayaClinic.com
Gym Management Course: Learn how to successfully manage a Gym, Fitness
Club or a Health Club! www.keleven.com
Admissions Open For MSW: Study MSW in Amrita College.
Download free application here! www.amrita.edu/MSW
40
ICICI Health Care Plans: One Health Policy For Entire Family No Check Up or
Paperwork. Buy Now! ICICILombard.com

5. Retail advertising: Retail advertising is usually done by retailers who sell

goods directly to the customers. Retail advertising is targeted at achieving the
following objectives: (i) to sell the stock; (ii) to establish the identity of business;
and lastly (iii) to attract personal, telephone or mail order shoppers. Retail
advertising is done through window display, neon signs, posters, leaflets etc. It is
usually local in approach.

6. Financial advertising: When an advertisement is organized for the sole purpose

of raising capital, it is called financial advertising. For instance, banks, insurance
companies and commercial undertakings raised required funds from the savings of
the people by motivating them to postpone present expenditure to a future period.

An investor considers two things before investing his hard earned savings.
(1) Safety of investment (2) Return on investment
The safety of investment depends upon the reputation and goodwill of the
company and the properties possessed by it. The institutional advertising helps in
creating confidence in the minds of the investors. The financial advertisement
informs the investors about the past
performance in declaring dividends and the
trend in declaring of dividend. The
dividend depends upon the profitability of
the company. The company with the help
of charts, diagrams etc. communicate the

41
rate of growth and rate at which profit is increasing.

Essentials for the success of financial Ads :

Irrespective of how creative and persuasive it may be, no financial ad campaign
can produce the desired result until the following conditions are satisfied.
(a) The performance and image of the company and its future prospects must be
good.
(b) The premium charged on the share price must be fair and reasonable.
(c) The brokers and underwriters must extend unqualified support to the company.
(d) The company should get wide publicity from the press through press
conferences.
(e) True statement of facts should be included in the Ads.
(f) Finally, financial climate of the country plays an important role.

7. Corporate image advertising: Corporate Image advertising is designed to

create favourable attitude towards the seller and also to earn the advertiser a good
goodwill and reputable public image; rather than to sell a specific product or
service. Institutional advertising is done to boost the public image of the marketer
or advertiser in the market and also to increase the patronage of the advertised
product. In this light, Institutional advertising can be subcategorized into two:
patronage advertising and public relations service advertising.

Public relations institutional advertising is aimed at creating a favourable image of

the company (advertiser) among employees, investors or general public. Public
service institutional advertising also aims at changing the attitudes or behaviour of
the people for the betterment of the community or public at large. Patronage
advertising is targeted at attracting customers by appealing to their patronage
42
buying motives rather than product buying motives. Most of the companies are
successful in reinforcing their image in the minds of the people by using such
names as “Bata”, “Tata”, “Dunlop”, “J.K.”, and “Bombay Dyeing” etc.

In-Text Question 4:
Mention five essentials for the Success of Financial Ads

8. Public Relations advertising: It is a part of institutional advertising. The basic

objective of public relations advertising is to establish cordial and healthy relations
with the customers, bankers, suppliers, Government, Patrons and the general
public. Through public relations advertising, company announces the changes in its
policies, its developmental activities, its position and stand whenever the
employees are on strike. It helps the company to correct negative misconception of
the people about the company. During the periods of short supply of goods, the
public relations advertising helps to hold and maintain the interest and loyalty of
the customers. The company assures the public of normalcy in the supply of its
product and also admonishes its customers to bear with the company. Institutional
advertising and public relations advertising are complimentary to each other. Both
are aimed at building favourable corporate image.

There are several reasons as to why a corporate firm may resort to public relations
advertising. The reasons are:
(a) To create a favourable image of the organization.
(b) To secure and keep good suppliers.
(c) To build goodwill of the dealers.
(d) To arouse and serve customers in a better way.
43
(e) To arouse interest of the present and potential shareholders.
(f) To correct misconceptions about the firm during strikes.
(g) To win confidence of its employees.
(h) To render community service.
(i) To make people aware of social evils and hazards etc.
(j) To obtain public support for certain cause.

9. Institutional advertising: The objective of institutional advertising is to build

and sustain manufacturers’ reputation in the minds of the general public. The
advertising message is tailored to give insightful facts about the Company, its
people, its contribution in promoting social welfare activities and consumer
satisfaction, its achievements in technology, its broad philosophies, and its share in
economic progress etc.

Such advertisements do not immediately bring benefits in the form of higher sales;
rather they create good footing for the company in the long run. The competitive
strength of the company goes up with the enhancement of corporate image. It is
much easier for a highly reputed company to launch a new product in the market.
Basically, institutional advertising aims at getting public support for raising capital
through public subscription.

The following points are normally considered in institutional Ads:

(a) Research and Development of the firm.
(b) Number of factories or branches of the firm.
(c) The number of employees and facilities provided to them.
(d) Foreign collaborations, if any.
(e) Distribution network of the firm.
44
(f) Market position of the firm.
(g) Products or services offered by the firm.
(h) Social welfare programs undertaken by the firm, etc.

10. Internet advertising: The Internet facility has been around for some 30 years.
It actually began in the early 19608 in USA, where the U. S. Department of
Defence saw it as a means of supercomputer communication for researchers and
military facilities across the country. Until its commercial explosion in 1990s, the
Internet remained a relatively obscure network of linked computers - mostly by
academics, military researchers, and scientists around the world to send and
receive electronic mail, transfer files, and find or retrieve information from
databases. At present, Internet is the fastest growing medium in history, offering
incredible opportunities for a wide range of people in both business and
advertising. For advertisers, there is a whole new world of potential customers on
the internet.

11. Primary demand advertising: The main objective of Primary demand

advertising is to create demand for a new product or product category. This is
necessary for newly developed products or the products which are costly in nature.
Examples of such products are cars, refrigerators, washing machines, watches, etc.
it is also described as selective demand advertising because it is usually directed
towards a class of customers. It is heavily utilized during the introductory stage of
product life cycle.

Primary demand is when a potential buyer or prospect is showing interest in a

product or service for the first time. Often times, it is because the prospect was
never exposed to the “concept” of the product or service or never really understood
45
it. But now, due to new circumstances, the prospect developed an apparent need all
of a sudden.

12. Selective demand advertising: Selective demand advertising is done to meet

the growing competition mainly in growth stage of the life cycle of the product.
Here, the goal of advertising is to push the demand of specific product or service.
Often, promotion becomes less informative and more emotional during this phase.
Advertising may begin to stress subtle differences in brands with emphasis on
brand name recall. At this stage, pricing may also be used as a weapon because
products of all the competitors are almost similar in quality.

Selective demand is when a prospect has a need, has identified the need, and is
ACTIVELY seeking out a solution. In most cases, the prospect will come to you if
he is confident of your company's ability to solve his needs. When someone has
selective demand, they are more proactive in their search for information. They
usually give themselves enough time to compare the qualities, values, and offers of
different companies. So while they are calling you, they are also likely to call
others as well.

13. Product advertising: Product Advertising refer to the advertising of tangible

product. The product advertising has emerged as a powerful instrument of
marketing. A product may be anything in which a trader deals or trades. A product
may be tangible or intangible. Products like radio, soap, pen cloth etc. are tangible
products, while services of professionals like doctors, lawyers, engineers etc. are
intangible products.

46
The fundamental of any advertising campaign is to establish the fact that among
the substitutes, the product advertised is the best. Thus, product is the heart and
focus of any advertising program. Advertising makes smooth entry of a new
product into the market possible.

14. Service advertising: Service advertising is designed to operate in the public

interest. It is undertaken to seek public welfare and social development. It is a form
of non-commercial institutional advertising. In this type of advertising, the
objective is to put across a message with the intension of changing attitudes or
behaviour and subsequently help the public at large. It is generally used by
government and other organizations to promote public welfare.

We often come across advertisements which focus on the need for small family
norms, functional literacy and environmental sanitation and so on.

15. National advertising: It is generally sponsored by manufacturers of branded

goods for the purpose of conveying messages about their products to consumers all
over the country. Almost all available mass media are employed for national
advertising. Product, services, and ideas that have nationwide are suitable for
national advertising. In India, Indian Airline Hindustan
Lever Ltd., Vicco, Godrej, Bajaj and Kirloskar are a few
leading advertisers at national level. Likewise,
detergents, soaps, toothpastes, cosmetics, scooters, cars,
and bicycles, are some of the products which are
advertised nationwide.

4.0 Session Summary

47
In this study session, we dwelled on the topic: advertising and its types. We were
able to understand the meaning of advertising, different types of advertising and
the essentials of a successful ad.

5.0 Self-Assessment Questions

1. Explain the types of advertisement
2. Discuss the classifications of advertisement
3. Describe the classification of advertisement on the basis of media
4. Classification of advertisement can be done on the basis of function, explain
5. Discuss the classification of advertisement on the basis of audience

6.0 Additional Activities (Videos, animation and outdoor activity)

a. Visit U-tube https://goo.gl/xM3fpX Watch the video & summarise in 1
paragraph

b. View the animation on https://goo.gl/FEJHZt and critique it in the discussion

forum

In-Text Answers 1:
It is directed at professionals like doctors, professors, engineers and others, who
are expected to recommend, prescribe or specify the advertised products to
ultimate consumers. This is done through professional journals and representative
of the advertisers.

In-Text Answer 2:
Primary Advertising is sponsored by trade association or by cooperative groups for
the purpose of creating generic for products and services, while Selective
Advertising is undertaken by marketers of branded products.
48
 In-Text Answer 3:
I. Classification on The Basis of Area Coverage
II. Classification on The Basis of Audience
III. Classification on The Basis of Media
IV. Classification on The Basis of Function
V. Classification on The Basis of Advertising Stages

In-Text Answer 4:
(a) The performance and image of the company and its future prospects must
be good. (b) The premium charged on the share price must be fair and
reasonable.(c) The brokers and underwriters must extend unqualified support
to the company.(d) The company should get wide publicity from the press
through press conferences.(e) True statement of facts should be included in the
ads.

7.0 References/Further Readings

Aaker, David, and John (1992). Advertising management. Pretice-Hall of India
Doyle, Peter (2002). Marketing Management & Strategy.(3rd Edition). Essex:
Pearson Educational Limited.
Ferrell, D. C. and Hartline, Michael D. (2005). Marketing Strategy. (3rd
Edition)Ohio: Thomson South-Western.
Kenneth E. Clow and Donald Baack(2007). Integrated Advertising, Promotion,
and Marketing Communications, (Third Edition). Pearson Education, Inc.
Prentice Hall.
Kotler, Philip and Keller, Kevin Lane (2006). Marketing Management.(12th
Editio) New Jersey: Pearson Prentice Hall.
Perreault, William D., Jr. and McCarthy, Jerome E. (2005). Basic Marketing: A
Global- Management Approach. Boston: McGraw-Hall Irwin.

49
Peter, J. Paul and Donnelly, James H., Jr. (2011). Marketing Management:
Knowledge and Skills, (10th Edition). New York: McGraw-Hall Irwin.
Westwood, John (1996). The Marketing Plan: A Practitioner’s Guide, (2nd
Edition). London: Kogan Page Limited.
White, Roderick (2000). Advertising, (4th Edition). London: McGraw-Hill
Publishing Company.
Wood, Marian B. (2007). Essential Guide to Marketing Planning. London:
Prentice Hall.

50
 STUDY SESSION 3
Integrated Marketing Communication
Section and Subsection Headings
Introduction
1.0 Session Learning Outcomes
2.0 Main Content
2.1 Integrated Marketing Communication
2.2 Steps Involved in Framing Integrated Marketing Communication
2.3 Goals of Marketing Communications
2.4 Benefits of Integrated Marketing Communications
2.5 Barriers to Integrated Marketing Communications
3.0 Tutor Marked Assignment
4.0 Session’s Conclusion and Summary
5.0 Discussion Questions
6.0 Additional Activities
7.0 References/Further Readings

Introduction
In this study session, the locus and basis of our discussion is integrated marketing
communication. This session seeks to acquaint you with the meaning of integrated
marketing communication, Goals of marketing communication and the processes
involved in integrated marketing communication.

1.0 Learning Outcomes

At the end of this study session, you should be able to understand the following:
1. The meaning of integrated marketing communication
2. Steeps involved in framing integrated marketing communication
51
 3. Goals of marketing communication.

2.0 Main Content

2.1 Integrated Marketing Communication
“can you define integrated marketing communication? Be optimistic, give it a
trial!!”
Advertising is a major component of integrated marketing communications. It is
also part of the “traditional” promotions mix of advertising, consumer and trade
promotions, and personal selling. These functions, along with other activities such
as direct marketing and public relations efforts, form the basis for communicating
with individual consumers and business customers. The role played by advertising
varies by company, products, and the marketing goals established by the firm. For
some products and companies, advertising is the central focus, while other
components (such as trade promotions, consumer promotions, and personal selling)
support the advertising campaign. In other situations, advertising plays a secondary
role, such as supporting the national sales force and a firm’s trade promotion
programme.
In a business-to-business sector, advertising often assists other promotional
activities, including trade shows and personal sales calls. In the consumer sector,
the reverse is often the case. Advertising is usually the primary communication
vehicle and the other promotional tools (contests, giveaways, special packages) are
designed to back the advertising campaign. In both business-to-business and
consumer promotions, the key to using advertising effectively is to see advertising
as one of the “spokes” in the “wheel” of the promotional effort. The remaining
“spokes” are the other components of the IMC plan.

52
IMC includes clear internal communications among departments along with the
messages sent to external customers and suppliers. IMC programmes apply
information technologies to develop databases that help everyone in the firm
understand customers’ needs and characteristics. This covers the needs of both
business customers and end-user consumers. Effective integrated communications
programmes mean that every organizational member works toward the goal of
reaching customers with a clear and consistent message.
Integrated Marketing Communications (IMC) is a strategic marketing process
specifically designed to ensure that all messaging and communications strategies
are unified across all channels and are also centreed on customers. The IMC
process emphasizes identifying and assessing customer prospects, tailoring
messages to customers and prospects that are both serviceable and profitable, and
evaluating the success of these efforts to minimize waste and transform marketing
from an expense into a profit-centre. Thus, IMC is an approach to achieving the
objectives of a marketing campaign, through a well-coordinated use of different
promotional methods that are intended to reinforce each other.

According to American Association of Advertising agencies, integrated

marketing communications (IMC) is a concept of marketing communications
planning that recognizes the added value of a comprehensive plan that evaluates
the strategic roles of a variety of communications disciplines. In other words, the
message and approaches of general advertising, direct response, sales promotion,
public relations, and personal selling efforts are combined to provide clarity,
consistency, and maximum communications impact. For example, general
advertising, direct response, sales promotion and public relations are combined to
provide clarity, consistency, and maximum impact through the seamless
integration of messages.
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Thus, IMC calls for a “big picture” approach to planning marketing and promotion
programmes and coordinating the various communication functions. Rather than
just advertising and communicating to its customers, it requires firms to develop a
total marketing communications strategy that recognizes what the sum total of a
firm’s marketing activities is. Consumers’ perceptions of a firm and/or brands are a
synthesis of the messages they receive from various sources. These include media
advertisement, price, direct marketing efforts, publicity, and sales promotions, as
well as interactions with salespeople and other customer-contact employees. In a
global economy with international markets and instantaneous communications, no
aspect of marketing can be studied in a vacuum or in isolation if one desires to be
accurate and relevant. Marketing tools, used as planned business-building
techniques, are more likely to facilitate attainment of organizational goals than
current “silo” approaches.

IMC is the use of coordinated messages and media on regular bases to consumers.
The messages are consistent and clear in all the channels of communication.
Databases are used to keep in touch with consumers. Repeat sales, customer
attitudes and related purchases are some of the tools used to
measure the effectiveness of IMC. Thus, IMC is the
integrating and coordinating of a company’s
communications, so that the message delivered is consistent
and clear in all channels used. Advertising is but a part of
this integrated marketing communication.

One of such tools within IMC is Direct or Database Marketing. This involves not
just direct mail but also telemarketing and direct response advertising on T.V and
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radio and other media where ad aims to generate an action response (e.g. Call
Centre number).

As stated below, direct marketing has two advantages over mass advertising:

1. The ability to target specific individual consumer with an offer that is tailored to
that consumer.
2. The ability to directly measure response.

The goal of direct marketing may not be to generate awareness or change

preference but to generate some action. It could be to get an order or request for
some information, a visit to a dealer or a store and so on. As a result, direct
marketing encompasses the following:
ꞏ Targeting
ꞏ Customization ability
ꞏ Measurability

This has become a major tool since many advertisers are combining direct
marketing efforts with their regular advertising efforts primarily to retain loyalty of
existing customers, to cross sell new products and services to these existing
customers, and to increase the amount or frequency of usage.

The second important tool within the context of IMC is Sales Promotion. They are
of two types:
Consumer promotion (coupons, samplings, premiums, sweepstakes, low-cost
financing deals and rebates)

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Trade promotions (allowances for featuring the product in retail advertising,
display and merchandising allowances and the like)

These are used to get the consumer to try or to repurchase the brand and to get the
retail trade to purchase and to ‘push’ the brand.

Retails in turn use promotions to clear their inventory of slow moving, out of
season, shelf-unstable products (such as fresh produce). Price cuts, displays,
frequent shopper programs and so on are few of the sales promotions done by the
retailers.

So how does it complement IMC or advertising? There are three (3) ways in which
it performs this complementary role.
It is a key element in inducing trial or repurchase in many communication
programs in which advertising creates awareness and favourable attitudes but fails
to spur action. The action comes about due to the limited duration of the
programme, so the consumer must act quickly. The consumer may perceive this as
a value for money purchase.
In many retail outlets, the companies are able to make out through scanners as to
which brands are moving fast off the retail shelves and also try to understand as to
which shelf does not receive much sales so that they could reduce the hiring or the
display of merchandise from the shelf. This is done in order to be cost effective.
In order to keep the equity of the brand intact (especially for high involvement
products and ‘feeling’ products), the advertising and sales promotion efforts must
complement each other.

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 In-Text Question 1:
What is integrated marketing communication?

Apart from integrated marketing communications (IMC), there are other action
related marketing communications. These other marketing communications are
stated and explained as follows:

Retail advertising
Retail advertising provides consumers with lots of information in order to
influence and lure them to buy the advertised products. For instance, listing the
size, colour and prices of various shirts in a
store make a buyer more action inductive.
Appropriate behavioural aspects are used in
case of durables and automobiles. The
advertisement used here must create a strong
sense of desire, curiosity and urgency to get the
reader or viewer to make the store visit.

Cooperative advertising
Here, a manufacturer offers retailers an advertising programme for the later to run.
The programme may include suggested advertising format, materials to be used to
create actual advertisements, and money to pay a portion of the cost. Certain
merchandise quantity is also suggested for the retailer to stock and perhaps display.
There are three (3) types of co-op advertising:
1. Vertical: When the upstream manufacturer or service provider pays for a
downstream retailers ad.
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2. Horizontal: When local dealers in a geographic area pool money for
advertising.
3. Ingredient producer co-op: When the producer of an ingredient pays part of an
Ad run by the user product.

The intention of this type of communication is to stimulate short-term sales. The

advertising is specific to the product, the place where it can be purchased and the
price. In this case, maintenance of the brand’s image and reinforcement of the
company’s leverage with the retailers are important long-term considerations. The
need should also be to expand the distribution coverage by allowing allowances to
the retailers.

Reminder, point-of-purchase and specialist advertising

Reminder ads serve to stimulate immediate purchase and/or use to counter the
inroads of competitors. It is basically reminding the consumer about its existence.
A concrete example of such advertisement is ‘Shelf talkers’ or point of purchase
materials being placed in stores at or near the place where the brand is on display.
For instance, you might have seen sachets of shampoos being hung right in front of
a shop for the primary purpose of getting your attention by appealing to your visual
senses (i.e. eyes). This scenario is a typical example of point of purchase material.
Here, the product itself acts as the material. Top of the mind awareness is the basis
of the reminder and point of purchase material. Specialist advertising is useful in
circumstances when certain free products like diaries, pens and calendars bearing
the name of the manufacturer are given to the consumers for greater brand
awareness. Pepsi and Coca Cola often paint the entire shop with their logo. This is
to remind the consumer of their existence in that area.

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Sales promotions
Sales promotions are different from advertising in that they do not involve the use
of mass media. Many sales promotions are designed
to encourage the immediate sale of goods, while
others have longer-run goals of keeping customers
loyal to the
store, aiding salespeople, or attracting customers into
the store. The term promotion is used to refer to all
communication efforts made on an impersonal basis,
including sales promotions, publicity, and
advertising.

Personal selling
Personal selling involves individual, face-to-face communication, in contrast to the
impersonal mass communication involved in advertising. Effective personal selling
is quite often the most important and effective element in retail communication.

Publicity
Two factors distinguish publicity from advertising. These factors are cost and
control. When a newspaper, magazine, TV or radio features a retailer’s store,
personnel, product or events and the retailer does not have to pay for it, the retailer
receives publicity. However, the retailer cannot control the time, direction, or
content of the message.

Word-of-mouth

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Retailers cannot directly control what customers say to friends about their stores,
services and products. However, they should be aware of this channel of
information because potential customers often rely on what customers of a store
say about it. Unfair treatment of one customer can create an ever-widening web, as
more people are told about that customer’s experience.
Fortunately, fair treatment and real value are also
discussed among customers, although positive aspects
may not have as much influence as the negative ones
do. The point is that customers are going to talk about
how they are treated in a store.

Packaging
Proper product packaging protects the product as well as provides a message that
facilitates its sale. Unfortunately, in most cases, retailers purchase products already
packaged and therefore have little control over the message on the package.
However, the retailer should always consider the image and message projected by
packaging as a part of the total communication mix. The retailers package many
goods with paper and plastic bags, boxes, and wrapping paper. If carefully
designed, such packaging can prove to be an effective yet inexpensive element
within the complete communication programme

Merchandising and in-store advertising

Of late, it has made a lot of inroads in outlets. With Bennetons with their colour
scheme in various shelves and Raymond’s with their window, display plays a
major role in attracting the consumer base. This is so because most decisions about
brands are made when you enter a particular shop. So the use of displays, signs,

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and positioning of the particular brand in the store is an important decision making
exercise.

Industrial marketing
A business-to-business deal, which requires a sales representative to make the sales
call. Here, the additional information provided by him with the help of certain
pamphlets and brochures are the key tones for advertising. The telemarketers can
handle the calls made once the pamphlets and brochures are effective enough for
eliciting a response. Often toll free numbers are provided in the pamphlets and
brochures.

Integrated marketing communication with the help of another tool, namely Public
Relations, is important to accommodate complex buying decisions. The key to the
success lies in the effective monitoring of the various tools used in order to avoid
dilution to the plan by any one. One important impact of IMC is greater
consistency to their communication including media waste. In addition, we must
answer the following in order to have a successful marketing communication:
What are the target audience and their behavioural pattern?

What are the media that the target audience normally comes in touch with?
What behaviour or attitudes do we want to affect?
What are the communication goals?
What is the best marketing programme(s)?
How should we allocate the budget?
Who is responsible for the programmes?
How will we measure the degree of success of each part?

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The answer to the following would indeed give us a fair amount of idea as to
which plan could be the most effective.

Another important tool within the marketing communication is the Customer

Relationship Management (CRM). Relationship management is emerging as the
core marketing activity for businesses operating in fiercely competitive
environments. On average, businesses spend six times more to acquire customers
than they do to keep them (Gruen, 1997). Therefore, many firms are now paying
more attention to their relationships with existing customers in order to retain them
and increase their share of customer’s purchases.

Worldwide service organizations have been pioneers in developing customer

retention strategies. Banks have relationship managers for selected customers,
airlines have frequent flyer programmes to reward loyal customers, credit cards
offer redeemable bonus points for increased card usage, telecom service operators
provide customized services to their heavy users, and hotels have personalized
services for their regular guests.

2.2 Steps Involved in Framing Integrated Marketing Communication

It is likely that integrated marketing communication will be expected to make a
number of contributions toward meeting the marketing objectives. Thus, the main
steps in designing IMC are:
1) Identification of target audience: Defining the target audience is one of the
first steps in designing the IMC. While thinking about the target audience, one
must look well beyond traditional demographic considerations. It is also important
to 'think ahead 'and ask the following question.
• What are the relevant target buyer groups?
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• What are the target group's demographic, lifestyle, and psychographic profile?
• How is the trade involved?

2) Determining the communication objectives: The next step is setting the

communication objectives. There may be different communication objectives like
increase in sales, brand image and good will, expansion of business. Thus, the
seller has to evaluate all these objectives and select the one which he intends to
achieve.

3) Determining the message: An effective message should get attention, hold

interest, arouse desire, and obtain action (AIDA model). In practice, few messages
take the consumer all the way from awareness to purchase, but the AIDA
framework suggests the desirable qualities of a good message. In putting the
message together, the marketing communicator must decide what to say, how to
say it, and who should say it. Thus, the communicator should focus more on
message content, message format and message structure.

