Advertising has been defined as “mass, paid communication, the ultimate purpose of which is to impart information, develop attitudes and induce actions beneficial to the advertiser”.
Advertising is one of the promotion techniques categorically used to impact the demand for product in the market.
The word ‘advertise’ originates from the Latin word ‘advertere’ which means to turn towards or to take note of something.
When the marketer decides to transmit the message about a product through some mass information directed media and impart a frame of mind for reference at the time of actual product purchase in the market – it amounts to advertising.
Advertising aims at selling things persuasively and creatively as the primary goal of advertising is to increase the probability that those exposed to an advertisement will behave or believe as per the wishes of the advertiser.
The visual and verbal messages – that are a part of advertising – are intend to attract the attention and produce some response by the viewer.
Advertising in any form is found capable of fulfilling the information needs of the market.
In due course of economic development, as the information gap become more prevalent, advertising becomes the integral economic force and is considered as a pervasive form of communication both for the sender and the receiver.
Some of the types of advertising are:
1. Internet Advertising 2. Television Advertising 3. Radio Advertising 4. Print Advertising 5. Outdoor Advertising 6. Non-traditional Advertising.
7. Product-Oriented Advertising 8. Image Advertising 9. Advocacy Advertising 10. Public Service Advertising 11. Direct Mail Advertising 12. Display Advertising.
Different Types of Advertising
Types of Advertising: Product, Markdown Event, Institutional, Co-Operative, Retail Promotion and Window Displays
There are many different forms of advertising. While different, each one produces a highly public exposure of messages and concepts to the general public. The very public nature of this confers a legitimacy and acceptance of the retailer or brand. Consumers are aware that the advertising is an expressive and targeted medium by which individuals can feel they share a set of underlying values which reflect their involvement with the retail offer or store.
Some of the different types are as follows:
(1) Product Advertising:
Product advertising is aimed at enticing people to the store in order to consider specific merchandise. Product advertising will feature the promotion of merchandise that is new, exclusive, and superior in aspects of quality and design as well as creating awareness of complete assortments or special merchandise events. It is aimed at creating awareness of the product, its availability and benefits.
(2) Markdown Event Advertising:
This is used to create some excitement about a special period of lower cost offers for products. It is likely to be more successful if the reduction is believed to be part of a genuine sale of products which in the past had been fairly priced.
(3) Institutional Advertising:
This type of advertising is used to sell the store or shopping mall as a pleasing place to shop. With the use of institutional advertising, the store attempts to reinforce the image of one or more of the following – a leader in fashion, fair- prices, wide merchandise selection, superior service or quality, a leisure experience or somewhere to enjoy visiting.
There is now a trend to advertise a shopping centre rather than individual outlets. The communication emphasis is on the available range of shops, ease of parking or other consumer benefits. The frequency of this type of advertising increases at peak demand times such as Christmas.
(4) Co-Operative Advertising:
This is used where manufacturers fund part of a promotion by supplying leaflets or advertising material for use by the store. The store can add its own address to ready-prepared printed material and carry out mail drops or other methods of distribution. Alternatively, a manufacturer may agree to share equally the costs of an advertising campaign.
Manufacturers are keen to have their brands stocked and sold; therefore, they often enter into joint advertising schemes with retailers. Co-operative advertising may involve a combination of one or more retailers in an area as well as the manufacturer. In addition, co-operative promotions may well extend to agreements to provide joint branded window display material and point-of-sale material.
(5) Retail Promotion in Relation to that of Manufacturers:
There are differences between retailer and manufacturer advertising strategies. Retail advertising is often based upon short-term objectives with the emphasis on value or price of the products on offer. This is unlike manufacturers’ approaches; they often attempt to build favourable attitudes or improve the image of the brand or organisation over an extended period of time.
Whereas a manufacturer will need to create awareness of its brand across major market areas, a retailer may have more geographically concentrated target markets. Therefore, a retailer has to take into account local habits, conditions of the marketplace, availability of local media and have a clear idea of the housing areas where potential customers are living.
The expense of some forms of advertising is excessive — for example, TV advertising is extremely expensive due to production as well as transmission costs, and therefore only the larger companies or franchisers will use this medium. The alternative use of direct marketing is often a more cost-effective form of promotion for smaller, more geographically dispersed retailers.
