Advertising and IMC: Principles and Practice, 11th Edition Solution Manual

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Advertising & IMC:Principles and PracticeEleventh EditionSandra MoriartyNancy MitchellCharles WoodWilliam WellsInstructor’s Manual forAdvertising & IMC: Principlesand PracticeStephanie Bibb

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Chapter 1: Strategic Brand Communication1Chapter 1Strategic Brand CommunicationCHAPTER CONTENTKEY OBJECTIVES1.What is the marketing mix, and how does it send messages?2.What is integrated marketing communication?3.Understand how this text will prepare you for your career.CHAPTER OVERVIEWThis chapter opens by providing a definition of both marketing and marketingcommunication, which is followed by a discussion of the marketing industry’s key playersand the most common types of markets pursued, as well as the concept of added value.Next, integrated marketing communications (IMC) is defined and the various elements ofbranding strategy are explored, including brand meaning, brand transformation, brandidentify, brand position, and brand promise. An emphasis on the role of effectivecommunication in building strong, viable brands is woven throughout this discussion, aswell as the importance of building strong brand relationships that will drive brand value.The chapter closes with a discussion of brand communication in a time of change and howthe practice of marketing is evolving, especially in this new social media period.CHAPTER OUTLINETHE MARKETING FOUNDATIONTraditionally, the goal of most marketing programs has been to sell products, definedasgoods, services, or ideas. Marketing’s sales goals respond to the marketplace,ideally matching a product’s – and the company’s production capabilities – to theconsumer’s need, desire, or demand for the product.Sometimes the challenge is to build demand for a product, as the Showcase feature inthe text about Urban Decay illustrates.The Marketing MixMarketing accomplishes its goal by managing a set of operations and strategicdecisions referred to as themarketing mix, also called the four Ps.These include thedesign and performance of the product, its distribution, its pricing strategies, and itspromotion. These four Ps all deliver messages about the brand.Marketing also focuses on managing customer relationships to benefit all of a brand’sstakeholders, i.e., all individuals and groups who have a stake in the success of thebrand, including employees, investors, the community, media, business partners, andcustomers.

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Chapter 1: Strategic Brand Communication2Marketing and MessagesMarketing communication(marcom) involves the use of a variety of tools andfunctions, such as advertising, public relations, sales promotion, direct responseevents and sponsorships, point of sale, digital media, and the communication aspectsof packaging, as well as personal sales and new forms of online communication thatare constantly being developed.On a more general level,brand communicationincludesall various marketingcommunication messages, as well as personal experiences, that create and maintain acoherent brand.The management challenge is to plan and monitor all of the messages delivered by allvarious types of marketing communication so that they work together to present thebrand in a coherent and consistent way, as a coordinated basket of messages.Who Are the Key Players?The marketing industry is a complex network of professionals. The four categories ofkey players include 1) marketers, 2) marketing partners, such as advertising andpublic relations agencies, 3) suppliers and vendors, and 4) distributors and retailers.1.The marketer is any company or organization behind the product, that is, theorganization, company, or manufacturer producing the product and offering it forsale. To marketing communication partners, the company or firm behind thebrand is referred to as theclient.2.The relationship between marketers and their agencies can be a complicated onebecause of pressures to cut costs as well as changing strategies and technologies,particularly in the digital arena, as aWall Street Journalarticle explained.3.The materials and ingredients used in producing the product or managing anonprofit agency are obtained from other companies, referred to assuppliersorvendors.The phrasesupply chainis used to refer to this complex network ofsuppliers whose product components and ingredients are sold to manufacturers.Thedistribution chainordistributionchannelrefers to the various companies that areinvolved in moving a product from its manufacturer into the hands of its buyers.Suppliers and distributors are also partners in the communication process.What Are the Most Common Types of Markets?The wordmarketoriginally meant the place where the exchange between seller andbuyer took place. Today, we speak of a market not only as a place but also as aparticular type of buyer — for example, the youth market or the motorcycle market.The phraseshare of marketrefers to the percentage of the total market in a productcategory that buys a particular brand.

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Chapter 1: Strategic Brand Communication3As Figure 1.1 shows, the four main types of markets are 1) consumer, 2) business-to-business (or industrial), 3) institutional, and 4) channel markets. We can furtherdivide each of these markets by size or geography.Consumer markets(B2C)refers to businesses selling to consumers who buygoods and services for personal or household use. As a student, you areconsidered a member of the consumer market for companies that sell jeans,athletic shoes, sweatshirts, pizza, music, textbooks, backpacks, computers,education, checking accounts, bicycles, travel, and a multitude of other products.Business-to-business marketsconsist of companies that buy products or servicesto use in their own businesses or in making other products. Advertising in thiscategory tends to be heavier on factual content, but can also be beautifullydesigned. General Electric, for example, buys computers to use in billing andinventory control.Institutional marketsinclude a wide variety of nonprofit organizations, such ashospitals, government agencies, and museums. Ads for this category are verysimilar to B2B ads in that they are heavy on facts.Channel marketsinclude members of the distribution chain, which is made up ofbusinesses that we callresellers.Channel marketing, the process of targeting aspecific campaign to members of the distribution channel, is more important nowthat manufacturers consider their distributors to be partners in their marketingprograms.How Does the Marketing Mix Send Messages?Marketing managers construct themarketing mix,also called the four Ps, toaccomplish marketing objectives. As shown in Figure 1.2, the marketing mixdecisions are key elements of marketing strategy.To a marketing manager, marketing communication is just one part of the marketingmix, but to a marcom manager, all of these marketing mix elements also sendmessages that can sometimes contradict planned messages or even confuseconsumers.ProductDesign, performance, and quality are key elements of a product brand’s success.When a product brand performs well, its performance sends a positive message thatthis brand is okay to repurchase or revisit. A positive brand experience also motivatesthe buyer to recommend the brand to others, extending the reach of the positiveexperience into personal communication, which we refer to as ‘word of mouth.’

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Chapter 1: Strategic Brand Communication4Some brands are known for their design, which becomes a majorpoint ofdifferentiationfrom competitors. When this point of difference is of significantimportance to customers, it also becomes acompetitive advantage.A product launchfor a new brand depends on announcements in the media, usuallyinvolving both publicity and advertising. The goals of the communication are to buildawareness of the new brand, explain how this new product works, and how it differsfrom competitors.Product performance – how it handles or is used - sends theloudest message about a product or brand and determines if it will be purchasedagain.Related to product performance is product adaptation, particularly when innovation isdriven by consumer needs.PricingThepricea seller sets for his product sends a ‘quality’ or ‘status’ message. The priceis based not only on the cost of making and marketing the product, but also on theseller’s expected margin of profit, as well as the impact of the price on the brandimage.Ultimately, the price of a product is based upon what the market will bear, thecompetition, the economic well-being of the consumer, the relative value of theproduct, and the consumer’s ability to gauge the value, which is referred to asprice/value proposition.Psychological pricing strategies use marketing communication to manipulate thecustomer’s judgment of value. An example of this isprestige pricing.The meaning ofprice is often dependent on the context provided by marketing communication, whichputs price into perspective.With the exception of price information delivered at the point of sale, marketingcommunication is often the primary vehicle for telling the consumer about price.The termprice copy,which is the focus of much retail advertising,refers toadvertising copy devoted primarily to price and its relation to value.Promotional pricingis used to communicate a dramatic or temporary price reductionthrough terms such assale, special,andtoday only.Place (Distribution)Distribution strategy provides mechanisms that make the product easily accessible toits customers and also handle the exchange of payment. Where and how the brand ismade available also sends a message.A common distribution strategy involves the use ofintermediaries,such as retailers.

