Learning goals: Understand the purpose of advertising Understand how different types of media are used Understand how media costs are calculated
Purpose of advertising: • To present its message so well that the customer will buy the product or accept the idea presented. • Gives people the information needed about a product. • Way of pre-selling a product
Promotional advertising- advertising designed to increase sales. • creates an interest • introduces new products • explains a product • supports personal selling efforts • creates new markets
Institutional advertising-attempts to create a favorable impression for a business or an organization. Ex. Environment, public health, education.
Primary focuses on the product and its uses Secondary focuses on a specific brand Product promotion: Convinces potential customers to buy products
Media- agencies , means, or instruments used to convey messages. TYPES OF MEDIA • Print • Broadcast • Online • Specialty
Advantages Newspapers have a large readership and a high level of reader involvement. They have a known circulation, so businesses using newspapers can target their specific market. Cost is relatively low. Newspapers are timely, and advertisers can easily change ads. Disadvantages Wasted circulation ( papers being sent outside of the target market). Life of the advertisement is limited. Papers are thrown away daily. The quality of reproduction is poor. Usually black- and –white. Newspaper Advertising
Think of two advantages (things) that make magazine ads a primary choice of advertisers.
Advantages Businesses can target their audiences because the circulation of their readers is known. Magazines are normally read slower. Print quality is good. Have a longer life span and are often reread. Disadvantages Magazines have less mass appeal geographically. More expensive than newspaper. Not as timely. Usually once a month. Magazine advertisements:
Advantages advertiser can be highly selective on who will receive the mailer. Advertiser can be sensitive Has a wide variety of sizes and formats to choose from. Advertiser can use coupons or other incentives to get customers to try the product. Customers can order from catalogues directly from home making purchases convenient. Disadvantages There are a low number of responses compared to the amount of material sent out. It is very costly. Must pay for printing, sending through the mail, mailing lists. Many people consider direct mail to be junk mail. Direct-mail (e-mail) Advertising:Sent through the mail to the prospect. (Direct mail sells over 80 billion in goods and services for advertisers. Ex. Coupons, samples, catalogues, circulars.
Standard outdoor signs- placed near highly traveled roads and freeways. Posters – pre-printed sheets put up like wallpaper on outdoor billboards and re changed three of four times a year. Painted bulletins – painted billboards that are changed every 6 months to a year. Spectaculars – outdoor advertising signs that use lights or moving parts. (Las Vegas) Nonstandard- used by local firms at their place of business. Outdoor MediaThe use of outdoor signs or billboards for advertising.
Advantages Relatively inexpensive. Found in over 90% of American households. Usually kept for at least a year when they are replaced. Disadvantage Advertisements can’t be changed until the next year. Directory (online) AdvertisingAdvertisements placed in alphabetical listings of businesses. (Yellow pages)
Advantages Reaches a large audience. Economical Has a defined market (usually urban). Disadvantages Often unavailable in smaller towns. Subject to defacement. It is restricted to certain travel destinations. Transit AdvertisingUses public transportation facilities to bring advertising to people. (Printed posters found in commuter trains, exterior posters on buses or taxis, stationed posters found near subways and in airports.
BROADCAST MEDIARadio and television advertisements. The average person who lives 70 years will spend 10 years watching T.V.
Radio Advertising:it is estimated that radio reaches 96% of all people ages 12 and over. Best time for advertising is in the morning and in the evening.
Television Advertisements: The ultimate advertising for most because it can communicate a message with sound, action, and color.
SPECIALTY MEDIARelatively inexpensive, useful items with an advertisers name on them. ex. Coffee mugs, hats, key chains.
OTHER ADVERTISING MEDIABlimps, sky writing, airplanes pulling banners.
MEDIA COSTSThe cost for advertising in newspapers, magazines, radio, online, and television. • Newspaper rates: classified & display • Classified: pay a set rate for the ad • Display: By the column inch (# of inches x # of columns) x rate = cost of the ad 4 x 3 x $17 = $204
Magazine rates: • Bleed • Spread • Premium position • Frequency discounts
*Radio rates: • -Network radio adv. – broadcast from a studio to all affiliated radio across the country. • -National spot radio adv.- used by national firms to advertise on a station-by-station basis. • - Local radio adv. – used by local businesses for its target market. • - $ is determined by station and times of advertising. • -spot radio- refers to the geographical location an advertiser wants to reach. • -spot commercials- advertising commercials of one minute or less.
Television Rates: • * Rates vary with the time of day and programs. -prime time hours are (7-11 p.m. ) known as class AA time. -Less expensive classes A, B, C, D.
COST PER THOUSAND (CPM) • The cost of exposing 1,000 readers to an ad. cost of the ad x 1,000 circulation (audience) = CPM
CPM • Cost of the ad = $500 • Circulation is =500,000 $500 x 1,000 500,000 = $1 per 1,000 readers