4) Selecting the communication channel: There are two broad types of

communication channels - Personal and Non personal.
a. Personal Communication Channels: In personal Communication
channels, two or more people communicate directly with each other. They
might communicate face-to-face, over the telephone, through the mail or even
through an internet chat. Personal Communication channels are effective
because they give rooms for receiving and addressing feedbacks.
b. Non Personal Communication Channels: Non personal communication
channels include the media which consists of:
1. Print media -newspapers, magazines, direct mail etc.
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 2. Broadcast media-radio, television etc.
3. Electronic media-audiotapes, videotapes, CD-ROM, web page etc.
4. Display media-billboards, signs, posters, banners, hoardings etc.
Most of the non- personal messages come through paid media.

5) Determining the budget: This is one of the most important decisions of IMC
process. Effective IMC depends on the budget set for communication Mix. The
marketer prepares the budget taking into nature of the customers, objectives, nature
of competitions and also availability of funds.

6) Promotion Mix decision. After determining budget, it is essential to determine

the promotional mix. Promotional mix is the combination of various tools like
advertising, public relation, personnel selling and so on. Because of different
marketing environment, there has to be variation in communication mix. A
medium that is effective in one market may not be equally effective in another
market.

7) Implementation of promotion mix: The marketer then makes an arrangement

to implement the communication mix. The seller has to select the right media in
order to put across the promotion message.

8) Follow up: Here, the advertiser has to review the performance in terms of sales
and purchase. If the performance is as per communication objectives, there is
nothing to worry. On the other hand, if the performance falls below the
communication objectives, then certain corrective steps have to be taken.

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 In-Text Question 2:
Mention FIVE (5) steps involved in framing integrated marketing communication

2.3 Goals of Marketing Communications

Marketers communicate with target customers for the obvious purpose and goal of
increasing sales and profits. Accordingly, they seek to accomplish several strategic
goals with their marketing communications efforts. Below are some of the
marketers’ goals and targets
1) Create awareness
Obviously, we cannot purchase a product if we are not aware of it. An important
strategic goal must be to generate awareness of the firm as well as its products.
Marketing communications designed to create awareness are especially important
for new products and brands in order to stimulate trial purchases. As an
organization expands, creating awareness must be a critical goal of marketing
communications.

2) Build positive images

When products or brands have distinct images in the minds of customers, the
customers better understand the value of what is being offered. Positive images can
even create value for customers by adding meaning to products. Retail stores and
other organizations also use communications to build positive images. A major
way marketers create positive and distinct images is through marketing
communications.

3) Identify prospects
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Identifying prospects is becoming an increasingly important goal of marketing
communications because modern technology makes information gathering much
more practical, even in large consumer markets. Marketers can maintain records of
consumers who have expressed an interest in a product and as a result, efficiently
direct future communications. Technology now enables marketers to stay very
close to their customers. Websites are used to gather information about prospects.
Also, supermarkets use point-of-sale terminals to dispense coupons selected on the
basis of a customer’s past purchases.

4) Build channel relationships

An important goal of marketing communications is to build a good relationship
with the organization’s channel members. When producers use marketing
communications to generate awareness, they are also helping the retailers who sell
the product. Producers may also arrange with retailers to distribute coupons, set up
special displays, or hold promotional displays in their stores. All of these benefit
retailers and wholesalers. Retailers support manufacturers when they feature
brands in their advertisements to attract buyers. All members of the channel benefit
because of such efforts. Cooperating in these marketing communication efforts can
build stronger channel relationships.

5) Retain customers Loyal customers are a major asset for every business. It costs
far more to attract a new customer than to retain an existing one.
Marketing communications can support efforts to create value for
existing customers. Interactive modes of communication
(including salespeople and websites) can play an important role in
retaining customers. They can serve as sources of information
about product usage and also about new products being developed. They can also
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gather information from customers about what they value, as well as their
experiences using the products. This two-way communication can assist marketers
in increasing the value of what they offer to existing customers, which will
definitely influence retention in the long run.

In-Text Question 3:
What are the goals of marketing communication?

2.4 Benefits of Integrated Marketing Communications

Although Integrated Marketing Communications requires a lot of effort, it yields
many benefits. It can create competitive advantage, boost sales and profits, while
saving money, time and stress. IMC wraps communications around customers and
helps them move through the various stages of the buying process. The
organization simultaneously consolidates its image, develops a dialogue and
nurtures its relationship with customers.

This ‘Relationship Marketing’ cements a bond of loyalty with customers which can
protect them from the inevitable onslaught of competition. The ability to keep a
customer for life is a powerful competitive advantage.
IMC also increases profits through increased effectiveness. At its most basic level,
a unified message has more impact than a disjointed myriad of messages. In a busy
world, a consistent, consolidated and crystal clear message has a better chance of
cutting through the ‘noise’ of over five hundred commercial messages which
bombard customers each and every day.

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At another level, initial research suggests that images shared in advertising and
direct mail boost both advertising awareness and mail shot responses. Thus, IMC
can boost sales by stretching messages across several communications tools to
create more avenues for customers to become aware, aroused, and ultimately to
make a purchase

Carefully linked messages also help buyers by giving timely reminders, updated
information and special offers, which when presented in a planned sequence, help
them move comfortably through the stages of their buying process. Consequently,
this reduces their ‘misery of choice’ in a complex and busy world.

IMC also makes messages more consistent and therefore more credible. This
reduces risk in the mind of the buyer which, in turn, shortens the search process
and helps to dictate the outcome of brand comparisons.

Un-integrated communications send disjointed messages which dilute the impact

of the message. This may also confuse, frustrate and arouse anxiety in customers.
On the other hand, integrated communications present a reassuring sense of order.
Consistent images and relevant messages help nurture long term relationships with
customers. Here, customer databases can identify precisely which customers need
what information and when throughout their whole buying life.
Finally, IMC saves money as it eliminates duplication in areas such as graphics
and photography since they can be shared and used in advertising, exhibitions and
sales literature etc. Agency fees are reduced by using a single agency for all
communications and even if there are several agencies, time is saved when
meetings bring all the agencies together for briefings, creative sessions, tactical or

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strategic planning. This reduces workload and subsequent stress levels. This,
indeed, is one of the many benefits of IMC.

2.5 Barriers to Integrated Marketing Communications

Despite its numerous benefits, Integrated Marketing Communications (IMC) has
some barriers. In addition to the usual resistance to change and the special
problems of communicating with a wide variety of targeted audiences, there are
many other obstacles that restrict IMC. These include: Functional Silos; Stifled
Creativity; Time Scale Conflicts and a lack of Management know-how.

Functional silos: Rigid organizational structures are infested with managers who
protect both their budgets and their power base. Sadly, some organizational
structures isolate communications, data, and even managers from each other. For
example, the PR department often doesn’t report to marketing. The sales force
rarely meets the advertisers or sales promoters and so on. Imagine what can happen
when sales representatives are not told about a new promotional offer! And all of
this can be aggravated by turf wars or internal power battles where specific
managers resist having some of their decisions (and budgets) determined or even
influenced by someone from another department.

Here are two difficult questions – What should a truly integrated marketing
department look like? And how will it affect creativity? It does not matter whose
creative idea it is, but often, it does. For example, an advertising agency may not
be so enthusiastic about developing a creative idea generated by, say, a PR or a
direct marketing consultant.

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IMC can restrict creativity. No more wild and wacky sales promotions unless they
fit into the overall marketing communications strategy. The joy of rampant
creativity may be stifled, but the creative challenge may be greater and ultimately
more satisfying when operating within a tighter, integrated, and creative brief. Add
different time scales into a creative brief and you’ll see Time Horizons provide one
more barrier to IMC. For example, image advertising designed to nurture the brand
over a longer term may conflict with shorter term advertising or sales promotions
designed to boost quarterly sales. However the two objectives can be
accommodated within an overall IMC, if carefully planned. But this kind of
planning is not common. A survey in 1995 revealed that
most managers lack expertise in IMC. It is not just
managers, but also the agencies. There is a proliferation
of single discipline agencies. There appears to be very
few people who have real experience of all the marketing
communications disciplines. This lack of know-how (i.e.
knowledge) is then compounded by the dearth of
commitment.

4.0 Session Summary

In this study session, we considered the topic: integrated marketing
communication. We got to understand that the integrated marketing
communication (IMC)is a concept of marketing communications planning that
recognizes the added value of a comprehensive plan which evaluates the strategic
roles of a variety of communications disciplines.

5.0 Self-Assessment Questions

1. What is integrated marketing communication?
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 2. What are the steps involved in framing integrated marketing
communication?
3. Discuss the goals in marketing communication
4. What are the barriers to integrated marketing communication?
5. Explain the benefits of integrated marketing communication

6.0 Additional Activities (Videos, animation and outdoor activities)

a. Visit U-tube https://goo.gl/ZR44M7. Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/Km9kBo and critique it in the discussion
forum

In-Text Answer 1:
Integrated Marketing Communications (IMC) is a strategic marketing process
specifically designed to ensure that all messaging and communications strategies
are unified across all channels and are centred around the customer.

In-Text Answer 2:
1 Identification of target audience,
2. Determining the communication objectives
3. Determining the message
4. Selecting the communication channel
5. Determining the budget
6 Promotion Mix decision
7 Implementation of promotion mix and
8 Follow up.

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 In-Text Answer 3:
1) Create Awareness,
2) Build Positive Images,
3) Identify Prospects
4) Build Channel Relationships and
5) Retain customers.

7.0 References
Aaker, David, and John (1992). Advertising management. Pretice-Hall of India
Kenneth E. Clow and Donald Baack (2007). Integrated Advertising, Promotion,
and Marketing Communications, (Third Edition). Pearson Education, Inc.
Prentice Hall.

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 STUDY SESSION 4
Communication Models in Advertising
Section and Subsection Headings
Introduction
1.0 Session Learning Outcomes
2.0 Main Content
2.1 Communication Models in Advertising
2.2 Elements of Advertising/marketing Communication
2.3 AIDA Model
3.0 Tutor Marked Assignment
4.0 Conclusion/Summary
5.0 Discussion Questions
6.0 Additional Activities
7.0 References/Further Readings

Introduction
You are welcome to this study session. In this study session, you will be
introduced to the subject matter of "communication models in advertising". This
session is expected to expose you to communication models as well as the meaning
of communication.

1.0 Learning Outcomes

At the end of this study session, you should be able to understand the following:
1. The meaning of communication
2. The element of advertising /marketing communication
3. The AIDA model.

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2.0 Main Content
2.1 Communication Models in Advertising
The word communication comes from the Latin word communis, meaning
common. When we communicate, we try to establish commonness with someone
by sharing information, ideas or attitude. Man is a social animal and thus,
communication is essentially a social affair. ‘No man is an island or an entire in
himself’, ‘We cannot not communicate’ are some of the common sayings in
communication. Communication is what makes human relationships possible.

Speech, writings, gestures are some of the means of communication or social

interaction. Communication can be in terms of conventions of dress, mannerism,
institutions etc. There are various schools of thought in the communication. The
process of communication has been explained through different models and
theories as per the changing times. Aristotle was among the first to develop a
communication model. According to him, there are three main elements in a
communication event. They are the speaker, the speech and the audience.
Subsequently, many other experts have developed other models.

Shannon and Weaver developed a model based on technical aspect of

communication. They introduced the concept of ‘noise’ and the idea that meaning
lies in people. Noise could be the culture, value etc. of the society. The Berlo’s
model introduced ‘encoder’ ‘decoder’ elements into communication process.
Furthermore, Harold Laswell’s model emphasized on the effect of communication
and the response of the receiver. In the Wilbur Schramm model, the focus is on the
signal from the two sides (i.e. the source and receiver). Also, there are various
theories (such as the Bull’s eye theory, spiral theory etc.) that explain the process
of communication.
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Communication is no longer viewed as simply a way to reach out to people.
Communication is a field that has been growing in diverse directions. Hence, it is
to be studied not only at interpersonal, organizational levels, but also at other
various levels such as the inter-cultural context. To understand communication at
any level, we need to study any communicative event, process or system under
four main categories: Context, Technology, Representation and Social relation.
These are the four analytical dimensions of communication. Each of them is co-
determinant. These four dimensions can be studied as the broad framework of the
communication process.

In-Text Question 1:
According to Aristotle, event there are three elements in communication. What are they?

George T. Vardaman of the College of Business Administration, University of

Denver, USA, suggests a simple formula with an acronym TRIM as the title. He
suggests the definition, planning, whom, what, when and where of communications
using the TRIM formula.
This formula is further elaborated as follows:
ꞏ Target or Mission or purpose of communication.
ꞏ Receiver to whom the message is directed at, based on his needs
ꞏ Impact or result that is desired.
ꞏ Method of media that must be employed to get the desired results.

The TRIM formula can give you very effective communications and presentation
control, so that your time and efforts can be productively channelled and bring you
the results you want.

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Effective communication really depends on how ideas are being organized and put
together. The way you put together your ideas determines how you will give out
the information and how well your targeted audience will receive your message.
This is vital to the success of business communications. It is worthwhile to
examine methods for putting ideas into a communicable form. These methods are
given as follows;
1. Structuring ideas for the target group
2. Building logical sequences.
3. Building psychological sequences.
4. Developing core ideas from the lot.
5. Having proper introductions and conclusions.

However, in any situation, success of the communication will directly depend on

the quality of the ideas and their development within the larger objectives. While
communication can be better if you know your objective, greater effectiveness lies
in hitting the right target audience with their predominant communicative needs. In
this case, there are five types of receiver that need to be understood and
considered.
1. Apathetic
2. Sophisticated
3. Hostile
4. Credent
5. Critical

You may have the most important message delivered in the most creative manner,
but the communication would fail if you strike the wrong chord in the audience.

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You must overcome receiver’s apathy, draw attention and sustain interest. Some of
the techniques used by professional communicators are:
1. Shock - startle, shake or surprise the audience.
2. Suspense - keeping them guessing.
3. Humour - in language or situation to overcome apathy.
4. Novelty - something new or innovative or creative.
5. Familiarity - keeping audience interest through something known.
6. An inside story - something to do with behind the scene activities.
7. Visual and other devices - in presentation, like demo, audiovisual, case-studies,
and anecdotes.

While doing these, one must, at the same time, be careful in selecting appropriate
techniques, avoid talking down to the audience, be
natural, avoid being condescending towards people and
lastly, monitor the communications. If it exposes
weaknesses, it is essential for corrective action to be
taken. Monitoring must be dependent on feedback
received from the audience through formal and informal
channels.

Context
Communication can take place in literally hundreds of contexts. Therefore, it is
important to view communication from a contextual point of view. Context keeps
on changing. It affects ideas, technology etc. Media products at one level are
products of complex organization, and at another level, they reflect the economic
arrangements of media industries and other institutions. The work of individual

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communicator cannot be understood outside these organizational, industrial and
institutional contexts.

Technology
In today’s world, the very word communication brings to mind technical and
electronic means of communication, such as the telephone, television, computer
etc. These are the means of communication through which the entire systems in the
world are functioning, be it trade, business, education and even keeping in touch
with friends and the family members.

Articulation is dependent on the medium involved, or it can be said that

communication is dependent on the channel to transmit a message. Therefore,
technology largely determines communication.

Social Relations
Social relations comprise of the relationship and role of the players in the
communication process. Communication can be said to be a process of information
handling which includes the activities of production, dissemination, reception and
storage all within a social system. Social relations deal with how the changes in the
relationship between the players affect the information process.

Representation
Representation is the projection of content. It is the image, idea or message that is
conveyed through the communication. The way in which a fact is projected is
known as representation. Media by means of representation can give meaning in a
particular manner. Media representation is one of the means of achieving
hegemony and popular consent. Each one of these factors affects the other, and in
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turn the entire communication process. Thus, communication can be described as
‘The articulation of social relations between individuals in a society.’
Advertising as a communication tool is an integral part of marketing.

2.2 Elements of Advertising/marketing Communication

You will now be made to understand the various elements in the communication
process.

Advertiser: It could be an individual or an organization that wants to communicate

to the target audience. The communication could be about its products/services.

Advertisement: It is meant for information. It goes on to make the target audience

to be favourably inclined towards a particular product. It may ask people to act on
the message. Both rational and emotional appeals could be used to do so.

Media: The channels of communication are the media. They convey the ad
message to the target audience. Newspapers, magazines, TV, etc. are the common
or few of the media tools used. The media have their own strengths and
weaknesses.

Targeted audience: The readers of the print media, the listeners of radio and the
viewers of TV make the audience. The product could be for
the mass audience or for a targeted audience. Audience
could be both users and nonusers of the product. Now let us
come down to certain models that primarily have their roots
within the context of advertising. You must understand that
the basic principle relates to communication principle itself.
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2.3 AIDA Model
The design and development of advertising follows the AIDA formula. The
effectiveness of advertising depends on extent to which the advertising message is
received and accepted by the target audience.
To be effective, research has identified that an advertisement has to
i. Attract Attention
ii. Secure Interest
iii. Build Desire for the product and finally
iv. Obtain Action.
All advertisements obviously do not succeed on these counts. This is one solitary
reason behind the great divergence between the number of people exposed to the
advertisement and those who ultimately take the purchase decisions. At this stage,
however, other elements of the marketing mix, especially distribution become
crucial.

Advertisement communicates an idea, a message or a belief. An advertisement

would be effective only if the audience accepts the message and is motivated to
take the required action. Several models have been developed to specifically
identify the sequence of events that must take place between the receipt of message
and the desired action.

In-Text Question 2:
To be effective, research has identified that an advertisement has to fulfil a number of
conditions. What are they?

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A somewhat simplified model based on the identical principle of sequential stages
of consumer action is known as AIDA model.

Advertising as a communication medium can in most cases effectively perform the

first three functions. In the case of direct action advertising, it also must translate
the desire into action, unaided by any other promotional instruments. In the case of
indirect-action advertising, however, the action can be aided at the time of
purchase by two-way communication between the intending buyer and the sales
staff.

Attention
The layout is the most important factor that directs attention to an advertisement.
Typography and colors used in the layout can rivet us. The size of the
advertisement also compels us to get attracted to it. Contrast by white space is a
good attractor. Movement is a vital element for getting attention. Movement can be
physical or emotional. The position of the advertisement also enhances its
attractiveness. The use of Celebrities in the advertisement, dramatization, model
selection, and illustration etc. also help in getting attention.

Interest
Ad seen does not mean ad read. Mostly, people see the illustrations and do not read
the copy. Hence, illustrations have to be applied effectively. They should, together
with headlines, induce further reading. The selection of the illustrations and its
integration to life are very important just as the copy format is important for
interest creation. A humorous copy is suitable for some people, while some
categories of people prefer scientific copy. As a result of this difference, there is a
dilemma for a copywriter. The target of a copywriter is to satisfy maximum
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number of people. If this is truly case, he has to search for a common denominator
of interest.

Desire
The basic purpose of advertising is to create a desire for the product or service
being advertised. It is a function of appeals used for motivating people. Vivid
description or copy always helps. Buying motives (either physiological or
psychological) make people purchase products. The copy of the advertisement
must kindle these motives. There are certain barriers that must be overcome. For
example, certain reservation in the mind of customers is one of these barriers. As a
result of these barriers, the advertiser has to be convincing enough by giving
evidence, testimonials, endorsements, and facts and figures. On arousal, people
become prone to buy the product.

Action
The logical end of the desire aroused is to buy the product.
1. Products are associated with company.
2. The message is repeated.
3. Certain immediate action appeals are used.
There are six steps or movements towards the purchase of a product or service. The
first two steps, awareness to knowledge and fall in the cognitive sphere of related
behavioural dimension. It deals with the realm of thoughts. Here, Advertising
provides essential information and facts. These advertisements are announcements,
descriptive slogans, jingles, sky writing, and teaser campaigns.

The next two steps in the movement towards purchase are liking and preference.
These have been linked with the affective sphere, which is the realm of emotions
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wherein the advertising changes attitudes and feelings. Advertisements falling in
this category are competitive advertisements, argumentative advertisements,
advertisements with a strong rational message and image advertisements with
status and glamour appeals.

The final two steps in the movement towards purchase are conviction and
purchase. These are related to behavioural realm of motives. Here, the
advertisements stimulate or direct desires. Advertisements that fall in this slot are
POP, retail store advertisements, last chance offers, price
reduction appeals, testimonials, and prize scheme
advertisements. This is called Hierarchy of Effect (HOE)
model.

Three models of message design and development: They

are 1. AIDA model, 2. HOE: Hierarchy of Effects model,
and 3. Communication model of Advertising.

In-Text Question 3:
The design and development of advertising follows the AIDA formula. What is the meaning of
the acronym?

4.0 Session Summary

In this study session, we considered the topic titled communication models in
advertising. We were able to discuss the meaning of communication, the element
of advertising/element of communication and went further to look at the AIDA
model of communication.

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5.0 Self-Assessment questions
1. What are the models in advertising?
2. Explain the elements in advertising
3. What do you understand by the AIDA model?

6.0 Additional Activities (Videos, animation and outdoor activities)

a. Visit U-tube https://goo.gl/NmkaRq . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/exZ5R9 and critique it in the discussion
forum

In-Text Answer 1:
They are the speaker, the speech and the audience.

In Text Answer 2:
i. Attract Attention
ii. Secure Interest,
iii. Build Desire for the product and finally
iv. iv. Obtain Action.

In-Text Answers 3:
AIDA means: Attention, Interest, Desire and Action.

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7.0 References/Further Readings
Aaker, David, and John (1992). Advertising management. Prentice-Hall of India
Kenneth E. Clow and Donald Baack(2007). Integrated Advertising, Promotion,
and Marketing Communications, (Third Edition). Pearson Education, Inc.
Prentice Hall.

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 2.0 MODULE 2
Objective Setting and Budgeting for Advertisement, Segmentation
and Positioning
Contents:
Study Session 1: Setting objectives and budgeting for advertisement
Study Session 2: Understanding Segmentation and positioning
Study Session 3: Choosing an advertisement agency
Study Session 4: Advertising campaign management

STUDY SESSION 1
Setting Objectives and budgeting for advertisement
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Setting objectives and budgeting for advertisement
2.2 DAGMAR approach
2.2.1 Nature of objectives
2.2.2 Assessment of DAGMAR
2.3 Establishing the budget
2.4 Advertising the budget
2.5 Allocating the budget
3.0 Tutored Marked Assignment
4.0 Conclusion/Summary
5.0 Discussion Questions
6.0 Additional Activities
7.0 References/Further Readings
86
Introduction:
You are welcome to this study session. In this study session, we are going to be
discussing the topic titled setting objectives and budgeting for advertisement. You
will get to understand that advertising is a method of communication with
specified objectives.

1.0 Learning Outcomes:

At the end of this study session, you should be able to understand the following:
1. The DAGMAR approach in setting objective in advertisement
2. Advertising budget
3. Approaches to develop advertisement budget

2.0 Main Content

2.1 Setting Objectives and Budgeting for Advertisement
Advertising is a method of communication with a specified objective. As explained
earlier, the objectives of advertising are grouped as sales objectives (measured in
terms of increase in sales, increase in market share and return on investment) and
communicative objectives. The communication objectives of advertising can be
grouped into the following
 Building awareness (informing): The first task of any advertising is to
make the audience appreciate that the product or service exists and to
explain exactly what it is.
 Creating favourable attitudes (persuasion): The next stage and the one
that preoccupies most advertisers is to attract the favourable attitude to the
brand which will eventually lead the consumers to switch their purchasing
pattern

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  Maintenance of loyalty (reinforcement): One of the tasks which is often
forgotten is that of maintaining loyalty of existing customers who will
almost always represent the main source of future sales.

There are general objectives of advertising that cover goals like encouraging
increased consumption of a product by current users, generating more sales leads,
increasing brand awareness, increasing repeat purchases and supporting the
personal selling efforts.

In-Text Question 1:
Mention the ways in which the communicative objectives of advertising can be grouped.

2.2 DAGMAR Approach

Dagmar Approach is the task of measuring ad. Effectiveness will not be daunting
if we clearly spell out the advertising objectives. Russel H. Colley (1961)
pioneered an approach known by the acronym DAGMAR (Defining Advertising
Goals for Measured Advertising Results). This approach aims at establishing an
explicit link between ad goals and ad results. Colley distinguished fifty two (52)
advertising goals that might be used with respect to a single advertisement and a
year’s campaign for a product or a company’s entire advertising philosophy.

These goals may pertain to sales, image, attitude, and awareness. Some of the goals
are:
 Persuade a prospect to visit a show room and ask for a demonstration.
 Build up the morale of the company’s sales force.

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  Facilitate sales by correcting false impression, misinformation and other
obstacles.
 Announce a special reason for buying now (price, discount, premium and so
on).
 Make the brand identity known and easily recognizable.
 Provide information or implant attitude regarding benefits and superior
features of brand.

According to DAGMAR approach, the communicative task of the brand is to gain

(a) awareness, (b) comprehension, (c) Conviction, (d) image and (e) action.
Advertising goals should be consistent with these communicative tasks. Later
performance on these counts and projected goals is compared. For example, if a
company setting a goal of 15 per cent increase in sales advertises and achieves this
objective, then its ad is successful and effective. It presupposes the understanding
of the dynamics of consumer behaviour. Without these, goals cannot be set.
Besides, a thorough acquaintance of market environment is called for.

