Appropriation & ad agency by manish badhiye

 Several Factors influence the relationship between expenditure
on promotions and sales including:

Assumpions
 The goal of the promotion
Hierarchy of effects approach- Awareness, knowledge, linking, preferences,
conviction , actual purchase
 Threshold effect -early effect of ad are minimal
 Carryover effect -pdts purchased when needed
 Wear out effect – at a certain pt a pdt simply becomes old
/boaring. Creating promotion to add excitement are, at that pt. ,
difficult. The company must spend a great deal of time trying to
rejuvenate the brand in some way.
 Decay effect- when company stops adverting, consumers begin
to forgot about company.
 Random events

Setting the Total
Promotion Budget
 The marketer must decide how much to
spend on promotion. According to the type of
industry, the promotion spendings vary. E.g.
20-30%of the sales in cosmetics, 2-3%in
industrial machinery.
 There are basically four methods to set the
total budget for advertising;
 affordable method
 percentage-of-sales method
 competitive-parity method
 objective-and-task method

Affordable Method
 Setting the promotion budget at the level that
management thinks the company can afford.
 Small companies project their total revenues,
deduct their operating expenses and capital
outlays, and then devote some of the
remaining funds to advertising.
 This method places advertising last among
expenses, therefore, ignores the effects of
promotion on sales.
 This method may result in either over or
under spending for advertising.

Percentage-of-Sales Method
 Setting the promotion budget at a certain
percentage of current or forecasted sales or
as a percentage of the sales price.
 The advantage of this method is that it helps
management think about the relationships
between promotion spending, selling price,
and profit per unit.

Percentage-of-Sales Method
The disadvantages are;
(1)it wrongly views sales as the cause of
promotion rather than as the result,
(2) it may prevent increase in promotional
spending, when the sales are falling,
(3) it does not provide any basis for choosing a
specific percentage, except last year’s and
competitors percentages.

Competitive-Parity Method
 Setting the promotion budget to match competitor’s
outlays. The company monitors competitor’s
advertising or industry averages.
 The disadvantages of this method are; (1) each
company has its own promotional needs, therefore,
the competitors’ spending may be misleading, (2)
there is no guarantee that this method will prevent
promotion wars.
 The concept to remember is that it is not how much
is spent , but rather how well the money is allocated
and how effectively the marketing compaign works at
retaining customers and mkt share.

Objective-and-Task Method
 Setting promotion budgets based on what the
company wants to accomplish with promotion.
 This is the most logical budget setting where the
company (1) defines specific promotion objectives,
(2) determines the tasks needed to achieve these
objectives, (3) estimates the total costs of performing
these tasks.
 The budget will be cumulative sum of the estimated
cost for all objectives.

Objective-and-Task Method
This is the most difficult method to use
because it is hard to understand which tasks
will achieve specific objectives. E.g. if Sony
wants to create 95% awareness for its new
camera within 6 months, it is difficult to
decide what messages and promotions to
use and how much to spend.

 Quantitative Model-
are limited to larger organizations with strong computer and
statistical dept

Lux Soap ad featuring Leela
Chitnis 1941

 First and oldest ad agency in India was B. Dattaram
& Co. (1905)
 Sista (1934) was the first full service Indian Agency

Advertising Agencies
 Provides services of highly skilled individuals
 Can provide an objective viewpoint of the mkt and its business.
 “Advertising agency is an independent business, composed of
creative and business people who develop, prepare & place
advertising in advertising media for sellers seeking to find
customers for their goods or services.”
 Volney B. Palmer (1840) is the first known person who worked
on a commission basis to sell space in newspapers.
 In 1917, newspaper publisher set 15 % as standard agency
commision
 During the 1980s, there was a wave of acquisition & merger of
ad agencies and support org. to form super-agencies.

