IMPACT OF ADVERTISING:Trial, Continuity, Brand Switching, Market Share

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Introduction to Mass Communication MCM 101

LESSON 38

IMPACT OF ADVERTISING

Advertising Objectives

Advertising objectives are the communication tasks to be accomplished with specific customers

that a company is trying to reach during a particular time frame. A company that advertises usually strives to

achieve one of four advertising objectives: trial, continuity, brand switching, and switchback. Which of the

four advertising objectives is selected usually depends on where the product is in its life cycle.

Trial

The purpose of the trial objective is to encourage customers to make an initial purchase of a new

product. Companies will typically employ creative advertising strategies in order to cut through other

competing advertisements. The reason is simple: Without that first trial of a product by customers, there

will not be any re peat purchases.

Continuity

Continuity advertising is a strategy to keep current customers using a particular product. Existing

customers are targeted and are usually provided new and different information about a product that is

designed to build consumer loyalty.

Brand Switching

Companies adopt brand switching as an objective when they want customers to switch from

competitors' brands to their brands. A common strategy is for a company to compare product price or

quality in order to convince customers to switch to its product brand.

Switchback

Companies subscribe to this advertising objective when they want to get back former users of their

product brand. A company might highlight new product features, price reductions, or other important

product information in order to get former customers of its product to switchback.

Advertising Budget

Once an advertising objective has been selected, companies must then set an advertising budget for

each product. Developing such a budget can be a difficult process because brand managers want to receive

a large resource allocation to promote their products. Overall, the advertising budget should be established

so as to be congruent with overall company objectives. Before establishing an advertising budget,

companies must take into consideration other market factors, such as advertising frequency, competition

and clutter, market share, product differentiation, and stage in the product life cycle.

Advertising Frequency

Advertising frequency refers to the number of times an advertisement is repeated during a given

time period to promote a product's name, message, and other important information. A larger advertising

budget is required in order to achieve a high advertising frequency: Estimates have been put forward that a

consumer needs to come in contact with an advertising message nine times before it will be remembered.

Competition and Clutter

Highly competitive product markets, such as the soft-drink industry, require higher advertising

budgets just to stay even with competitors. If a company wants to be a leader in an industry, then a

substantial advertising budget must be earmarked every year. Examples abound of companies that spend

millions of dollars on advertising in order to be key players in their respective industries (e.g., Coca Cola and

General Motors).

Market Share

Desired market share is also an important factor in establishing an advertising budget. Increasing

market share normally requires a large advertising budget because a company's competitors counterattack

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with their own advertising blitz. Successfully increasing market share depends on advertisement quality,

competitor responses, and product demand and quality.

Product Differentiation

How customers perceive products is also important to the budget-setting process. Product

differentiation is often necessary in competitive markets where customers have a hard time differentiating

between products. For example, product differentiation might be necessary when a new laundry detergent is

advertised: Since so many brands of detergent already exist, an aggressive advertising campaign would be

required. Without this aggressive advertising, customers would not be aware of the product's availability and

how it differs from other products on the market. The advertising budget is higher in order to pay for the

additional advertising.

Stage in the Product Life Cycle

New product offerings require considerably more advertising to make customers aware of their

existence. As a product moves through the product life cycle, fewer and fewer advertising resources are

needed because the product has become known and has developed an established buyer base. Advertising

budgets are typically highest for a particular product during the introduction stage and gradually decline as

the product matures.

Selecting the Right Advertising Approach

Once a company decides what type of specific advertising campaign it wants to use, it must decide

what approach should carry the message. A company is interested in a number of areas regarding

advertising, such as frequency, media impact, media timing, and reach.

Frequency

Frequency refers to the average number of times that an average consumer is exposed to the

advertising campaign. A company usually establishes frequency goals, which can vary for each advertising

campaign. For example, a company might want to have the average consumer exposed to the message at

least six times during the advertising campaign. This number might seem high, but in a crowded and

competitive market repetition is one of the best methods to increase the product's visibility and to increase

company sales. The more exposure a company desires for its product, the more expensive the advertising

campaign. Thus, often only large companies can afford to have high-frequency advertisements during a

campaign.

Media Impact

Media impact generally refers to how effective advertising will be through the various media outlets

(e.g., television, Internet, print). A company must decide, based on its product, the best method to

maximize consumer interest and awareness. For example, a company promoting a new laundry detergent

might fare better with television commercials rather than simple print ads because more consumers are

likely to see the television commercial. Similarly, a company such as Mercedes-Benz, which markets

expensive products, might advertise in specialty car magazines to reach a high percentage of its potential

customers. Before any money is spent on any advertising media, a thorough analysis is done of each one's

strengths and weaknesses in comparison to the cost. Once the analysis is done, the company will make the

best decision possible and embark on its advertising campaign.