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Chapter 1: Strategic Brand Communication5Direct marketingcompanies distribute their products directly to a consumer withoutthe use of a reseller. The sale is totally dependent on the effectiveness of catalogs anddirect-response marketing.Apushstrategyoffers promotional incentives, such as discounts and money foradvertising to retailers. Distribution success depends on the ability of theseintermediaries to market the product, which they often do with their own advertising.In contrast, apullstrategydirects marketing communication efforts at the consumerand attempts to pull the product through the channel by intensifying consumerdemand.Other Factors in the MixPersonal sellingrelies upon face-to-face contact between the marketer and aprospective customer, rather than contact through the media. It is particularlyimportant in B2B marketing and high-end retail. In contrast to most advertising,marketers use personal selling to create immediate sales to shoppers.Marketing communication supports sales programs to developleads, theidentification of potential customers orprospects.Lead generationis a commonobjective for trade promotion and advertising.Customer servicerefers to the help provided to a customer before, during, and after apurchase. It also refers to the company’s willingness to provide such help. Manycompanies now provide more assistance to customers through online connectionsthan through face-to-face.What is the Added Value of Marcom?Added valuerefers to a strategy or activity that makes the product more useful orappealing to the consumer as well as distribution partners.Product, price, and place add the greatest amount of tangible value. Marketingcommunication adds psychological value by creating a brand that people remember,by delivering useful information, and by making a product appealing.WHAT IS INTEGRATED MARKETING COMMUNICATION?Integrated marketing communications (IMC)is the practice of coordinating allmessages from all marketing communication tools, as well as the messages from themarketing mix decisions. One important IMC goal is to send a consistent messageabout the brand.IMC is still evolving, and both professionals and professors are engaged in definingthe field and explaining how it works.Integrationis the key; itmeans every messageis focused and that all messages work together, which createssynergy. When thepieces are effectively coordinated, the whole has more impact than the sum of itsparts.

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Chapter 1: Strategic Brand Communication6Marketing communication is at the center of brand communication and marketingplanning. Those relationships are depicted in Figure 1.3. The problem arises when themarcom tools are not aligned with other marketing mix communication messages thatdeliver brand communication.One thing that makes the practice of IMC different from traditional advertising orpublic relations is its focus on branding and the totality of brand communication,including experiences. Through IMC that considers all possible brand messages,marketing communication managers are able to ensure that the perception of theirbrand is clear and sharp.Why Focus on Brands?Brandingis a management function that uses communication to create the intangibleaspects of a brand that make it memorable and meaningful to the consumer. Effectivemarketing communication establishes the unique identity by which the brand engageshearts and minds.Abrandcan be defined as a perception, often imbued with emotion, that results fromexperiences with and information about a company, an organization, or a line ofproducts. Other definitions include identity elements such as the brand name and thetrademark, which stand for the brand. A brand is a complex bundle of feelings,promises, and experiences that lives in the heads and hearts of consumers and otherstakeholders.All organizations with a name can be considered a brand.Organization brandsmayor may not be distinct from product brands. International branding expert GiepFranzen found that “organizations should be aware that simply by existing andinteracting with others, an organization is branding itself. It’s going to happenwhether the process is managed or not.” An organization cannot ‘not’ communicate.Branding Differentiates Products and OrganizationsBranding also differentiates similar products from one another. Companies makeproducts but they sell brands. A brand differentiates a product from its competitorsand makes a promise to its customers.Product brands are not just goods for sale. They apply to services and nonprofitorganizations as well.How Does a Brand Acquire a Meaning?A brand is more than a name or logo. It is in fact a perception – an identification orimpression that we assign to products we know and use. It is also defined as anintegrated perception that is derived from experiences with and messages about thebrand.

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Chapter 1: Strategic Brand Communication7Meaning-making cues and images are what marketing communication delivers tobrands. Thisbrand meaningis the one thing a brand has that can’t be copied.Competitors can make a similar product but it’s difficult for them to make the samebrand because brand meaning is built on a collection of personal experiences.A brand, then, is a perception loaded with emotions and feelings (intangibleelements), as well as tangible elements, such as trademark or package design.Tangible features are things you can observe or touch, such as a product’s design,size, shape, and performance. Intangibles include the product’s perceived value, itsbrand image, positive and negative impressions and feelings, and experiencescustomers have with the brand.How Does Brand Transformation Work?A basic principle of branding is that a brand communication transforms a product intosomething more meaningful than the product itself.Brand transformationcreatesthe difference by enriching the brand meaning through symbolic brand cues. Thereare many elements in branding, but for our purposes, we will focus on four: identity,position and promise, image and personality, and reputation.Brand IdentityA critical function of branding is to create a separatebrand identityfor a productwithin a product category. Brand identity cues are generally the brand name and thesymbol used as a logo. The choice of a brand name for new products is tested formemorability and relevance. The easier it is to recognize, the easier it will be to createawareness of the brand. Successful brand names have several characteristics:Distinctiveness. A common name that is unrelated to a product category ensuresthere will be no similar names creating confusion, such as Apple Computers. Itcan also be provocative, such as Virgin Airlines.Association. Subaru, for example, chose Outback as the name for its ruggedSUV, hoping the name would evoke the adventure of the Australian wilderness.Benefit. Some brand names relate to the brand promise, such as Slim-Fast forweight loss.Heritage. Some brand names reflect their maker, such as H&R Block, Kellogg’s,and Dr. Scholl’s. The idea is that there is credibility in a product when makers areproud to put their names on it.Simplicity.To make a brand name easier to recognize and remember, brandnames are often short and easy to pronounce, such as Bic, Tide, and Nike. Withglobal marketing on the rise, it is also important that names properly translate intoother languages.

