Above-The-Line and Below-The-Line Advertising, Are they still Relevant - Essay Example

Above-The-Line and Below-The-Line Advertising, Are they still Relevant? Info Above-The-Line and Below-The-Line Advertising, Are they still Relevant? Promotion involves all kinds of marketing communication activities, from defining communication objectives and target audience, to selecting communication channels, and identifying the size of communication budget (Muller, Florian, and Daniel, 2011, p. 4).Traditionally, promotional activities are divided into above-the-line (ATL) and below-the-line (BTL). Mass media advertising through television, newspapers, radio, cinema, and outdoor advertising are above-the-line or ATL. All new communication tools are regarded as below-the-line or BTL measures (Muller, Florian, and Daniel, 2011, p. 4). Advertising is the most critical communication tool in the marketing mix (Meffert, Burmann, and Kirchgeorg, 2008).The terms ATL and BTL advertising came from agencies balance sheets where different types of media are listed. Agency received a commission for ATL activities from media, while a separate fee is taken for BTL activities (Brierley, 2005, p.42). Despite its history, the division is fading as marketers prefer a 3600 approach for their marketing activities today. This paper explores the terms above-the-line and below-the-line and their relevance, and identifies that the division is irrelevant when it comes to todays marketing practices. Above The Line Advertising Right from the early days, advertising activities are classified as: above-the-line (ATL) or below-the-line (BTL). Generally, mass media advertising is considered to be above the line advertising. It is conducted through television, newspapers, radio, and internet (Gaerig, 2012). Most common types of above-the-line (ATL) advertising include: television and radio commercials, display advertising in mass media, classified advertising (newspaper and yellow pages), and billboard advertising. Major objective of ATL advertising is to build a brand (Gaerig, 2012, p.8). Below The Line Advertising There is no standard definition of below-the-line (BTL) advertising; however, it can be defined as a form of advertising that provides tactical incentives to buy a certain product or service, for instance, a product sample or coupon.BTL advertising methods include: price promotions and discounting, gift with purchase, loyalty incentives, coupons, prizes, competitions, monetary refunds, and point-of-sale display.BTL advertising is also considered to be "out of home" advertising or "direct marketing". Direct marketing, such as, direct mail, yellow pages, and telemarketing has been incorporated in the advertising expenses from past several years (Gaerig, 2012, p. 9). Smith and Jonathan (2004) argue that BTL is every other (than advertising) communication tool excluding sales force. Sales force is not included in either category. Most often, BTL refers to sales promotion and public relations (p.23). According to Winterberry Groups report (2006) on tracking the trends, ATL advertising includes traditional marketing channels targeted for mass audience. It includes message that reinforces: brand, general information about product or service, or stimulate an emotional response. On the other hand, BTL advertising initiatives work like traditional direct marketing efforts. They aim to establish targeted relationship between individual consumer and marketer. It also offers a comparable simplicity in measurements.ATL includes the measurable media (TV, radio, print, outdoor, and yellow pages) while BTL includes direct mail, direct response print, event marketing, direct response broadcast, and promotional and interactive marketing. The Line and its Relevance The concept of "line" originated from advertising accountancy during 1950s. It seems that marketing industry has always been discussed and distinguished by "the line. Both marketers and agencies are categorized on the basis of their expertise in either above-the-line or below-the-line advertising. Most often, marketers dont realize the origin and reasons of this division (Ells and Chris, 2010, p.3). Agencies divided advertising activities in above and below the line due to different forms on income generated. They earned commission on above the line and fees on below the line advertising activities. In contemporary world, the dividing line is eroding since agencies are more inclined to a fee-based earning. It started fading when some marketing experts started seeing direct marketing as through the line. Moreover, advertorial is also compensated for out of PR budget (BTL) because it is written from a journalistic perspective rather than advertising copywriters perspective. However, it is paid for the space that is paid for like an advertising space (ATL) (Smith and Jonathan, 2004, p. 23). ADMAs Multi Channel Acquisition Council challenges this outdated perception. ADMA identifies that all mediums have become direct now, therefore, they are all for acquisition (cited in Ells and Chris, 2010, p.5).ADMA defines direct marketing as, "any marketing communication that actively solicits and produces a tangible and measurable response"(cited in Ells and Chris, 2010, p.5). It is a broad definition that entitles all mediums as capable of acquisition through direct marketing. According to Garrison (n.d), despite the division, no one has an exact idea of where the line exists. Every marketer has an opinion about the amount they must be spending on both ATL and BTL. They consider ATL for image communication and BTL for selling. Therefore, in recent times, BTL is getting comparatively more funding for wrong reasons. In fact, the line is a carry-over from the time when agencies derive revenue from commissions. In the mid-90s, when agencies were refused for 15% commission rate, the ATL and BTL division became irrelevant, or at least, it should have been. Surprisingly, this commission system became ancient before internet was fully utilized