(6) Window Displays:
Window areas offer a major opportunity to provide a distinctive image for a store, to promote seasonal activities and merchandise, or to create interest and capture the attention of the public. Think about the Christmas period in any large city centre. It is not simply Christmas street decorations which offer the most fascination. It is often the clever automatons and figures which are used as window displays to bring pleasure to both children and adults alike.
Some store fronts are configured to allow large display areas with either straight, angled or arcade style designs. Some frontage designs dispense with the whole of the built area of the shopfront and window so as to offer a larger sales space and to provide views of the interior display areas.
In any type of window the use of good lighting is essential to show the display to best effect and to reduce the effect of glare on the outside of the window. Whatever the shop front design, it should act as a funnel to induce the potential customer to enter the store.
The window area will need to be thought about in terms of the logic of positioning and grouping of display material and merchandise. There is far more impact gained from the grouping of products in similar categories. Sales can also be enhanced by recognition about how purchases may be primary and secondary. As such the display accessories that may also be purchased along with a main purchase of furniture or an outfit can provide increased sales and a more pleasing display.
Like any promotional medium specific areas will attract more attention and so should be utilized for the most important displays -those near eye level, away from corners or pillars, or on moving displays. The window display should be changed on a regular basis and this should always be planned in advance of the event so that the theme is agreed and the assignment of space is controlled.
Design of Shop Windows:
(i) Windows should have simple clear messages as would a poster, and the design should convey the personality of the brand or store. Passing consumers have only a short attention span for the window so it should not be confusing in any way.
(ii) For upmarket retailers a minimalist, simple approach with a focus on a single communication, emotion or product will provide a powerful image. The approach is used by retailers such as Prada and Versace.
(iii) The utilisation of dressing the window space with similar props, mannequins or garments creates impart through repetition. This is often utilised by French Connection and Gap.
(iv) Interest is produced by movement based upon live events, technology based upon changes in lighting, projection of images on screens, etc., or mechanical use of props or products.
(v) In this integrated communications age the windows must be consistent in their message and positioning with other communications.
(vi) Lighting through colour and graduation or changes in intensity can provide dramatic effect. It also has to be planned to take into account the strength of the daylight.
(vii) The window has to be changed to create interest and relationships with the consumer that provides information as to what is the fashion change or new look they should be informed of.
Types of Advertising – 4 Types: Product-Oriented Advertising, Image Advertising, Advocacy Advertising and Public Service Advertising
Types of advertising refer to the primary “focus” of the message being sent and fall into one of the following four categories:
1. Product-Oriented Advertising:
Most advertising spending is directed toward the promotion of a specific good, service or idea. In most cases the goal of product advertising is to clearly promote a specific product to a targeted audience. Marketers can accomplish this in several ways from a low-key approach that simply provides basic information about a product (informative advertising) to blatant appeals that try to convince customers to purchase a product (persuasive advertising) that may include direct comparisons between the marketer’s product and its competitor’s offerings (comparative advertising).
2. Image Advertising:
Image advertising is undertaken primarily to enhance an organisation’s perceived importance to a target market. Image advertising does not focus on specific products as much as it presents what an organisation has to offer. In these types of ads, if products are mentioned it is within the context of “what we do” rather than a message touting the benefits of a specific product.
Image advertising is often used in situations where an organisation needs to educate the targeted audience on some issue. For instance, image advertising may be used in situations where a merger has occurred between two companies and the newly formed company has taken on a new name, or if a company has received recent negative publicity and the comp my wants to let the market know that they are about much more than this one issue.
3. Advocacy Advertising:
Organisations also use advertising to send a message intended to influence a targeted audience. In most cases there is an underlying benefit sought by an organisation when they engage in advocacy advertising. For instance, an organisation may take a stand on a political issue which they feel could negatively impact the organisation and will target advertisements to voice their position on the issue.
4. Public Service Advertising:
In some countries, not-for-profit organisations are permitted to run advertisements through certain media outlets free-of- charge if the message contained in the ad concerns an issue viewed as for the “greater good” of society. For instance, ads directed at social causes, such as teen-age smoking, illegal drug use and mental illness, may run on television, radio and other media without cost to organisations sponsoring the advertisement.
For help in planning and preparing their advertisements, small retailers turn to the local media, the newspapers, television, and radio stations. Large retailers particularly the major departments stores operating several branches in metropolitan areas, have their own advertising departments with a full complement of skilled professionals—such as writers, artists, media buyers, and promotion planners.