 “Medison Avenue”
Become a symbol of advertising to the
world

Advertising Agency
Some important players in the system are
 Clients or Advertiser- one who want to communicate
 Advertising Agency-
independent org. that provide one or more specialized
adv .& promotion related services to assists companies in
developing , preparing & executing their adv. & other promotion
programs
 Media organizations-
 Marketing communication specialist organizations
 And Provider of collateral services
Direct Response agencies, sales promotion agencies, package
design specialist, mkting Research providers
Vidio production house, printers , photographers

Participants in the IMC Process
Marketing
Communications
Specialist Organization
Marketing
Communications
Specialist Organization
Media OrganizationsMedia Organizations
Advertiser (Client)Advertiser (Client)
Advertising AgencyAdvertising Agency
Collateral ServicesCollateral Services
Direct
Response
Agencies
Direct
Response
Agencies
Sales
Promotion
Agencies
Sales
Promotion
Agencies
Interactive
Agencies
Interactive
Agencies
Public
Relations
Firms
Public
Relations
Firms

Kinds of Agencies
 Large agencies concentrated in relatively few pdts
 Small agencies
 Agency network

Types of Ad agencies
 Full Service Agencies
 Specialty Agencies- ind-medical , real estate,
education, financial
Work for a function such as-
internet, Public Relation, marketing research
 In house agencies
 Creative Boutiques
 Media Buying Agencies

Structure & Organization
 What Agencies do?
 And how they are organized to do it?

primary services:
 complete a marketing analysis
 develop an advertising plan
 prepare a creative strategy
 create advertising executions
 develop and implement a media plan
 handle billing and payments
 integrate other marketing communications

 Full service agency
planning ,creating, producing, selecting
media

Creating
advertising
Creating
advertising
Planning
advertising
Planning
advertising
Producing
advertising
Producing
advertising
Performing
research
Performing
research
Selecting mediaSelecting media
Sales promotion
and training
Sales promotion
and training
Strategic market
planning
Strategic market
planning
Trade show
materials
Trade show
materials
Package designPackage design
Planning
advertising
Planning
advertising
Creating
advertising
Creating
advertising
Producing
advertising
Producing
advertising
Performing
research
Performing
research
Selecting mediaSelecting media
Strategic market
planning
Strategic market
planning
Sales promotion
and training
Sales promotion
and training
Trade show
materials
Trade show
materials
Package designPackage design
Full-Services Agencies
Full Range of
Marketing
Communication
and Promotion
Services
Full Range of
Marketing
Communication
and Promotion
Services
Non-Advertising
Services
Non-Advertising
Services
Public relations
and publicity
Public relations
and publicity

functions of full-service agenciesfunctions of full-service agencies
account managementaccount management
creativecreative
media planning and placementmedia planning and placement
researchresearch

 liaison between agency and client
 responsible for understanding...
 the client’s business
 the client’s marketing needs
 strategy development
 representing client point of view within the
agency
account management

 account management director
 management supervisor
 account supervisors
 account executives
 assistant account execs
 account coordinators
 traffic
account management

 responsibility
the creative department is responsible forthe creative department is responsible for
creating and producing the print and broadcastcreating and producing the print and broadcast
advertisingadvertising
strategy is keystrategy is key
good creative workgood creative work is always guided by ais always guided by a
creative strategycreative strategy that sets forththat sets forth goals to begoals to be
accomplishedaccomplished andand key message pointskey message points to beto be
relayedrelayed
the creative department is responsible forthe creative department is responsible for
creating and producing the print and broadcastcreating and producing the print and broadcast
advertisingadvertising
strategy is keystrategy is key
good creative workgood creative work is always guided by ais always guided by a
creative strategycreative strategy that sets forththat sets forth goals to begoals to be
accomplishedaccomplished andand key message pointskey message points to beto be
relayedrelayed
creative department

media department
 The media department has two main
functions - planning and buying.
The planning group handles moreThe planning group handles more
strategic marketing and media issues.strategic marketing and media issues.
The buying group handles mediaThe buying group handles media
negotiations and implementation.negotiations and implementation.
The planning group handles moreThe planning group handles more
strategic marketing and media issues.strategic marketing and media issues.
The buying group handles mediaThe buying group handles media
negotiations and implementation.negotiations and implementation.