as an advertising medium. Therefore, it is unclear that whether internet is ATL or BTL medium. Regardless of its historical context, the concept of line is completely irrelevant in terms of contemporary marketing activities (pp.1-2). Supporters may argue that in recent times, ATL and BTL advertising is about delineation between image and promotional advertising. Nevertheless, it is still a bad idea. Since customers mind (unlike advertiser) doesnt distinguish between image and promotional communication, the only thing he/she is connected to is, "brand value". Brand value offers a combination of price and benefits. It works the best when communication is effortlessly executed in inside and outside selling environment. If the division is crucial for more focused communication, we must separate advertising activities on the basis of inside or outside selling environment (Garrison, n.d.pp.2-3). Multi-channel marketing strategist, Maloney (2009) believes that due to continuous technological advancement, all of the mediums once considered as mass or ATL are changing, and the change is fast. In other words, all forms of media are becoming direct because marketers always aim for more accountability and less expenditure, and new technology has the potential to deliver that. It implies that no line exists for marketing industry. Direct Online Advertising Through behavioral targeting, marketers identify customers with specific surfing patterns as they are highly likely to respond to a specific offer (Ells and Chris, 2010).According to Jupiter Research, 65% of online shoppers expressed their inclination towards behaviorally target advertising rather than contextually targeted one(cited in Ells and Chris, 2010). Interactive Television Television is at a point of development where it needs to adapt. In todays world of interactivity, it has to keep itself relevant. For the sake of greater accountability and targeting, television is becoming direct just like computer IP address (Ells and Chris, 2010). Maloney (2009) identifies changes in ATL mediums. For instance, Scared sh!tless by Googles TV Ads. Giant U.S. cable companies are together to form Canoe Ventures. Canoe is designed to provide marketers with the ability to target TV advertising through consumers set top box. It implies that marketers get the ability to advertise tires only to potential customers (people who own cars). Canoe made advertising more measurable, relevant, engaging, and interactive. In Australia, Foxtels red button provides direct TV engagement, and due to long time exposure, people are accustomed to it. Digital Radio Plus Radio is also adapting to change and becoming more targeted and interactive. For direct marketing, the association between radio and internet is well-established (Ells and Chris, 2010).As website reveals digital radio plus will facilitate advertising information on demand. Through new technology, radio advertisements will work on a new level with enhanced features, such as, use of images and text. It means that marketers can target an ad for local hotel as customer reaches the nearby highway (Maloney, 2009). The digital radio will result into more channels and more listeners. For advertisers, it means more targeted and accountable advertising. More channels will allow marketers to develop integrated branded programming in order to add value for particular customer base (Ells and Chris, 2010). Outdoor Advertising Direct outdoor activities are also gaining prominent. For instance, bus shelter ad from Fitness First in the Netherlands. Shelter seat measures commuters weight and displays it on a digital screen. Another direct outdoor example is pigeons with built in GPS (Maloney, 2009). Mobile Advertising In addition to SMS and Bluetooth for direct marketing purposes, yahoo announced online behavioral targeting for mobiles. This technology promises to double average ROI with three times click through rates as compared to traditional banner ads (Maloney, 2009). Despite the division and its relevance, some marketers are working to conceive high-impact integrated marketing solution which involves both ATL and BTL activities. For instance Home Depot and Discovery Channel working to integrate cable programming on TLC, on-air, in-store, events, and workshops (Vollmer, John, and Randall, 2006, p.7). Conclusion Marketing and media industry is continuously challenged to abandon ancient above and below the line approach. Hayward in his white paper predicts the death of line within next ten years since the division between media and marketing functions continue to fade (cited in Hooton, 2011). In recent years, the whole concept of "line" has become irrelevant and marketing efforts are considering a full 3600 approach. Primary issues are integration of available data in new ways in order to enhance the relevance and direct delivery of message regardless of the channels used (Ells and Chris, 2010, p.5).Traditional above-the-line medium are increasingly becoming direct marketing mediums which is a clear evidence that line is becoming extinct. In order to remain relevant, traditional mass media has also adapted to interactivity. With technological development, marketers are getting greater insights of consumer behavior for better targeting and accountability. Works Cited Brierley, S.2002. The Advertising Handbook. New York, NY: Routledge. Ells, A., and Chris, M., 2010. The Line does not Exist-How all Above-The-Line Advertising is Becoming Direct. [Online]Australian Direct Marketing Association (ADMA), Sydney: ADMA Multi-Channel Acquisition. Available at: < http://s3.amazonaws.com/admaweb-production/assets/333/The_Line_Doesn_t_Exist_original.pdf> [Accessed 20 April 2012].White paper pdf. Gaerig, A.M., 2010.The New Economics of Advertising: The Principle of Relative Constancy Reconsidered.[pdf].Available at: < http://www.knightdigitalmediacenter.org/images/uploads/neweconomics.pdf> [Accessed 20 April 2012]. Garrison,P.,n.d. 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