Advertising and Its Drivers - Essay Example

Advertising and Its Drivers Coca-cola, Kellogg's, McDonald's, Kodak, Marlboro, IBM, American Express, Sony, Mercedes-Benz and Nescafe are generally in the world's top ten brands in the market , and they have reached and retained in such position mainly because of the efforts of marketing and advertising departments ( Stanley, 2003). So exactly what is an advertisement or what can we understand by the term advertisement. Their have been different views regarding the concept of advertisement. According to John Burnett, "Advertisement is a non-personal communication of marketing related information to a target audience, usually paid by the advertiser and delivered through mass media in order to reach specific objective of sponsor". However according to the critic of advertising, Judith Williamson (1978, p.57) states that it's "the most ubiquitous form in which we encounter commercial photography" which means advertising is the 'official art' of the advanced industrial nation of the west. (Hackley, 2005) It occupies the newspapers and is covered all over with urban environment, it is highly systematize organization involving many artist, writer and film directors, and consist of a large amount of output of the mass media. Advertisements promote and affect the idea and value which are crucial to a particular economy system. Thus a good advertisement is that, which we should not lose interest in their ideological functions, which is connected to their economic functions (Dyer, 1995 p.2). Another definition by (Longman, 1971) 'Advertising attempts to inform and persuade a large number of people with a single communication'. Therefore in its simple sense the word 'advertising' means capturing the attention to something or telling or advising somebody of something. (Dyer, 1995 p.2). Thus advertising can be seen as a medium for communicating or providing knowledge to the customers from a recognized authority or person. This range of activities also qualifies as marketing communication or marcoms. KEY DRIVERS OF MARCOMS ACTIVITIES Perception: Creating Shopping Power When something has been perceived, then it has been noted and the message is recorded. In the words of psychologist, W. H. Ittelson and F. T. Kilpatrick, perception can't be definite, of 'what is'. Rather what we perceive is created by ourselves, which is mostly based on past experiences (Bogart, 1995). Also people's perceptions of brand are governed by some factors which are personal and public (Fletcher, 1999 p.163). It is one of important challenges for an advertiser trying to reach the customers, either by any form of mass communication like newspaper, or television ad so that they could notice it. Even sometimes the consumer miss out some messages directed to them. So the main thing is to give them exposure. (Wells, Burnett and Moriarty1992, p. 241). For example if all the ads are in colors then a black and white will be noticed, which is what Chanel did with their Nicole Kidman glossy ad for Chanel Perfume which would be place at the back cover of magazines like Cosmopolitan so as to give covert instead of ostensive communication. So by this the customers attention can be taken. (Hackley, 2005) This can be seen in the use of a ground breaking issue to position an advertisement. An example of this may be found in the 'Torches of Liberty Contingent' campaign aimed at expanding cigarette sales manifold by encouraging women to smoke. This campaign was launched and executed by Bernays in 1929. He was inspired by Sigmund Freud's view that actions are crystallised by the subconscious motivations. Another line of thought that he followed was based on the theory of psychoanalyst Brill, who held that women equated smoking as an expression of their freedom. Bernays campaign prompted women to start smoking during the Easter Day parade of 1929. While this enjoyed mixed reactions and extensive media reactions, the combination of liberation and democracy - both of which were emerging trends of the time - helped Barnays earn a place in history besides increasing sales manifold. He was rewarded by George Washington Hill, the President of the American Tobacco Company. (Hackley, 2005) It may be noted that this campaign has a high play of ethics in the context of PR. The women's rights and feminist issues of the time fuelled this 'movement' of sorts with a focus on setting new trends as far as women ethics were concerned. In this case, ethics have been used very effectively to portray a picture of the times that the women had wanted to usher in. (Hackley, 2005) Awareness: Awareness implies that the message has made an impression on the audience or reader, who can then identify the product or the advertiser. Although awareness is a low form of impact, but it is objective of a great ad. Relative low level of attention can create minimum awareness for low interest product (Wells, Burnett and Moriarty, 1992, p. 244). ATL or Above the Line advertising is a technique that is commonly used when trying to build a brand on the basis of mass appeal. This can be seen in examples like Coca Cola, Pepsi, Nokia and others. ATL Technique: Brand Positioning through Market Segmentation and Targeting Marketing in above the line advertising is an arena where the basic norm is to promote visibility. Visibility, in turn, depends on positioning which again depends on branding and the equity commanded by the same. (Aaker, 1991) This has promoted advertising agencies the world over to study and implement strategies that will accentuate brand equity as this is the greatest indicator of, and the base for, the calculation of returns on investment. While the consumer's awareness of a brand, and the reasons for choosing an associated product may depend on various factors including peer reference, peer approval, or other social factors beyond the direct control of the brand's investor, the brand's marketing mix is definitely within the investor's control, and something that demands big budget investment. Therefore, investor's and researchers are always concerned about the actual effects and results of marketing components including advertisement, sales promotions, and