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Chapter 1: Strategic Brand Communication8Brand identity cues are generally the brand name, but they can also be visualsymbols. A number of elements contribute to the visual identity: logos, trademarks,characters, and other visual cues such as color and distinctive typefaces.While brand names are important, recognition is often based on a distinctivegraphic. Alogois similar to a cattle brand, in that it stands for the product’s source.Atrademarkis a legal symbol that indicates ownership. Trademarks are registeredwith the government and the company has exclusive use of it, as long as it is used forthat product alone.Problems can arise when a brand name dominates a product category, such asKleenex and Xerox. In such situations, the brand name becomes a substitute label forthe category label. Some branded products lost the legal right to their names whenthey became generic category names.Some brands have anchored their identity in association with an iconic figure, such asthe Pillsbury Doughboy, The Keebler Elves, and McDonald’s Ronald McDonald.Also, sounds can be strong brand cues, such as Apple computer’s start-up noise. Themost common audio identity element, of course, is the jingle.We use the wordcuesin talking about branding because a brand name is essentially areminder of a product or organization that is familiar: it brings to mind someinformation, an impression, or an experience. “A brand memory is about the futurenot the past – consumers buy future memories,” according to the president of theAmeritest research firm.Brand Position and PromisePositioningis a way to identify the location a product or brand occupies in theconsumers’ minds relative to its competitors. Related to brand position isbrandpromise.From a consumer viewpoint,the value of a brand lies in the promise itmakes.The brand, through its communication, sets expectations for what a customerbelieves will happen when the product is used.Principle:Brand communication sets expectations for what will happen when theproduct is used through the virtual contract of a brand promise.Consistency is the backbone of that promise. The promise needs to be delivered at allpoints of contact with a brand. Furthermore, the brand must deliver on its promise.Many weak brands suffer from over-promising.Brand Image and PersonalityA brand imageis a mental picture or idea about a brand that contains visualassociations, as well as emotions and past experiences with the brand. Theseassociations and feelings result primarily from the content of advertising and othermarketing communications.

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Chapter 1: Strategic Brand Communication9Part of the image isbrand personality,whichhumanizes an organization or a brand.It symbolizes personal qualities of people you many know, such as bold, fun,studious, geeky, daring, etc. Brands speak to us through their distinctive images andpersonalities.Reputation and IntegrityIntegrity means that the brand stands for something, has a coherent presence, and hasa brand reputation that honestly reflects the promise that the brand signals tostakeholders. Effective strategic communication programs deliver cohesive imagesand coordinated messages that lead to measurable brand integrity, as well as equity.Brand Value and EquityBrand valuecomes in two forms – the value to a consumer and the value to thecorporation. The first is a result of the experiences a customer has had with a brand.The second is a financial measure, which is calledbrand equity.Consumer Brand ValueOn the customer side, the decision to buy or use a product or affiliate with anorganization is made easier by the familiar face of a known brand. There is less riskin committing to a known brand, particularly if you have previous experience with it,you liked it, and it is well promoted.Another type of added value for a brand can come from associating the brand with agood cause, a practice calledcause marketing.Customers feel good aboutthemselves because they support a company or brand that is aligned with a goodcause. TheA Principled Practicefeature in this chapter illustrates how causemarketing contributes to the value of a brand.Brand EquityA brand and what it symbolizes can affect how much people are willing to pay for it.When identical products carry different labels, people will pay more for therecognizable brand. “The value added is in the brand – how it is imagined, presented,sold, and sustained,” according to CNN’s Fareed Zakaria.Brand relationshipprograms that lead toloyaltyare important strategies andindicators of financial performance.Brand loyaltyprograms can also offer rewardsfor repeat business.An important principle is that brand relationships drive brand value.The part of brand equity that is based on relationships is referred to asgoodwill. Itlies in the accumulation of positive brand relationships, which can be measured as alevel of personal attachment to the brand that has revenue-producing potential.

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Chapter 1: Strategic Brand Communication10To summarize,brand equityis the intangible value of the brand based on therelationships with its stakeholders, the effectiveness of its identity elements, itsreputation and perceived performance, and its intellectual property, such as productformulations.Google was the first $100 billion brand, and now there are many brands valued in thebillions. The 2016 BrandZ Top 10 list by Millward Brown, a consulting firm thatspecializes in calculating the value of global brands, can be found in the textbook.Leveraging Brand EquityBrand marketing and communication managers, who we callbrand stewards, willsometimes leverage brand equity through abrand extension, which is the use of anestablished brand name on a related line of products. In effect, they will launch newproducts with a recognized and respected name. The disadvantage is that theextension may dilute the meaning of the brand or may even boomerang, if theextensive performance is not comparable to the original brand.Co-brandingis a strategy that uses two brand names owned by two separatecompanies to create a partnership offering. An example is the brand name MileagePlus, which carries the identities of both Visa and United Airlines. The idea is that thepartnership provides customers with value from both brands.Through a practice calledbrand licensing, in effect, a partner company rents thebrand name and transfers some of its brand equity to another product. The mostcommon example comes from sports teams whose names and logos are licensed tomakers of shirts, caps, mugs, and other memorabilia.Another way to leverage a brand is throughingredient branding, which refers to theuse of a brand name to identify a component used in a product’s manufacturingprocess. A well-known example of this is the “Intel Inside” phrase and logo used bycomputer manufacturers to call attention to the quality of chips within its products.The point of reviewing branding practices is to reinforce that the way a product ismade or how it performs is no longer the primary differentiating point. Marketingstrategy isn’t as much about promoting features, but rather about creating brandmeanings. Ultimately, the stronger the brand, the more value it has to all of itsstakeholders.Principle:Most of the added value that comes from an effective brand strategy andaccumulates as brand equity is driven by marketing communication.Brand Communication in a Time of ChangeAccountabilityMarketing managers are challenged by senior management to prove that theirdecisions lead to the most effective marketing strategies. Business results measured interms of sales increases, the percentage share of the market that the brand holds, andreturn on investment (ROI).

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Chapter 1: Strategic Brand Communication11Brand Relationship StrategiesRelationship building communication programs have strategic implications becausethey shift marketing strategy away from focusing on one-time purchasing toemphasizing repeat purchases and the maintenance of long-term brand loyalty. Allstakeholders are communicators who send either positive or negative messages aboutthe brand. Therefore, it is important to plan for multi-audience interactions andencourage fans of a brand to talk to their friends.Word-of-Mouth MarketingA powerful new force, word-of-mouth communication, is a partner to relationshipprograms. Comments from influential friends and family are more believable thanmost planned marketing communication messages, such as advertising, which is oftenseen by consumers as self-serving.The power and reach of personal communication has been driven in the 21stcenturyby social media. Today, marketing messages are spread not only in face-to-faceconversation but also online. If messages are quickly spread on the internet through awide network of contacts, it is referred to asviral marketing.Brands can instigate theviral process but can’t control it.Global MarketingMarketers have moved into global markets. In most countries, markets are composedof local, regional, international, and global brands. Alocal brandis one marketed in asingle country. Aregional brandis one marketed throughout a region, such as NorthAmerica, Europe, or Asia. Aninternational brandis available in a number ofcountries in various parts of the world. Aglobal brandis available virtually anywherein the world, such as Coke.The communication strategy for international marketing depends in part uponwhether the brand’s messages arestandardizedacross all markets orlocalizedtoaccommodate cultural differences.Convergence“Convergence of business models, convergence of digital, convergence of tools –everything is changing quite radically the way we do business,” according to the CEOof Publicis, a global marcom agency. Consumers are empowered and engage in bothsending and receiving messages. Media forms are blurred. Advertising, publicrelations, and other marcom areas are blurring their functions, as well as integratingtheir functions.DiversityMarketing programs are becoming more complicated as they are challenged to bemore socially inclusive. Gender, ethnicity, and sexual orientation are importantissues.