DAGMAR is a planning and control tool. It may guide the creation of advertising.
However, the basic inputs of DAGMAR are not so easily to formulate and may
also inhibit creativity.
Awareness
Comprehension
Conviction
Image
Action

2.2.1 Nature of objectives

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According to Colley, objectives should be stated in terms of concrete and
measurable communicative tasks. The advertiser should specify a targeted
audience, indicate a benchmark starting point and the degree of change sought, and
also specify a time period for accomplishing the objectives(s).

2.2.2 Assessment of DAGMAR

The DAGMAR approach of setting objectives has had considerable influence on
the advertising planning process. Many promotional planners use this model as a
basis for setting objectives and assessing the effectiveness of their promotional
campaigns. DAGMAR also focused advertisers’ attention on the value of using
communication–based rather than sales-based objectives to measure advertising
effectiveness and encouraged the measurement of stages in the response hierarchy .
Colley’s work has led to improvements in the advertising and promotional
planning process by providing a better understanding of the goals and objectives
toward which planners’ efforts should be directed. This usually results in less
subjectivity and also leads to better communication and relationships between the
client and its agency.

2.3 Establishing the Budget

While establishing objectives is an important part of the planning process, the
limitations of the budget are important too. No organization has an unlimited
budget. Hence, objectives must be set with the budget in mind. The budgeting
decisions have a significant impact not only on the firm itself, but also on many
numerous others who are involved, either directly or indirectly. Two primary
budgeting decisions are establishing a budget amount and allocating a budget.
However, there is no universally accepted method of setting a budget figure.
2.4 Advertising Budget
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In this advertising world, we see much advertisement of different products or
brands. Organizations invest heavily in advertising to make their product popular
and to increase sales. Consequently, the following questions should arise
How do organizations decide on how much to advertise?
How much to invest in advertisement?
What should be the size of advertising budget?
"Advertising budget is an estimated amount an organisation decides to
invest in its promotional expenditures over a period of time. An advertising
budget is the money a company set aside to accomplish its marketing
objectives."
It is difficult to measure the effect of advertising on business sales. Advertising is
just one of the variables that affect sales in a period of time. As a percentage of
sales, advertising expenditure varies from business to business. Because of such
complications, it is very difficult for business organizations to decide the size of
advertising budget. However, there are various approaches that can be used to set
advertising budget.

There are various methods of deciding on advertising budget. This decision will be
largely influenced by the objective that we set for the campaign. For example, if
there is a new product launch, then the advertising campaign will have to be high.
Whereas, launching a repeat campaign requires less spending.

In Text Question 2:
What is advertising budget?

The most commonly used advertising budgeting method include

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1. Percentage of Sales Volume: The percentage is worked out on the basis of a
firm’s historical budget, industry norms or on the basis of the prevailing market
conditions. If the market has started an upward trend, then one percent extra
amount will be put for advertising budget. Without considering market conditions,
following this method may create problem. If the firm’s market share is in a
downward trend, then the firm may decide to increase the advertising budget.
If the product is in the disinvestments stage, then disinvestment may be an option.
In such a case, only marginal advertising budget is sufficient to clear the stock. If
the firm realizes that the competitors are moving out at the decline stage, then the
firm can decide to take the leadership position through aggressive advertising.
2. Unit of Sale Method: Consumer durable firms make use of this method as a
variant on sales percentage. While it mostly works out same as a sales percentage,
the firm puts an amount of advertising expenses on the unit.
3. Competitive Parity Method: the firm must carefully study Competitive
information regarding their sales, distribution pattern and advertising. It will
provide the correlation between the competitive sales and advertising effort.
Depending on the firm’s strategy of increasing market share or steadying the share,
decision can be made to have a bigger or smaller budget than the competitors.
Instead of reacting to competitor’s advertising results, firms can be proactive in
their approach by planning their own goals of marketing and then the advertising
budget will emerge.
4. Historical Method: In this method, last year’s advertising budget is adopted for
the current year based on the assumption that practically no change has taken place
in the market and market growth is slow, which does not justify any addition to the
budget. Last year’s budget could be multiplied by a factor to cover media rate
increase.

92
5. Affordability Method: Some firms believe that advertising is tactical and not
strategic and hence does not need much attention. These kinds of firms follow a
method of affordability and spend what is left after managing the details of the
official expenses involved in paying to the factors of production.
6. Total Group Budget: In case of multi-location and multi product line firms, a
total amount is dedicated for advertising and each strategic business unit receives a
share according to their needs. This method helps the group to segregate some
amount for corporate group advertising for the purpose of building the image of the
organization.
7. Percentage of Anticipated Turnover: This method is useful in dynamic
markets and budget can be fixed on the estimated demand pattern than the current
year sales.
8. Elasticity Method: This method takes in to consideration the seasonality of
business, the periodicity in the purchase cycle of consumer and the demand and
supply situation. This method is mostly used for advertising industrial products.
9. Operational Modelling: Market research gives advertising expenses, market
response and sales per advertising figures and the modelling is done to explain the
budget.
10. Composite Method: This method takes into consideration several factors in
formulating the advertising budget. Such factors include indices like firm’s past
sales, future sales projection, production capacity,
market environment, sales problems, efficiency level of
sales personnel, seasonality of the market, regional
considerations, changing media scenario and changing
media impact on the target market segment, market
trends and results of advertising and marketing.

93
11.Objective and Task Method: Marketers follow this method more often as this
is a scientific method where the advertising goals are explicitly stated and the cost
to achieve the target is also spelt out. Taking each activity like increasing
geographic sales area and increasing market awareness by a certain percentage
over the figure obtained from the brand tracking study, they add up the amounts
needed for each activity.

2.5 Allocating the Budget

Once the budget has been appropriated, the next step is to allocate it. The
allocation decision involves determining which markets, products and/or
promotional elements will receive which amounts of the funds appropriated.
Allocation can be influenced by the following:
• Allocation to advertising and promotion elements
• Client/agency policies
• Market size
• Market potential
• Market share goals
• Economies of scale advertising
• Organizational characteristics

In-Text Question 3:
Mention five advertising budgeting methods?

4.0 Session Summary

In this study session we dwelled on the topic setting objectives and budgeting for
advertisement and we were able to understand that advertising is a method of
communication with a specified objective. We were able to also discuss the
94
DAGMAR approach in setting objectives in advertisement. We went further to
discuss advertising budgeting and the different approaches to developing
advertising budget.

5.0 Self-Assessment Questions

1. How do you set objectives foe advertisement?
2. Explain what you understand by DAGMAR approach
3. Discuss how establish budget for advertisement
4. Describe how to allocate budget for advertisement

6.0 Additional Activities (Videos, animation and outdoor activities )

a. Visit U-tube https://goo.gl/dMhfaC . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/bFY68n and critique it in the discussion
forum

In-Text Answer 1:
The communication objectives of advertising can be grouped in to the following: i.
Building awareness (informing), ii. Creating favorable attitudes (persuasion), iii.
Maintenance of loyalty (reinforcement)

In-Text Answer 2:
Advertising budget is an estimated amount that an organization decides to invest
in its promotional expenditures over a period of time. An advertising budget is
the money a company set aside to accomplish its marketing objectives.

95
 In-Text Answers 3:
1. Percentage of Sales Volume,
2. Unit of Sale Method,
3. Competitive Parity Method,
4. Historical Method,
5. Affordability Method

7.0 References
Aaker, David, &John (1992). Advertising management, Pretice-Hall of India
Kenneth E. Clow and Donald Baack(2007). Integrated Advertising, Promotion,
and Marketing Communications (Third Edition). Pearson Education,
Inc.Prentice Hall.
Perreault, William D., Jr. and McCarthy, Jerome E. (2005). Basic Marketing: A
Global- Management Approach. Boston: McGraw-Hall Irwin.

96
 STUDY SESSION 2
Understanding Segmentation and Positioning
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Understanding Segmentation and Positioning
2.2 Basis of Segmentation
2.2.1 Geographic Segmentation
2.2.1.1 National Advertising
2.2.1.2 Local Advertising
2.2.1.3 Global Advertising
2.2.1.4 Demographic segmentation
2.2.1.5 Psychological/Psychographic Segmentation
2.2.1.6 Socio cultural Segmentation
2.2.1.7 Use-Related Segmentation
2.2.1.8 Usage-Situation Segmentation
2.2.1.9 Benefit-segmentation
2.2.1.10 Hybrid Segmentation
2.3 Segmentation on the basis of target groups
2.3.1 Consumer Advertising
2.3.2 Industrial Advertising
2.3.3 Trade Advertising
2.3.4 Professional Advertising
2.4 Behavioural Segmentation
2.5 Positioning
2.6 Using Product Characteristics or Customer Benefits
97
3.0 Tutored Marked Assignment
4.0 Conclusion/Summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, animation and outdoor activities)
7.0 References/Further Readings

Introduction
In this study session, we are going to be considering segmentation and positioning.
Basis for segmentation, the concept of positioning and the positioning strategy
shall form the basis of our discussion in this study session.

1.0 Learning Outcomes:

At the end of this study session, you should be able to understand
1. What market segmentation is
2. Basis for segmentation
3. The concept of positioning
4. Positioning strategy.

2.0 Main Content

2.1 Understanding Segmentation and Positioning
A market is defined as individuals, organizations with purchasing power, and
desire/ willingness to purchase. Markets can be categorized based on the buyers as
follows:
Producers market: it refers to the markets that trade in raw material, equipment,
supplies, machines etc.
Reseller market: this form of market trades in finished goods, services from
producers
98
Consumer markets: these are markets where the end-consumers buy finished
products for personal or household use. Consumer market can be bifurcated into
durables and non-durables markets. The non-durable products are also known as
fast moving consumer goods.

The principal means of classification are:

a. geographical spread (such as national, regional and local)
b. target group (such as consumer advertising, industrial advertising or trade
advertising)
c. type of impact, such as the following
i. Primary demand or selective demand advertising,
ii. Direct or indirect action advertising, and
iii. Institutional advertising. Markets comprise of heterogeneous segments of
consumers.

Market segmentation refers to process of identifying a group of buyers with similar

buying desires and requirements. The marketer targets each segment with a distinct
marketing mix. Companies, whether they are big or small, experience a similar
challenge. In such a confused situation, ‘Segmentation’ comes in handy!
Segmentation is defined as the process of dividing a market into distinct sub-sets of
consumers with common needs or characteristics and selecting one or more
segments to target.

Segmentation is the first step in a marketing strategy. Once marketers divide the
market into various groups, they can then select their ‘targeted segments’ and
design products that suit their requirements. For instance, companies like BPL
have resorted to market segmentation as a strategy to beat its competitors. Each of
99
its products has been designed to cater for the
demand of a particular segment. Some of the
company’s products are BPL Loewe (digital designer
televisions for the premium-end of the market);
Matrix Flat screen TV (for technology lovers); Studio
line (who are performance seekers); and Prima (for the lower-end of the market).

In-Text Question 1:
Mention the ways market can be categorized

2.2 Basis of Segmentation

The first step in developing a segmentation strategy is to identify the basis on
which the market segmentation is done. There are eight categories of customer
characteristics that form the basis for segmentation. The categories are:

2.2.1 Geographic Segmentation

The market is divided according to the location. The classification is based on the
assumption that people living in the same area share similar habits and wants.
However, there is a difference in the purchasing patterns of the consumer living in
urban, semi-urban, and rural areas. For instance, as an Electrolux dealer that has a
showroom in Hyderabad, you can advertise your company in and around
Hyderabad via local newspapers, TV, radio, and other magazines. On the basis of
geographical spread, advertising can be sub-classified as (a) national, (b) local and
(c) global.

2.2.1.1 National advertising

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Some manufacturers may think that their target is the entire country. They select
media with a nationwide base. Generally, large firms (MTN, Dangote Cement
Companies, etc.) undertake this kind of advertisement.

2.2.1.2 Local advertising

Small firms may like to restrict their business to State or regional level. Some firms
first localize their marketing efforts and once success has been achieved, they
spread out to wider horizons. Retail stores also undertake local advertising. The
area to be covered would generally be a city or a town and media would be
selected to principally relate to that area. In recent years, several magazines, which
focus on a particular city, have appeared and are of direct relevance to its
inhabitants. Sometimes, large firms may also go in for local advertising for the
purpose of undertaking pre-test of a product (especially consumer product) in
selected areas before embarking on promotional campaign at a national level.

2.2.1.3 Global advertising

Multinational firms treat the world as their market. Firms like National, IBM or
Sony or Ford advertise globally in periodicals like Times, Reader’s Digest etc.
However, with the increase in the use of the television and satellite
communications, marketers strongly believe that the geographic segmentation can
be replaced by a single global marketing strategy.

2.2.1.4 Demographic segmentation

The segmentation is based on characteristics like age, sex, marital status, income,
occupation, and education. It is the most accessible and cost-effective way to
identify your target market.
2.2.1.5 Psychological/psychographic segmentation
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Psychological characteristics refer to the inner qualities of a person. For instance,
consumers are divided on the basis of their needs and motivations, personality,
perceptions, learning, level of involvement, and attitudes. As an executive dealer,
you can provide a questionnaire to the people residing in the area with questions
like: Do you like reading book or not? How often do you go out for movies and
picnics? What channels do you prefer watching etc? Depending on their responses
to these questions, you can segment the consumers and offer a product that
matches their lifestyle.

2.2.1.6 Socio cultural segmentation

This is another basis for segmentation. Markets are divided based on factors like
family life cycle, social class, cultural values, and cross-cultural affiliations.
Culturally distinct segments offer excellent growth avenues for marketers.
However, care should be taken while advertising the products. For instance, if you
are selling the Whirlpool refrigerator with the ‘instant cool’ feature, sell it as a
means of convenience for a workingwomen family. However, the same should
appeal as a ‘status symbol’ for the upper class.

2.2.1.7 Use-related segmentation

It is the most popular method of segmentation. Consumers are divided into
different categories depending on the product, service, or brand usage
characteristics like the rate of usage (consumers are divided depending on the
number of times they use a product); Awareness status (Consumers are divided
based on their knowledge level of a product. For instance, if a consumer instantly
recalls all the features and models available or even those that are yet to be
launched in the market, his awareness level is high); and brand loyalty.
2.2.1.8 Usage-situation segmentation
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This classification is based on the products or services that the consumer uses
depending on the situation. For instance, if you buy red roses for your wife on her
birthday, you fall under one category.

2.2.1.9 Benefit-segmentation
The market is divided into segments depending on the benefits of the products.
This sort of segmentation is used to communicate the product features to
consumers. For instance, Bausch and Lomb advertises its disposable lenses as a
form of convenience.

2.2.1.10 Hybrid segmentation

Instead of sticking to one particular segmentation style,
marketers combine one or two segmentation variables
and arrive at another segmentation. This style is referred
to as Hybrid segmentation.

In-Text Question 2:
There are eight categories of customer characteristics that form the basis for segmentation.
What are those categories?

2.3 Segmentation on the Basis of Target Groups

On the basis of target groups, advertising can be classified as follows;
a. Consumer Advertising,
b. Industrial Advertising,
c. Trade Advertising,
d. Professional Advertising.

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2.3.1 Consumer advertising
A very substantial portion of total advertising is directed towards the consumers
who purchase them either for their own use or for their household. The main point
to be remembered here is that buyers of consumer items are generally very large
and are widely distributed over a large geographical area. This, however, enhances
the importance of advertising as a marketing tool. Looking into any general print
media, such as newspapers, magazines etc, can see such advertising. Any
advertisement intended to promote sale of the advertised products by appealing
directly to the buyers/consumers is called consumer advertising.

2.3.2 Industrial advertising

Industrial advertising on the other hand refers to those advertisements, which are
issued by the manufacturers or distributors to the buyers of industrial products.
This category would include machinery and equipment, industrial intermediates,
parts and components, etc. Because of the unique characteristics of industrial
buying decision process, the importance of industrial advertising is comparatively
lower than that of consumer advertising.

2.3.3 Trade advertising

Advertisements, which are directed by the manufacturers to its distribution channel
members (such as wholesalers or retailers), are called trade advertising. The
objective of such advertising is to promote sales by motivating the distribution
channel members to stock or to attract new retail outlets.

2.3.4 Professional advertising

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There are certain products for which the consumers themselves are not responsible
for the buying choice. Classic examples are pharmaceuticals in which where
doctors make decision for the consumers (i.e. the patients). Almost similar
situation exists in the field of construction where architects, civil engineers and
contractors are the decision makers. Firms operating in such market segments,
therefore, have to direct their advertising to these decision makers who are
professionals. With increasing competition, players try out to carve separate niche,
which leads to greater segmentation of the market. As each brand needs significant
investment for launch as well as to sustain equities, the plethora of brands become
unmanageable.

The process of restructuring and cost of engineering results in consolidation and

phasing out of weaker brands and thereby reducing the market segmentation. As a
tool, segmentation is effective in understanding the consumers and the market
associated with your brand. Only a proper understanding of it will give you an
understanding as to how to make your advertising campaign.

In-Text Question 3:
What is industrial advertising?

Segmentation is the division of the market into groups based on certain

demographical variables such as:
a. Age
b. Gender
c. Income
d. Geographic location
e. Usage
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f. Occupation
g. Education
h. Generation
i. Family size

The basis of this type of segmentation is:

1. That the groups of buyers are not being served well presently by the competitor,
and are therefore likely to try the brand advertised (e.g. Life Insurance
advertisements focusing on the young salaried class instead of stereotyped older
generation)
2. That the buyers are large enough, or growing in size (e.g. Advertisements for
women office wear)
3. That they are most likely to respond positively to the benefits offered by the
brand advertised (e.g. advertising luxury to the existing high-end brands of car
owners).

Let us take the above demographic variables one by one:

Age: Age is a very basic but useful demographic segmenting variable. People often
seek different features or benefits depending upon their age (and, relatedly, their
family life-cycle stage). Consequently, people in different age groups often differ
as to the brands they prefer within a product category. Hence, it is sometimes
possible to direct particular brands to a particular age group. Researchers have
found that a person’s “cognitive age” is a much better predictor of purchase
patterns than “actual” (chronological) age. For instance, a forty-year-old man may
still feel as if he was in his thirties, in terms of interests and activities. Therefore, it
is useful to learn as much as possible about prospective targeted segments.
The questions you should be asking yourselves are:
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What kinds of products and services will your target age group want to buy?
What kinds of features will they seek?
What kinds of advertising appeals and personalities will they be most responsive
to?

The answers to the above will give you a fair amount of insight into the designing
of your offering to the particular age group. For example, the advertisements for
cosmetics will invariably show a young woman, even if it is aimed at all the age
group. ‘I am a complan girl” is an advertisement focused at the young teens and
adolescents, whereas an advertisement about liquor targets matured age groups.
Thus, segments of different age groups often need different advertising
approaches, both in terms of message and execution.

Gender: Much research suggests that men and women process information from
ads differently. For instance, it has been shown that women process more detailed
information than men do, possibly because they are more attuned to paying
attention to external cues than men are. The woman manager who headed Nike’s
marketing campaigns to grow its women’s markets agrees and claims that women
are:
1. More discerning buyers than men, and
2. That they research many products and weigh several factors before they buy.
3. Women, unlike men, find ads using celebrity endorsements to be unpersuasive
because they don’t like being preached to.
4. Instead, women are responsive to ads that portray them as powerful, capable
people who hate being told they can’t do things simply because they are women.

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Income: Another useful demographic variable is income. Not surprisingly, higher
income households tend to be less sensitive about price and thus, they place a
higher value on buying higher-quality merchandise. Because of the growth in dual-
income households, there has been a dramatic growth in the proportion of total
spending in the economy coming from such households, implying that the market
for high-end products and services should increase substantially. Even sometimes,
the choice of celebrity endorser is considered while targeting a certain income
category.

Geographic Location: Geographic location can often provide the basis for an
effective segmentation strategy. If it so chooses, a firm with modest resources can
dominate a small geographic area. Its distribution within the limited area can be
Internet. Local media such as newspapers or spot television can be employed.
Also, it is possible to buy space in regional
editions of major national magazines.
In recent years, it has become increasingly
possible to learn something about a company’s
targeted consumers simply by knowing the postal
zip code in which they live. Census-based
demographic data on households has been
analyzed by various companies to yield “average profiles” for house-holds in
different segments, or groups.

Usage: A natural and powerful segmentation variable is product-class usage. Who

are the heavy users of the product or service? In many product categories, the
heavy users (who are usually 20 to 30 percent of the users) account for almost 70
to 80 percent of the volume consumed. This is sometimes called the “80:20” rule.
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It is obviously extremely valuable for a brand to have most of its users from the
heavy-user category because that should lead to disproportionately higher share of
units sold.

One segmentation scheme might thus involve heavy users, light users, and
nonusers. This particular segmentation scheme is likely to be useful wherever the
focus is on building up the market. Each person is classified according to usage,
and a programme is developed to increase the usage level. The segments defined
by usage usually require quite different marketing programs. So, a program
tailored for one of these segments can generate a substantially greater response
than would a marketing program common to all segments. Of course, designing
and implementing several marketing programmes is costlier than developing one,
but the resulting market response will often be significant enough to make it
worthwhile.

A somewhat different aspect of usage segmentation is the possibility that

consumers may seek different benefits from the same product (e.g., soft drinks) de-
pending on the nature of the usage-occasion (e.g., social use versus food
enhancement). Different Ad campaigns to address these different occasion-based
segments are therefore also possible.
Occupation: There are professionals who have MBAs, CA, etc. We have the
technicians, civil servants, businessman, farmers, and housewives, the
unemployed, the list seems to go on. Of late, there are insurance firms who are
targeting at the housewives and even the unemployed to sell their policies.

Education: Different academic qualifications affect and determine the

receptiveness of people to the content of the advertisement. The school going kids
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would be able to grasp any advertisement given by an IIT coaching institute.
Whereas, graduates and the postgraduates would grasp the ads which would offer
them a job or a professional course. This type of advertising is available in
recruitment advertisements.

Generation: Pepsi, with its ads on ‘Gen X’, were able to understand the relevance
of generation advertising. Be it the baby boomers of the 60s and the high energy
level Generation Y, brands and companies focus on certain generations for
marketing their products. Each set of generations has their own values, beliefs and
attitudes and companies might focus on these variables so that their brands could
be well positioned towards them.

Family Size: The followings are certain classifications and the type of products
that customers of different kinds are likely to purchase:
ꞏ Young and single: Personal consumption items, entertainment, bikes, clothing
and love to go on a vacation.
ꞏ Newly married couples: Households durables like furniture, TVs, refrigerators,
etc.
ꞏ Young married with child: Toys, medicines, tonics, baby food, formula milk, etc.
ꞏ Older married with children: Food products, music, educational services and wide
variety of other products.
ꞏ Older married with dependent children: Rational purchases more on replacement
buying.
ꞏ Older married with no children: Self-education, saving schemes, hobbies, luxury
appliances, magazines, health products, etc.
ꞏ Old single retired: Economic lifestyle, healthcare and other services

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ꞏ Young married with child dual income: Convenience goods like washing
machines, microwave ovens, costly garments for the kid along with games.
Expenditure on instant food and crèches, etc.
ꞏ Single parent families: Buying physical, psychological and financial securities,
like insurance, alarms, boarding school expenses.
ꞏ Divorced: Money saving products, rental housing, childcare, time saving
appliances, etc.
ꞏ Older people married or single: as a result of being cash poor and health
conscious, they need security and recreation.
ꞏ Middle age: Children’s lesson on dance and music, dental care, furniture, autos,
houses, dining out, etc.
ꞏ Middle aged with no children: Luxuries, travels, gift products, etc.

This is one of the segmentation variables to be considered while understanding the

targeted audience. The other one that is equally important is the Psychological
segmentation. A person’s pattern of interests, opinions, and activities represent his
or her lifestyle. Knowledge of lifestyle can provide a very rich and meaningful
picture of a person. It can indicate whether the person is interested in outdoor
sports, shopping, culture, or reading. It can include information concerning
attitudes and personality traits. Lifestyle also can be used to define a segment
empirically. This is often called psychographic (as opposed to demographic)
segmentation.

Lifestyle is particularly useful as a segmentation variable in categories where the

user’s self-image is important, such as fragrance. As an example of lifestyle
segmentation in fragrances, Revlon’s Charlie cosmetic line was targeted at a
lifestyle segment profiled as follows:
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ꞏ Is irreverent and unpretentious.
ꞏ Doesn’t mind being a little outrageous or flamboyant.
ꞏ Breaks all the rules.
ꞏ Has her integrity based on her own standards.
ꞏ Can be tough; believes rules are secondary.
ꞏ Is a pacesetter, not a follower.
ꞏ Is very relaxed about sex.
ꞏ Is bored with typical fragrance advertising.
ꞏ Mixes Gucci and blue jeans; insists on individual taste, individual judgment.
ꞏ Has a sense of self and sense of commitment.

Personality: Marketers have identified personality variables to segment the

market. Motor-cycle buyers can be identified as ‘independent, impulsive, macho,
ready to change, confident people.’ Lipsticks are for ‘young, out-going, beauty-
conscious women.’ Other products, which cater for personality traits, are liquor
and insurance. The marketers try to adjust the brand’s personality to the personality
and traits of buyers for whom it is meant. Consumers of different brands are
subjected to personal preference tests so as to measure their different needs, and
the differences in personality and traits are recorded.