Media Timing

Another major consideration for any company engaging in an advertising campaign is when to run

the advertisements. For example, some companies run ads during the holidays to promote season-specific

products. The other major consideration for a company is whether it wants to employ a continuous or

pulsing pattern of advertisements. Continuous refers to advertisements that are run on a scheduled basis for

a given time period. The advantage of this tactic is that an advertising campaign can run longer and might

provide more exposure over time. For example, a company could run an advertising campaign for a

particular product that lasts years with the hope of keeping the product in the minds of customers. Pulsing

indicates that advertisements will be scheduled in a disproportionate manner within a given time frame.

Thus, a company could run thirty-two television commercials over a three-or six-month period to promote

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the specific product is wants to sell. The advantage with the pulsing strategy is twofold. The company could

spend less money on advertising over a shorter time period but still gain the same recognition because the

advertising campaign is more intense.

Reach

Reach refers to the percentage of customers in the target market who are exposed to the advertising

campaign for a given time period. A company might have a goal of reaching at least 80 percent of its target

audience during a given time frame. The goal is to be as close to 100 percent as possible, because the more

the target audience is exposed to the message, the higher the chance of future sales.

The impact of advertising has been a matter of considerable debate and many different claims have been

made in different contexts. During debates about the banning of cigarette advertising, a common claim

from cigarette manufacturers was that cigarette advertising does not encourage people to smoke who would

not otherwise. The (eventually successful) opponents of advertising, on the other hand, claim that

advertising does in fact increase consumption.

According to many media sources, the past experience and state of mind of the person subjected to

advertising may determine the impact that advertising has. Children under the age of four may be unable to

distinguish advertising from other television programs, whilst the ability to determine the truthfulness of the

message may not be developed until the age of 8.

Public perception of the medium

As advertising and marketing efforts become increasingly ubiquitous in modern Western societies,

the industry has come under criticism of culture jamming which criticizes the media and consumerism using

advertising's own techniques. The industry is accused of being one of the engines powering a convoluted

economic mass production system which promotes consumption. Recognizing the social impact of

advertising, Media-watch-uk, a British special interest group, works to educate consumers about how they

can register their concerns with advertisers and regulators. It has developed educational materials for use in

schools. The award-winning book, Made You Look How Advertising Works and Why You Should Know, by

former Media-watch (a feminist organisation founded by Ann Simonton not linked to media-watch-uk)

president Shari Graydon, provides context for these issues for young readers.

Compensation demanded

Public interest groups are increasingly suggesting that access to the mental space targeted by

advertisers should be taxed, in that at the present moment that space is being freely taken advantage of by

advertisers with no compensation paid to the members of the public who are thus being intruded upon.

This kind of tax would act to reduce what is now increasingly seen as a public nuisance.

Efforts to that end are gathering momentum, with Arkansas and Maine considering bills to implement such taxation. Florida

enacted such a tax in 1987 but was forced to repeal it after six months, as a result of a concerted effort by national commercial

interests, which withdrew planned conventions, causing major losses to the tourism industry, and cancelled advertising, causing a

loss of 12 million dollars to the broadcast industry alone.

Negative effects on communication media

An extensively documented effect is the control and vetoing of free information by the advertisers.

Any negative information on a company or its products or operations often results in pressures from the

company to withdraw such information lines, threatening to cut their ads. This behavior makes the editors

of the media self-censor content that might upset their ad payers. The bigger both companies are, the bigger

their relation gets, maximizing control over single information.

Advertisers may try to minimize information about or from consumer groups, or consumer controlled

purchasing initiatives or consumer controlled quality information systems.

Another indirect effect of advertising is to modify the very nature of the communication media where it is

shown. Media that get most of their revenues from publicity try to make their medium a good place for

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communicating ads before anything else. The clearest example is television, where this means trying to

make the public stay for a long time and in a mental state that encourages spectators not to switch the

channel through the ads. Programs that are low in mental stimulus and require light concentration and are

varied are best for long sitting times. These make for much easier emotional jumps to ads, which can

become more entertaining than regular shows. A simple way to understand the objectives in television

programming is to compare contents from channels paid and chosen by the viewer with channels that get

their income mainly from advertisements.

Future

With the dawn of the Internet have come many new advertising opportunities. Pop-up, Flash,

banner, adver-gaming, and email advertisements (the last often being a form of spam) abound.

Each year, greater sums are paid to obtain a commercial spot during super sporting events like cricket and

football championships. Companies attempt to make these commercials sufficiently entertaining that

members of the public will actually want to watch them.

Another problem is people recording shows on DVRs (ex. TiVo). These devices allow users to record the

programs for later viewing enabling them to fast forward through commercials. Additionally, as more

seasons or "Boxed Sets" come out of Television shows; fewer people are watching their shows on TV.

However, the fact that these sets are sold, means that the company will additionally receive profits from the

sales of these sets. To counter this effect, many advertisers have opted for product placement (prize during

TV shows).

Particularly since the rise of "entertaining" advertising, some people may like an advert enough that they

wish to watch it later or show a friend. In general, the advertising community has not yet made this easy,

although some have used the Internet to widely distribute their adverts to anyone wishing to see or hear

them.

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