1. Cooperative Advertising:
Cooperative advertising does what an individual retailer cannot do individually.
(i) Horizontal Cooperative Advertising:
It is the joint effort of independent retailers in the same category, such as hardware stores and realtors. Auto dealers selling the same make of cars form dealer associations and advertise as one within metropolitan areas. Individual retailers get the benefits of professional agency service through such cooperative ventures. They also get exposure to the larger media audiences of metropolitan newspapers, television and radio stations at a cost they could not otherwise afford. A significant extension of this kind of cooperation is the advertising done by and for franchise outlets.
(ii) Vertical Cooperative Advertising:
It is a joint venture between manufacturer and retailer. The manufacturer offers the retailer an allowance front the full cost of the brand’s space to 50-50 for advertising the manufacturer’s brand in the store’s advertising. The manufacturer may or may not require proof of performance in the form of a tear sheet to prove that the ad that was paid for actually ran. As the retailer gets a lower rate than the manufacturer gets from the local media both parties gain; both benefit from the ad while sharing the cost.
The co-operative advertising allowance has become part of a more general promotional allowance. The manufacturer offers retailers an allowance of so much per case (case allowance) to be used in a variety of ways—end of aisle display, shelf talker, more facings, and cents-off retail price co-operative advertising and others. The retailers may or may not advertise the manufacturer’s brand but use the allowance simply to augment, their gross margins.
With the greater margins, they may order cases and do some form of promotion to increase volume and total profit. The manufacturer, benefits from the extra volume, although at a lower profit per case, which he is willing to endure because it helps build goodwill with the dealers who probably have come to expect the allowance anyway because it has become a practice of the trade.
2. Agency Advertisement:
Retailers generally do not use advertising agencies. Their scale of operation is too small. Their day-to-day selling activities require more quick-changing tactical maneuvers than long-range strategic planning. The small or medium-sized store does not generate enough billings from commissionable media to become a profitable client for an agency.
Billings of Rs.100,000 would gross only Rs.15,000 a year in commissions, which would hardly be enough to cover the agency’s cost of ‘preparing the many ads required throughout the year. If paid on a fee basis, the agency would have to charge more than such retailers would be willing or able to pay.
The giant retailers operate as both national and retail advertisers. They have their own brands and institutional advertising. Most of their day-to-day store advertising is handled internally. Though agencies have not been a dominant factor in the retail field, there, is considerable evidence that they will grow in importance.
With greater funds in their hands, more retailers will be attractive clients for Ad agencies. The renewed emphasis on local promotions gives smaller ad agencies with specialized knowledge of a market or an industry or a local area, a decided advantage. The larger Ad agencies have bought into smaller shops to gain this local expertise.
Media advertising largely attempts to generate an indirect response towards the merchandise or services advertised. Direct response advertising includes mail-media advertising, catalogues, departmental store’s advertising yellow pages, handouts, and window displays.
Media marketing is an effective buyer-seller interactive system in which the merchandise advertised is brought close to the buyer using one or more advertising styles, and the response is measured with reference to the location and volume of transaction.
Mail-media advertising involves promoting the merchandise market by establishing contact with potential and existing consumer through mail orders, publicity materials and telephone service. In this process no personal selling is performed.
Direct mail advertising has many advantages. It attempts to build goodwill between sellers and buyers. Hence, mail advertising is often identified as productive advertising technique.
The numerous advantages of this system are listed below:
i. It is highly selective.
ii. This form of advertising is elastic as retailer can add or delete the name of consumer at his discretion.
iii. A wide variety of merchandise or services can be advertised to the same consumer.
iv. Privacy on consumer preference/order can be maintained.
v. Market competition can be avoided instantly.
vi. Direct mail advertising is personal specific.
vii. Home delivery of goods and service can be assured.
viii. Performance of merchandise/service sales can be monitored and evaluated.
Despite the many advantages of the direct mail advertising, there exist some demerits also. The most commonly observed problem in mailing business orders is the high expenditure involved in the process. The periodical updating of the mailing list is a major task in direct-mail advertising and consumes large business time.
Besides these advantages, it sometimes becomes disinteresting and irritable to the persons addressed and they feel offended as the ‘copy’, the mail-order may not match with the profile of person to whom it is sent.
The different types of mail-order advertising comprise of a comprehensive text and a visual copy that attempts to make interesting reading.