Personality characteristics, especially the self-image that ideally should correspond

to the brand-image, are the basis of advertising appeals made to certain types of
personality. Other personality characteristics used are changeability, adaptability,
thriftiness, prestige consciousness, self-confidence, masculinity, conservativeness
and sentimentalism.

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Since it is difficult to reach targets on the basis of traits like sociability, self-
reliance or assertiveness, the classifications based on slots as given above become
useful.

We shall include a few other segmentation techniques, which to an extent could be

a part of psychographic understanding of the buyers. The need is to understand
segmentation from all angles rather than understanding it from a single point of
view.

2.4 Behavioural Segmentation

In behavioural segmentation, buyers are divided into groups on the basis of the
benefits sought from the product, user-status, usage-rate, loyalty-status, attitude
and readiness to use state.

Attitudes and benefits

Attitudes, preferences, and many related psychological constructs such as
motivations, perceptions, beliefs, product benefits etc. can also be used to segment
markets through the second empirical segmentation approach. Consumers differ in
the “need” for which they buy the same product. Thus, the fact that buyers will
tend to place different degrees of importance on the benefits obtained from that
type of product leads logically to the fact that they represent different segments.

The idea of segmenting on the basis of important attributes has been termed as
benefit segmentation by Russell Haley. For example, lowest price, durability, use
on special occasions. In the case of tooth paste, we could use elements like flavour,
price, product appearance, brightness of teeth and decay prevention.

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Considering the different advertising approaches that will be appropriate for each
segment suggests and underlies the value of benefit segmentation for advertising.
Whether it is demographic study in the previous lesson or behavioural and
psychographic analysis in this lesson, we must learn to integrate in order to clearly
understand all our buyers.

2.5 Positioning
Just as segmentation involves the decision to aim at a certain group of customers
and not others, positioning involves a decision to stress only certain aspects of our
brand, and not others. The key idea in positioning strategy is that the consumer
must have a clear idea of what your brand stands for in the product category, and
that a brand cannot be sharply and distinctly positioned if it tries to be everything
to everyone. Such positioning is achieved mostly through a brand’s marketing
communication, although its distribution, pricing, packaging, and actual product
features also can play major roles.

It is often said that positioning is not what you do to the product, but what you do
to the consumer’s mind through various means of communication. For instance,
many products in the over-the counter drug market have identical formulas but are
promoted for different symptoms by using different names, packaging, product
forms, and advertising.

The strategic objective must be to have segmentation and positioning strategies

that fit together. A brand must be positioned in a way that is maximally effective in
attracting the desired target segment. A brand’s position is the set of associations
that a consumer has with the brand. These may cover physical attributes, lifestyle,
use occasion, user image, or stores that sell it.
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A brand’s position is developed over years through advertising, publicity, word of
mouth and usage experience. This development could be sharp or diffuse,
depending on the consistency of the brand’s advertising over the years.

A brand’s position in a consumer’s mind is a relative concept, in the sense that it

refers to a consumer’s comparative assessment of how a brand is similar to or
different from the other brands that compete with it. Think of every consumer as
having a mental map of the product category. The location of your brand in that
map, relative to that of your competitors, is your position, and the locations of all
the brands in that map are determined by the associations that the consumer makes
with each brand.

A positioning strategy is vital to provide focus to the development of an

advertising campaign. The strategy can be conceived and implemented in a variety
of ways by considering the attributes, competition, specific applications, the types
of consumers involved, or the characteristics of the product class. Each represents
a different approach to developing a positioning strategy, even though all of them
have the ultimate objective of either developing or reinforcing a particular image
of a brand in the mind of the audience.

Seven approaches to positioning strategy are presented below:

1. Using product characteristics or customer benefits,
2. The price-quality approach,
3. The use or applications approach,
4. The product-user approach,
5. The product-class approach,
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6. The cultural symbol approach, and
7. The competitor approach.

In-Text Question 4:
What is positioning? What is the key idea in positioning strategy?

2.5 Using Product Characteristics or Customer Benefits

Probably, the most-used positioning strategy is to associate an object with a
product characteristic or customer benefit.

Imported automobiles illustrate the variety of product characteristics that can be

employed and their power in image creation. Honda and Toyota have emphasized
economy and reliability and have become the leaders in terms of the number of
units sold. Sometimes a new product can be positioned with respect to a product
characteristic that competitors have ignored.

Occasionally, a product will attempt to position itself along two or more product
characteristics simultaneously. Sometimes, different models of a product may be
positioned towards different segments by highlighting different attributes.

It is always tempting to try to position along several product characteristics, as it is

frustrating to have some good product characteristics that are not communicated.
However, advertising objectives that involve too many product characteristics can
be most difficult to implement. The result can often be a fuzzy, confused image,
which usually hurts a brand.

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Myers and Shocker have made a distinction between physical characteristics,
pseudo physical characteristics, and benefits, all of which can be used in
positioning. Physical characteristics are the most objective and can be measured on
some physical scale such as temperature, colour intensity, sweetness, thickness,
distance, dollars, acidity, saltiness, strength of fragrance, weight, and so on.

Pseudo physical characteristics, in contrast, reflect physical properties that are not
easily measured. Examples are spiciness, smoky taste, tartness, type of fragrance,
greasiness, creaminess, and shininess. Benefits refer to advantages that promote the
wellbeing of the consumer or user.

Positioning by price and quality

The price-quality product characteristic is so useful and pervasive that it is
appropriate to consider it separately. In many product categories, there exist brands
that deliberately attempt to offer more in terms of service, features, or
performance. Manufacturers of such brands charge more, partly to cover higher
costs and partly to help communicate the fact that they are of higher quality.
Conversely, in the same product class, there are usually other brands that appeal on
the basis of price, although they might also try to be perceived as having
comparable or at least adequate quality. In many product categories, the price-
quality issue is so important that it needs to be considered in any positioning
decision.
It is usually very difficult to compete successfully using both quality and price.
There is always the risk that the quality message will blunt the basic “low-price”
position or that people will infer that if the prices are low, the quality must also be
low.

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Positioning by use or application
Another way to communicate an image is to associate the product with a use or
application. Products can have multiple positioning strategies; although increasing
the number attracts obvious difficulties and risks. Often a positioning by use
strategy represents a second or third position for the brand, a position that
deliberately attempts to expand the brand’s market.

Positioning by product user

Another positioning approach is to associate a product with a user or a class of
users. Michael Jordan, for example, was used by Nike. Many cosmetic companies
have used a model or personality to position their product. The expectation is that
the model or personality will influence the product’s image by reflecting the
characteristics and image of the model or personality communicated as a product
user.

Positioning by Product Class

Some products need to make critical positioning decisions that involve product
class associations. For example, Maxim freeze dried coffee, the first one in the
market, needed to position itself with respect to regular and instant coffee. Some
margarines need to be positioned with respect to butter. Dried milk makers came
out with instant breakfast positioned as a breakfast substitute and a virtually
identical product positioned as a dietary meal substitute. The toilet soap Dove
positioned itself apart from the soap category as a cleansing cream product for
women with dry skin.

The soft drink,7-Up, was for a long time positioned as a beverage that had a “fresh
clean taste” that was “thirst quenching.”
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However, research uncovered the fact that most people did not regard 7-Up as a
soft drink but rather as a mixer beverage. Therefore, the brand tended to attract
only light soft-drink users. The positioning strategy was then developed to
position7-Up as a “mainline” soft drink and also as a logical alternative to the
“colas” but with a better taste. The result of this was the successful “Uncola”
campaign.

Positioning by cultural symbols

Many advertisers use deeply entrenched cultural symbols to differentiate their
brand from competitors. The essential task is to identify something that is very
meaningful to people which other competitors are not using, and thereafter
associate the brand with that symbol.

Positioning by competitor
In most positioning strategies, an explicit or implicit frame of reference is one or
more competitors. In some cases, the reference competitor(s) can be the dominant
aspect of the positioning strategy. It is useful to consider positioning with respect
to a competitor for two reasons. First, the competitor may have a firm, well-
crystallized image developed over many years. The competitor’s image can be
used as a bridge to help communicate another image referenced to it. If someone
wants to know where a particular address is, it is easier to say it is next to the Bank
of America building than to describe the various streets to take to get there.
Second, sometimes it is not important how good customers think you are; rather it
is just important that they believe you are better than (or perhaps as good as) a
given competitor.

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Perhaps, the most famous positioning strategy of this type was the Avis “We’re
number two, we try harder” campaign. The message was that the Hertz company
was so big that they did not need to work hard. The strategy was to position Avis
with Hertz as major car-rental options, and therefore to position Avis away from
National, which at the time was a close third to Avis.

Positioning with respect to a competitor can be an excellent way to create a

position with respect to a product characteristic, especially price and quality.
Positioning with respect to a competitor can be accomplished by comparative
advertising (i.e. advertising in which a competitor is explicitly named and
compared on one or more product characteristics).

So how should you go about formulating your positioning plan? There are
essentially two (2) ways of going about it.
a. Market Positioning.
b. Psychological Positioning
Market Positioning
It is a three-step process:
i. Identify market opportunities.
ii. Segment the market and select the right
segment.
iii. Devise a competitive strategy.

The whole idea is to meet market requirements better than the competitors can.
1. Explore the market
Ask which are the areas where the company has distinctive advantage over the
competition. Study the sales potential of the new market and its growth rate. Do
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financial calculations like to produce, profits, pricing etc. Understand market
dynamics and channels of distribution. Put the key factors that may contribute to
success on paper.

2. Segmentation and targeting

Markets can be segmented on different bases, e.g., users, products. Further
segmentation is on the basis of end-use. The marketer targets his product to a
particular segment. While doing so, competitor’s positions are kept in mind by
drawing a Product Space Map (PSM).

3. Competitive strategy
Identify the competitor’s weaknesses and your company’s strengths. Emphasize
your strengths to differentiate your offer. The company identifies the most
important differences to develop strategy. Consider factors like:
i. Market share
ii. Profitability
iii. Product range
iv. Corporate profile
v. Financial strength
vi. Cost position
vii. Product differentiation
viii. Quality of management, technology, distribution
ix. Reputation.
Find out the gaps between you and your competitors against the above-listed
factors. It will give you an offer that distinguishes you - a benefit bundle or value
package consisting of price, distribution and service mix.
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These days, many products are technologically so similar to each other to the
extent that the distinctions between them are hardly noticeable. These similar
products can be distinguished by introducing various measures, such as warranties,
after-sales service, instalment offers, price-offs, discounts, strong distribution,
responsiveness etc.

Psychological positioning
Basically, psychological positioning is a communicative exercise that follows
AIDA (Attention, Interest, Desire and Action model). It is derived from market
positioning and tells what the company is, what the product does, and what to
expect from the purchase.

The brand name, the look and the packaging must complement the psychological
positioning. Consumer behaviour is driven more by feelings than rationale, and
even the most aptly positioned brand might fail if it does not strike the right chord.
Brand ultimately has to build a good relationship with the customer.

Benefits and benefit gaps are easy to identify through research. Feelings are more
difficult to get to. Coffee, for instance, is about intimacy, romance and
togetherness. Thus, brand positioning is not just occupying a slot in the mind of the
consumers; rather it is also about ruling the heart.

Another interesting area worth understanding is Perceptual Mapping for

Positioning. Perceptual Space Map (PSM) shows the perceived relative positions
of products along different dimensions. To do this, the attributes or dimensions of a
product are identified by qualitative research like depth interviews. The consumers
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are then asked to rank each brand along each of the dimensions identified.
Statistical techniques are used to reduce a very large number of dimensions to a
few significant dimensions.

Advertising and positioning

Research has shown that there is a very real limit to how much a mindset can
handle. According to George A. Miller, a psychologist at Harvard, the average
person can rarely name more than seven brands. This is where positioning comes
in. Advertising has to establish the brand in a commanding position in the mind-
sets if consumers.

The image and appeals must be related to the way consumers possibly think about
a brand and thus position it in their minds. In order to develop a clear position, the
communicator must somehow put together all aspects of product, consumer, trade,
competition and communication situation in a distinctive way for that brand. Good
positions are difficult to maintain, and a company must be prepared to defend its
position sometimes at great cost.

The competitors relate their brand to a brand that is in a dominating position.

Positioning doesn’t require a head-on collision with the leading competing brand.
This is quite risky. It is better to manoeuvre around the leader’s position. Sacrifice
is the essence of positioning. For effective positioning, a brand has to stand for one
quality or benefit in the mind of consumers, instead of being all things to all
people. This involves sacrifice of opportunity to different market segments.
Positioning in the consumer’s mind is the end product of the process of filtering
information about:
ꞏ The product attributes,
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ꞏ The packaging,
ꞏ The pricing, and the image of the product created by
advertising.

This may be different from the product’s functional or

physical attributes. This subtle distinction is increasingly
important in a competitive market place where thousands
of advertisements fight for the attention of the consumer.

In-Text Question 5:
Mention 5 approaches to positioning strategy

4.0 Session Summary

to understand what segmentation is, the basis for segmentation and segmentation
strategy. We also went further to look at what positioning is as well as approaches
to segmentation strategy.

5.0 Self-Assessment Questions

1. What do you understand by segmentation?
2. Explain the basis for segmentation
3. Segmentation is done on the basis of target groups, discuss
4. What do you understand by positioning?
5. Discuss behavioural segmentation

6.0 Additional Activities (Videos, animation and outdoor activities)

a. Visit U-tube https://goo.gl/LBKH1W . Watch the video & summarise in 1
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paragraph
b. View the animation on https://goo.gl/iZGAEe and critique it in the discussion
forum

In-Text Answers 1:
Markets can be categorized based on the buyers as follows:
Producers market trade in raw material, Reseller market trade in finished goods,
Consumer market.

In-Text Answer 2:
1. Geographic Segmentation
2. Demographic segmentation
3. Psychological/Psychographic Segmentation
4. Socio cultural Segmentation
5. Use-Related Segmentation
6. Usage-Situation Segmentation
7. Benefit-segmentation
8. Hybrid Segmentation

In-Text Answer 3:
Industrial advertising refers to those advertisements which are issued by the
manufacturers or distributors to the buyers of industrial products.

In-Text Answer 4:
Positioning involves a decision to stress only certain aspects of our brand, and
not others. The key idea in positioning strategy is that the consumer must have a
clear idea of what your brand stands for in the product category, and that a
brand cannot be sharply and distinctly positioned if it tries to be everything to
everyone.

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 In-Text Answer 5:
1. Using product characteristics or customer benefits, 2. The price-quality
approach, 3. The use or applications approach, 4. The product-user approach, 5.
The product-class approach.

7.0 References
Aaker, David, & John (1992). Advertising management, Prentice -Hall of India
Kenneth E. Clow and Donald Baack(2007). Integrated Advertising, Promotion,
and Marketing Communications, Third Edition, Pearson Education, Inc.
Prentice Hall.

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 STUDY SESSION 3
Choosing an Advertisement Agency
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Choosing an Advertising Agency
2.2 Decision Variables
2.3 External Advertising Agencies
2.4 Advertising Planning and Research
3.0 Tutored Marked Assignment
4.0 Summary
5.0 Discussion Questions
6.0 Additional Activities
7.0 References/Further Readings

Introduction
As stated above, this study session shall be considering the subject matter of
choosing an advertisement agency. In this study session, you shall be acquainted
with the definitions of advertising agency, most especially the one given by the
American Association of Advertising Agency.

1.0 Learning Outcomes:

At the end of this study session, you should be able to understand the following:
1. Definition of advertising agency
2. decision variables on whether to choose internal or external advertising
agency
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 3. the process of choosing an external advertising agency

2.0 Main Content

2.1 Choosing an Advertising Agency
The American Association of Advertising Agencies (AAAA) defines an
advertising agency as “An independent business organization, composed of
creative and business people, who develop, repair and place advertisements in
advertising media for sellers seeking to find customers for their goods and
services”.

The first step of an advertising programme is the choice between an in-house

advertising group and an external advertising agency. In some businesses, the
integrated communications and advertising programmes are handled by internal
departments. Part of the reasons for doing this is that internal organization
members have a better sense of the company’s mission and message. Managers in
these firms believe they can develop effective advertising programs through
outsourcing some of the functions and by hiring a few key marketing and
advertising experts.

Activities such as writing, filming, recording, and editing advertisements in

addition to planning and purchasing media time (on television and radio) and space
(in magazines, in newspapers, and on billboards) can be performed by outside
agencies while the remainder of the IMC program is managed internally.

Recently, Canada’s property and casualty insurance industry experienced its worst
Two years in history. The management team at Co-operators, one of Canada’s
largest insurance companies, grew tired of dealing with advertising agencies that
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didn’t seem to understand the company’s or the industry’s problems. As a result,
an in-house marketing team was developed. The team was assigned the objective
of revitalizing the company’s well-known brand and linking that awareness to
specific attributes. The team developed a profile of the company’s customers using
in-house research and data mining. A top-notch creative director was hired to assist
in the production of new advertisements. A television campaign called “Heritage”
was created. The ads and accompanying marketing materials focused on an
association of farmers who relied on a caring, friendly, community minded, honest,
and Canadian insurance company. Due to these arrangements, the spots and the
integrated campaign were highly successful.

There can be disadvantages, however, to an internal approach to advertising. One

problem is that the company can go “stale” and fail to recognize other promotional
or advertising opportunities. An internal department may also lack the expertise to
carry out all of the necessary functions. What may result is the tendency to cut
costs in developing ads rather than taking
advantage of the knowledge and expertise that
advertising agencies have to offer. In the global
arena, internal members of the firm lack the
necessary understanding of language, customs,
and buyer behaviors in international target
markets. Therefore, a decision must be made.

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 In-Text Question 1:
What is an advertising agency?

2.2 Decision Variables

In deciding whether to use an external agency or in-house department, there are
several key factors to consider. The management team should review the following
variables before making the choice:
1. The size of the account
2. The amount of money that can be spent on media
3. The objectivity factor
4. The complexity of the product
5. Creativity concerns

With regards to the account size, a small account usually is not attractive to an
advertising agency, because smaller accounts are less profitable. Also, with regards
to money spent on media, smaller accounts are less economically sound for the
agency, because more money must be spent on producing advertisements rather
than on purchasing media time or space. A good rule of thumb is called the 75–15–
10 breakdown. That is, 75 percent of the money buys media time or space, 15
percent goes to the agency for the creative work, and 10 percent is spent on the
actual production of the ad. For smaller accounts, the breakdown may be more like
25–40–35. This means that 75 percent of the funds go to the creative and
production work, and only 25 percent is spent on media purchases. Unless 75
percent of the company’s advertising budget can be spent on media purchases, it
may be wise either to do the work in-house or to develop contracts with smaller
specialty firms to prepare various aspects of the advertising campaign.

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An agency is more likely to be objective than an in-house advertising department.
It is difficult for an in-house creative to remain unbiased and to ignore the
influences of others in the organization who may not fully understand the artistic
aspects of advertising.

An external creative does not face these influences and pressures. Advertisements
for highly complex products create a different set of circumstances. This is so
because external advertising agency members may have a difficult time
understanding complicated products. To get them up to speed often requires a
considerable amount of time, which costs money. Therefore, in-house departments
may be better for some more complex products.

For generic or more standardized products, Ad agencies usually have more to

offer. The final issue to consider in choosing external Ad agency and in-house
department is creativity.

Advertising agencies claim to offer greater creativity. Many

times this is true. Still, an in-house department will be able to
freelance and utilize creatives just for the ad design process.
The question, then, is whether to give the entire project to an
agency or only use the agency’s creatives and other specialists.
When the decision is made to retain an external advertising
agency, the company commits substantial resources to the goal of expanding its
audience through advertising and communications programs.

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In-Text Question 2:
In deciding whether to use an external agency or in-house department, there are several key factors
to consider, what are they?

2.3 External Advertising Agencies

Companies’ leaders have a variety of options when choosing an advertising
agency. All sizes and types of advertising agencies exist. At one end of the
spectrum are the highly specialized, boutique-type agencies offering only one
specialized service (e.g., making television ads) or serving only one type of client.
For instance, G_G Advertising of Albuquerque, New Mexico, specializes in
advertising to Native Americans, a market of an estimated 10 million people.

At the other end of the spectrum are the full-service agencies that provide all types
of advertising and promotional activities. These companies also offer advice and
assistance in working with the other components of the IMC program, including
consumer and trade promotions, direct-marketing programs, and public relations
events. Full-service advertising agencies provide a number of items, including:
◗ Consulting and giving advice about how to develop target markets

◗ Providing specialized services for business markets

◗ Providing suggestions on how to project a strong company image and theme
◗ Supplying assistance in selecting company logos and slogans
◗ Preparation of advertisements

◗ Planning and purchasing media time and space

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In addition to advertising agencies, there are other closely associated types of
firms.

Media service companies negotiate and purchase media packages (called “media
buys”) for companies. Direct marketing agencies handle every aspect of a direct-
marketing campaign, either through telephone orders (800 numbers), Internet
programs, or by direct mail. Some companies focus on either consumer
promotions, trade promotions, or both. These companies assist in developing
promotions such as coupons, premiums, contests, and sweepstakes. They also
provide assistance in making posters, end-of-aisle displays, and point-of-purchase
displays. Public relations firms provide experts to help companies and individuals
develop positive public images. PR firms are often called in for damage control
when negative publicity arises. In-house members of the organization can render
these activities, just as an in-house marketing department can perform advertising
and IMC programmes. In both instances, companies’ leaders must decide how they
can perform these key marketing activities efficiently and effectively.

A new trend in advertising, called the “whole egg theory,” has recently been
introduced by the Young and Rubicam Advertising Agency. The concept of the
whole egg theory is to move from selling a client’s products to helping the client
attain total success in the marketplace. Achieving success requires integrating the
marketing approach by offering a fuller array of services to both business and
consumer clients. Thus, as client companies began to move toward more integrated
marketing approaches, agencies such as Young and Rubicam captured more
accounts.
A similar company is Venture Communications of Calgary, Canada. The
company’s founder, Arlene Dickson, transformed Venture from a traditional
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advertising agency into an integrated marketing communications company by
expanding to cover every aspect of a company’s marketing program. Venture is
divided into six communities: advertising, technology, media buying, brand
planning, public relations, and marketing and business strategies. U.S. brands such
as Lipton, Cisco, and Unisys, have bought into Venture’s “synchronized”
communication approach and now make up 15 percent of Venture’s revenues.
Agencies like Young & Rubicam and Venture continue to succeed because they
are more than just advertising agencies. Instead, these firms offer marketing
experts who participate in the entire integrated marketing communications
program.

The process of selecting an advertising agency is difficult. Companies’ leaders

must decide how much involvement the agency will have and how many functions
the agency should perform. The next step is to develop effective selection criteria
to help companies’ leaders make wise choices in the process of hiring an
advertising agency.

◗ Set goals.
◗ Select process and criteria.
◗ Screen initial list of applicants.
◗ Request client references.
◗ Reduce list to two or three viable agencies.
◗ Request creative pitch.
◗ Select agency.

Fig.1: Steps in Selecting an Advertising Agency

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Choosing an agency
Choosing the advertising agency that best suits a company requires careful
planning. Figure 1 above lists the steps involved in this process. Additional
information about each of these steps is given as follows.

Goal setting
Before making any contact with an advertising agency, it is important to identify
and prioritize corporate goals. Goals provide a sense of direction for the company’s
leaders, for the agency account executive, and for the advertising creative. Each is
more likely to be “on the same page” as preparation of the advertising campaign
unfolds. Without clearly understood goals, it is virtually impossible to choose an
agency because companies’ leaders may not have a clear idea of what they want to
accomplish. Unambiguous goals help ensure a good fit between the company and
the agency.

◗ Size of the agency

◗ Relevant experience of the agency
◗ Conflicts of interest
◗ Creative reputation and capabilities
◗ Production capabilities
◗ Media purchasing capabilities
◗ Other services available
◗ Client retention rates
◗ Personal chemistry

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Fig. 2: Evaluation Criteria in Choosing an Ad Agency

Selection criteria
The second step in selecting an agency is stating the selection criteria that will be
used. Even firms with experience in selecting agencies should set selection criteria
in advance. The objective is to reduce biases that may enter into the decision.
Emotions and other feelings can lead to decisions that are not in the company’s
best interests.

Although good chemistry between the agency and the firm is important, this aspect
of the choice comes later in the process, after the list has been narrowed down to
two or three agencies. Figure 2 lists some of the major issues to be considered as
part of the selection process. This list is especially useful in the initial screening
process, when the task is to narrow the field to the top five (or fewer) agencies.

The size of the agency is important, especially as it compares to the size of the
company hiring the agency. If a large firm were to hire a small agency, the small
agency may be overwhelmed by the account. A small firm hiring a large agency
may find that the company’s account might be lost or could be treated as being
insignificant. A good rule of thumb to follow regarding the size of the agency is
that the account should be large enough for the agency so it is important to the
agency but if lost, the agency would not be badly affected.

When Norwest Banks of Minneapolis acquired Wells Fargo of San Francisco, the
company tripled in size. Norwest’s agency, Carmichael Lynch, was not large
enough to handle the new larger company. According to Larry Haeg, “We needed
the resources and services of a larger agency.” In this case, it was not a matter of

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the firm being incompetent, but rather that the larger Norwest needed a wider
variety of services and expertise.