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Chapter 1: Strategic Brand Communication12End-of-Chapter SupportREVIEW QUESTIONS1-3. What is the difference between marketing communication and brandcommunication?Marketing communication (marcom) involves the use of a variety of tools and functions,such as advertising, public relations, sales promotion, direct response events andsponsorships, point of sale, digital media, and the communication aspects of packaging,as well as personal sales and a number of new forms of online communication that haverecently emerged. Marketing communication tools deliver a complex system of brandmessages we refer to as brand communication–all various marketing communicationmessages and brand experiences that create and maintain a coherent brand.1-4. What is the definition of marketing, and where does marketing communicationfit within the operation of a marketing program?Marketing is the way a product is designed, tested, produced, branded, packaged, priced,distributed, and promoted. The American Marketing Association (AMA) defines it as“the activity, set of institutions, and processes for creating, communicating, delivering,and exchanging offerings that have value for customers, clients, partners, and society atlarge.” Marketing managers manipulate the marketing mix, also called the 4Ps,whichrefers toproduct,price,promotion, andplace. A key component of marketingmanagement is the building of successful brands.Marketing communicators manage a multiplicity of interrelated activities and programsthat work together with other elements of the marketing plan, for the purpose of buildingand sustaining a strong, viable brand. Without marketing communication, brand buildingwould be extremely difficult. Conversely, when marketing communication efforts fittogether perfectly with other elements of the marketing plan, brand meaning is generatedand brand value is created.1-5. Outline the general structure of the marketing industry and identify the keyplayers.The marketing industry is a complex network of professionals. The four categories of keyplayers include 1) marketers, 2) marketing partners, such as advertising and publicrelations agencies, 3) suppliers and vendors, and 4) distributors and retailers.The marketer is any company or organization behind the product, that is, theorganization, company, or manufacturer producing the product and offering it for sale.To marketing communication partners, the company or firm behind the brand is referredto as the client. Most marketers work very closely with partners, such as advertising andpublic relations agencies. The relationship between marketers and their agencies can be acomplicated one because of pressures to cut costs as well as changing strategies andtechnologies, particularly in the digital arena.

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Chapter 1: Strategic Brand Communication13The materials and ingredients used in producing the product or managing a nonprofitagency are obtained from other companies, referred to assuppliersorvendors. Thephrasesupply chainis used to refer to this complex network of suppliers whose productcomponents and ingredients are sold to manufacturers.Thedistribution chainordistributionchannelrefers to the various companies that areinvolved in moving a product from its manufacturer into the hands of its buyers.Suppliers and distributors are also partners in the communication process.1-6. Explain how marketing communication relates to the four key marketingconcepts and to the marketing mix.The four key marketing concepts highlighted in this chapter are the marketing concept,exchange, competitive advantage, and added value. To adhere to the marketing concept,marketers must first determine through research consumer needs and wants. Typically,some form of marketing communication is used to collect consumer feedback so thatmarketers can develop products that respond to those consumer wants and needs thatwere identified. Marketing communication is required to teach consumers about aproduct’s points of differentiation and competitive advantage. The creation of addedvalue is the result of a marketing communication activity that presents the product asmore valuable, useful, or appealing to a consumer. Prior to any economic exchange, acommunication exchange must first occur. Also, some type of marketing communicationis needed to bring the buyer and seller together, which creates the opportunity forcustomer-company interaction.The marketing mix, also called the 4Ps, refers to product, pricing, place (distribution),and promotion strategies. The primary goal of marketing communication is to buildawareness of the new brand, explain how a product works, and illustrate its superiorityover competitors, thereby supporting product strategy. Advertising is often the primaryvehicle for telling the consumer about price, and the meaning of price to the consumeris often dependent upon the context provided by the marketing communication, whichputs the price in perspective. When using direct marketing as a distribution strategy, thesales generation is totally dependent upon the effectiveness of the marketingcommunications within the direct response appeal. Similarly, the effectiveness of pushand pull strategies is dependent upon the effectiveness of marketing communicationefforts directed toward the trade or the consumer. Promotion includes advertising, publicrelations, sales promotion, direct marketing, events and sponsorships, point of sale,digital media, the communication aspects of packaging, as well as personal sales and newforms of online and place-based communication that have emerged recently.1-7. Define integrated marketing communication and explain what integrationcontributes to brand.Integrated marketing communications (IMC)is the practice of coordinating all marketingcommunication messages as well as the messages from the marketing mix decisions.One of the important things that IMC does is send a consistent message about the brand.

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Chapter 1: Strategic Brand Communication14IMC is like a musical score that helps the various instruments play together. The song isthe meaning of the brand. It is still evolving, and both professionals and professors areengaged in defining the field and explaining how it works.Integration means every message is focused and works together, which createssynergy.When the pieces are effectively coordinated, the whole has more impact than the sum ofits parts. A problem arises when the marcom tools are not aligned with other marketingmix communication messages that deliver brand communication. The point is thatmarketing communication is at the center of brand communication, and the effectivenessof the brand communication depends on how well all the pieces are integrated.1-8. Explain how brand meaning and brand value are created and how they relateto brand equity.Brand meaning evolves through the transformation of a product into something uniqueand distinctive and by making a promise that establishes customer expectations of theproduct. The impressions created by the brand’s tangible and intangible features cometogether as a brand concept. Intangibles are very important because they create theemotional bonds people have with their favorite brands, are impossible for thecompetition to copy, and can lend monetary value and legal protection to the brand’sunique identity. Brand identity, positioning, image, and personality are also importantcontributors to a brand’s meaning.Brand value comes in two forms – the value to a consumer and the value to thecorporation. The first is a result of the experiences a customer has had with a brand. Thesecond is a financial measure, which is called brand equity. How much a consumer iswilling to pay for a brand is determined by what it symbolizes to them and theiremotional connection with it. Hence effective branding, in addition to differentiatingproducts, also increases their monetary value. Brand equity is the intangible value of thebrand that stems from relationships with its stakeholders, as well as intellectual property,such as product formulations. When a company is sold, a figure is calculated to determinethe value of its brands.DISCUSSION QUESTIONS1-9. Apple is one of the most recognized brands in the world. How did the companyachieve this distinction? What has the company done in its marketing mix in terms ofproduct, price, distribution, and marketing communication that has created suchtremendous brand equity and loyalty? How have advertising and other forms ofmarketing communication aided in building the brand?Below is a brief summary of key elements of Apple’s marketing strategy, reflecting eachof the 4Ps. Student responses to this question should reflect the key points discussed here.Product Strategy:Apple releases few but highly anticipated high-end products thatreflect innovative technology and sleek design. Steve Jobs’ strategy was to develop andsell brand new, innovative products which blended art and technology in order to provide