Services Provided by Agencies
Agency ServicesAgency Services
The link between
agency and client
Managed by the
Account Executive
The link between
agency and client
Managed by the
Account Executive
Research
department may
design and execute
research programs
Media department
may analyze, select
and contract media
resources
Research
department may
design and execute
research programs
Media department
may analyze, select
and contract media
resources
Creation and
execution of ads
Copywriters,
artists, other
specialists
Creation and
execution of ads
Copywriters,
artists, other
specialists
Marketing
Services
Marketing
ServicesAccount ServiceAccount Service Creative
Services
Creative
Services
Marketing
Services
Marketing
ServicesAccount ServiceAccount Service

ArtistsArtists
Ad Agencies Have Skilled Specialists
WritersWriters ResearchersResearchers
PhotographersPhotographers Media AnalystsMedia Analysts Other SkillsOther Skills

More
Control
More
Control
Cost
Savings
Cost
Savings
Better
Coordination
Better
Coordination
Less
Objectivity
Less
Objectivity
Less
Experience
Less
Experience
Less
Objectivity
Less
Objectivity
Less
Experience
Less
Experience
Better
Coordination
Better
Coordination
More
Control
More
Control
Cost
Savings
Cost
Savings
Pros & Cons of In-House Agencies
The
In-house
Agency
The
In-house
Agency
+ Positive+ Positive - Negative- Negative
Less
Flexibility
Less
Flexibility

The Role of Creative Boutiques
Creative
Boutiques
Creative
Boutiques
Provide Only Creative ServicesProvide Only Creative Services
Full-Service Agencies May
Subcontract With Creative
Boutiques
Boutiques
Provide Only Creative ServicesProvide Only Creative Services
Boutiques
Boutiques
Other Functions Provided by the
Internal Client Departments
Other Functions Provided by the
Internal Client Departments

Specialize in Buying Media,
Especially Broadcast Time
Agencies and Clients Develop
Media Strategy
Media Strategy
Media Strategy
Media Strategy
Media Buying Can Be Specialized
Media Buying
Services
Media Buying
Services
Media Buying Organizations
Implement the Strategy and Buy
Time and Space
Media Buying Organizations
Implement the Strategy and Buy
Time and Space

Direct
Mail
Direct
Mail
Data Base
Management
Data Base
Management
ResearchResearch
CreativeCreative
Media ServicesMedia Services
CreativeCreative
Media ServicesMedia Services
ResearchResearch
Direct
Mail
Direct
Mail
Data Base
Management
Data Base
Management
Direct Response Agency Activities
Direct
Response
Agencies
Direct
Response
Agencies
ProductionProduction

Great Advertising is:
 Relevant
 Provocative
 Credible
 Consistent
 Memorable

General Characteristics of Major Media Types
Media Advantages Disadvantages
Television Offers mass coverage.
High level of reach.
Combined impact of sight,
sound, and motion.
Prestige value.
Low cost per exposure.
Attracts attention.
Offers low selectivity.
Short span of message life.
High cost.
High production costs.
Creates advertising clutter.
Waste coverage.
Radio Local coverage.
Lower cost.
High frequency.
Focused segment selection.
Low production costs.
Only audio.
Noise.
Low on attention getting.
Message short lived.
Newspapers Mass coverage.
Low cost, large space.
Short lead time for ad placing.
Ad position choice possible.
Good for current ads.
Reader controls exposure.
Coupons can be inserted.
Short life of advertisement.
Clutter.
Low attention getting.
Poor production quality.
Selective exposure.
Cont…

General Characteristics of Major Media Types
Magazines Potential for focused segmentation.
Very good production quality.
Longevity of message.
High information content.
More readers per copy.
Long lead time for ad placing.
Only visual.
Low frequency.
Lack of flexibility.
Outdoor Good for specific location.
High repetition.
High visibility.
Short exposure time.
Short message.
Poor image.
Direct mail High level of selectivity.
Reader controls exposure.
High information content.
Opportunity for repeat exposures
High cost per contact Clutter.
Often thrown as junk mail.
Internet User controlled.
Increased attention and involvement.
Limited creative capabilities.