Relevant experience in an industry is a second evaluation criterion. When an

agency has experience in a given industry, the agency’s employees are better able
to understand the client firm, its customers, and the structure of the marketing
channel.

At the same time, it is important to be certain that the agency does not have any
conflicts of interest. An advertising firm that has been hired by one manufacturer
of automobile tires experiences a conflict of interest if the ad agency is hired
by another tire manufacturer.

An advertising agency can have relevant experience without representing a

competitor. Such experience may be gained when an agency works for a similar
company that operates in a different industry. For example, if an agency has a
manufacturer of automobile batteries as a client, this experience is relevant to
selling automobile tires. The agency should have experience with the business to-
business side of the market, so that retailers, wholesalers, and any other channel
party are considered in the marketing and advertising of the product.

The initial screening process includes an investigation into each agency’s creative
reputation and capabilities. One method of judging an agency’s creativity is to ask
for a list of awards the company has received. Although awards do not always
translate into effective advertisements, in most cases there is a positive relationship
between winning awards and writing effective ads. Most creative awards are given
by peers. As a result, they are good indicators of what others think of the agency's
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creative efforts. Assessing creative capabilities is very important when preparing
advertising campaigns for a different country in which the firm has limited
experience.
Production capabilities and media purchasing capabilities of the agencies should
be examined if these services are needed as the company prepares an advertising
campaign. The information is gathered to be sure the agency has the desired
capabilities. A firm that needs an agency to produce a television commercial and
also buy media time should check on these activities as part of the initial screening
process.

Media buying skills are important. Questions to ask include:

◗Does the agency buy efficiently?
◗Is the agency able to negotiate special rates and publication positions?
◗Does the agency routinely get “bumped” by higher-paying firms, which means
ads do not run at highly desirable times?

This type of information can be difficult to obtain. The company hiring the agency
must be persistent and engage in thorough research. Accessing each agency’s Web
page, reading annual reports, and searching for news articles about individual
agencies can be helpful.

Most ad agencies provide prospectus sheets describing their capabilities. These

reports render some information about their media
buying skills. The final three selection criteria (other
services available, client retention rates, and personal
chemistry) are revealed as the final steps of selection

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take place. These criteria help to make the final determination in the selection
process.

Reference requests
Once the initial screening is complete, it is time to request references from those
agencies still in the running for the contract. Most agencies willingly provide lists
of their best customers to serve as references. A good strategy the company can use
is to obtain references of firms that have similar needs. Also, when possible, it
helps to obtain names of former clients of the agency. Finding out why they
switched can provide valuable information. Often changes are made for legitimate
reasons. Discovering an agency’s client retention rate helps reveal how effective
the firm has been in working with various clients. Poor service is not the only
reason a firm switches advertising agencies.

Background checks also provide useful information. Background checks start with
finding firms that have dealt with each agency. Also, talking to media agents who
sell media time provides insights as to how an agency buys time and deals with
customers.

Companies that have formed contracts with individual agencies for production
facilities or other services are excellent sources of information. Background checks
help the client company to make sure the agency can provide quality professional
services.

Creative pitch
If the list has been narrowed to two or three finalists, the company’s selection team

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is ready to ask for a creative pitch. If not, the team should reduce the list of viable
agencies.

Preparing a creative pitch is time-consuming and costly for the advertising

agencies; therefore, agencies only want to spend time on preparing pitches with a
decent chance of being accepted. Although most firms narrow the list down by
using the selection criteria already discussed, Lucent Technologies utilized a
different method. Before choosing two or three to make a pitch for their $60
million account, the executives of Lucent visited six agencies over a 2-week
period. All the six had met the selection criteria that had been set. The visits were
made to conduct chemistry and credential checks. The idea was to see which
would fit the best with the marketing staff at Lucent.

Advertising agencies that are chosen to compete for the contract provide a formal
presentation addressing a specific problem, situation, or set of questions. This
process is called a “shootout.” The presentations reveal how each agency would
deal with specific issues that arise as a campaign is prepared. This helps a client
company decide which agency best understands the issues at stake and has
developed an advertising or integrated communication approach that will solve the
problem or issue.

In recent years, the Lycra company faced increasingly stiff competition. When the
advertising selection team at Lycra narrowed the field down to three agencies, the
team asked each firm to develop a creative pitch that would enhance the unique
position of the Lycra brand. The agency that was finally chosen suggested the
theme “Lycra has it.” The theme featured an emotional campaign. It evolved from

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the discovery that consumers derive positive emotions from wearing Lycra,
including feeling sexy, confident, and beautiful.

The agency’s proposal suggested that a stronger emotional message would help
consumers experience a greater sense of ownership or identification with the
brand. The “Lycra has it” campaign proved to be a successful campaign, one that
became the cornerstone for a major repositioning of the brand in the United States
and around the world.

Agency selection
During the presentation phase, the opportunity exists to meet with creatives, media
buyers, account executives, and other people who will work on the account.
Chemistry between employees of the two different firms is important.

The client companies’ leaders should be convinced that they will work well
together and that they will feel comfortable with each other. In competing for the
new Norwest–Wells Fargo account, the firm DDB was chosen over the incumbent
agency, Carmichael Lynch, because Fargo executives believed DDB had greater
strategic insights, a better range of services, higher-quality creatives, and a more
thorough media plan.

DDB was able to show how the agency intended to combine the strength of Wells
Fargo’s 150-year heritage with the excellent customer service qualities of Norwest.
This presentation led to the decision to hire DDB. It came after Fargo executives
listened to the presentations of both agencies and asked key questions about who
would actually be working on the account.

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Whenever possible, a client company’s leaders should visit the advertising
agency’s office as part of the evaluation process. Often, agencies use company
executives such as presidents or vice presidents, termed “heavy hitters” by industry
insiders, to win contracts, but then turn the account over to other individuals in the
agency after signing the deal.

Visiting the agency’s office provides an opportunity to meet personnel who might
work on the account. Talking with these individuals generates quality information
about how the account will be handled. The visiting period also can be used to
hammer out specific details, such as identifying the actual person(s) who will work
on the advertisements, and either agreeing to the use of freelancers (independent
contractors who provide various services) to work on the project or prohibiting the
agency from using such individuals.

After the selection process has been completed,

the agency and the company work together to
prepare the advertising campaign. Along the way,
the account executive plays a key role in the
process, as does the advertising creative. A brief
review of the activities performed by these two
individuals follows later in this chapter.

2.4 Advertising Planning and Research

The initial meetings between the agency that has been selected and the firm’s
advertising management and marketing team are key moments. These meetings
should be used to combine all of the advertising elements. Even then, some
planning and research projects remain.
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First, the agency involved should be engaged in general preplanning input
collection. This task includes “reading up” on the client organization in books,
trade publications, research reports, and the company’s Web site. Also, members
of the advertising agency should, when possible, actually use the good or service
involved. Also, by visiting members of the community, employees, and other
business partners, members of the advertising agency can develop a solid
understanding of the client.

Next, product-specific research should be conducted. Two things should be

identified at this point. The first is whether there are problems associated with a
given good or service. One approach is called “problem detection,” in which
consumers are asked to report any problems or difficulties they have encountered
using a product. These issues must be addressed as part of the IMC program. The
other matter to complete is discovering the major selling idea to be used in the ad
campaign.

Remember that both the upside and the downside of a product should be clearly
understood before moving forward with an advertising or IMC campaign. Finally,
qualitative research can be used to assist the vendor company and its advertising
agency. Focus groups are often used to bring people together to talk about a
product. With a creative in attendance, it is possible to hear about the kind of
person who likes a product and to discover tactics that might reach the individual.
The actual collection of information can come from a variety of perspectives,
including:
◗ Anthropology

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◗ Sociology

◗ Psychology

The methods employed by anthropologists often involve direct observation. This

helps the marketing team discover not only who is using a product, but also how it
is being used. When Whirlpool employed anthropologists to study washing
machines, it became clear that adult men and children also used the machines, not
just the wife or mother. The researchers suggested making the controls on the units
easier to use and understand for men and children, who may be less familiar with
appropriate temperature and cycle settings for various kinds of fabrics.

Sociologists examine social class issues and trends. Using a sociological approach,
it is clear that the “World of Ralph Lauren” is composed of rich, elite, and distinct
people. Ralph Lauren creates fashions for the wealthy and features messages that
that stress style and high social class.

Psychology concentrates on motivation, cognition, and learning. When these

come together, values emerge. The values and lifestyle model (VALS) predicts
consumers’ behaviour by concentrating on self-orientation and resources. In other
words, most purchases are based on a match of lifestyle choice with funds
available.

Another psychological approach is called a personal drive analysis (PDA). This

method helps the researcher understand psychological drives toward indulgence,
ambition, or individuality. These drives affect brand choices. A fine wine may be
viewed as an indulgence by a consumer or as an expression of individuality.

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Knowing the purchasing motives of a target market can greatly enhance the
effectiveness of an advertising program.

Carefully collected knowledge about the good or service and the audience for ads
and advertising campaigns is crucial to success. With this information in mind, the
actual campaign can be developed.

4.0 Session Summary

In this study session, we discussed the topic: choosing an advertising agency. We
were able to understand the meaning of an advertising agency, decision variables
as to whether to use external advertising agency or in-house department. We went
further to discuss steps in selecting an advertising agency.

5.0 Self-Assessment Questions

1. How do you choose an advertisement agency?
2. Discuss the nature of external advertisement agency
3. Explain advertisement planning and research

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/GkEWPU) . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/Go8iza and critique it in the discussion
forum

In-Text Answers 1:
Advertising agency can be defined as “An independent business organization,
composed of creative and business people, who develop, repair and place
advertisements in advertising media for sellers seeking to find customers for their
goods and services”.
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customers for their goods and services”.
 In-Text Answer 2:
1. The size of the account
2. The amount of money that can be spent on media
3. The objectivity factor
4. The complexity of the product
5. Creativity concerns

7.0 References
Kenneth E. Clow and Donald Baack (2007). Integrated Advertising, Promotion,
and Marketing Communications, Third Edition, Pearson Education, Inc.
Prentice Hall.

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 STUDY SESSION 4
Advertising Campaign Management
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Advertising Campaign Management
2.2 Communication Market Analysis
2.3 Advertising Goals
2.3.1 Building Brand Image
2.3.2 Providing Information
2.3.3 Persuasion
2.3.4 Supporting Marketing Efforts
2.3.5 Encouraging Action
2.4 The Advertising Budget
2.5 Media Selection
2.6 The Creative Brief
3.0 Tutored Marked Assignment
4.0 Summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, animation and outdoor activities)
7.0 References/Further Readings

Introduction
In this study session, you will be introduced to the advertising campaign
management. You will get to understand that it is the process of preparing and

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integrating a specific advertising program in conjunction with the overall IMC
message.

1.0 Learning Outcomes

At the end of this study session, you will be able to understand the following:
1. What advertising campaign management is
2. What communication analysis is
3. What advertising budgeting is.

2.0 Main Content

2.1 Advertising Campaign Management
Managing an advertising campaign is the process of preparing and integrating a
specific advertising program in conjunction with the overall IMC message. An
effective program consists of five steps. The steps of advertising campaign
management are:
1. Review the communication market analysis.
2. Establish advertising objectives to be consistent with the communication
objectives developed in the promotions
opportunity analysis program.
3. Review the advertising budget.
4. Select the media in conjunction with the
advertising agency.
5. Prepare a creative brief.

The advertising program should be consistent with everything else in the IMC
program. The idea is to make sure the firm presents a clear message to key target
markets. Then, advertising efforts can be refined to gain the maximum benefit
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from the promotional dollars being spent. A review of the issues present in each
element of advertising campaign management is presented next.

2.2 Communication Market Analysis

In the first phase of planning, the account executive studies what the company’s
communication market analysis reveals. The analysis reveals where the firm can
best focus advertising and promotional efforts by discovering company strengths
along with opportunities present in the marketplace. The analysis of the various
target markets and customers suggests how the firm’s previous marketing
communications efforts have been received by the public as well as by other
businesses and potential customers. The positioning analysis explains how the firm
and its products are perceived relative to the competition. The value of reviewing
the communication market analysis is in focusing the account executive, the
creative, and the company itself on key markets and customers while helping them
understand how the firm currently competes in the marketplace. Then, the team is
better able to establish and pursue specific advertising objectives.

For the purposes of advertising, two important items are outlined as part of the
communication market analysis:
1. The media usage habits of people in the target market
2. The media utilized by the competition

When analyzing customers, knowing which media they use is vitally important.
For example, teenagers surf the Web, watch television, and listen to the radio. Only
a small percentage reads newspapers and news magazines. Various market
segments have differences in when and how they view various media. For

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example, older African-Americans watch television programs in patterns that are
different from those of older Caucasians.

Males watch more sports programs than females, and so forth. In business-to-
business communication markets, knowing which trade journals or business
publications the various members of the buying centre most likely read is essential
for the development of a print advertising campaign. Engineers, who tend to be the
influencers, have different media viewing habits than do vice presidents, who may
be the deciders. Discovering which media reach a target market (and which do not)
is a key component in a communication market analysis and an advertising
program.

Furthermore, studying the competition

reveals how other firms attempt to reach
customers. Knowing how other firms
contact consumers is as important as
knowing what they say. An effective
communication market analysis reveals this information, so that more effective
messages and advertising campaigns can be designed.

In-Text Question 1:
What is advertising campaign management?

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2.3 Advertising Goals
The second step of advertising planning is to establish and
clarify advertising goals, which are derived from the firm’s
overall communication objectives. Several advertising goals
are central to the IMC process. Some of these goals are listed
in Figure 3.

◗ To build brand image

◗ To inform
◗ To persuade
◗ To support other marketing efforts
◗ To encourage action◗ To build brand image
◗ To inform
◗ To persuade
◗ To support other marketing efforts
◗ To encourage action

Fig. 3: Advertising Goals

A discussion of each individual goal area follows.

2.3.1 Building brand image

Building a strong global brand and corporate image is one of the most important
advertising goals. A strong brand creates brand equity. As discussed earlier, brand
equity is a set of characteristics that make a brand seem different and better to both
consumers and businesses. These benefits can be enhanced when they combine
effective advertising with quality products. Higher levels of brand equity are a
distinct advantage as consumers move toward purchase decisions.

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Advertising is a critical component in the effort to build brand equity. Successful
brands have two characteristics:
(1) the top of mind and (2) the consumers’ top choice. When consumers are asked
to identify brands that quickly come to mind from a product category, one or two
particular brands are nearly always mentioned. That name has the property of
being a top of mind brand. For example, when asked to identify fast food
restaurants, McDonald’s and Burger King almost always head the list. The same is
true for Nike and Reebok shoes. This is true not only in the United States but also
in many other countries. The term top choice suggests exactly what the term
implies. A top choice brand is the first or second pick when a consumer reviews
his or her evoked set of possible purchasing alternatives. Part of building brand
image and brand equity is developing brand awareness, and advertising is the best
method to reach that goal. Brand awareness means the consumers recognize and
remember a particular brand’s or company’s name when they consider purchasing
options. Brand awareness, brand image, and brand equity are vital for success.

In business-to-business marketing, brand awareness is often essential for

consideration by members of the buying centre. It is important for business
customers to recognize the brand’s name(s) of the various goods or services a
company sells. Brand awareness is especially important in modified rebuy
situations, when a firm looks to change to a new vendor or evaluates a product that
has not been purchased recently. In new buy situations, members of the buying
centre spend more time seeking prospective vendors than they do in modified
rebuys. Consequently, brand equity is a major advantage for any company that has
such recognition. Currently, many firms have increased importing and exporting
activities. This makes a memorable and accepted global brand a major feature of
many marketing programs.
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2.3.2 Providing information
Besides building brand recognition and equity, advertising serves other goals. For
example, advertising often is used to provide information to both consumers and
business buyers. Typical information for consumers includes a retailer’s store
hours, business location, or sometimes more detailed product specifications.
Information can make the purchasing process appear to be convenient and
relatively simple, which can entice customers to finalize the purchasing decision
and travel to the store.
For business-to-business situations, information from some ads leads various
members of the buying centre to consider a particular company as they examine
their options.

This type of information is most useful when members of the buying centre are in
the information search stage of the purchasing process. For high-involvement types
of purchases, in which members of the buying centre have strong vested interests
in the success of the choice, informative advertisements are the most beneficial.
Low-involvement decisions usually do not require as much detail.

In marketing to both consumers and other businesses, information can help those
involved reach a decision. Information is one component of persuasion, another
objective of various advertising programs.

2.3.3 Persuasion
One of the most common goals of advertising programs is persuasion.
Advertisements can convince consumers that a particular brand is superior to other
brands. They can show consumers the negative consequences of failing to use a
particular brand. Changing consumer attitudes and persuading them to consider a
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new purchasing choice is a challenging task. As described later, advertisers can
utilize several methods of persuasion. Persuasive advertising is used more in
consumer marketing than in business-to-business situations. Persuasion techniques
are used more frequently in broadcast media such as television and radio rather
than in print advertising.

2.3.4 Supporting marketing efforts

Another goal of advertising is to support other marketing functions. For example,
manufacturers use advertising to support trade and consumer promotions, such as
theme packaging or combination offers. Contests, such as the McDonald’s
Monopoly promotion, require extensive advertising to be effective.

Retailers also use advertising to support marketing programs. Any type of special
sale (white sale, buy-one-get-one-free, pre-Christmas sale) requires effective
advertising to attract customers to the store. Both manufacturers and retail outlets
use advertisements in conjunction with coupons or other special offers. Del Monte
placed a 30-cent coupon in the advertisement shown in this section. The ad
highlights a smaller-size container with a pull-top lid. These features match the
ad’s target market: senior citizens. The first magazine featuring this advertisement
was Modern Maturity. Manufacturer coupons are regularly redeemed at grocery
stores (sometimes at double their face value), and in-store coupons are part of
many retail store print advertisements. When ads are combined with other
marketing efforts into a larger, more integrated effort revolving around a theme,
the program is called a promotional campaign.

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2.3.5 Encouraging action
Many firms set motivational goals for advertising programs. A television
commercial that encourages viewers to take action by dialing a toll-free number
to make a quick purchase is an example. Everything from Veg-O-Matics to DVDs
and cassettes are sold using action tactics. Infomercials and home shopping
network programs heavily rely on immediate consumer purchasing responses.
Action-oriented advertising is likely to be used in the business-to-business sector.
When it is, often the goal is to generate sales leads. Many business advertisements
provide a Web address or telephone number that buyers can use to request more
information or make a purchase more easily.

The five advertising goals of building image, providing information, being

persuasive, supporting other marketing efforts, and encouraging action are not
separate ideas. They work together in key ways. Image and information are part of
persuasion. Thus, when Barnes & Noble announces its Internet sales program, the
firm’s image combines with the information provided to persuade online book
buyers to consider it rather than Amazon.com. The goal of encouraging action is
often part of supporting other marketing tactics. The key advertising management
objective is to emphasize one goal without forgetting the others.

In-Text Question 2:
What are some of the advertising goals?

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2.4 The Advertising Budget
Once the company, account manager, and creative agree upon the major goals of
the advertising campaign, a review of the communications budget is in order. After
the total dollars allocated to advertising have been established, account managers
and company leaders agree to uses for the funds. This includes the media to be
utilized (television versus newspaper versus billboards). Also, however, the
manner of distribution must be arranged. Three basic tactics include:
◗ Advertising the most when sales are at peak seasons

◗ Advertising the most during low sales seasons

◗ Level amounts
Firms that advertise during peak seasons like Christmas are emphasizing sending
out the message when customers are most inclined to buy. When consumers are on
the “hot spot,” this approach makes sense for some products. For example, Weight
Watchers, Diet Centres, and others advertise heavily during the first two weeks of
January. Many New Year’s resolutions include going on a diet.

Advertising during peak seasons can be accomplished in two ways. The first is a
pulsating schedule of advertising. This schedule involves continuous advertising
with bursts of higher intensity (more ads in more media) during the course of the
year, most notably during peak seasons. Companies can also utilize what is called a
Flighting approach or schedule, where ads are presented only during peak times,
and not at all during off seasons.

Deciding to advertise during slow sales seasons is essentially oriented toward

“drumming up business” when people do not regularly buy. In retail sales, slow
seasons occur during January and February. Some companies advertise more

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during those periods to sell merchandise left over from the Christmas season and to
encourage customers to shop.

Many marketing experts believe that it is best to advertise in level amounts,

particularly when a product purchase is essentially a “random” event. This
approach is a continuous campaign schedule. For example, many durable goods
such as washing machines and refrigerators are purchased on an “as needed” basis.
A family ordinarily buys a new washing machine only when the old one breaks
down. Consequently, level advertising increases the odds that the buyer will
remember a given name (Kenmore, Whirlpool, or General Electric). Also, there is
a better chance that consumers will be exposed to ads close to the time they are
ready to make purchases.

In any case, the objective should be to match the pacing of advertisements with the
message, media, and the nature of the product. Some media make it easier to
advertise for longer periods of time. For instance, contracts for billboards are
normally for a month or a year. They can be rotated throughout a town or city to
present a continuing message about the company or its products. Budgetary
constraints must also be incorporated into the strategies and tactics used in the
advertising program.

2.5 Media Selection

The next step of advertising management is to develop strategies and tactics for
media selection by describing the intent of the message in each specific ad. It is
crucial to convey messages that are both consistent with the firm’s IMC theme and
that match with various media. Media buys are guided by the advertising agency or
media agency, the company, and the creative.
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When media selection is performed correctly and messages are designed to fit with
the chosen media, the chances for success greatly increase. When these issues are
well-coordinated, a company creates a major competitive advantage. Coordination
efforts are largely outlined and described in the creative brief, which is the final
element of an advertisement management program.

Typically, creatives work with a document called a “creative strategy” or “creative

brief” as they prepare advertisements. The creative takes the information provided
by the account executive and others in the creative brief to produce ads that convey
the desired message. Details about each element of the creative brief are provided
below:

The objective
The first step in preparing the creative strategy is to identify the objective of the
advertisement. Some of the most common advertising objectives include:
◗ Increasing brand awareness
◗ Building brand image
◗ Increasing customer traffic
◗ Increasing retailer or wholesaler orders
◗ Responding to inquiries from end users and channel members
◗ Providing quality information

The creative must understand the main objective before designing an

advertisement. The objectives guide the design of the advertisement and the choice
of an executional framework.

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An ad to increase brand awareness prominently displays the name of the product.
An ad to build brand image can display the actual product more prominently.

The Target Audience

A creative must know the target audience. An advertisement designed to persuade
a business to inquire about new computer software will be different from a
consumer advertisement created by the same company. The business advertisement
should focus on the type of industry and a specific member of the buying centre.
The more detail that is known about the target audience, the easier it is for a
creative to design an effective advertisement.

Target market profiles that are too general are not very helpful. Rather than
specifying males, ages 20 to 35, more specific information is needed (e.g., males,
20 to 35, college educated, professionals). Other information such as hobbies,
interests, opinions, and lifestyles makes targeting an advertisement even more
precise. Notice that the Playtex advertisement below is designed for young females
who enjoy playing sports and have active lifestyles. The additional information
helped create an advertisement that appeals to this particular market segment of
females.

The message theme

The message theme is an outline of key idea(s) that the advertising program is
supposed to convey. The message theme is the benefit or promise the advertiser
wants to use to reach consumers or businesses. The promise, or unique selling
point, should describe the major benefit the good or service offers customers. For
example, the message theme for Advertising to an automobile could be oriented
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toward luxury, safety, fun, fuel efficiency, or driving excitement. The message
theme for a hotel (such as a hotel in Paris, France) could focus on luxury, price, or
unusual features, noting the ease of access to all of the nearby tourist attractions.
The message theme should match the medium selected, the target market, and
the primary IMC message.

Message themes can be oriented toward either rational or emotional processes. A

“left-brain” ad is oriented toward the logical, rational side, which manages
information such as numbers, letters, words, and concepts. Left-brain advertising is
logical and factual, and the appeals are rational. For example, there are logical
features that are part of the decision to buy a car (size, price, special features). At
the same time, many cars are purchased for emotional reasons. The right side of
the brain deals with the emotions. It works with abstract ideas, images, and
feelings. A car may be chosen for its colour, sportiness, or other less rational
reasons.

Most advertising is either right-brained or left-brained. Effective advertising is

produced when there is a balance between the two sides. Rational and economic
beings have difficulty defending the purchase of an expensive sports car such as a
Porsche. Many product purchases are based on how a person feels about the good
or service, combined with rational information.

In-Text Question 3:
What is a message theme?

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The support
The fourth component of the creative strategy is the support. Support takes the
form of the facts that substantiate the message theme. A pain reliever
advertisement's claim of being effective for arthritis may support this point by
noting independent medical findings or testimonials from patients with arthritis.
The micro THINS are 30 percent thinner, 40 percent lighter, 4 times more scratch
resistant, 10 times more impact resistant, antireflective, and have 99.9 percent UV
protection. The creative needs these supporting facts to design effective
advertisements.

