Chapter 3 advertising full lecture notes

OBJECTIVES OF THE LESSON
After completion of this lesson the student will be able to understand :
• Broad classification of advertising
• Various categories of advertising : Social Advertising, Political Advertising,
Advocacy Advertising, Retail Advertising
• Financial Advertising, Essentials for the success of Financial advertising,
Advantages of Financial advertising
• Corporate Image Advertising, Public Relations Advertising, Institutional
Advertising
• Internet Advertising, Types, Advantage and disadvantages of Internet Advertising
• Product Advertising, Service Advertising, National Advertising, Retail Advertising

INTRODUCTION:
Different authors have classified advertising in different ways. Philip Kotler has
classified advertising 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.:

CLASSIFICATION OF ADVERTISING
Management scientists have classified advertising on different such criteria as follows :

I) Classification on The Basis of Area Coverage :
On this basis advertising may be classified into the following four
categories:
(1)local,
(2)regional,
(3)national,
(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, selling cloth, saris and other
consumer goods and consumer durables. It is directed at local customers. Media,
used for local advertising, are shop decorations, local newspapers, magazines,
posters, pamphlets, hoarding, new signs, local cinema houses, etc.
2. Regional Advertising : It has wider coverage, as compared to local advertising. It
covers a particular region, which may be one state, or, more than one state, the
people of which may be having a common tongue, or, using one common
product. It is undertaken by manufacture, or, regional distributor of a product.
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

3. National Advertising: It is generally undertaken by manufactures of branded
goods, for which, advertising messages is communicated to consumers allover 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 those
companies, which operate in more than one country, known as „multi-national‟
companies. Exporters, generally advertise their products and services in foreign
countries, where ready markets are available. Coca-Cola and Pepsi are advertised
globally, as the sales are almost all over the world. International advertising is
extremely expensive, involving the services of professional advertising agencies in
different countries.

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 the consumer products, i.e., the individuals, who buy, or, use the
consumer products, or services, say, for example, toilet soap, toothpaste,
toothbrush, tea, textiles, etc., for themselves and for their families. All types of
consumer products need continuous and extensive advertising on T.V., radio, and
press.
2. Industrial Advertising : This type of advertising is used by manufacturers and
distributors of industrial goods. Such as, machinery, plants, equipment, spare parts
and components, and are directed at industrial users or customers. 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
manufactures 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 particular products(s).
4. Professional Advertising : It is directed at professional 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.

III. Classification on The Basis of Media
On the basis, advertising may be-classified into the following four categories
(1)Print media advertising;
(2)electronic, or, broadcast media advertising;
(3)outdoor media advertising.
(4)Other Media

1. Print Media Advertising : The print media consists of newspapers, magazines, journals,
handbills, etc. No newspaper or, journal, today, can survive without advertising revenue.
Print media advertising, even today, is the most popular form; and revenue derived by
mass media from advertising has, therefore, been progressively 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, appealing 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 appealing to both the
senses of sight sound (eyes and ears). Different methods, such as, spot announcements,
sponsored programs, etc., are used for broadcasting advertising messages. However,
broadcasting media are very expensive form of advertising. Advertising is also
undertaken through movies, video, and the internet.

3) Outdoor Media : This include 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, especially, the POP advertising.
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.

IV. Classification on The Basis of Function :
1. Direct Action and Indirect Action Advertising : Direct action advertising is undertaken to
obtain immediate response or action on the part of target audience. Examples include
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
undertaken to influence the audience in respect of advertiser's brand. The advertiser
expects the target audience to prefer his brand as compared to competitors whenever a
buying decision arises in future.
2. Primary and Selective Advertising : Primary Advertising is undertaken by trade association
or by cooperative groups. It is undertaken to create generic den1 and for products and
services. For example, the Nescafe may advertise to consume more coffee. Selective
Advertising is undertaken 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
undertaken to build name and goodwill of the organization. It is
also, know as corporate advertising or image advertising. It is
mostly undertaken by large firms.

V. Classification on The Basis of Advertising Stages
On this basis, advertising may be classified into the following three different
categories,
(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 undertaken to make
the audience fully aware of the new brand of product and 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 has,
soon to face a stiff competition with other well-established 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, or retain the
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”.

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 undertaken 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 undertaken by political parties
to motivate the general public in favor of the ideology of the party in
question. Political advertising are intensively made during election times to
gain favor of the voters. Such advertising promote plans and policies of the
concerned party. It also try to expose weaknesses of the opposition with a
view to convince the voters to vote for their party candidates. Some political
advertisement are also made to assist the Government to implement its
schemes for rehabilitation and national re construction.

3. Advocacy Advertising : We often come across advocacy advertised relating to the
use of family planning methods. Conservation of scarce resources, 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.
This is designed to alert people to the fact that such ads are not editorials or
informational pieces, but are specifically advertisements. Companies can place
advocacy advertising on billboards, in print magazines and newspapers, online, and
on television.
In fact, many advertising firms consider candidates who have completed
advertising internships far more attractive than those who have not. If you are
planning to begin your career in advertising in the creative department of an
advertising firm, a bachelor's degree may not be as essential.