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Chapter 1: Strategic Brand Communication15a simple and streamlined user experience.Thisstrategy skyrocketed Apple to theforefront of the smart phone market, making Apple a force to be reckoned with beginningwith their original release of the iPhone in 2007.Promotion:Apple has done a superior job of creating abrand personality and buildingan emotional connection with its customers through marketing communication. Apple’sadvertising has been instrumental in making Apple the iconic brand that it has become.In 1984, Apple created a commercial for the Macintosh that is now regarded as awatershed event in the history of the brand. In later years, Apple’s advertisementsestablished “traits” such as ‘creative’ (for example the “Think Different” campaign inlate 1990s) and “intelligent” (for example, the “Get a Mac” campaign that told viewerswhy Macs were better than PCs). Today, Apple’s advertisements try to highlight qualitiessuch as “hip and cool.”Apple’s logo is an equally significant contributor to success of its brand communicationcampaign. Initially Apple was marketed as “Apple Computer Co.,” with the imagery ofNewton sitting under an apple tree. In 1976, this complex logo was replaced with asimpler but more colorful rainbow “bitten” apple logo. In 1998, the colors weresacrificed in favor of the monochrome logo that we now see on millions of iPods andiPhones. The current logo reflects the minimalist design philosophy that Apple has madeits own.Distribution Strategy:In the late 1990s and early 2000s, Apple, like other consumerelectronics companies, was dependent on big-box retailers to sell its products. While thisstrategy made sure that Apple products were widely available, it gave the company littlecontrol over point-of-sale customer experience as the retailers’ staff was usually nottrained in selling Apple products. To address this problem, Apple launched what itprefers to call as significant stores. These stores, with amazing architecture, are locatedin prime locations of major cities such as New York, London, Paris, Shanghai, etc. Thesales staff that man these stores are trained not to sell. Instead they are asked to respondto customer queries and provide solutions to customers’ problems. In these stores, you’llfind “The Genius Bar,” where specially trained staff offers one-on-one training tocustomers on how they can maximize their use of their Apple products.Pricing Strategy:According to Forbes Magazine, Apple uses a “high price, high marginstrategy.” Some feel that the company’s insistence on this strategy is limiting profitgrowth, since they clearly could sell more phones at a cheaper price. Clearly, this pricingstrategy sends a message to consumers about the product’s quality and status.Sources:http://www.saleschase.com/blog/2012/04/17/how-apples-branding-strategy-made-it-an-icon/#sthash.UXOEvy8f.dpuf by Dave Bui, Travlos, Darcy. "Apple: Product Commoditization?"Forbes. ForbesMagazine, 15 May 2012. Web. 15 Oct. 2012. http://www.forbes.com/sites/darcytravlos/2012/05/15/apple-product-commoditization. “The Cost of Apple’s High Price, High Margin Strategy”, printed in Forbes Magazine website. May6, 2013, Apple’s Innovative Distribution Strategy Revealed,” written by Dave Bui, April 9, 2012.

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Chapter 1: Strategic Brand Communication161-10.When identical products carry different labels, people will pay more for therecognized brand. Explain why that is so.Because it is brand relationships that drive brand value, how much a consumer is willingto pay for a brand is determined by what it symbolizes to them and their emotionalconnection with it. This is especially true for parity products, products with fewdistinguishing features. For these products, impressions created by the brand’s tangibleand intangible features, as well as feelings and emotional attachment to the brand, canbecome a critical point of difference.1-11.List your favorite brands and from that list do the following analyses:a.Think about the categories where it is important to you to buy your favorite brand.For which categories does the brand not make a difference? Why is that so?While student responses will vary, product categories in which branding and associatedbrand meaning play a major role include soft drinks, face soap, toothpaste, children’stoys, athletic shoes, breakfast cereals, etc. It is challenging to think of consumer productcategories in which manufacturer branding does not play a role. A couple of examplesmay be household hardware products such as screws and nails, and some desk supplies,such as paper clips and rubber bands.b.In those categories where you have a favorite brand, what does that brand represent toyou? Is it something that you’ve used and liked? Is it comfortable familiarity – youknow it will be the same every time? Is it a promise – if you use this, something goodwill happen? Is it something you have always dreamed about owning? Why are youloyal to this brand?While student responses will vary, product categories in which branding and associatedbrand meaning play a major role include soft drinks, face soap, toothpaste, children’stoys, athletic shoes, breakfast cereals, etc. It is challenging to think of consumer productcategories in which manufacturer branding does not play a role. A couple of examplesmay be household hardware products such as screws and nails, and some desk supplies,such as paper clips and rubber bands.TAKE-HOME PROJECTS1-12. Portfolio Project:Look through the ads in this textbook or in other publicationsand find an example of an advertisement that you think adds value to a brand and anotherad that you think does not effectively make the brand valuable to consumers. Comparethe two and explain why you evaluated them as you did. Copy both ads and mount themand your analysis in your portfolio.

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Chapter 1: Strategic Brand Communication17Added valuerefers to a strategy that makes the product more useful or appealing to theconsumer, as well as distribution partners. Added value is the reason consumers arewilling to pay more for one brand over its competition. Advertising and other marketingcommunication not only showcase the product’s value but also may add value by makingthe product appear more desirable. This concept should be reflected in (or missing from)ads reflected selected by students.1-13. Mini-Case Analysis:Explain how New Pig’s marketing communication helpssupport and build the brand image. In what ways do the other elements of the marketingmix communicate messages about the New Pig brand?New Pig’s integrated marketing communication strategy used a variety of promotionaltools to send a singular, unified message to its customers about its brand. This company’smarketing communication strategy added tremendous value by transforming a productthat many would consider boring into a brand that was interesting, appealing, and easyto remember. Customers responded enthusiastically to the quirky ‘pig personality’attached to the brand and came to expect a certain amount of fun when dealing with thecompany. A highly creative approach was used to create a brand image that made theproduct line unforgettable.New Pig’s marketing communication strategy readily differientated the brand from itscompetitors, while also creating a meaning for the brand that would be almost impossiblefor others to copy. Because customers had so much fun with the name and remembered itso easily, it’s reasonable to assume that distributors did also, thereby providing a bit ofextra motivation to them to push the brand through its distribution channel. Also, theinterpretation of the brand’s pricing is often put into perspective by consumerperceptions formed from marketing communication, thereby contributing to theconsumer’s acceptance of the price/value proposition that the company is offering.TRACE NORTH AMERICA CASEMulticultural MillennialsRead the Trace case in the Appendix before coming to class.1-14. What aspects of the marketing mix are relevant to a campaign to MulticulturalMillennials (ages 18 – 29)?1-15.Why do you think TRACE would want a campaign directed to MulticulturalMillennials?1-16.Prepare a one-page statement explaining how the “Hard to Explain, Easy toExperience” campaign will actually help TRACE sales among Multicultural Millennials.