The constraints
The final step in the development of a creative strategy is identification of any
constraints. These can be legal and mandatory restrictions placed on
advertisements. They include legal protection for trademarks, logos, and copy
registrations. They also include disclaimers about warranties, offers, and claims.
For warranties, a disclaimer specifies the conditions under which they will be
honoured. For example, tire warranties often state they apply under normal driving
conditions with routine maintenance, so that a person cannot ignore tire balancing
and rotation and expect to get free new tires when the old ones wear out quickly.
Disclaimer warranties notify consumers of potential hazards associated with
products. For instance, tobacco advertisements must contain a statement from the
Surgeon General about the dangers of smoking and chewing tobacco. Disclaimers
about offers spell out the terms of financing agreements, as well as when bonuses
or discounts apply. Claims identify the exact nature of the statement made in the
advertisement. This includes nutritional claims as well as statements about serving
sizes and other information describing the nutrients that are actually in the product.

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After these steps have been reviewed, the creative brief is complete. From this
point forward, the message and the media match, and actual advertisements can be
produced.

Effective creative briefs focus on everyone involved in both the IMC message and
the intent of the advertising campaign. This, in turn, gives companies better
chances of reaching customers with messages that return measurable results and
help guarantee the success of both the company and the advertising agency. When
the creative brief has been completed, the design of the campaign should move
forward at a solid pace. Recent research suggests that campaigns designed in two

(2) months or less have the greatest likelihood of being “highly effective.” Those
that take longer tend not to be as effective. The goal is to move forward without
rushing. Campaigns designed in two weeks or less are more likely to be ineffective
as well.

In-Text Question 4:
What are the steps in preparing a creative strategy?

4.0 Session Summary

In this study session, we discussed advertising campaign management. We got to
understand that the advertising campaign management is the process of preparing
and integrating a specific advertising program in conjunction with the overall IMC
message. We went further to discuss Advertising goals, advertising budget, the
media selection and the message theme.

5.0 Self-Assessment Questions

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 1. What is advertisement campaign management?'
2. How do you communicate market analysis?
3. Discuss media selection in advertisement

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/Eddiob . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/irbB5A and critique it in the discussion
forum

In-Text Answer 1:
Advertising campaign management is the process of preparing and integrating a specific
advertising program in conjunction with the overall IMC message.

In-Text Answer 2: They are: (i) building image, (ii) Providing information, (iii) Being
persuasive, (iv) Supporting other marketing offering, (v) encouraging action.

In-Text Answer 3:
The message theme is an outline of key idea(s) that the advertising program is
supposed to convey. The message theme is the benefit or promise the advertiser wants
to use to reach consumers or businesses.

In-Text Answer 4:
The objective, the target audience, the message theme, the support and the
constraints

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7.0 References
Kenneth E. Clow and Donald Baack (2007). Integrated Advertising, Promotion,
and Marketing Communications, Third Edition, Pearson Education, Inc.
Prentice Hall.
Kotler, Philip & Keller, Kevin Lane (2006). Marketing Management, 12th Edition.
New Jersey: Pearson Prentice Hall.
Perreault, William D., Jr. & McCarthy, Jerome E. (2005). Basic Marketing: A
Global- Management Approach. Boston: McGraw-Hall Irwin.

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 MODULE 3
Advertising Laws, Globalization and the Future of Advertising
Contents
Study Session 1: Advertising laws and ethics
Study Session 2: Regulation in advertising
Study Session 3: Advertising and society
Study Session 4: Global and advertisement
Study Session 5: Future of advertising

STUDY SESSION 1
Advertising Laws and Ethics
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Advertising Laws
2.2 Ethics in advertising
2.3 History of APCON and Its Operations
2.4 Nigerian Communications Commission Guidelines on Advertisements
and Promotions
2.4.1 Introduction
2.5.2 Definitions of terms
2.5 Other Laws Governing Advertising in Nigeria
3.0 Tutored Marked Assignment
4.0 Summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, activities, animation and outdoor activities)
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7.0 References/Further Readings
Introduction
In this study session, our discussion will be centred advertising laws and ethics. It
is expected that you will be enlightened on the ethics in advertising.

Learning Outcomes
At the end of this study session, you will be able to understand the following:
1. Advertising laws and ethics
2. Ethics in advertising
3. The history of APCON
4. The functions of APCON in the advertising industry in Nigeria
5. The Nigeria communication commission guidelines on advertisement and
promotion.

2.0 Main Content

2.1 Advertising Laws
With the fast expansion of Integrated Marketing Communication nowadays,
advertising has emerged as a most demanding & challenging business industry.
Advertising plays an important role by creating
primary demand for the product or service. Thus, its
usage rate increases. It does not only stimulates the
product distribution but also build brand
preferences and loyalty. It also reduces the time
between the purchases and persuades the consumers
to try various new products in the market.
Advertising is a persuasive promotional tool especially for companies whose
products and services are targeted at mass consumer markets.
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 In-Text Question 1:
What plays an important role by creating primary demand for the product or service?

From mission to profession to industry, the world of advertising has come a long
way. Some people describe it as a parasitical, untrue, misleading and obscene.
Advertising Industry have been facing a lot of criticism in the recent times as the
advertising practices have not always been ethical. Advertisements should be
socially, culturally and morally ethical. Advertisements appearing on television
and radio have to be approved by regulatory authorities. Similarly, advertisements
in newspapers and magazines, and on outdoor sites are also regulated by
guidelines. In today’s competitive market, it is free for all, thus advertisers are
sometimes following the unethical practices to fight the competition. For many
years, the advertising industry has practiced, promoted voluntary self- regulation.
Most advertisers and media recognize the importance of maintaining consumer
trust and confidence. The circle of self-regulation in advertising is widening day by
day.

2.2 Ethics in Advertising

Ethics means “Good Conduct” or “Conduct which is right in view of the society
and the time period”. By common consent, various modes of behaviour and
conduct are viewed as “good” or “bad”.

In other word, we can say that Ethics are moral principles and values that govern
the actions and decisions of an individual group. Ethics is a choice between good
and bad, between right and wrong. It is governed by a set of principles of morality
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at a given time and at a given place and in a given society. Ethics is related to
group behaviour in ultimate analysis, thus setting norms for an individual to follow
in consistence with the group norms.

A particular action may be within the law and still not be ethical; Target Marketing
is a good example for this. There is no law to restrict tobacco companies from
promoting their brands to Africans and Americans, though there is such law in
India, but for Doordarshan only. Similarly, alcoholic beverage companies promote
their brands and target not only college students but underage drinkers as well.
These advertisements have increased alcohol related problems. Advertisements
exposing pornography is another serious issue in advertising industry today.
Advertisements promoting permissiveness and objectifying women are heavily
criticized in the society.

In-Text Question 2:
What is the meaning of ethics?

Therefore, even advertising has ethical value. The mixing of art and facts in
advertising communication are subservient to ethical principles. In today’s
competitive and buyer’s market, an advertisement has to be truthful and ethical. If
an advertisement is misleading, the credibility of the organization is lost. To view
the truth in advertisement, it has to be seen from the consumer’s point of view
rather than from legal point. The advertising industry has been frequently criticized
for putting out misleading or exaggerated claims in respect to the product, goods
and services advertised. It is also perceived as guilty of glorifying certain habits or
tendencies regarded as undesirable.

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However, it is very difficult to demarcate a clear line of difference between what is
true and what is untrue. But the advertisement as such is judged by its impact, and
by its acceptance by the consumers. The product must fulfil its advertised claims.
Advertisements should be decent and not be obscene. It must be truthful. Gambling
is also unethical. Sometimes, celebrities endorsing the product and spreading
falsehood is also criticized.

Advertising is a social process, thus it must follow the time-

tested norms of social behaviour and should not affront our
moral sense. In short, ethics are rules of conduct or principles
of morality that point us towards the right or best way to act in
a situation. Ethics vary from person to person, society-to-
society point of view. Remember that various people have
different backgrounds, values and interests. You may see nothing wrong with the
advertisements for cigarettes or beer or sexually suggestive ads, but other students
many oppose these advertisement on moral and ethical grounds. You will have to
draw your own conclusions as to what is right and what is wrong!

2.3 History of APCON and its Operations

The main regulator of advertising practice in Nigeria is the Advertising
Practitioners Council of Nigeria (APCON). It is the body established by the
Federal Government to regulate advertising activities through APCON Decree 55
of 1988 and the subsequent amendments: Decree 93 of 1992 and Decree 116 of
1993. The adoption in January, 1988 by the National Council of Ministers of a
broad National Mass Communication Policy was an important milestone in the
birth of the Advertising Practitioners Council of Nigeria. Various discussions were
said to have led to the articulation of the relevance of advertising in the nation’s
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social, political and economic activities as well as the need for recognition and
regulation. The Advertising Practitioner Council of Nigeria (APCON), established
by Act 55 of 1988, was a logical outcome of the legislative recognition of
advertising as a profession in Nigeria.

Functions of APCON
Section One Act 55 of 1988, which set up APCON, states its functions as:
a. determining who are advertising practitioners;
b. determining what standards of knowledge and skill are to be attained by persons
seeking to become registered members of the advertising profession and reviewing
those standards from time to time;
c. securing, in accordance with the provisions of the Decree, the establishment and
maintenance of a register of practitioners and the publication from time to time
d. regulating and controlling the practice of advertising in all its aspects and
ramifications;
e. conducting examinations in the profession and awarding certificates or diplomas
to successful candidates and when appropriate and for such purpose, the council
shall prescribe fees to be paid in respect thereof;
f. Performing the other functions conferred on the council by the Act.

Membership
The Decree makes provision for four grades of membership:
• Fellow
• Full Member
• Associate Member
• Student Member

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Registration as an Ad practitioner
Associate Member
Anyone above the age of 21, who possesses any of the degrees or diplomas listed
under the student category, and is employed in a recognized organization where he
or she can acquire professional experience. He or she must be of good character
and must not have been convicted in Nigeria or elsewhere of a criminal offence.

Full Member
Anyone who has met the requirements for associate membership and in addition
has been in continuous advertising practice for a minimum of five years.

Fellow
To be a fellow, the applicant must have fulfilled the conditions for associate and
full membership. In addition, he or she must have been in continuous active
advertising practice in the 15 years preceding the date of his or her application, and
must show evidence of significant contributions to the practice of advertising.

Student Member
Anyone who satisfied the Council that he or she is undergoing a course of studies
recognized by the Council.

Control functions of APCON

As a means of making APCON law effective, a Secretariat was created and
saddled with the responsibility of monitoring and enforcing the provisions of the
APCON law and the Code of Advertising Practice in Nigeria.

In this regard, the Council appoints other bodies to support the secretariat
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in executing the provisions of the law. These bodies are:
a) Investigating Panel: this body hears complaints from and against advertising
practitioners and stakeholders in the industry.
b) The Advertising Practitioners Disciplinary Committee: this body is charged with
adjudicating in these cases.
c) The Advertising Standards Panel: it ensures that practitioners maintain standards
set in the industry.

Besides this regulatory structure of the industry, Fadipe (2002) also identifies other
functions of APCON as set out in the law setting it up. These are:
i. screening and registration of practitioners
ii. ii. induction of new practitioners
iii. assessing and upgrading practitioner’s
iv. iv. vetting of new advertisements
v. monitoring of the exposure of advertisements
vi. education of practitioners and training of new members
vii. accreditation of departments offering advertising courses in universities and
polytechnics
viii. publishing reading and reference literature on advertising
ix. enforcing discipline
x. ensuring that ethical standards are maintained.
Apart from these functions, APCON also ensures that advertising practice is
developed and upgraded to international standards. Essentially, APCON
recognizes excellence in the practice of advertising in Nigeria by giving awards
and an annual lecture series to increase debate and body of literature in the
industry. These include:
a) Annual Advertising Day/Lecture at the end of very year.
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b) Student Encouragement Awards. These are sponsored by eminent and registered
members of the advertising industry, corporate bodies and other practitioners in the
practice.

However, issues continued to be raised by advertising practitioners where they

think APCON needs to do more work. Some of these are:
i. they believe that direct media buying and selling, which involves placement of
advertisements by an advertiser without the knowledge of the practitioners, is
against the APCON law and therefore unhealthy for the advertising industry
ii. they believe that the entry into the profession is loose as many unregistered
people still engage in the business of advertising in the country. They say this
is also against the spirit and tenets of the APCON law
iii. members of the public have continued to raise issues about the need to
strengthen the effectiveness of the APCON laws regarding deceptive
advertisements
iv. in addition, issues of compliance with the advertising code of ethics are raised
against APCON as we shall see in subsequent units.

ITQ 3: Mention three functions of APCON

2.4 Nigerian Communications Commission Guidelines on Advertisements and

Promotions
1. Introduction
(1) The Nigerian communications Commission (the Commission) has been given
powers under the Nigerian Communications Act,2003 (the Act) and the Nigeria
Communications (Enforcement Processes, etc.) Regulations 2005 respectively to
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inter alia;
a. Make and publish Guidelines on any matters as are necessary for giving full
effect to the provisions of the Act and or their due administration.
b. Publish Guidelines specifying inter alia minimum standards and requirements in
respect of advertisements and promotions of products and services by licensees for
the purposes of protecting consumers and ensuring ethical marketing and
promotional standards by licensees.
(2) The Guidelines are developed to set minimum requirements and standards for
advertisements and promotions by licensed telecommunications operators in
Nigeria.

2. Definitions of terms
Unless the context otherwise requires, these terms shall have the following
interpretations in these guidelines.

“Act” means the Nigerian Communications Act, 2003 or any succeeding

legislation thereto.

“Advertisement” means any message, the content of which is controlled directly

or indirectly by the advertiser, expressed in any language and communicated in any
medium with the intent to influence their choice, opinion or behaviour.

“Commission” means the Nigerian Communication Commission

“Licensee” means any person who holds an operating license issued by the
Commission.

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“Promotion” means any message, the content of which is controlled directly or
indirectly by the advertiser, expressed in any language and communicated in any
medium with the intent to influence their choice, opinion or behaviour in order to
receive a reward or benefit.

3. Minimum standards and requirements for advertisement

The Commission shall receive written notification from the licensees for all
advertisements of goods and services within a minimum of seven (7) days of the
proposed or planned publication of an advertisement in order to ensure such
advertisements meet the following minimum standards and requirements:
a) Standards and requirements:
i. The licensee shall attach a detailed report of the advertisement clearly specifying
the goods and/or services and the target consumers.
ii. The licensee shall, If the goods and services on which an advertised claim or
representation depends can be tested by survey or data, provide such data which
must be reasonably competent and reliable, reflecting the true and accepted
principles of such research.
iii. The licensee must adhere to set standards for quality and grade of service set by
the Commission.
iv. The licensee must adhere to the set standards on telecommunications products
and equipment that are manufactured, imported or sold in Nigeria.
v. The licensee shall adhere to any other standards or requirements of a specific or
general nature that may be specified from time to time by the Commission.

b) Pricing
i. The licensee must communicate all prices and financial implications clearly and
have no hidden or disguised price adjustments, discounts, unrealistic price
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comparisons or exaggerated claims as to worth or value. Advertising with
complicated price structures and information shall not only appear in transient
types of media such as radio and television, but must be accompanied with detailed
print media explanations, and on the licensee’s website. The transient media must
specifically instruct consumers to see the print mediums for details.

c) Advertorial medium
i. The licensee shall be required to make advertisements and advertisements for
promotions only via print, radio, mail, licensee’s website, text messages, electronic
mail (where permitted by recipient to send such promotional material), and/or
visual media, with accuracy and clarity of the goods and services being offered.
ii. No advertisement or advertisement for a promotion shall contain any obscenities
or profanities unsuitable for young persons and children or contain any racial or
prejudicial content relating to national origin, religion, sex, gender or age.

d) Comparative advertising
i. Advertisements must not unfairly discredit, disparage or attack other products,
services, advertisements or companies, or exaggerate the nature or importance of
competitive differences.
ii. No licensee shall imitate the slogans or illustrations of another advertiser in such
a manner as to mislead the consumer.

e) Internet Connections
i. Licensees offering internet connections should state the Internet connection
speed available to end-users as well as specific upload and download speed. If the
connection speed quoted is only obtainable under special circumstances, then these
circumstances should be clearly stated.
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4. Application for promotion
i. Every licensee shall, prior to the release of any promotion of its products and
services, make an application to the Commission for approval of such
promotion.
ii. The application must be filled in the stipulated application form as provided in
Schedule 1 and submitted to the Commission after paying the relevant
application fees as stated in schedule 2 of these guidelines.
iii. The licensee shall attach a detailed report of the promotion clearly specifying
the goods and/or services and the target consumers.
iv. The Commission shall cause the approval or otherwise to be communicated to
the licensee within 7 days of receiving the application.
v. All approvals granted must be registered with the Consumer Protection Council
within three (3) days of the launch of the promotions.
vi. The licensee shall ensure that its network is capable of sustaining the traffic that
may be generated from such promotion.
vii. The licensee must ensure that the tariff attributed to such promotion does not
exceed the tariffs approved by the Commission.
viii. The licensee must specify the duration and date range of such promotion and
the date of redemption of such promotional benefits.
ix. All promotions must not misrepresent the licensees’ opportunity to provide the
goods and services at the terms presented. If supply of the goods and services
are limited, or the licensee can fulfil only limited demand, this must be clearly
stated in the communication for the promotion.
x. In respect of promotions or advertisements containing promotions, the licensee
must specify the duration and the date range of such promotion and the date of
redemption of such promotional benefits.
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xi. Where the duration of the promotion is not time bound, but subject to
attainment of a specific target (for example a raffle targeted at the first 5,000
adopters of a promotion), the promotion must state clearly the threshold to be
applied.
xii. The licensee must specify the target subscribers’ clearly distinguishing those
targeted at new subscribers and those targeted at existing subscribers.
xiii. The licensee must communicate to the subscribers where such goods are
available to only a particular geographical region.
xiv. The licensee must ensure a geographical balance while offering its
promotional sales to its consumers without concentration on consumers in a
particular geographical location.
xv. The licensee must communicate clearly and understandably to the subscribers
all relevant terms and conditions of the promotions.
xvi. Where a licensee communicates certain categories and/or specific products
services as rewards or potential rewards for partaking in a promotion, it must
ensure that the specific items and or services portrayed and/or promised are
not varied.

5 Denial of application
i. The Commission reserves the right to reject any application for promotion.
ii. The rejection shall be communicated to the licensee within seven days of
receiving the application.
iii. The Commission shall communicate to the licensee the reasons for the rejection
and where the situation can be remedied or the application varied may ask the
licensee to remedy the situation within a specified period.

6. Withdrawal of Approval
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a. The Commission reserves the right to withdraw any approvals for promotions
from the licensee for reasons not limited to:
i. Network Congestion
ii. Poor performance in licensee’s services
iii. Consumer complaints,
iv. Misrepresentation of offer by the licensee,
v. Contravention of specific approval,
vi. Variation from submitted application content and /or context
a) Upon the withdrawal of the approval, the licensee must discontinue such sales
promotions with immediate effect. The discontinuation must be communicated to
the subscribers via SMS, website publication, newspaper publication or any other
effective medium of communication.

7. Appeal
a. Where a request for approval is rejected or approval is withdrawn, the licensee is
entitled to request an appeal from the decision of the Commission by filing a
Request for Appeal.
b. The Request for Appeal must be in writing and received at the Commission
within seven working days after the decision is sent to the licensee. It must
provide the appellant’s basis for the request.
c. An Appeal Panel shall be constituted compromising persons who did not serve
at the original decision making. The licensee making the request will be given at
least five working days advance written notice of the date of the appeal hearing.
d. At the appeal hearing, the complaint will be treated as a new complaint and the
matter reconsidered in its entirety.
e. Decisions of Appeal Panels will be sent to the licensee within five working days
of the appeal hearing.
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f. Decisions by the Appeal Panel shall be binding.

8. Sanctions
The Commission reserves the right to place appropriate sanctions on defaulting
licensees including but not limited to:
a. Imposition of Fines further to the provisions of Regulation 15 of Nigerian
Communications (Enforcement Processes etc., Regulations 2005.
Any violation of these guidelines ……………N1, 000,000 per violation
Failure to provide information required or providing information which is false or
misleading…………………………….N1, 000, 000 per

Violation:
Failure to obtain prior approval of the Commission for the promotion of goods and
services..................................N2, 000, 000 per violation.
b. Failure or refusal to register any promotions with the Consumer
Protection Council within the specified period……N5, 000,000.00 per violation
c. Withdrawal, (revocation) or suspension of the operator’s license.

E. Other Laws Governing Advertising in Nigeria

Other agencies, organizations, or decrees put in place by the Federal Government
to address the problem of unwholesome practices between producers, marketers,
suppliers, service providers and the consumers in Nigeria include:
• Food and Drug Decree of 1974: this law prohibits sale of certain category of food
and drugs, and/or of such food and drugs because they are considered to be
either unsafe or they are misleading the public. For example, you are not
allowed to advertise a drug, which claims to cure obesity in Nigeria.
Unfortunately, this is now flouted with impunity in Nigeria and APCON and
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 some of the regulatory bodies concerned have proved incapable of dealing with
these infractions.
• Standards Organization of Nigeria (SON)
• National Drug Law Enforcement Agency (NDLEA)
• National Agency for Food and Drug Administration and Control
(NAFDAC), 1993
• Nigerian Communication Commission (NCC)
• Economic and Financial Crimes Commission (EFCC).
• Independent Corrupt Practices and other related offences Commission (ICPC).
• Federal Environmental Protection Agency (FEPA)
• National Lottery Regulatory Commission
• The Counterfeit and Fake Drugs Decree No 21 of 1988
• The Food and Drugs Act Cap 150 of 1990
• The Poison and Pharmacy Act Cap 366 of 1990
• Consumer Protection Council (CPC): a parastatal of the Federal Government
established by Act No. 66 of 1992 to promote and protect consumers’ interests in
all areas of products and services, provide speedy redress to their complaints,
inform, educate and empower them (consumers) to act as discerning and
discriminating consumers in the market place. There is also the Consumers
Association of Nigeria and such other groups, which we shall deal with under
consumerism.

In-Text Question 4:
Mention three (3) other agencies that are also saddled with the responsibility of addressing
problems of unwholesome practices between producers and consumers.

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4.0 Session Summary
In this study session, we considered advertising laws and ethics. we were able to
define ethics as “Good Conduct” or “Conduct which is right in view of the society
and the time period”. By common consent, various modes of behaviour and
conduct are viewed as “good” or “bad”. We went further to look at the main
regulatory body in charge of advertising in Nigeria (i.e. APCON) as well as other
agencies that are saddled with the responsibility of addressing problems of
unwholesome practices between producers and the final consumers.

5.0 Self-Assessment Questions

1. Discuss ethics in advertisement
2. What are the laws governing advertisement in Nigeria?
3. Discuss the history of APCON and its operations
4. Describe the Nigerian Communication Commission guidelines on
advertisement and promotions

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/55HaU7. Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/VN32ny and critique it in the discussion
forum

In-Text Answer 1:
Advertising

In-Text Answer 2:
Ethics means “Good Conduct” or “Conduct which is right in view of the society and
the time period.
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 ITA 3: i. Determining who are advertising practitioners; ii. determining what
standards of knowledge and skill to be attained by persons seeking to become
registered members of the advertising profession and reviewing those standards
from time to time; iii. Securing, in accordance with the provisions of the Decree,
the establishment and maintenance of a register of practitioners and the publication
of list of these registered persons from time to time.

In-Text Answer 4:
Standards Organization of Nigeria (SON), National Drug Law Enforcement
Agency (NDLEA) , Nigerian Communication Commission (NCC).

7.0 References
Aaker, David, & John (1992). Advertising management, Prentice-Hall of India
Bel-Molokwu, J. (2000). Principles of Advertising in Nigeria. APCON.
Bel-Molokwu, J. et al. (1997). Advertising in Nigeria. APCON.
Fadipe, S. (2002). Advertising Practice with Nigerian Orientation. Lagos: Christ
Publishers.

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 STUDY SESSION 2
Regulations in Advertising
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Regulations in Advertising
2.2 Misrepresentation or Omission
2.2.1 Restitution
2.2.2 Affirmative Disclosures
2.2.3 Corrective Advertising
2.2.4 Competitor Lawsuits
2.3 Need for Advertisement regulations
2.4 Various Types of Regulations in Advertising Abroad
Consumer protection (distance selling) Regulations 2000
3.0 Tutored Marked Assignment
4.0 Session summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, animation and outdoor activities)
7.0 References

Introduction
In this study session, we are going to continue from our last topic on advertising
laws and ethics. The study session seeks to explore the regulations in advertising.
This and many more will form the basis of our discussion in the session.

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1.0 Learning Outcomes
At the end of this study session, you will be able to understand the following:
1. The need for proper regulation of advertisement.
2. What is deception as it relates to advertising
3. What is misrepresentation or omission.

2.0 Main Content

2.1 Regulations in Advertising
Due to recent tremendous and fast expansion of international market, advertising
has become an important and challenging business industry. Advertising helps in
increasing customer’s base and the primary demand and its usage rate for various
products. Moreover, it reduces the time between purchases and induces consumers
to try new products. It also stimulates the distribution of products and build brand
preferences and loyalty, thereby, presenting the product with the objective to
promote it. Generally speaking, advertisement is a powerful communication force
and vital market tool that helps to sell goods, services, images, and ideas through
channels of information and persuasion. It is published or broadcasted on payment
basis by the benefited organization.