The various types of mail-order advertising are:
i. Business reply mail with pre-paid postage fee.
ii. Information enclosures, circulars, etc.
iii. Postal cards without an order form.
iv. Self-mailing folders.
v. Booklets and catalogues.
Mail-order advertising is a quantitative exercise and requires the systematic processing of data. Hence, computerization is the basic requirement to handle the data with reference to classifying consumers, sorting types of orders, making a record of compliance to order and other functions.
Window display is the most prominent style of direct response advertising as it establishes ready information, product impression, and impulse of buying that helps in decision-making. Display advertising can be indoor and outdoor. Indoor display advertising consists of showcase advertising and indoor displays in departmental stores. There are some common kinds of indoor display of merchandise.
i. Display of merchandise in showcase of departmental stores abstract with on combination.
ii. Display of merchandise in a decorative style in the showcase/window.
iii. Display of prestige copy under a simulated environment.
iv. Display of merchandise on a dummy.
v. Theme display.
vi. Demonstration of the use of the merchandise.
The outdoor display of merchandise or services may be done in the form of sign boards, commercial hoardings, posters, neon signs, vehicle sign boards, train posters, electronic sign boards, balloons, fiber optical billboard and other special effects. Merchandise advertising on vehicles is called transit advertising which carries the message from place to place. It is a good way to reach specific markets and can be tailored according to the geographical market segmentation.
Advocacy advertising, on the other hand, attempts to highlight contemporary arguments directed at specific general clients like political activists, consumer groups, media and government agencies.
Advocacy advertising consists of:
i. Ideological advertising which is principle oriented and attempts to highlight the ethics of an institution.
ii. Defense advertising which argues to protect the image of institution against contemporary controversies.
iii. Reply bound advertising seeking quick and ready response to issues highlighted in the advertisement.
iv. Position taking advertising emphasizing the point of view of an institute of and thus coming up issue with a strong argument to seek public acceptance or a referendum.
v. All recruitment advertising asking interested persons to present their views in support of the ethics of an institution in order to strengthen its position before their joining a position in the institute.
Advocacy advertising has the advantage of exhibiting the message in a controlled situation which then helps in dealing with complex issues. An institution can plan a series of advertisements for a campaign, supporting its views and an image building simultaneously among the clientele group. Institutional advertisements are generally released on multi-media and cover a substantially larger segment of the target audience.
Types of Advertising – With Advantages and Disadvantages
Advertising is the element of the promotion mix most consumers think of first. Advertising is non-personal promotional communication about goods, services, or ideas that is paid for by the firm identified in the communication. Two words in the definition, paid and non-personal, are key to understanding how advertising fits into the promotion mix.
The paid aspect of the definition reflects that the time or space for an advertising message is purchased. Since it is paid for, advertising has the advantage of control; the purchaser decides how to present the message to the public. The non-personal component refers to the fact that advertising uses media (e.g., Internet, television, radio, print, etc.,) to transmit a message to large numbers of individuals rather than marketing to consumers face-to-face.
Firms spend hundreds of billions of dollars on advertising campaigns each year in an effort to appeal to large numbers of individuals. An advertising campaign is a collection of coordinated advertisements that share a single theme.
Marketers use advertising campaigns to achieve three primary objectives:
1. To inform,
2. To persuade, and
3. To remind.
1. Informative advertising attempts to develop initial demand for a product. It’s especially important in the introductory stage of the product life cycle. A flyer for an upcoming meeting of a new club at your college with the date, time, room number, and a description of the guest speaker classifies as informative advertising.
2. Persuasive advertising attempts to increase demand for an existing product. Persuasive advertising is common during the growth stage of the product life cycle as firms compete directly and attempt to take market share from one another. Persuasive advertising would include a speech from one of your professors that highlights the benefits of selecting a major in his or her course area.
3. Reminder advertising seeks to keep the product before the public in an effort to reinforce previous promotional activity. Reminder advertising is most common in the maturity and decline stages of the product life cycle. An e-mail prompting you to purchase season tickets to support one of your college’s sports teams is an example of reminder advertising.
Depending on the firm’s objective, marketers must also decide on the media to use to convey their message. Notice that, though some forms are projected to remain relatively stable, newspaper advertising is expected to drop, while Internet advertising is expected to grow by approximately 5 percent. Each type of media has its own unique advantages and disadvantages that firms must understand if they want to determine the best fit for their specific product and budget.