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Chapter 1: Strategic Brand Communication18ADDITIONAL MATERIALASSIGNMENTSIndividual Assignments1.Have students select one of their favorite brands. It can be either a product or aservice. Then have them consider what sort of image the brand carries in their minds.How did this image come about, and what was the role of advertising in creating it?Students should share their answers with the class in 2- to 3-minute presentations.To enhance their presentations, students can also pull up their organization’s websiteto show the class.2.Have students identify a brand communication campaign that is designed to appealto each of the four markets identified in Figure 1.1 of the textbook. Compare andcontrast the marketing mix of each to identify strategic similarities and differences.How does each attempt to communicate a point of differentiation and/or competitiveadvantage? Students should share their findings with the class in 8- to 10-minutepresentations. To enhance their presentations, students can also provide brandcommunication images to show the class.Think-Pair-Share1.Have students pair off to interview each other regarding a negative experience theycan recall with a specific brand of product or service. Draw upon the principles ofIMC in this chapter to attempt to determine what went wrong. How did it happen?What contradictory brand messages were conveyed? Was a brand promise violated?What was the result of this breakdown – did the student remain as a customer with thecompany, or was the brand relationship severed? Once the interviews are complete,each student should draft a brief report outlining their findings.2.Many marketers have moved into global markets. The communication strategy forglobal marketing depends in part upon on whether the brand’s messages arestandardized across all markets or localized to accommodate cultural differences.Have students pair off, with one student locating two examples of brands using astandardized strategy and the other student locating two examples of brands using alocalized strategy. As a team, ask the pair to jointly prepare a 10-minute presentationfor the class explaining which strategy was used by the four companies theyidentified and why it was deemed most appropriate.

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Chapter 1: Strategic Brand Communication19OUTSIDE EXAMPLES1.Choose a small business or non-profit organization in your community to visit.Gather as many samples of their marketing efforts as possible and analyze themcarefully. Examples could possibly include brochures, print advertisements, directresponse communication, or a website. Then, present a 10-minute “samples analysis”to your class, commenting on the samples’ strengths, weaknesses, continuity, andbrand messages from a marketing standpoint. Offer suggestions for improvement,if appropriate.2.Explore marketing fundamentals by conducting research to learn about a recent newproduct launch. Describe this new product’s target audience, as well as each of thefour components of its marketing mix. What is the consumer need it is intended to filland what is its competitive advantage? Prepare a discussion for your class thathighlights the new product’s overall marketing strategy and highlights the valueadded by its marcom strategy.

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Chapter 2: Advertising20Chapter 2AdvertisingCHAPTER CONTENTKEY OBJECTIVES1.Describe the practice of advertising.2.Explain the evolution of the key concepts of advertising.3.Identify the key players and jobs within agencies.4.Discuss changes in the practice of advertising.CHAPTER OVERVIEWThis chapter defines advertising, explains its basic functions and key components, definesthe role it plays in our society, and identifies eight different types of advertising that arecommon today. The industry’s evolution is explored, along with the role of theadvertising agency, how they are organized and how they function. The chapterconcludes with a discussion of how the practice of advertising is changing.CHAPTER OUTLINETHE PRACTICE OF ADVERTISINGThe purpose of advertising has always been to sell a product, which can be goods,services, or ideas. Although there have been major changes in recent years, the basicsof advertising remained unchanged even in the face of economic downturns andmedia convulsions.We can summarize a modern view of advertising with the following definition:Advertising is a paid form of persuasive communication that uses mass and interactivemedia to reach broad audiences in order to connect an identified sponsor with buyers(a target audience), provide information about products (goods, services, and ideas),and interpret the product features in terms of the customer’s needs and wants.This definition has a number of elements and the definition is changing because ofnew technology, media shifts, and cultural changes.Advertising is usuallypaidfor by the advertiser who has a product tosell,although some forms of advertising, such as public service announcements(PSAs), use donated space and time.Not only is the message paid for, but thesponsoris identified. TheInside Storyfeature in the text explains how the ‘paid’ characteristic affects regulation.

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Chapter 2: Advertising21Advertising began asone-way communication, from marketer to a targetedaudience. It generally reaches abroad audienceof potential consumers, either as amass audienceor smallertargeted groups. However,direct responseadvertising,especially those practices that involve digital communication, has the ability toaddress individual members of the audience. So, some advertising can deliverone-to-one communication to a large group of people.In traditional advertising, the message is conveyed through different kinds ofmass media,which are largelynon-personalmessages. This non-personalcharacteristic, however, is changing with the introduction of moreinteractivetypes of media.Digital interactive media, such asword-of-mouthconversations on social media orconsumer-generated messages sent to a company, have opened the door tointeresting new forms oftwo-wayandmultiple-waybrand-related communication.A great deal of emphasis is now placed onword-of-mouth, which is now definedas personal communication through new media forms rather than “scriptedmessages in a paid format,” according to agency CEO Richard Edelman.Most advertising has a defined strategy and seeks to inform consumers and makethemawareof a brand, company, or organization. In many cases, it also tries topersuadeor influence consumers to do something. Persuasion may also involveemotionalmessages.A product can be a good, service, or an idea. Nonprofits, for example, use ads to sellmemberships, inform about a cause, or advocate on behalf of its position or point ofview.What are Advertising’s Basic Functions?Identification.Advertising identifies a product and/or the store where it’s sold.Thisgoes back as far as ancient times. Some of the earliest ads were simply signs with thename or graphic image of the type of store – cobbler, grocer, or blacksmith.Information.Advertising provides information about a product.Advances in printingtechnology at the beginning of the Renaissance spurred literacy and brought anexplosion of printed materials in the form of posters, handbills, and newspapers. Theword advertisement first appeared around 1655 and by 1660, publishers were usingthe word as a heading in newspapers for commercial information.

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Chapter 2: Advertising22Persuasion.Advertising persuades people to buy things.The Industrial Revolutionaccelerated social change, as well as mass production. It brought the efficiency ofmachinery not only to the production of goods, but also to their distribution. Forwidespread marketing of products, it became important to have a recognizable brandname. Also, large groups of people needed to know about these goods. P.T. Barnumand patent medicine makers were among the advertising pioneers who movedpromotion from identification and information to a flamboyant version of persuasioncalled “hype” – graphics and language characterized by exaggeration or hyperbole.What are the Key Components of Advertising?Strategy: This is the logic orstrategybehind the advertisement. It is stated throughobjectives that may focus on areas such as sales, news, psychological appeals,emotion, branding and brand reputation, as well as the position and differentiation ofthe product from competition, and segmentation and targeting of the best prospects.Message: This is the concept behind a message and how that message is expressedbased on research and consumer insights, with an emphasis on creativity and artistry.Media:Various media have been used by advertisers over the centuries includingprint, broadcast, outdoor, and now digital media. Targeting ads to prospective buyersis done by matching their profiles to media audiences. Advertising agencycompensation was originally based on the cost of buying time or space in the media.Evaluation:Effectiveness means meeting objectives, and in order to determine if thathas happened, there must be testing. Standards are set by professional organizationsand companies that rate the size and makeup of media audiences, as well asadvertising’s social responsibility.What are the Common Types of Advertising?Different types of advertising play different roles. We can identify eight differenttypes of advertising:1.Brand Advertising,the most visible type of advertising, is also referred to asnational or consumer advertising, focuses on the development of a long-termbrand identity and image.2.Retail Advertising or Local Advertising: This type of advertising focuses onretailers, distributors, or dealers who sell their merchandise in a certaingeographical area. Retail advertising has information about products that areavailable in local stores. The objectives focus on stimulating store traffic andcreating a distinctive image for the retailer. Local advertising can refer to aretailer, such as T.J. Maxx, or a manufacturer or distributor who offers products ina fairly restricted geographic area.