company emblems - upon the consumer's perception and their consequence upon brand equity. In the last decade, a lot of research has been dedicated to conceptualizing and measuring customer-based brand equity. (Hackley, 2005) However, apart from putting forth various influencing factors, no integrative framework has so far been developed to account for the complex psychological processes underlying the formation of customer-based brand equity. In this context, this paper attempts to propose such a framework by drawing on the theory of the Elaboration Likelihood Model. (Kotler, 1997) This simple reason as to why ATL marketing is not used at all, or not used beyond the launch of a product, by popular brands is that these brands need to retain exclusivity in terms of the outreach and target audience that they are catering to. This generally implies a younger crowd which is constantly on the lookout for things that define their personalities in the most unique way, and in ways that they will not find anywhere else. The branding and positioning of a high end lifestyle product like the Apple Phone which is not just another mobile phone - is of utmost importance to give its market value a lift. The Apple phone was launched on the 29th of June, 2007 by Apple Inc and a higher version of the same model made its way into the hearts and minds of the consumers during July, 2008 amid widespread media coverage the world over. In 2007, it sold between 500,000 and 1 million phones within two days of its launch. (Srinivas, 2008) Brand equity: This is a very important concept from 1990s. This refers to the use of respected brand name to add value to the product. Branding is a way to help the customer's memory process. It identifies the product and makes it possible to position the product in compared to other brands. For example Walt Disney Company discovered that any kind of Disney film would be perceived as targeted to a young audience. So rather than looking for a way to expand the Disney name to film targeted at audience, so Disney launched Touchstone Films (Wells, Burnett and Moriarty, 1992, p. 256). This can be seen in the Jonas Brothers and Miley Cyrus' advertisements for glossy magazines where the celebrities have been used as the focal point with screaming fans around them. Brand Positioning - Match Up Hypothesis Celebrity endorsements render a certain level of unique appeal which in turn facilitates brand association. (Moore, 2005) This kind of association comes from the strategic positioning of the brand by brining in a celebrity to endorse the same. To begin with, it is imperative to define brand positioning. Brand positioning is the process of defining the following dimensions associated with a product: Target audience Competitors Unique selling points of the product in question Through the definition of these factors, the producer focuses on the basic criteria that are being met in each case. The target audience is a market that has a particular demand as regards features of the product. (Moore, 2005) The producer studies the similar products being sold in the market by his or her competitors and tries to find the scope for creation of a product which will have the features that are lacking. This becomes the unique selling point of the product and ensures competitive advantage. In this context, brand positioning may be described from the perspective of match up hypothesis as far as celebrity endorsements are concerned. (Hackley, 2005) It has already been established that a brand fits into various market segments as well as sensibilities of the end users, through the use of appropriate positioning. Celebrity endorsements are a crucial part of this 'fit'. Match Up Hypothesis is the function of the influence of the celebrity on the brand image and the message that is being conveyed through the use of the celebrity. (Moore, 2005). Therefore, it is of great importance to use a celebrity for causes that will support credibility and a certain amount of positive affiliation from the viewer's perspective, as far as the brand is concerned. This is the main objective of match up hypothesis in case of brand positioning where celevrity endorsements are concerned. This can be seen in the case of Aishwarya Rai, former Miss World, promoting L'Oreal Products in glossy ads which feature on the first page of any magazine. This buoyed sales to a great degree and presented an icon for the brand. Millions of women the world over found themselves drawn to L'Oreal products in search of beauty like hers. This is a part of the attractiveness theory that helps a person affiliate with a product based on the person who is endorsing it. (Moore, 2005) Positioning: The way the company designs their offerings and image to occupy a distinctive place in the mind of the target market (Kotler). For example, for many years during the 1970s and also in 80s the Tesco supermarket chain in the UK portrait itself as low price store, whereas Sainsbury's (with a similar range of pricing) stressed quality and value for money ( Wilmshurst). Case Studies Case 1: In the case of Tesco, it is necessary to comprehend that this is an organisation that sells fast moving goods. This company needs to shift its strategy from mass marketing to product variety market and then to target marketing so as to cater to the growing market for its books and other related products. Its strategy can be studied under the elaboration likelihood model as it wanted to be a forerunner in the market where soft drink brands were emerging with each passing day. The choice of the Elaboration likelihood Model was one that came directly from the consumer oriented characteristics of brand equity and brand knowledge in below the line segmentation and differentiation. Elaboration Likelihood Model identified message relevance as one of these factors. According to this model, when message relevance is high, individuals will actively process and evaluate the information in the advertisement when forming or changing attitudes. (Aaker, 1991) When message relevance is low, individuals will not actively process the information in the advertisement, but will instead rely on peripheral message cues to form or