Internet advertising takes many forms. Paid Internet advertising can be broken down into paid search and paid display advertising. Paid search advertising typically involves offering consumers advertising links to brand content based on what they’re searching for.
Paid display typically consists of banner advertising—a graphic display that appears on a website in an effort to get you to click on the content. For example, the 2013 movie Olympus Has Fallen was promoted using banner ads on sites like ESPN(dot)com. Consumers could watch an extended movie trailer by clicking on the ad, which was located directly above the breaking news stories.
Social media platforms like Facebook are an ever more popular choice for Internet advertisers because they offer new strategies for online advertising. Facebook’s sponsored stories feature posts from friends about a product, which firms pay to highlight to make them more visible to other potential consumers.
Coca-Cola, Levi’s, UNICEF, and other organizations increasingly spend part of their ad budgets on these new strategies. Overall, the U.S. spends the most on online advertising, approximately $35.4 billion in 2012. However, Internet advertising is gaining popularity across the globe, with Asia-Pacific countries spending over $30 billion, while western European countries combined spent just under $27 billion.
The Internet has also made it easier for organizations to advertise directly to consumers. Direct marketing is advertising that communicates directly with consumers and organizations in an effort to provoke a response. You have likely received an e-mail advertisement directed to you based on information that marketers have about you from your previous purchases or marketing research.
The e-mail might contain information about a new product that might interest you or promote a special offer at a restaurant you frequent. By individually customizing their advertising using direct marketing strategies, firms seek to increase interest and awareness and, ultimately, generate additional revenue.
One advantage of advertising via the Internet is the reduced cost relative to advertising on other media. Online video advertising rates have been falling 10-15 percent since 2011, and most social media ad content can be posted for almost nothing. In addition, the effectiveness of Internet marketing is far more measurable than television, radio, or print options.
Firms can use measurement tools like Google Analytics to closely monitor their return on investment, using metrics such as – cost-per-thousand impressions, cost per click, and click-through rates to determine the success of their Internet advertising.
i. Cost-per-thousand impressions (CPM) is what the firm pays for a thousand views of its ad. CPM exposes the firm and its products to potential customers.
ii. Cost per click (CPC) is the amount the firm pays each time a customer clicks on an ad. Monitoring CPC gives marketing professionals a more accurate picture of the effectiveness of their advertisement because the clicks represent some interest on the part of the customer.
iii. The click-through rate (CTR) is a ratio showing how often people who see an ad end up clicking on it. CTR can be used to gauge how well the firm’s ads perform.
Firms that have access to such metrics and, more importantly, use them to determine the effectiveness of their marketing strategies are in a better position to modify those strategies as needed to increase sales.
The average web page visit generates 50 data collection events that can provide direction to marketers in their efforts to segment and target specific consumers.
Disadvantages of Internet Advertising For all its advantages, Internet advertising has drawbacks, including clutter and the difficulty of actually reaching consumers. Banner ads for example have an average CTR of around 0.1 percent, which means that if 1,000 people see a banner only one of them actually clicks on it. Consumers have become so accustomed to seeing banner ads on websites that they no longer pay as much attention to them.
Another potential disadvantage of Internet advertising involves consumer privacy. Privacy advocates worry that data collection efforts by marketers will hurt consumers because information about their Internet habits could be released or used inappropriately.
Privacy groups are pushing for new rules that would allow marketers to keep Internet data on consumers for only 24 hours unless consumers opt in and allow marketers to keep data for longer than that. Privacy concerns have led marketers to use Internet advertising based on consumers’ web-browsing habits 75 percent less than they would otherwise.
A major privacy breach could greatly harm an organization’s image and the increased regulatory scrutiny gives Internet advertising an uncertain future that is troublesome for some marketers.
People often think of television advertising first when they hear the term marketing. Television advertising is very different today than it was a generation ago. In the early 1980s, the most popular television show was “Dallas,” and more than 30 million people tuned in every week to watch J.R. Ewing and the drama that surrounded his family.
Today the most popular shows on television often average less than 10 million viewers per week, and running ads during such shows comes at an increasingly high cost to firms. Marketing professionals must understand the changing landscape of television advertising and consider the various advantages and disadvantages of trying to reach consumers in this way.