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Chapter 2: Advertising233.Direct-Response Advertisingtries to stimulate an immediate response by thecustomer to the seller. It can use any advertising medium, particularly direct mailor the internet. The consumer can respond by telephone or mail, and the product isdelivered directly to the consumer by mail or some other carrier.4.Business-to-Business Advertising:Business-to-business (B2B) advertising,alsocalledtrade advertising, is sent from one business to another. It includesmessages directed at companies distributing products as well as industrialpurchasers and professionals, such as lawyers and physicians. Advertisers placemost business advertising in professional publications or journals.5.Institutional Advertising, also calledcorporate advertising, focuses onestablishing a corporate identity or winning the public over to the organization’spoint of view. Tobacco companies, for example, run ads that focus on the positivethings they are doing. Ads for a pharmaceutical company showcasing its leukemiatreatment are another example of this type of advertising.6.Nonprofit Advertising: Not-for-profit organizations, such as charities,foundations, associations, hospitals, orchestras, museums, and religiousinstitutions usenonprofit advertisingto reach customers, members, andvolunteers. It is also used to solicit donations and other forms of programparticipation.7.Public ServiceAdvertisingprovides messages on behalf of some good causes,such as stopping drunk driving (as in messages from Mothers Against DrunkDriving) or preventing child abuse. Advertising professionals usually create theseadvertisements, also calledpublic-service announcements (PSAs),pro bono(free of charge) and the media often donate the necessary space and time.8.Specific advertising areas, such as health care, green marketing, agribusiness, andinternational address specific situations or issues and have developed specializedadvertising techniques and agencies.Despite their differences, there are many commonalities among these eight categories.All types of advertising demand creative, original messages that are strategicallysound and well executed, and all are delivered through some form of media.Advertisements can be developed as single ads largely unrelated to other ads by thesame advertiser. Or they can be developed as acampaign, a term that refers to a setof related ads that are variations on the same theme.What Roles Does Advertising Perform?In addition to marketing communication, advertising also has a role in the functioningof the economy and society. This is illustrated in the “1984” commercial thatlaunched the Apple Macintosh. As you read about this commercial in theMatter ofPracticefeature in this chapter, note how it demonstrated all four functions –marketing, communication, social, and economic.

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Chapter 2: Advertising24Marketing Communication RoleIn its marketing communication role, advertising provides information about aproduct. It can also transform a product into a distinctive brand by creating abrandimageand personality that goes beyond straightforward product features. Advertisingalso creates consumer brand awareness and demand and makes statements that reflectsocial issues and trends.Branded entertainmentandbrand contentare similar terms used to emphasize therecent trend in building brand relationships. These terms highlight the ability of brandmessage to inspire, engage, and develop long-term brand relationships.Economic and Societal RolesAdvertising flourishes in societies that enjoy economic abundance, in which supplyexceeds demand. In such societies, advertising extends beyond a primarilyinformational role to create a demand for a particular brand. Creatingbuzz –gettingpeople to talk about the brand – has become an important goal of marketingcommunication in this era of social media.Most economists presume that because it reaches large groups of potential consumers,advertising brings cost efficiencies to marketing, and thus, lowers prices toconsumers. As demand grows, as well as competition, prices begin to drop.Two contrasting points of view explain how advertising creates economic impact.In the first, the rational view, advertising is seen as a vehicle for helping consumersassess value through price cues and other information, such as quality, location, andreputation. Advocates of the first viewpoint see the role of advertising as a means toobjectively provide price/value information, thereby creating morerational economicdecisions.The second approach appeals to consumers making a decision onnon-price, emotional appeals.This type of advertising is believed to be so persuasive thatit decreases the likelihood a consumer will switch to an alternative product, regardlessof the price charged.Advertising mirrors fashion and design trends, thereby adding to our aesthetic sense.It also has an educational role in that it teaches us about new products. It may alsoexpose social issues and help us shape an image of ourselves by setting up rolemodels with which we can identify. It also presents images that capture the diversityof the world in which we live. These social roles have both negative and positivedimensions.EVOLUTION OF THE KEY CONCEPTS OF ADVERTISINGAs illustrated in Figure 2.2 in the textbook, the advertising industry is dynamic and isaffected by changes in technology, media, and the economic and social environment.This timeline reflects how the principles and practices of this multi-billion dollar industryhas evolved.

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Chapter 2: Advertising25The Early Age of PrintIndustrialization and mechanized printing spurred literacy, which encouragedbusinesses to advertise beyond just their local places of business. Ads from theseearly years look like what we callclassified advertisingtoday. Their objective was toidentify products anddeliver information about them, including where they werebeing sold.The primary medium of this age wasprint, particularly newspapers,although handbills, posters, and hand-painted signs were also important.The Early Age of AgenciesThe 19thcentury introduced the beginning of what we now recognize as theadvertising industry. During this era, the first ad agency was opened in 1848 inPhiladelphia and P.T. Barnum embarked on one of the firstcampaigns. Thecommission systemfor placing ads was begun and theaccount executive positionwascreated.As advertisers and marketers became more concerned about ads that worked,professionalism in advertising began to take shape. This is also when it becameimportant to have a definition or a theory of advertising.On the retail side, department store owner John Wanamaker hired a full-timecopywriter. Also, the newly founded McCann agency developed a philosophy thatemphasized the agency’s role in crafting the ad message, and the industry’s first tradepublication appeared in 1888.By the end of the 19thcentury advertisers began to give their goodsbrand names.The purpose of advertising during this period was to create demand, as well as avisual identity for these new brands. Inexpensive brand name products, known aspacked goods, began to fill the shelves of grocers and drug stores. The questionableethics of hype andpufferycame to a head in 1892.In Europe, the visual quality of advertising improved dramatically as artists who alsowereillustratorsbrought their craftsmanship to posters and print ads, as well asmagazine illustrations. Because of the artistry, this period is known asThe GoldenAge. The artist role moved beyond illustration to become the art director in 20thcentury advertising.The Scientific EraIn the early 1900s, professionalism in advertising was reflected by the beginnings of aprofessional organization, which was officially named the American Association ofAdvertising Agencies in 1917.In the early 20thcentury, modern professional advertising adopted scientificresearchtechniques. Advertisers believed they could improve advertising by blending scienceand art. During the 1930s and 1940s, Daniel Starch, A.C. Nielsen, and George Gallupfounded research organizations that are still a part of today’s advertising industry.