Advertisements are made with the use of various categories of print and electronic
media to large section of people and when the consumer’s attention is drawn to
these, he is seeking information to help him decide for or against that particular
product. Thus, advertising is a buyers’ guide for both consumers and industrial
purchasers. It adds value to products, encourages competitions, fosters quality and
also reduces distribution costs. In this era of globalization, it enables both print and
broadcasting communication to maintain independence from government and
political policies and stimulates thoughts on national and local problems. To make
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the business remunerative, in-depth studies and knowledge about various laws
which are in force, amendments from time to time in this law, constitutional
restrictions impositions are very necessary.
Advertising regulation is a fascinating subject, and it is heavily determined by
political attitudes. Those who believe less in government and think that business
should be left alone to regulate itself tend to favour less advertising regulation.
Others who believe government has a role to play tend to want more legislation
and government regulation. To understand advertising regulation, a host of issues
need to be addressed. One central issue is definitional: what is deception?
One Ad claimed that “Milwaukee’s finest beer,” is deceptive, while many
(particularly other Milwaukee brewers) argue that other beers are superior? What
does “finest” mean? One advertisement claimed that a hair dye would color hair
permanently. If someone exposed to the advertisement believed that the dye would
hold for hair not yet grown and thus a single dye would last for decades, is the
claim deceptive?

In-Text Question 1:
Why has1 advertising become an important and challenging business industry?
.

A basic issue in the enforcement of these laws against deceptive advertising, to

which we now turn, is how to define and identify deception.

Conceptually, deception exists when an advertisement is introduced into the

perceptual process of some audience and the output of that perceptual process
1. Differs from the reality of the situation and
2. Affects buying behaviour to the detriment of the consumer. The input itself may
be determined to contain falsehoods. However, the more difficult and perhaps
186
more common case is when the input and the advertisement are not obviously
false, but the perceptual process generates an impression that is deceptive. A
disclaimer may not pass through the attention filter or the message may be
misinterpreted.

Dividing the definition into its three major components, it states that deception will
be found if:
1. There is a misrepresentation, omission, or practice that is likely to mislead.
2. The consumer is acting responsibly (or reasonably) in the circumstances.
3. The practice of material and consumer injury is possible because consumers are
likely to have chosen differently if there was no deception.

Although some argue that this definition only codifies the body of law that
preceded it, most observers suggest that the definition involves two major changes
from prior positions that make it harder to quality as deceptive. First, the deception
will likely to mislead. Second, the deception
must occur in consumers acting responsibly or
reasonably in the circumstances rather than
simply occurring in a substantial number of
consumers (even if they are naïve and
unthinking). Thus, the consumer is charged with
at least some minimal responsibility in
interpreting the advertising.

In the following discussion, we will look more closely at the three dimensions of
deceptive advertising discussed above.

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2.2 Misrepresentation or Omission
There are a variety of ways in which misrepresentations or omissions can occur:
1. Suggesting that a small difference is important.
2. Artificial product demonstrations
3. Using an ambiguous or easily confused phrase.
4. Implying a benefit that does not fully or partially exist
5. Implying that a product benefit is unique to a brand.
6. Implying that a benefit is needed or that a product will fulfil a benefit when it
will not.
7. Incorrectly implying that an endorser uses and advocates the brand.
8. Making a claim without substantiation
9. Bait and switch
10. Identifying the advertising

Puffery
A rather well-established rule of law is that trade puffing is permissible. Puffing
takes two general forms. The first is a subjective statement of opinion about a
product’s quality, using such terms as “best or greatest”. Nearly all advertisements
contain some measure of puffery. Examples of this are “You can’t get any closer”
(Norelco), “Try something better” (J&B Scotch), “Gas gives you a better deal”
(American Gas Association), “Live better electrically” (Edison Electric
Institution), “State Farm is all you need to know about insurance,” and “Super
Shell”. None of these statements has either been found to be true or false. They all
involve some measure of exaggeration
The second form of puffery is exaggerations extended to the point of outright spoof
that is obviously not true. A Green Giant is obviously fictitious, and even if he
were real, he wouldn’t be talking the way he does. In the 1927 Ostermoor case, the
188
court pointed to the puffery argument in denying that a mattress company was
deceptive in using an illustration appearing to depict that the inner filling of a
mattress would expand to 35 inches when in fact it would expand only 3 to 6
inches.

Based on stated definitions and policy, puffing has been narrowed to the point
where no deceptive claim can properly be termed as puffery

In-Text Questions 2:
Mention 4 ways in which a misrepresentations or omissions can occur

Remedies
Cease –and – Desist Orders
The cease and desist order prohibits the respondent from engaging further in the
deceptive practice. It has been criticized as being a command to “go and sin no
more” which has little practical effect. By the time the cease- and-desist order is
issued, the advertising may have served its purpose and another campaign may be
underway anyway.

Restitution
Restitution means that the consumer is compensated for any damage. Restitution is
rarely considered because of its severity.

Affirmative disclosures
If an advertisement has provided insufficient information to the consumer, an
affirmative disclosure might be issued. Affirmative disclosures require “clear and
conspicuous” disclosure of the omitted information. Often, the involved
189
information relates to deficiencies or limitations of the product or service relating
to matters of health or safety.

Corrective advertising
Corrective advertising required advertisers to rectify past deception by making
suitable statements in future commercials. Some important issues could need your
research on the subject. Any remedy should be non-punitive in nature and should
not be burdensome. How do you determine whether the corrective advertising is
generating damage to sales or image? Any remedy should preserve First
Amendment rights to express ideas.

What about those ideas that are counter to the corrective message’s claims? Can an
advertiser simply decide to stop advertising, thereby avoiding corrective
advertising?

One problem with corrective advertising is that it has usually resulted in lawyers
writing copy and insisting that it be run some arbitrary length of time. The
implementation of the communication objective approach to corrective advertising
will always face difficulties. The problem of ascertaining how misperception and
its effect are to be measured and the appropriate target level of misperception that
should be obtained reappears in this context. Judgments on such questions are
required to set communication objectives.
Obviously, a zero misperception level is not generally feasible. Yet, regulators and
the general public to which they must answer have difficulty accepting realistic
standards. A key is to know whether the advertiser is making a good faith effort
toward the objective. Copy testing could logically be used to address this point, but
the parties would have to agree in advance on relevant and suitable tests, a difficult
190
prospect. Another problem is the cost of measuring deception over time. The
tracking required measuring the impact of the commercials (no problem for large
advertisers who do that anyway, but could be costly for smaller advertisers and
may require the government to share some of the costs).

Corrective advertising has only rarely been considered, largely because of the
difficulties in deciding on the target objective. However, it remains an important
option and serves to focus attention on the central issues in deception cases.

In-Text Question 3:
What is corrective advertising?

Competitor lawsuits
Another mechanism that inhibits deceptive advertising is the
possibility that competitors will sue, charging that false
advertising has caused them damage. In one case, a suit was
successfully brought by Honeywell against a competitor
who supplied replacement parts to Honey well's safety control systems and had incorrectly
claimed that its products had comparable quality and ease of replacement to that of
Honeywell.

2.3 Need for Advertisement Regulations

With the ever increasing growth and turnover of the advertising industry in the
current century due to industrial revolution, there is urgent need and necessity to
frame legal rules, regulations and specific legislative enactments that specifically
directed at this industry. These regulations determine both the broad framework
191
within which the industry is allowed to operate and content of its outputs. The
advertisers have responsibility to clientele of social, cultural and moral values of
the community in which they function, while promoting commercial prosperity by
selling their products or services or ideas to win customers and influence people.
Therefore, it is necessary to ensure truthfulness and honesty of representations and
claims made by the advertisers and also to safeguard against misleading
advertisements. Advertisements should not distort facts and mislead the consumers
by any means of implications or omissions. Hence, there is a necessity to frame
legal law and act for smooth working of the business and also to protect the
consumer’s interest by providing legal provisions.

2.4 Various Types of Regulations in Advertising Abroad

Different countries following common or civil laws have different ways of dealing
with misleading advertisements. These advertisements are examined through
conceptual framework consisting of the following five stages; initiation,
interpretation, deceptive, verification and remediation based on comparative legal
system of the International Journal of Advertising. The USA common law country
entertains advertising challenging from three sources viz. by competitor,
consumers or consumer organizations. Some individual television stations and
magazines also review advertising before accepting them. Civil law tends to rely
less on government regulation and more on private law suits and/or industry self-
regulations.

Italy and Japan rely mostly on self- regulation. Advertising law of Italy is enforced
by competitor law suits and consumers’ organizations are specifically barred from
bringing advertising fewer suits. Japan followed a civil code in 1898 based on the
German Civil Code which relies heavily on self-regulation. Germany bases its
192
regulation of misleading advertisements on competitor’s law suits and those
brought by consumer organizations. They can request the Director of Fair Trading
to seek a court injunction. The U.K. Trade Descriptions Act of 1968 authorizes
local weights and measures authorities to seek either summary criminal conviction,
punishable by a maximum five of 1000 pounds or criminal indictment punishable
by an unlimited fine and up to two years in jail for false trade descriptions
contained in an advertisement or by other means. In Germany (a country that
operates Civil Law), consumer research is required to determine the implied
meaning of the particular advertisement. In all other countries, it is the judge or the
regulator, who views the advertisement and interprets it based on his personal
opinion of the standard for deception.

U.S. Lanham Act follows the old FTC practice of condemning advertising that has
tendency or capacity to mislead 25 per cent or more consumers. In U.S., Federal
Trade Commission (FTC) Act was passed in 1914. Traditionally the advertisers are
not required to prove the truthfulness of their claims. The onus of proving the
falsity of the claim rests on the challengers, while common law country, New
Zealand recently followed the U.S. FTC under which advertisers are required to
prove their claim when challenged. The European Community Directive on
misleading advertisement calls for advertisers to bear the brunt of proving the
truthfulness of their claims. The UK self -regulation and its 1988 Control of
Misleading Advertisements Regulation requires that advertiser develop
substantiation prior to dissemination. In Germany and the UK, damages are
ordered when complainant prove intention or negligent misconduct. In New
Zealand and Canada, injunctions are very rare, however, heavy penalties serve as
deterrents. Truly speaking, advertising is unfortunately not taken seriously by the
governments and regulatory bodies at large.
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 In-Text Question 4:
Why do we need advertising regulations?

Consumer protection (distance selling) Regulations 2000

The Webspace Contract and any Advertisement Contracts will allow for any rights
you may have under the Consumer Protection (Distance Selling) Regulations 2000
including a cooling-off period.

4.0 Session Summary

In this study session, we discussed the regulations in advertising and we got to
understand what deception is as regards to advertising. We went further to
understand what misrepresentation or omission is as well as what corrective
advertising is. We concluded by discussing various types of advertising regulations
abroad.

5.0 Self-Assessment Questions

1. Should there be any need for regulations in advertising?
2. What are the various types of advertisement abroad?
3. Discuss the consumer protection regulations 2000
6.0 Additional Activities (Videos, animations and outdoor activities)
a. Visit U-tube https://goo.gl/XRjYxn . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/no4LJW and critique it in the discussion

194
forum

In-Text Answer 1:
It is due to recent tremendous and fast expansion of international market

In-Text Answer 2:
Misrepresentations or omissions can occur when:
1. Suggesting that a small difference is important.
2. Artificial product demonstrations
3. Using an ambiguous or easily confusing phrase. 4. Implying a benefit that does
not fully or partially exist.

In-Text Answers 3:
Corrective advertising required advertisers to rectify past deception by making
suitable statements in future commercials.

In-Text Answer 4:
With the ever increasing growth and turnover of the advertising industry in the
current century due to industrial revolution, there is urgent need and necessity
to frame legal rules, regulations and specific legislative enactment that
specifically directed at this industry. These regulations determine both the broad
framework within which the industry is allowed to operate and content of its
outputs.

7.0 References
Aaker, David, and John (1992). Advertising management. Prentice-Hall of India

195
 STUDY SESSION 3
Advertising and Society
Section and Subsection Headings
Introduction
1.0 Learning Outcomes
2.0 Main Content
2.1 Providing Informational Utility
2.2 Advertising and Children
2.3 Encouraging Antisocial and Dangerous Products and Behavior
2.3.1 Dishonesty, Misleading, Cheating
2.3.2 Exploiting the Arts, Defacing the Environment
2.3.3 Promoting Consumerism
2.3.4 Undermining standards and values
3.0 Tutored marked Assignment
4.0 Session summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, animation and outdoor activities)
7.0 References

Introduction
This study session takes you on advertising and society. You will get to understand
how advertisement leads to materialism and also how it affects children.

1.0 Learning Outcomes:

At the end of this study session, you should be able to understand the following:
1. How advertisement encourages materialism in the society.
2. How advertisement provides information utility
196
 3. How advertisement encourages antisocial and dangerous products and
behaviour.

2.0 Main Content

2.1 Advertising and Society
Advertising is blamed for many of the ills of society. Significantly, the words used
when a politician, a judge, a social worker, a clergyman, a pressure group or even
the person next door, accuses advertising of some heinous crime against humanity
is virtually always 'advertising'. Advertising clearly sets out to encourage
'consumerism' (a word that used to mean concern for consumers, but suddenly
changed meaning, and, as such, exploits the gullibility of people who cannot afford
the goodies portrayed in the ads).

Undoubtedly, there are real criticisms that can be levelled at advertisements, and
possibly at the industry that produces them as well. Most of these criticisms are
supposed to be directed at the market economy and its workings; rather
advertising, though they recognize advertising as its most obvious commercial
face. There are a number of areas where society can reasonably attack
advertisements and advertising and plenty more where someone may find cause to
complain about an individual Ad.

2.2 Materialism
Materialism is defined as the tendency to give undue importance to material interests.
Presumably, there is a corresponding lessening of importance to nonmaterial interests such
as love, freedom, and intellectual pursuits. However, Bauer and Greyser argue that
although people do spend their resources on material things, they do so in the pursuit of
nonmaterial goals. They buy camping equipment to achieve a communion with nature,
197
music systems to understand the classic composers, and an automobile for social status. The
distinctive aspect of our society is not the possession of material goods, but the extent to
which material goods are used to attain nonmaterial goals. Thus, Bauer and Greyser raise
the issue of whether material goods are a means to an end rather than an end in
themselves. In making such an evaluation, it is useful to consider how people in other
cultures fulfil nonmaterial goals. A leader in a primitive culture may satisfy a need for
status in a different way from someone in our culture. But is the means used really that
relevant? Russell Belk and others have begun a systematic series of studies into
materialism in American society, showing its manifestations in advertising, comic books,
television programming, swap meets, and the role of consuming and consumption in many
facets of life generally.

Does advertising create or foster materialism or merely reflect values and attitudes that are
created by more significant sociological forces? Mary Gardiner Jones develops the
argument that advertising, especially television advertising, is a contributing force.

In-Text Question 1:
What is materialism?

The conscious appeal in the television commercials essentially materialistic. Central to the
message of the television commercial is the premise that it is the acquisition of things
which will gratify our basic and inner needs and aspirations. It is the message of the
commercial that all of the major problems confronting an individual can be instantly
eliminated by the application of some external force and the use of a product. Externally
derived solutions are thus made the prescription for life's difficulties. Television gives no
recognition to the individual's essential responsibility for at least a part of his condition or
to the importance to the individual of proving his own capacity to deal with life's
198
problems. In the world of the television commercial, all of life's problems and difficulties,
all of our individual yearnings, hopes and fears can yield instantly to a material solution
and one which can work instantly without any effort, skill or trouble on our part.
Associating advertising with materialism, of course, does not demonstrate a causal link, as
Commissioner Jones would be the first to recognize. In fact,
such a link is impossible to prove or disprove. It is true that
advertising and the products advertised are a part of our
culture and thus contribute to it in some way. It is also true,
however, that advertising does not have the power to dominate
other forces (family, church, literature, and so on) that
contribute to the values of society.

In-Text Question 2:
Does advertising create or foster materialism or merely reflect values and attitudes that are created by
more significant sociological forces?

2.3 Providing Informational Utility

Advertising that convey information to consumers that can help them make better economic
decisions than they would in the absence of that information provides a positive economic
service. Of course, any advertising that, by deception or any other means, induces
consumers to make suboptimal decisions provides a corresponding negative economic
service. Some advertising is of more value than others along this dimension. Classified
advertising, advertising for retail stores, catalog advertising, and much of industrial
advertising are usually sought out because of their informational value.

199
A study by Aaker and Norris of 524 prime-time television commercials suggests that
even television advertising is perceived as informative by substantial groups of people.
On the average 18.1 percent of respondents (approximately 500 per commercial) checked the
word informative from a list of 20 adjectives when asked to describe the commercial. The
percentage was over 20 when snack and beverage items were excluded.

2.4 Advertising and Children

The Codes of Practice are especially stringent in the attempt to control and regulate
the content of advertising to children. There are four related issues involved here.
First, are children capable of recognizing that ads are ads and also understanding
that the aim is to sell them something? Second, should we, in any event, regard
them as a legitimate target for advertising? Third, because the way in which most
advertising to children has to work is through 'pester power', is it right that
advertisers should be encouraging children to put pressure on their parents in this
way? Fourth, specific to nutrition is the argument that the concentration of food
advertising on 'junk' food (of a variety of kinds, according to current theories, or
who is doing the complaining) leads to the development of a whole range of
ailments.

In fact, Children do learn to recognize ads as ads from quite an early age. Research
by both commercial and academic researchers shows that they are well aware of
what an ad is, and what it is trying to do as young as four or five,. (This is younger
than classical child development theory (exemplified by Piaget) would suggest, but
the evidence seems clear). The Code of Practice aims to control the effects of
advertising by (for example) ensuring that Ads make clear to children the size and
capabilities of fantasy toys (in particular).

200
The broader issue is the one of involvement in the market, and how this affects
parents. I do not see how children can avoid the market. It therefore makes sense
that they should learn how to deal with it. This will (inevitably) mean that they
meet with disappointments, when they have believed too much of the (inevitable)
hype. You can argue that they should not have to cope with this until they reach a
certain age. but what age is most appropriate? Eight? Ten? Fifteen? Some people
already remain incurably naïve until they reach their dotage. It seems to me that
almost the earlier you learn not to believe everything you hear in the Ads (just as
you should learn not to believe everything you read in the papers or see on TV),
the better.

In-Text Question 3:
What are some of the issues as regarding advertising and children?

2.5 Encouraging Antisocial and Dangerous Products and Behavior

This is an area where the Code of Practice and the self-regulatory system, together
with a growing body of law, have the effect of making it very difficult to use
advertising to promote anything harmful. It is extremely difficult for those not in
this culture to prevent this happening. Most people over about 30, even in Ad
agencies, find themselves in much the same position as the much-criticized judges.
More generally, the very extensive literature on the relationship between
advertising and smoking is distinctly inconclusive as to whether Ad bans lead to a
reduction in smoking, or the presence of advertising creates extra volume demand.
The manufacturers argue that the advertising is solely about brand competition;
their critics vociferously disagree.
Alcohol is a more complex issue, because it is quite possible for children from
quite a young age to see Ads that sell the brands and the habit of drinking in a
201
reasonably appealing way. Again, however, it is by no means clear that it is
advertising that starts people drinking: parental example and encouragement seems
to be the most potent factor, followed by peer encouragement. Certainly, it is easy
for a young person to use Ads as a means of finding a repertoire of drinks to
explore.

On the positive side, it should be pointed out that government-sponsored

advertising to prevent many of the dangers and abuses discussed in this area has
been quite successful in changing attitudes to drinking and driving in certain areas
of the drug culture (a highly successful and totally unadvertised vice, incidentally),
and so on.

Dishonesty, misleading, cheating

Ads put the best face of the product forward, and may well conveniently forget to
point out the disadvantages. This is a recognized part of the way the game is
played. Interestingly, however, there is a
growing trend towards greater frankness, which
has arisen alongside the apparently growing
interest among consumers in the companies they
deal with. If there is pressure on companies to
be, and to be seen to be ethical and
environmentally concerned, there is definite
pressure on their brands and their advertising to conform to the same sorts of
standards. There is probably a great future for campaigns that acknowledge (small)
weaknesses, at the same time as boosting the brand's advantages.

202
In the long run, it is in no advertiser's interests to mislead the public. A dissatisfied
customer is the worst sort of advertisement. People are ten times likely to tell their
friends about a bad experience with a purchase as well as about a good one.

Exploiting the arts, defacing the environment

The Ad business has a quite incestuous relationship with the arts. Many people
who work in the arts have worked or even do work in advertising, and advertising
uses the arts all the time. The relationship is complex and complicated because
every now and then people in advertising act as if their latest Ads actually are
works of art. In fact, the only advertising form that seems to have got recognition
as art is the poster, though there are those that claim some TV commercials to be
works of art.

Of course too, Ads damage the environment. Think how much prettier our
townscapes would be without all those posters, shop signs, street furniture. Think
of all the paper wasted on printing all these Ads that encourage us to consume, to
deplete the earth's resources, to deposit rubbish and further pollute the environment
we live in.

Promoting consumerism
Ads encourage wasteful and excessive consumption. They promote the idea that all
that matters is to own things and consume things. They persuade people to buy
things they cannot afford or else rub the noses of the poor due to the fact that these
desirables are out of reach.

Undermining standards and values

203
Of course, Advertising is all about cheap-jack commercialism. It panders to the
lowest common denominator. It helps to drive out what is good in favour of what
is popular. This, of course, simply awful. If there was less advertising, or even if it
was more responsible, standards and values would be higher.

4.0 Session Summary

In this study session, we considered the effects and impacts of advertising on the society. We
were able to see how advertisement encourages materialism, how advertisement provide
information utility, and how advertisement encourages antisocial and dangerous products and
social behaviours.

5.0 Self-Assessment Questions

1. Discuss the relationship between advertisement and the society
2. How can you discourage misleading, cheating and dishonesty in advertisement?
3. What is the relationship between advertisement and children?

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/cRfpM9 . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/cQLvtf and critique it in the discussion
forum

In-Text Answer 1:
Materialism is defined as the tendency to give undue importance to material interests.

204
 In-Text Answer 2:
Yes, it does. According to Mary Gardiner Jones, the conscious appeal in the television
commercial . . . is essentially materialistic. Central to the message of the television
commercial is the premise that it is the acquisition of things which will gratify our
basic and inner needs and aspirations.

In-Text Answer 3:
Some of the issues involved here are: First, are children capable of
recognizing that ads are ads, and understanding that the aim is to sell them
something, Second, should we, in any event, regard them as a legitimate
target for advertising, Third, because the way in which most advertising to
children has to work is through 'pester power', is it right that advertisers
should be encouraging children to put pressure on their parents in this way,
Fourth, specific to nutrition, is the argument that the concentration of food
advertising on 'junk' food (of a variety of kinds.

7.0 References
Aaker, David, and John (1992). Advertising management. Prentice-Hall of India
Doyle, Peter (2002). Marketing Management & Strategy, (3rd Edition). Essex:
Pearson Educational Limited.
Ferrell, D. C. and Hartline, Michael D. (2005). Marketing Strategy (3rd Edition).
Ohio: Thomson South-Western.
Kotler, Philip and Keller, Kevin Lane (2006). Marketing Management, (12th
Edition). New Jersey: Pearson Prentice Hall.
Perreault, William D., Jr. and McCarthy, Jerome E. (2005). Basic Marketing: A
Global Management Approach. Boston: McGraw-Hall Irwin.
Peter, J. Paul and Donnelly, James H., Jr. (2011). Marketing Management:
Knowledge and Skills (10th Edition). New York: McGraw-Hall Irwin.

205
Westwood, John (1996). The Marketing Plan: A Practitioner’s Guide (2nd
Edition). London: Kogan Page Limited.
White, Roderick (2000). Advertising, (4th Edition). London: McGraw-Hill
Publishing Company.
Wood, Marian B. (2007). Essential Guide to Marketing Planning. London:
Prentice Hall.

206
 STUDY SESSION 4
Globalization and Advertisement
Section and Subsection Headings
Introduction
1.0 Session Learning Outcomes
2.0 Main Content
2.1 Globalization
2.2 What about the Ads?
2.3 Tribes and Tribulations
2.4 Global Advertising
3.0 Tutored Marked Assignments
4.0 Summary
5.0 Discussion Questions
6.0 Additional Activities (Videos, animations and outdoor activities )
7.0 References

Introduction
In this study session, globalization and advertisement shall form the basis of our
discussion.

1.0 Learning Outcomes:

At the end of this study session, you should be able to understand the following:
1. Globalization relative to advertisement
2. Explain the concept of global advertisement
3. Be able to examine the globalization and advertisement

207
2.0 Main Content
2.1 Globalization
The formalized concept of globalization of markets and commerce has been around
for over 25 years. In a similar vein, the idea of global advertising has been in
existence for a long time. If firms can produce products to a uniform specification
for the world's markets, why should they not have global brands under which to
sell them, and back these with global advertising? Production facilities have begun
to migrate around the world, seeking suitable low-cost locations, and companies
have grown even larger through internal expansion and through mergers and
acquisitions. At the same time, as we have seen, media companies have begun to
develop worldwide coverage, and even to sell space and time on an international
basis.