4. Advertising by Google
Ponds Age Miracle : Looking young is now really easy Get Ponds tips and tricks!
www.Ponds.in
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

5. Retail Advertising : Retail advertising is the advertising by retailers who
usually sell goods direct to the customers. Retail advertising has such
objectives as : (i) to sell the stock; (ii) to establish the identify of business; (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 character.
6. Financial Advertising : When an advertising message is directed to attract
for raising capital, it is called financial advertising. The banks, insurance
companies and commercial undertakings collect required funds from the
savings of the people by motivating them to post-pone present expenditure
to 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 inform 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 rate of growth and rate at which profit is increasing.
The financial advertising aims at establishing financial, solvency of the company in
the minds of the prospective investors. It is because of financial advertising the company
have succeeded in floating of mega issue of shares arc in cores.
The financial advertising aims at establishing financial solvency of the company in
the minds of the prospective investors. It is because of financial exports.

Essentials for the Success of Financial Ads :
No financial ad campaign; howsoever creative and persuasive it may be, can produce the
desired result, unless 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, made in the ads.
(f) Finally, financial climate of the country plays an important role.

Advantages of Financial Advertising :
Following are main advantages of financial advertising :
(a)Financial advertising transmits to target consumers all the material
information about new investment opportunities for investment of
savings, or, surplus funds.
(b) It provides education and guidance to consumers in respect of their
investments in shares, debentures, and public funds, off companies.
(c) It serves as a reminder to consumers to take suitable follow up action on
their part.

d) It helps to tap yet untapped rich areas in mini-metros, small towns, and even in
villages for financial institutions.
(e) As financial ads are required to give the required in formation about the aims,
objective business operation, for which additional funds are required by the
advertiser, the company gets wide publicity through such ads.
(f) Financial advertising serves as a : backbone to brokers as well as underwriters,
who as „intermediaries between the advertiser and the clients.
‟
(g) Finally, financial advertising indirectly aids and supports the economic an
industrial growth of country by mobiling public funds for expansion and
diversification of business.

7. Corporate Image Advertising : Corporate Image advertising designed or aimed to
create a proper attitude towards the seller and to build goodwill or image for the
advertiser (manufacturing concern or the selling concern) rather than to sell a
specific product or service. Institutional advertising is done to build good public
relations image in the market for the marketer and a patronage for its product or
‟
products. Institutional advertising can therefore be patronage advertising and public
relations service advertising. Public relations institutional advertising is aimed to
create a favorable image of the company (advertiser) among employees, investors
or general public. Public service institutional advertising aims at changing the
attitudes or behavior of the people to the good of the community or public at large.
Patronage advertising is aimed to attract customers by appealing to their patronage
buying motives rather than product buying motives.

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 when the employees
are on strike. It helps the company to remove mis concepts about the company
created by interested groups.
During the periods of short supply of goods the public relations advertising
helps to hold the interest of the customers. The company assures about the
normalcy of supply and request its customers to bear with the company.
Institutional advertising and public relations advertising are complimentary
to each other. Both are directed in building up 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 favorable 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.
(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, health hazards, etc.
(j) To obtain public support for certain cause.

9. Institutional Advertising : The object of institutional advertising is to build
manufacturers reputation in the minds of the public in general.
The advertising message is directed to talk about the Company, its
people, its contribution in promoting social welfare activities, in promoting
consumer satisfaction its achievements in technology its broad philosophies,
its share in economic progress of the Company etc.
Such advertisement do not bring benefits in the form of higher sales
immediately. But 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, the institutional advertising aims at
getting public support for raising the capital through public subscription.

The following points are normally referred in institutional ads :
(a) Research & 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.
(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 1960 in USA, where the U. S. Department
of Defense 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 the fastest growing medium in history, offers
incredible opportunities for a wide range of people in both business and
advertising. For advertisers, there is a whole new world of potential
customers.

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 in the case of a newly developed products or the products
which are costly in nature. For example, cars, refrigerators, washing
machines, watches, etc. Such advertising is directed towards a class of
customers, it is also described as selective demand advertising. It is heavily
utilized during the introduction 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 it. But now due to new circumstances she has 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 these cases, the prospect will come to you if he feels comfortable in 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
quality, value, and offers of different companies. you, while they are calling you they
are also likely calling others as well.

13. Product Advertising : Product Advertising refer to the advertising of
tangible product. It is for the marketing of the product advertising as a
powerful instrument has emerged. A product may be anything in which a
trader deals or trade. A product may be tangible of intangible. Products like
radio, soap, pen cloth etc. are tangible products and services of professional
people like doctors, lawyers, engineers etc. are intangible products.
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 of any advertising program. Advertising makes possible for the
smooth entry of the new product in to the market.

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 in the nature of non-commercial institutional advertising.
In this type of advertising, the objective is to put across a message intended
to change attitudes or behavior and, as a result, benefit the public at large. It
is generally used by government and other organizations to promote public
welfare.

15. National Advertising: It is generally undertaken by manufactures of
branded goods, for which, advertising messages is communicated to
consumers allover 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. Detergents, soaps,
toothpastes, cosmetics, scooters, cars, and bicycles, are some of the products,
which are advertised all over the country.

16. Retail Advertising: Retail advertising is the
advertising by retailers who usually sell goods direct to
the customers. Retail advertising has such objectives as :
(i) to sell the stock; (ii) to establish the identify of
business; (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 character.

Chapter 3 advertising full lecture notes

Chapter 3 advertising full lecture notes

More Related Content

Similar to Chapter 3 advertising full lecture notes (20)

More from annejo20 (13)

Recently uploaded (20)

Chapter 3 advertising full lecture notes