change attitudes. Segmentation ad differentiation are those elements of customer perception and awareness which has its focus in the results of a certain kind of projection through the brand equity building measures. This calls for an integrative model which will combine the basic elements of the brand identity and brand equity concepts so as to create a platform for the effective discussion of the Elaboration Likelihood Model. Case 2: Sainsbury is a more service oriented organisation that also sells various products in order to complement the treatment available within the organisation. This defines the area of operation as one that survives in the retail industry. Therefore, there is a need to integrate methods of research and development in order to carry out effective below the line promotions. This can be done in a better way through the use of an integrative model. An integrative model will serve the following purpose: - provide as detailed summation of the various factors that influence the end user to add to the brand equity; and - study these factors in context of the psychological process taking place in the mind of the consumer as he is exposed to advertisements and other brand identity elements. (Walter et al, 1988) Theories of Advertising As compared to Pavlov's theory of classical conditioning, advertising was thus seen as a stimulus, giving rise to a response. Therefore a set of consumer responses that shifts from consumer initial awareness to final action. The series of steps is called a hierarchy of effects (Hackley, 2005). AIDA model AIDA is one of the oldest advertising models. It suggest that an effective advertisements is one which can command attention, then leads to interest in the product, after that a desire to own and use the product arouses and final step must be the action (Hackley, 2005). THE AIDA MODEL Source: White R., 1993 This model ruled the advertising world for many numbers of years. It's still very difficult to check how the process works as some customers take actions some did not. But sales were the only real measures to confirm the effectiveness of an advertisement (White, 1993). Retail Advertising The purpose of retail advertising is to favourably influence the consumer perception and image about the store, its merchandise and its activities and to persuade sales directly or indirectly. For the retailer to be effective, it is important for the consumer to have sufficient knowledge about the retailer sector. Finally it is not only important to inform and persuade the customer about the retailer's product but it is also necessary to remind about the offer to consumer (Lewison, 1994). Two other companies that have followed this kind of a strategy with a focus on the ELM theory are Pepsi and Nokia. These two brands also started out with the strategy of mass marketing before moving onto product variation and then to the arena of target market. Both these brands have created market segmentation through their brand positioning strategy so as to achieve an up market status, especially in developing countries like India. (Walter et al, 1988) While Pepsi started with mass marketing, it did more specific target marketing and market segmentation through the launch of its products like Diet Pepsi which was aimed at weight watchers. This started in America as there are a majority of obese people in this country. This helped in a psychographics segmentation of the market in terms of emotionally reaching out to people. (Hackley, 2005) Nokia on its part, developed a more socio economic strategy that aimed at various market segments in various ways. This adhered basically to its marketing communication technicalities. After following the trend of mass marketing, Nokia withdrew a lot of its models from the market and came up with less and more exclusive models. It lay its focus on presenting the newest technology that will suit all kinds of people - irrespective of age, sex, social background and economic standing. These changes were done after 2004 so as to retain its position as a market leader and evolve in its role as a market leader in the face of rising competition. (Hackley, 2005) Green Advertising: Rising Trend Green branding is a concept that emanates from the theory of sustainable development as well as globalisation and international marketing. The angle of international marketing is an important one as green branding helps form a brand equity for entire organisations, range of products as well as travel destinations through its focus on the aspect of environmental friendly practices. (Foxall, 2005) It has been seen in the very recent past that many organisations the world over are turning to green marketing. There are numerous examples of this as noted by Fortune Magazine, as follows: Honda: This organisation embraced green and environmentally friendly practices as far as emission and fuel economy of their automobiles is concerned with the Civic GX as well as the hydrogen fuel cell called "FCX". It may be seen that since its foray into green marketing, the brand image of Honda has improved for the positive by leaps and bounds since it has achieved 5% of its goal for emission depreciation between 2000 and 2005. Continental Airlines: British Airways has come up with a "CO2 emission calculator" that will help keep a lid on emissions that end up polluting the air. This has helped in garnering more public support for the airline as it has introduced a staff of 13 environmentalists who ensure that it keeps up its green practices. Suncor: A Canadian company by birth, this organisation has reached the highest quarters of green branding by finding its name on the sustainability index of the Dow Jones, following its environmental and green house gas management systems that are the core of its operational sphere. Tesco: This company has been one of the foremost in the race towards green practices, and this has helped it marketing strategy. Tesco has stuck to environmental friendly practices through the use of wind powered stores, high tech recycling measures, as well as bio diesel delivery trucks. (Source: www.cnnmoney.com) References HACKLEY, C. 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