In response to this change, Ad agencies have become more multinational in

character, continuing a process which started in the 1920s when, for example, J.
Walter Thompson had an agreement to open an office wherever their then largest
client, General Motors, asked them to. Agencies, again, are the subject of frequent
mergers and acquisitions, as well as the forming and reforming of international
alliances. There is an interesting contrast between the acquisitiveness of major US
agency groups such as Omnicom and Interpublic, and the alliance-based strategy
of the Japanese giant Dentsu.

The WPP Group's 1997 Annual Report carries an interesting brief analysis of the
parallel processes of agency mergers and the consolidation of very large
multinational advertising accounts into a small number of agencies on a worldwide
basis. While 23 of the top 30 US agencies are now owned by just nine
multinational groups, major multinational client companies such as Colgate, IBM,
208
S C Johnson, Reckitt 8c Colman and Citibank have reduced their roster of agencies
from as many as 40 or more to just one or two. This means that the big global
networks have an overwhelming advantage. Even the best local agencies are trying
to win business from most major multinational clients. The fact that a major world
brand (such as Coca-Cola) could suddenly start to buy advertisement ideas from a
creative 'boutique' organization that was not even really in the business of
producing advertisement shows how potentially fluid the situation is.

The rationale for consolidating international business into just one or two agencies
is largely one of management efficiencies: shorter chains of command and simpler
co-ordination of activities, leading hopefully to reduced costs. These latter can
certainly accrue from a reduction in the amount of time that needs to be devoted to
dealing with the agency, and may include a reduction in the amount that the agency
or agencies is or are paid. At the same time,
centralized negotiation, whether through the creative
agency operating as a full-service agency, or
through a multinational media specialist agency,
could lead to reduced total media costs. In practice,
it is worth noting that at least some financial
arrangements reported (by agencies) appear to give
the agency more than the traditional 15 per cent
commission (or its equivalent in fees), rather than any reduction.

2.2 What about the Ads?

Part of the economy of effort to be looked for from international agency
consolidation lies in the cost of creating and producing the Ads. If you can produce
one campaign centrally and use this all over the world, there should be savings to
209
be gained. With a good major TV commercial costing perhaps £300 000 or more to
produce, a 30-country campaign could spend nearly £10 million before ever
putting an ad on air. In theory, you can instantly save about 90 per cent of that total
by developing and producing just one commercial.
Of course, this is naïve. The Ad will have to be translated and the verbal part of the
soundtrack rerecorded but this need not be very costly, except where the
commercial's dialogue has been produced in lip-sync, where dubbing may be
unacceptable in some key markets, such as the UK. We are still going to be well
ahead just so long as the Ad works as well in every other country as in the one for
which it was originally produced.

Great ideas, the argument goes, are too valuable to be wasted on a single market or
group of markets. It would be sheer dereliction of duty on the part of the
advertiser's management if they failed to use the idea in as many markets as
possible. At least one major global marketer, Unilever, has a policy of taking
excellent and successful advertising concepts, wherever they have been developed,
and applying them elsewhere to whichever of their many brands seems
appropriate. Because of the company's history, its brands tend not to be global, but
their Ad concepts sometimes are. By contrast, another multinational, Mars, has
spent the last few years globalizing long-established brands, so that the UK has
seen Marathon become Snickers, and Treets become M&Ms, for example, as part
of this harmonization.

The big question is ‘assuming we have a great idea and the ability to recognize it
as such is whether it is realistic to expect it to work equally well all over the world;
or, failing that, what we will have to do to adapt the idea to enable it to do so’

210
Again, there is a naïve assumption most frequently, but by no means exclusively
found among senior managers of US multinationals, that what works there will
work anywhere else. After all, the US is a very large and quite diverse set of
markets, so a successful Ad there has to have a degree of acceptability among
people of widely differing backgrounds and even languages. There are a number
of reasons why this assumption is naïve even though it is not necessarily wrong.
These can be divided into two broad categories: country-specific and market-
specific.

Market-specific reasons for questioning the assumption derive primarily from the
standing of the brand in different countries. Very few brands are equally strong or
equally well developed in terms of their product life cycles in more than a few 'of
the countries in which they are sold. A brand may be a long-established market
leader in the US; a well-known second or third brand in some other English-
speaking countries such as the UK and Australia; a struggling newcomer in (say)
France and Germany; and a luxury brand for the very rich in most of the South. In
each of these markets or groups of markets, it may be faced by a different group of
competitors (which will, to be sure, consistently include some well-known
multinationals), and these, again, will occupy different positions within the market.
A well-known example of the sort of differences that arise in this way is Levi's. in
the US, Levi's jeans are mass-market and price-competitive; but in much of
Europe, Levi's is a premium-priced, high-quality brand.

A further complication may be the way in which the product or product category is
used or consumed in the various countries: Kelloggs have had a long uphill
struggle to develop a market for breakfast cereals in Continental Europe, where

211
some of their products have found a completely unexpected (to an American or
Briton) niche in the snack market.

Clearly, where a brand's position can be so radically different from country to

country, and if the optimum advertising strategy should be derived from a detailed
analysis of the brand's specific position in its market, it is logically improbable that
the same advertising could fit every country equally well, simply on the grounds of
the brand's competitive situation.

In-Text Questions 1:
What is market specific assumption?

Then there are country-specific factors. These interact with the market factors,
but are primarily concerned with the nature of the society in the individual country,
the values of that society, and characteristics of the culture, such as body language,
frames of reference, sense of humor, taboos, religion, and so on. It is quite easy to
construct a case that makes it very difficult to believe that an Ad that works
excellently in one country could ever work as well in another. A most convincingly
argued example of this is that any 'global' advertising campaign must be quite
radically adapted to local needs if it is to stand a chance of success.

The fact that there are national styles of advertising is undoubtedly true, as anyone
who goes to any of the growing number of international advertising awards
festivals would readily acknowledge. What is more, these styles seem to emerge

most strongly in the best work from each country, which suggests that they are
reflecting the reality of the national cultural character.
212
 ITQ 2: What is country specific assumption?

2.3 Tribes and Tribulations

It is often suggested that particular groups of consumers have common
characteristics and interests that transcend national boundaries and that, therefore,
it is right to target them with international advertising campaigns. The two groups
that have traditionally been cited in this way are businesspeople and teenagers. It is
claimed businesspeople are now so used to travelling across national boundaries
and interacting with other nationalities. Thus, they may be regarded in a way as
international hybrids. Also teenagers, as is well known, listen to the same music,
wear the same (grungy) uniform, eat the same fast food and are, therefore, simply a
global tribe. To these two groups can be added the growing 'Internet Community',
which is assumed to have completely globalized instincts and interests in the
apparently total absence of any evidence.

One final argument that is sometimes used to support the concept of the global
campaign is that with tourism rapidly becoming the world's number one industry, it
would be immensely confusing to people if they travelled to another country and
saw their familiar brands advertised in a totally different way. Quite apart from the
fact that the numbers of people involved are still small when viewed against the
total populations of either the hosts' or visitors' countries, there are two highly
questionable assumptions built into this argument. First, that, the tourist will be
remotely in a frame of mind in which Ads are relevant; and, second, that he or she
can understand an Ad in a foreign language.

2.4 Global Advertising

213
The argument about the cultural differences between countries looks extremely
powerful. Indeed, it is, as it applies to the ends of the various scales of culture,
attitudes and beliefs. The only problem is that most countries are not at the
extremes. They tend to cluster towards the middle, where the differences are far
from clear-cut. The result of this is that it is frequently feasible to group broadly
similar countries together, and to run the same or virtually the same advertising
within the group. For example, you might treat northern and southern Europe as
two rather different areas, or run a common campaign in most of the Middle East,
or Latin America, without striking major problems.

Overall, then, the message from research seems to be that it is difficult, if not
impossible, to run an absolutely homogeneous campaign across national borders,
unless the countries concerned have a lot in common. You have to adapt and also
take account of local idioms, metaphors, body language, and sense of humor. You
have to recognize national styles. In a word, the ideal multinational campaign is
not 'global', but `global'. It embodies the widely quoted view that you should think
global, but act local.

The fact remains that there are successful

multinational or even global campaigns. To
take two prime examples, Marlboro and Coca-
Cola have successfully sold what is, in effect,
an American dream to the world for years.
Esso's (Exxon's) tiger is pretty much global. Even slightly surprisingly, British
Airways' arrogant and improbable repositioning of itself as the World's Favorite
Airline worked more or less all over the world with remarkably little variation.

214
 In-Text Question 3:
What is the concept of globalisation?

4.0 Session Summary

In this study session we have been able to discuss globalization and advertisement.
We went further to discuss the concept of global advertisement which is generated
a widely quoted view that you should think globally and act local.

5.0 Self-Assessment Questions

1. What is global advertising?
2. Discuss globalization and advertising

6.0 Additional Activities (Videos, animations and outdoor activities)

a. Visit U-tube https://goo.gl/oP5CN4 Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/aAkRtf and critique it in the discussion
forum

In-Text Answer 1:
The assumption derives primarily from the standing of the brand in different
countries. A brand may be a long-established market leader in one country and a
second or third brand in another country.

215
 ITA 2: The country specific assumption interacts with the market factors, but are
primarily concerned with the nature of the society in the individual country, the
values of that society, and characteristics of the culture that may involve body
language, frames of reference, sense of humour, taboos, religion, and so on.

In-Text Answer 3:
It embodies the widely quoted view that you should think global, but act local. It
takes account of local idioms, metaphors, body language, and sense of humor.

7.0 References
Doyle, Peter (2002). Marketing Management and Strategy, (3rd Edition). Essex:
Pearson Educational Limited.
Ferrell, D. C. and Hartline, Michael D. (2005). Marketing Strategy, (3rd Edition).
Ohio: Thomson South-Western.
Kotler, Philip and Keller, Kevin Lane (2006). Marketing Management, (12th
Edition). New Jersey: Pearson Prentice Hall.
Perreault, William D., Jr. and McCarthy, Jerome E. (2005). Basic Marketing: A
Global Management Approach. Boston: McGraw-Hall Irwin.
Peter, J. Paul and Donnelly, James H., Jr. (2011). Marketing Management:
Knowledge and Skills, (10th Edition). New York: McGraw-Hall Irwin.
Westwood, John (1996). The Marketing Plan: A Practitioner’s Guide, (2nd
Edition). London: Kogan Page Limited.
White, Roderick (2000). Advertising, (4th Edition). London: McGraw-Hill
Publishing Company.
Wood, Marian B. (2007). Essential Guide to Marketing Planning. London:
Prentice Hall.

216
 STUDY SESSION 5
Future of Advertising
Section and Subsection Headings
Introduction
1.0 Session Learning Outcomes
2.0 Main Content
2.1 Future of Advertising
2.2 Globalization
2.3 Unbundling
2.4 Total Communications
2.5 Technology
2.6 The Nigerian Situation
3.0 Tutored Marked Assignments
4.0 Session summary
5.0 Self-Assessment Questions and answers
6.0 Additional Activities (Videos, animations and outdoor activities)
7.0 References

Introduction
Wow!! You are welcome to the last session of the course. How has been the
class so far? Interesting? Educative? and Engaging?

This study session considers the future of advertising.

1.0 Learning Outcomes

At the end of this study session, you will be able to:
1. Evaluate the future of advertising
217
 2. Assess the future of advertising in Nigeria.

2.0 Main Content

2.1 Future of Advertising
The future does not imply some ten, twenty, or even fifty years to come. The future
is today and now!!! The future is the movement from advertising to marketing
communication, it's about brand and communication globalization, it's about the
incredible application of technology, it's about the redefinition of the customer and
the brand, it's about the introduction of new concepts and idea like 360 Degrees
Branch Stewardship, it's about micro specialization where your giant agency is
giving way to smaller and more efficient terms of specialists, it's about hitherto
accounting firms like Andersen making forays
into branch consultancy. Our task is to see how
well we have done within our operating
environment, and what humble suggestions from
this gathering can help us take advantage of this
very competitive future. In doing this, we will be
looking at Advertising as both a profession and
business.

2.2 Globalization
The last study session took a critical look at the way in which advertising can be
effectively global, and outlined the pressures behind globalization. It has been
estimated that the top 1000 advertisers account for 90 per cent of the world's Ad
expenditures. Assuming that this is remotely true, one possible implication is that
there is room for no more than 40-odd global agencies, each handling, on average,
25 of these advertising giants. The vision in Pohl and Kornbluth's sci-fi classic The
218
Space Merchants, of just two vast advertising mega-agencies effectively
controlling the world, appears to be almost conceivable especially since it seems
reasonably certain that at least 10 per cent of the top 1000 advertisers will merge
with, or acquire, one of the others in the next couple of years.

Then, the question is what good does this sort of gigantism do? For whom? And,
for an advertising text, does it help produce good or excellent advertising? It seems
that this process of corporate aggrandizement runs counter to most other trends
within the advertising business and more significantly within society as a whole.
Huge organizations progressively lose contact with their customers, and become
entirely reliant on bureaucratic system-building and system maintenance. This
removes the possibility of any creative response to changing circumstances, and
encourages a paralysis of the status quo.

This progressive gigantism offers numerous opportunities for the smaller, swifter,
more agile operator to start to pick off the juicy bits around the edges. Large
businesses neglect their smaller and outlying operations, and this applies both to
advertisers and their agencies. For many years now, the leading Italian Ad agency
has been the local Armando Testa, the only non-multinational in the top 20
agencies in Italy. They have attained and held this position by being good at being
Italian, something that none of their competitors is any longer able to do so well.
As their founder says, this process has been helped by the agency's refusal to go
public, which has relieved it of the need to damage the structure of the business in
the search for ways to boost profits for the shareholders.

The problem for the smaller operator remains that it is difficult to penetrate the
businesses of the large multinationals. Multinational executives find it as a source
219
of comfort that their agency has offices in outlying parts of the world. There is
almost a process of ticking off the flags on the map, and no one got fired for
buying IBM. The fact remains that it is perfectly possible for any agency to place
advertising in a country where it has no office of its own, and perfectly possible for
an advertiser to buy advertising from a creative source that has no agency network
and to use this all over the world.

Agency commentators mostly from the large groups have for long observed that it
is very difficult to be a medium-sized agency in most developed markets. In
practice, most such agencies get taken over by larger groups, and this leaves a
fertile source of material for smaller agencies to feed on. Meanwhile, there is an
observable ebb and flow in large corporations' relationships with agencies.
Consolidation and concentration tend to be followed by a period in which local
(especially) reins are loosened, and smaller firms are allowed to get a bite at the
peripheral and minor brands where the pressures for conformity and the safe
solution are fewer, and the opportunity to do something spectacular greatly
enhanced.

In-Text Question 1:
What is progressive gigantism?

2.3 Unbundling
Creative and media started to separate as long ago as the end of the 1960s in the
UK, and the process is far advanced in most major advertising markets. It has
proven less easy to hive off the creative function from the main agency that
remained, and most of the creative boutiques seem to have transformed themselves
into something else, while it is now more common to find freelance creative teams
220
operating on a small scale. Yet Coca-Cola was able to reinvent the concept by
going to CAA, which was, in effect, a talent agency.
More recently, the UK's planning initiative has begun to develop splittise
tendencies, with a variety of planning consultancies and individual consultants
providing services that compete with, or complement those of the agencies. These
strategists do not have the monopoly of thinking about brand strategy, however
there is a new breed of brand strategy consultants, and the marketing divisions of
the big management consultancy companies are also starting to intrude in this area
to the disquiet of some agency managements that recognize that the consultants
have access to higher levels of clients' management, and therefore pose a threat to
the agency's assumed leadership in brand thinking.

By now, in fact, you can buy almost any advertising agency function from a
specialist organization or consultant. There are even account managers who will
run an account for a period if an agency is for some reason short of people to
handle it. However, the fact that it is possible to do this does not necessarily make
it the right thing to do. While it is tempting to think that, as an advertiser, you
should buy the best expertise available to perform
every process involved. There is no guarantee that
the experts you assemble will be able to work
together as a team, especially as a creative team and
creativity is what advertisers seek from their
agencies, and the point where the agencies'
advantage over management consultants identifiably
lies. Certainly, unless you get the services of an account manager to organize the
whole process, what this 'cherry-picking' will cause is an enormous increase in the
detailed workload that you have to undertake. There is, however, a more
221
fundamental problem with unbundling, and this lies in the way in which advertisers
are increasingly looking at their communications.

2.4 Total Communications

If a brand is the sum of its physical characteristics, plus whatever intangible values
may be derived from the various brand communications, and if it is becoming
more difficult to differentiate brands physically so that their emotional values
become more important, then it becomes vital that every message the customer or
consumer receives about the brand works to build a coherent story. This means that
the brand's communications have to be integrated.

Furthermore, as the media available become more fragmented and complex, and
the possible ways of using them move from straightforward Ads to a variety of
forms of sponsorship, product placement, editorial and advertorial messages, and
so on, the need to approach all of these options with both understanding and
imagination begins to demand new ways of thinking about both the media and the
creative material that should go into them.

If all these elements are being assembled from a range of different and specialist
agencies and organizations, the task of coordinating and orchestrating the diverse
contributions rapidly becomes awesomely complicated and extremely difficult—
both because of the technical requirements of the different activities and because of
the politics of the various parties involved.

It can be argued, too, that because the ways in which media can be used are
proliferating, the primary communications planning decisions should now be about
the media, and that media thinking should precede any creative planning. This
222
would turn traditional practice on its head, though the more enlightened agencies
have long tried to keep media thinking at least in parallel with creative.

The logic of this is that unbundling media from the creative agency is a strategic
mistake. However, enticing it may be in terms of apparent economics. Either you
have to create a new breed of media planner, separate from the media buying
agency, and closely linked to the creative agency; or you have to reintegrate media
with creative into a new type of full-service agency. Media agencies have already
recognized part of this, by force of financial pressures: by the time they had turned
buying successfully into a commodity business, they desperately needed to find
ways of adding value to their operations, by developing more sophisticated
planning systems and approaches.

What is very clear is that any large and forward-thinking advertiser will be looking
to manage its use of media and of the types of
communication it puts through each medium in a much more
sophisticated, coherent and synergistic way than in the past.
For large users of media advertising in particular, this
requires something of a sea-change in thinking, and a
reappraisal of their whole marketing communications
function.

2.5 Technology
Technology has permeated the advertising world since the invention of the printing
press. It affects the availability and nature of media; the ways in which we can
223
create and produce ads; the ways in which we communicate our plans and
strategies to colleagues and clients or agencies; the ways in which we conduct
research into the media, into our ads, into our customers. It has created a whole
new range of media opportunities through the Internet, digital TV, interactive
point-of-sale material of all kinds, the new plasma video screens appearing in
shopping centres, and so on. Even printing has gone digital, so that in theory one
could, for example, tailor a customer magazine to a single customer.

The technological revolution has had its most obvious impact on advertising in
three areas: in media research where modern computers make it possible to analyze
vast tracts of data almost in real time; in production, especially for TV, where post-
production wizardry has almost no bounds; and in the understanding of consumer
information that underpins modern direct marketing

Agencies have so far tended to be erratic and cautious in their acceptance of most
forms of new technology. Few have gone far in investing on their own behalf, and
they have preferred to use specialized suppliers to provide the specific services that
they have wished to adopt. There are exceptions to this, and I think that the next
few years will see the larger agencies embarking on a quite massive move into
owning, as opposed to merely renting, a variety of technologies. In particular, it
seems very clear that the life of so-called 'new media' agencies as a specialist group
is going to be relatively short-lived as the good ones will be bought by established
ad agencies, and the poor ones will die. Similarly, as production facilities become
more computerized, the existing tendency for large agencies to acquire their own
will gather momentum.

224
 Quite simply, if the agencies do not become wired to a high degree of
sophistication, they will find themselves losing business. This will come to apply
to more mundane facilities such as video-conferencing. For international business,
this is becoming an essential tool in most large client organizations and, although
agencies tend to hate it, they will have to learn to live with it.

In-Text Question 2:
How has technology affected the future of advertising?

2.6 The Nigerian Situation

As one of the important dynamics that will determine the future direction of this,
there is currently a squabble going on between the major players in the industry.
One of the main issues at stake is that of allowing foreign advertising agencies to
invest their capital in the Nigerian advertising industry. Remember that the
outgoing board of advertising practitioners’ council of Nigeria (APCON) has
instituted a law banning foreign advertising agencies from owning more than 25%
stake in any advertising agency in the country. There are those that believe that the
move will help protect local advertising industry by protecting it from the
predatory practices of global advert agencies, thereby, allowing it to grow to a
level where it will compete with bigger global brands not only on Nigerian soil but
on the global scene.
Government has already reconstituted the board of APCON as well as appointing
new interim chairman. Hopefully, the new board will steer the course of the body
in the interest of all stakeholders in the industry and for the rapid development of
the Nigerian advertising market.
225
The good thing with globalization is that it brings with it world-recognized
parameters that help and enhance the growth of local industry. Our local industry
still needs the creativity, capital, and managerial know-how of the big global
advertising companies.

As the global marketing communication industry adopt the latest cutting edge
technology in order to make its operations more efficient and satisfy the changing
taste of consumers worldwide, Nigerian chapter is bound to follow suit spending
billions of Naira in the years to come in the purchase of some of the best
technology. Already new satellite TVs are coming on stream together with new TV
and radio stations.

The increasing adaptation of the internet as a means of advertising has awoken the
Nigerian advert industry on the need to quickly catch up with the global practice.
Already, numerous Nigerian corporate agencies are now allocating part of their
annual advert budget on internet sites such as Yahoo, Face book, Google,
LinkedIn, and others. The target is to reach the largest target audience possible at
the most efficient cost possible. As the economy continues to grow, there is also
increase in major companies’ efforts to boost their image. Already, major brands in
the country such as Dangote, First Bank, MTN, Glo, BUA, and GT Bank have
been spending billions of Naira in order to increase the strength of their brand.
Despite all these, the Nigerian advertising industry is still at developing stage, as it
will take years before it will reach the level of maturity we are seeing in advanced
markets such US, France and Japan. The total annual advert budget for the whole
economy combined is still meager compared to South Africa.

226
In terms of creative content in our advertising, we still lag behind what is found in
the Arab world whose creative content does not even reach the level found in
advanced countries. The Nigerian market is still being dominated by some few big
local advert agencies (with monopolistic tendencies) that do not want new entrants
into the business (whether they are local or international). Thus, for the interest of
developing of the industry, there is need for fair play, healthy competition and
effective regulations.

ITQ 3: What can you say about the good thing with globalization?

4.0 Session Summary

In this study session, we have tried to discuss the future of advertising. We came to
realise that the future does not imply ten, twenty, or even fifty years to come.
Rather, the future is today and now. The future is the movement from advertising
to marketing communication. It's about brand and communication globalization,
the incredible application of technology, the redefinition of the customer and the
brand, and lastly, the introduction of new concepts and idea.

Thanks so much for your maximum cooperation. See you some other time!!!
Meanwhile, don’t forget to read further as references are provided for this
purpose. BYE!!!

5.0 Self-Assessment Questions

1. Discuss the future of advertising
2. What is the Nigerian situation in regards to advertisement?
3. Explain the importance of technology in advertisement
227
6.0 Additional Activities (Videos, animation and outdoor activities)
a. Visit U-tube https://goo.gl/PyHzPc . Watch the video & summarise in 1
paragraph
b. View the animation on https://goo.gl/PdgWpv and critique it in the discussion
forum

In-Text Answer 1:
The progressive gigantism offers numerous opportunities for the smaller, swifter,
more agile operator to start to pick off the juicy bits around the edges.

In-Text Answer 2:
Technology has permeated the advertising world since the invention of the printing
press. It affects the availability and nature of media; the ways in which we can
create and produce ads; the ways in which we communicate our plans and
strategies to colleagues and clients or agencies; the ways in which we conduct
research into the media, into our ads, into our customers.

ITA 3: The good thing with globalization is that it brings with it world-
recognized parameters that help and enhance the growth of local industry.

7.0 References
Akinwumi Lolu; The Future of Advertising in Nigeria, Vanguard Nigeria (14th July
2003)
Doyle, Peter (2002). Marketing Management & Strategy, (3rd Edition). Essex:
Pearson Educational Limited.

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Ohio: Thomson South-Western.
Kotler, Philip and Keller, Kevin Lane (2006). Marketing Management, (12th
Edition). New Jersey: Pearson Prentice Hall.
Perreault, William D., Jr. and McCarthy, Jerome E. (2005). Basic Marketing: A
Global Management Approach. Boston: McGraw-Hall Irwin.
Peter, J. Paul and Donnelly, James H., Jr. (2011). Marketing Management:
Knowledge & Skills, (10th Edition). New York: McGraw-Hall Irwin.
Westwood, John (1996). The Marketing Plan: A Practitioner’s Guide (2nd
Edition). London: Kogan Page Limited.
White, Roderick (2000). Advertising (4th Edition). London: McGraw-Hill
Publishing Company.
Wood, Marian B. (2007). Essential Guide to Marketing Planning. London:
Prentice Hall.

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