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Chapter 2: Advertising26Targeting, the idea that messages should be directed at particular groups ofprospective buyers, evolved as media become more complex. In 1914, the AuditBureau of Circulation (ABC) was formed to standardize the definition of paidcirculation for magazines and newspapers. Media changes saw print being challengedby radio advertising in 1922. Radio surpassed print in ad revenue in 1938.The world of advertising agencies developed rapidly after World War II, led by theJ. Walter Thompson agency. The agency’s success was due largely to its creativecopy and the management style of the husband and wife team of Stanley and HelenResor, who introduced quite a few of the advertising concepts and practices still withus today.Television commercials came on the scene in the early 1950s and brought a huge newrevenue stream to the advertising industry. In 1952 the Nielsen rating system for TVadvertising became the primary way to measure the reach of TV commercials. Thisperiod also saw marketing practices, such asproduct differentiationandmarketsegmentation,incorporated into advertising. The idea ofpositioningwas developedin 1969.The Creative RevolutionThe creative power of agencies exploded in the 1960s and 1970s, a period marked bythe resurgence of art, inspiration, and intuition. Largely in response to the previousemphasis on research and science, this revolution was inspired by three creativegeniuses: Leo Burnett, David Ogilvy, and William Bernbach.Leo Burnett was the leader of what became known as theChicago School ofAdvertising.He believed in findinginherent dramain every product.The Era of Accountability and IntegrationStarting in the 1970s, the industry-wide focus was oneffectiveness.Clients wantedads that produced sales, so the emphasis was on research, testing, and measurement.To be accountable, agencies and other marketing communication agencies recognizedthat their work had to prove its value. The economic downtown and dotcom crashtoward the end of the 20thcentury reinforced this imperative. Advertisers nowdemanded proof that their advertisements accomplished itsobjectivesas stated in thestrategy.Social responsibilityis also another aspect of accountability. In 1971 the NationalAdvertising Review Board was created to monitor questions oftaste and socialresponsibility.As thedigital erabrought nearly instantaneous means ofcommunication spreading word-of-mouth among a social network of consumers,companies became even more concerned about their practices and brand or corporatereputation. At the same time,consumers became even more concerned aboutbusinessethics.

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Chapter 2: Advertising27This is also the era when integrated marketing communication became important.Integrated marketing communication(IMC) is another technique that managersbegan to adopt in the 1980s as a way to better coordinate their brand communication.Integration and consistency makes marketing communication more efficient and thusmore financially accountable.The Social Media EraAdvertising and marketing communication practices have been turned upside down inthe years since 2008. Digital and online communication became important earlier inthe new century with brands and companies setting up websites and experimentingwith online advertising worldwide. With the launch of Facebook, Twitter, YouTubeand other vehicles for sharing thoughts, photos, and videos, the structure of consumercommunication has been radically altered.THE ADVERTISING WORLDWho Are the Key Players?As we discuss the organization of the industry, consider that all of the key playersalso represent job opportunities you may wish to consider. The players include theadvertiser, the agency, the media, and suppliers who provide expertise.TheA Matter of Practicefeature about ‘1984,’ the greatest commercial ever made,introduced a number of these key payers and illustrated how they all make differentcontributions to the final advertising. Another way to get a peek into the field isthrough the lens of television, such as the showMad Men. TheA Matter of Principlefeature in this chapter explains how Bruce Vanden Bergh analyzed the culturalrelevance of this popular award-winning drama.The OrganizationAdvertising begins with the organization behind the promotion message, or theadvertiser.The advertiser is the number one key player. Management of advertisingfunction usually lies with the organization’s marketing or advertising department.The list of top advertisers in the United States usually begins with Procter andGamble (P&G). Other leaders that appear on that list vary from year to year.Most advertisers have an executive or a department that initiates the advertising effortby identifying a marketing problem that advertising can solve. The marketingexecutive hires the advertising agency and other marketing communication agenciesas needed. In professional jargon, the advertiser becomes the agency’sclient.As theclient, the advertiser is responsible for monitoring the work and paying the agency forits work on the account.The client’s marketing team, sometimes including the agency account people, makesthe final decisions about strategy, including the target audience and the size of the

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Chapter 2: Advertising28advertising budget. The client team approves the advertising or marketingcommunication plan, which contains details outlining the message and mediastrategies.Although big companies may have hundreds of agencies working for them, theynormally have anagency-of-recordthat does most of their business and may evenmanage or coordinate the work of other agencies.The AgencyThe second player is theadvertisingagency that creates, produces, and distributesthe messages. The working arrangement is known as theagency-client partnership.An advertiser uses an outside agency because it believes the agency will be moreefficient in creating advertising messages than the advertiser would be on its own.Not all advertising professionals work in agencies. Large advertisers, eithercompanies or organizations, manage the advertising process either by setting up anadvertising department(sometimes calledmarketing services) that oversees thework of agencies or by setting up their own in-house agency, as we see in Figure 2.3.The MediaThe third player in the advertising world is the media. The emergence of mass mediahas been a central factor in the development of advertising because mass media offersa way to reach a widespread audience. In traditional advertising, the termmediarefers to all ofthe channels of communication that carry the message from theadvertiser to the audience and from consumers back to the company.We refer to these media aschannelsbecause they deliver messages, but they are alsocompanies, such as your local newspaper or radio station. Some of those mediaconglomerates are huge, such as Time Warner and Viacom.Media vehiclesare thespecific programs, such as60 MinutesorThe Simpsons, or magazines such asAdvertising AgeorWoman’s Day.Also, note thatmediais plural when it refers to various channels, but singular—medium—when it refers to only one form, such as a newspaper.Each medium has a department that is responsible for selling ad space or time. Thesedepartments specialize in assisting advertisers in comparing the effectiveness ofvarious media as they try to select the best mix of media to use.The primary advantage of advertising’s use ofmass mediais that the costs to buytime in broadcast media, space in print media, and time and space in digital media arespread over the tremendous number of people that these media reach. One of thebiggest advantages of mass-media advertising is that it can reach a lot of people witha single message in a very cost-efficient form.An important principle to remember is that advertising is most cost efficient when ituses mass media to reach large numbers of prospective consumers.

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Chapter 2: Advertising29Professional Suppliers and ConsultantsThe fourth player in the world of advertising includes artists, writers, photographers,directors, producers, and printers as well as self-employed freelancers andconsultants. In addition, there are freelance copywriters and graphic artists,songwriters, printers, market researchers, direct-mail production houses,telemarketers, and public relations consultants.The Inside Storyfeature in thischapter highlights the career of a freelance creative director.This array of suppliers mirrors the variety of tasks required to put together an ad.Why would the other advertising players hire an outside supplier? There are manyreasons. The advertiser or the agency may not have expertise in specialized areas,their people may be overloaded with work, or they may want a fresh perspective.In the new world of digital media, another type of supplier has emerged, and that isthe consumers who supplyuser-generated content.Types of AgenciesWe are primarily concerned with advertising agencies in this chapter, but other areassuch as public relations, direct marketing, sales promotion, and internet marketinghave agencies that provide specialized promotional help, as well.The A-List awards byAdvertising Agerecognize cutting-edge agencies that rank highin three areas – they are creative, fast growing, and their work is effective. A briefdescription of the top ten agencies on the A-List can be found in the textbook.In addition to agencies that specialize in advertising and other areas of marketingcommunication, there are also consulting firms in marketing research and brandingthat offer specialized services to other agencies, as well as advertisers.Full-Service AgenciesAfull-service agency includes four major staff functions — account management,creative services, media planning, and account planning, which includes research.A full-service advertising agency also has its own finance and accountingdepartment, atraffic departmentto handle internal tracking on completion ofprojects, a department for broadcast and print production, and a human resourcesdepartment.In-House AgenciesAn in-house agency produces ads and places them in the media, also. The differenceis that the agency is a part of the advertiser’s organization, rather than an outsidecompany. Companies that need closer control over their advertising have their owninternal agencies.

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