One reason for the decreased viewership of top-rated TV programs is the greater number of channels available to consumers. In the early 1980s the average American home had access to less than 20 channels. Today the average American household can choose from over 118 channels, plus a variety of pay-per-view and on-demand options.
A large number of channels provides marketers an opportunity to target specific markets through narrowcasting. Narrowcasting is the dissemination of information (often by television) to a fairly small, select audience that is defined by its shared values, preferences, or demographic attributes.
For example, firms that marketed products to tennis fans a generation ago might have advertised heavily on ESPN, which at the time was the only all-sports channel on many basic cable subscriptions.
Now these same firms can promote their equipment and tennis apparel on The Tennis Channel, which is broadcast to over 34 million households in the U.S. While the average viewership of The Tennis Channel is far lower than ESPN, the audience is almost exclusively tennis enthusiasts, allowing marketers to reach their target market at a lower cost (ads on The Tennis Channel are far less expensive than on ESPN) and without wasting a significant amount of advertising on people who prefer other sports.
Another major advantage of television advertising is the ability to combine sight, sound, and motion to appeal to consumer senses. Television ads can develop messages that entertain or emotionally appeal to consumers in ways that radio and print media cannot.
In addition, television ads can demonstrate a product in use, for example, a new Toyota product with a rear camera that allows drivers to see the child’s bike sitting behind it or the absorption power of the Sham Wow. Such demonstrations give consumers a better understanding of what owning the product would mean to their daily lives.
Disadvantages of Television Advertising:
Perhaps the biggest disadvantage of television advertising is cost. The cost to air a single 30-second ad on a major broadcast network (NBC, ABC, CBS, or Fox) during prime time averages well over $100,000. Ads for special events, such as – the Super Bowl or the Academy Awards, can cost significantly more.
In recent years, a 30-second television ad during the Super Bowl cost over $3 million. Creating television ads is also expensive relative to other types of advertising. Television commercials can cost tens or even hundreds of thousands of dollars to make, depending on the length, complexity, and method used.
Complicating the use of television advertising is the rapid growth of digital video recorders (DVRs). Over half of all American households that subscribe to cable or satellite television services now have some type of DVR for recording and watching their favourite programs.
Consumers love the ability to skip or fast-forward through ads to reduce the time it takes to watch shows or events, which leaves marketing professionals paying for television ads that viewers aren’t watching. In response, firms are exploring new technologies to ensure that viewers see their ad content.
It has become common practice to hold the camera on a product for an extended period of time so that a viewer who is fast-forwarding through the commercial still has enough time to register the product. Firms are also implementing new strategies to put their ads directly into the program content using product placement.
The use of product placement has expanded in the past decade as marketers look for ways to get their products in front of their target audience despite the prevalence of DVRs. Product placement is an advertising technique in which a company promotes its products through appearances on television shows, movies, or other media.
For example, Sony used the 2012 hit movie The Amazing Spider-Man to promote several of its consumer electronic products. In the movie, Spider-Man uses a Sony smartphone to make calls, check voicemail, and listen to police radio broadcasts. Even the movie’s villain, Dr. Curt Connors, stays connected using a Sony Vaio laptop and records his experiments with a Sony camcorder.
Sony chose to place its products in The Amazing Spider-Man in an effort to increase its coolness factor with young consumers used to associating cool with companies like Apple.
Product placement has expanded beyond television and movies in recent years. In 2012, the National Basketball Association (NBA) developed a plan to become the first major North American sports association to allow teams to advertise on player jerseys. The ads consist of 2.5-by-2.5-inch patches located on the left shoulder of the jersey, where the NBA logo used to be found.
The ads allow marketers to feature their brand prominently during NBA games rather than only during commercials, which sports fans may not watch. The NBA estimates that this use of product placement will generate $100 million per year in new revenue in the coming years.
There are thousands of radio stations in the United States, ranging from satellite radio stations that reach consumers across the country to local terrestrial stations that reach only small, rural communities. Radio advertising remains a powerful promotional tool because consumers can listen to the radio in their cars, online, and virtually anywhere else through their smartphones.
Marketers spend approximately $14 billion per year on radio advertising, which provides certain unique advantages and disadvantages.
Advantages of Radio Advertising:
Radio advertising has two major advantages. First, radio advertising is often the most cost-effective medium available to a company. Not only is buying radio ad time far cheaper than buying television ad time, the production costs are comparatively low or even non-existent if the ad is read live during a broadcast.
A second advantage is that radio advertising allows marketers to segment effectively based on the geographic location and type of format a radio station uses. The narrow transmission of terrestrial radio stations provides a great way to market to small geographic regions.
While most regions of the country have a limited number of television markets that serve a large proportion of the population, each region has significantly more radio stations, including many that serve very small or rural communities. The local nature of radio makes it a perfect advertising medium for small merchants in the listening area.
Marketers can also segment consumers by what they listen to – country, pop, gospel, hip-hop, heavy metal, sports talk, politics, and numerous other formats. Advertising on stations that cater to these different audiences is a form of narrowcasting that allows firms to target more effectively.
Disadvantages of Radio Advertising:
Traditionally, the biggest disadvantage of radio advertising has been that radio ads are audio-only. Being able to appeal to only one sense makes it difficult for companies to illustrate the uses and benefits of their products. In recent years, technology advances have created several additional disadvantages for radio advertising.
Most cars today have digital pre-sets that allow listeners to switch stations when a commercial comes on simply by touching a button. For traditional music-based radio stations, the popularity of satellite radio represents an emerging challenge. Though satellite channels devoted to sports and news typically air ads, music stations on satellite radio are commercial-free.
Finally, most new cars today come with the ability to plug in an MP3 player or smartphone. Over 38 percent of Americans listen to content on digital devices in their car and that number is expected to double by 2015, making it harder for traditional radio advertising to reach these customers.
In response to these challenges, firms like Subway are exploring creative ways to reach consumers listening to podcasts and other digital content. Subway has partnered with ESPN to sponsor several of its most popular podcasts, such as – “The B.S. Report” with Bill Simmons.
The podcast is free and averages over 600,000 downloads per episode. Each podcast includes several mentions of Subway products, allowing the firm to reach listeners of the show in a new way.
Print media, which typically comprises newspapers and magazines, requires a greater degree of involvement on the part of the consumer than broadcast media. Readers choose what they want to read and then can spend as much time as they want reading it. This makes print advertising especially appealing for high- involvement (significant) consumer products, such as – a house or a car.
Advantages of Print Advertising:
Newspapers have been a valuable tool for marketers, especially retailers, for well over a century. Marketers spend over $20 billion each year on newspaper advertising, although that number is less than half of what it was in 2005. Newspaper advertising has two major advantages.
First, newspaper advertising is an effective way for small businesses to advertise their goods or services to the local community. Small-town newspapers or local community inserts in larger city (or even national) newspapers help marketers attract the local population that is most likely to buy their products.
In addition, firms can run their ads in a particular section of the newspaper if their business or product is specific to that section. For example, if you run a sporting goods store you might specify that your ad should appear in the paper’s sports section; if you are a financial advisor you can run your ad in the business section.
In addition to newspapers, there are thousands of special interest magazines in the U.S. and throughout the world covering almost every possible subject or interest. Approximately half of all U.S. adults look through at least one magazine on a regular basis. Marketers divide magazines into two categories- business magazines (e.g., Bloomberg Businessweek, Fortune, and Money) and consumer magazines (e.g., People, Better Homes and Gardens, and Sports Illustrated).
Consumer magazines have a wider audience and present subject matter using a more general approach than business magazines, as illustrated by the list of the most popular consumer magazines.
Both business and consumer magazines allow firms to segment based on a variety of demographic, geographic, and behavioural variables to reach their target audience. For example, AARP Bulletin, Cosmopolitan, and Parenting offer marketers the ability to reach very precise target markets with their ads.
Magazine advertisements also have a longer shelf life than daily newspapers. Imagine that a consumer is traveling for the weekend and gets home to find three editions of the daily newspaper waiting; it’s unlikely that he or she will read any of them. Compare that to readers of Bloomberg Businessweek who have a full week to read the content before a new issue arrives.
Disadvantages of Print Advertising:
The major disadvantage of advertising in print media is that fewer and fewer Americans use that as their primary information source. Younger consumers often receive news, entertainment, and employment information via computers and portable electronic devices.
Even if they still rely on newspapers and magazines for information, they may choose to access the content online rather than buying the hard copy. An additional disadvantage for newspaper advertising is that newspaper ads compete with other ads and editorial content for the consumer’s attention.
Firms with small or unimaginative ads risk the possibility that readers will pass over them completely while they engage with larger or more interesting graphics. Readers viewing multiple ads may also subconsciously spend less time on each individual ad.
Magazine advertising has several disadvantages as well, beginning with the lead time necessary to place an ad. The timeframe for designing a magazine forces marketers to plan and prepare advertisements months in advance of publication. As a result, the target audience might not see the ad until after the firm has committed the time and resources to the advertisement.
If you own a small start-up business, the amount of time you spend waiting for your ad to bring in revenue could determine whether the business succeeds or fails. Beyond this, events may occur between when the ad is placed and when it is seen that limit the impact of the ad or affect the way readers perceive it.
In addition, marketers typically do not control where their advertisements are placed in relation to the features and stories contained in the publication. Effective placement of an ad is essential to its success or failure. An advertisement placed in the back of the magazine may not receive the same attention as those at the front.
Outdoor advertising includes billboards, signs in sports arenas, skywriting, and ads on the sides of buildings, buses, and cars. Outdoor advertising has several advantages, including its flexibility and reduced costs that are very appealing to marketers.
Advantages of Outdoor Advertising:
Outdoor ads can be located where they will most likely be seen. For example, a company selling organic foods might advertise on a billboard near a farmer’s market. A new college night club might advertise outside of a popular restaurant to target diners looking for someplace to go later in the evening.
These same ads, if placed in a newspaper or on the radio, may be missed altogether by the target market. Outdoor advertisements are also one of the most cost-efficient ways to reach potential customers and clients and are generally cheaper than television, radio, or print advertisements.
Disadvantages of Outdoor Advertising:
Outdoor advertising also has several disadvantages. First, because of the speed people travel in cars, the exposure time for outdoor ads is generally very short. This limits the number of words or images that firms can use effectively. Too much information on an outdoor ad can make it difficult to see, read, and understand in the limited amount of time consumers have as they walk or drive by.
The other major disadvantage is wasted coverage. While outdoor advertising allows companies to target specific areas, it is unlikely that everyone driving past an outdoor ad is part of the target market. An outdoor advertisement for a new local restaurant might look great, but its effect is wasted on those audiences who do not like the type of food or price range promoted.
Business spending on traditional advertising like television, radio, and newspapers has been declining over the past decade. However, spending on non-traditional advertising has increased as firms place messages on everything from valet tickets to hubcaps. KFC used non-traditional advertising to help an Indiana town in need of new fire hydrants.
The firm paid the town to place Fiery Grilled Wing ads on three hydrants, helping to offset the cost of the new hydrants.
Mobile advertising is a form of advertising that is communicated to the consumer via a handheld device. It has experienced significant growth in recent years. Over 45 percent of U.S. adults use smartphones and most keep their devices within arm’s reach the majority of the day, allowing tech-savvy marketers a way to reach consumers at virtually any time.
One of Chevrolet’s recent Super Bowl mobile ads was a “Chevy Game Time” app. The app was designed to keep consumers’ attention on the Chevy products on their phone or tablet computer and away from commercials from other companies on their television sets.
It rewarded players who paid attention to the app and answered trivia questions to win prizes during the game. As many as 700,000 users signed into the Chevy app, and over 21 million trivia questions were answered.
Another fast growing area for advertisers is video games. The global market for ads in video games is expected to grow from $3.1 billion in 2010 to $7.2 billion in 2016. For example, the popular video game FIFA International Soccer prominently displays an Adidas ad on an onscreen billboard as users play.
Video game advertising benefits from widespread Internet connectivity and larger bandwidth, both of which allow manufacturers to deliver advertisements remotely and update advertisements after the game is launched. In October 2008, then-U.S. presidential candidate Barack Obama placed advertisements in numerous Xbox games destined for sale in 10 swing states, including the racing game Burnout Paradise.
When implementing non-traditional advertising, marketers must avoid harming or offending consumers. In 2007 Dr Pepper held a promotional treasure hunt in Boston, Massachusetts, in which a $10,000 prize was hidden in a cemetery. The event would have ultimately led pickaxe-wielding consumers into a 350-year- old graveyard in search of the prize. Unsurprisingly, Dr Pepper was eventually forced to cancel the event.
As consumer behaviour continues to evolve, firms will turn more and more to non-traditional advertising at the expense of traditional advertising like television commercials or newspaper ads. Marketers must be on the lookout for new and better ways to get their message in front of their target consumers.