Full Service Agency Organization Chart
Board of Directors
President
Vice-precedents,
Creative Services
Vice-precedents,
Creative Services
Vice-precedents,
Creative Services
Vice-precedents,
Creative Services
Directors
Media
Writers
Art
directors Print
Production
TV
production
Account
supervision
Account
executive
Research Sales
Promotion
Office
management
Finance
Personal

 Used in 30% of ads.
 Excellent in capturing attention.
 Score high in recall tests.
 Should be related directly to customer
benefit.
Humor Appeal
6-45

Message Appeal Options
Fear
Appeals
Fear
Appeals
• May stress
physical danger or
threats to health
• May identify
social threats
• Can backfire if
level of threat
is too high
• May stress
physical danger or
threats to health
• May identify
social threats
• Can backfire if
level of threat
is too high
Comparative
Ads
Comparative
Ads
• Especially useful
for new brands
• Often used for
brands with small
market share
• Used often in
political
advertising
• Especially useful
for new brands
• Often used for
brands with small
market share
• Used often in
political
advertising
Humor
Appeals
Humor
Appeals
• Can attract and
hold attention
• Often the best
remembered
• Put consumers in
a positive mood
• Can attract and
hold attention
• Often the best
remembered
• Put consumers in
a positive mood

The Role of Humor in Advertising
 Attract attention
 Enhances liking of ad and brand
 Does not hurt comprehension
 Does not harm persuasion
 Does not enhance source credibility
 Nature of product affects the appropriateness
of using humor

The Role of Humor in Advertising
 Effective only when consumers’ evaluations
of advertised brand are already positive
 Effect of humor can differ due to differences
in audience characteristics
 Humorous message may be so distracting
that receivers ignore the message contenttent

Humor Appeals
Does not aid persuasion in
general
general
ConsCons
May harm recall and
comprehension
May harm recall and
comprehension
May harm complex copy
registration
registration
Does not aid source credibilityDoes not aid source credibility
Is not effective in bringing
about sales
about sales
May wear out faster than non-
humorous ads
humorous ads
Aids attention and awarenessAids attention and awareness
ProsPros
May aid retention of the
message
message
Creates a positive mood and
enhances persuasion
enhances persuasion
May aid name and simple
copy registration
copy registration
May serve as a distracter,
reducing counter arguing
reducing counter arguing

Humor in advertising
 A lot of people simply don't have a sense of humor.
You lose them immediately, and the potential size of
your market shrinks.
 It is commonly misinterpreted. Many people will not
get the joke.
 And humor often insults someone. They may simply
get angry because they don't get the joke. This is fire
we are playing with. Your market size just shrunk
again.

 Advertising is about getting attention. The
best ways to get attention with advertising are
with strong visuals, powerful headlines, and
humor.
 First, people like funny things It puts them in
a good mood, and it creates a more
comfortable atmosphere and a more positive
image for your company

 Advertising humor works best with
established and commonly purchased
products.
 But corporate image and industrial
advertising are serious business. Unknown,
risky, expensive, or sensitive products are not
normally suited to the lighter touch of
advertising humor.
 Advertising humor also needs to be well
suited to its audience. If your customers don’t
get the joke, then the joke will be on you.

 Advertising humor also needs to be product specific.
We have all seen funny ads we liked so much that we
forgot what was being sold.
 And advertising humor has a relatively short life. The
first time we see it we may laugh out loud. But after a
while, although we still may smile at the joke, it’s not
so funny any more. Funny ads need to be replaced
periodically
 Will advertising humor work in your ads? Absolutely –
if you can make it appropriate to your products and
customers, if they understand it, if it is related to your
business or message, and if you change your ads
frequently enough so that they don’t wear out.

1. Comparison - Putting two or more elements together to produce
a humorous situation.
2. Personification - Attributes human characteristics to animals,
plants and objects.
idea, Rin
3. Exaggeration - Overstating and magnifying something out of
proportion.
fevicol ,
4. Pun - Using elements of language to create new meanings,
which result in humor.
Curcure
5. Sarcasm - According to Reick, sarcastic comments or situations
are classified as silliness.
cloromint

6. Silliness - silliness ranges from making funny
faces to ludicrous situations
7. Surprise - Includes all advertisements where
humor arises from unexpected situations. The
advertisement Surprise - Includes all
advertisements where humor arises from
unexpected situations.
Dish wash bars ,Ambuja Cement

Humor Appeals
general
general
ConsCons
May harm recall and
comprehension
May harm recall and
comprehension
registration
registration
Does not aid source credibilityDoes not aid source credibility
about sales
about sales
humorous ads
humorous ads
Aids attention and awarenessAids attention and awareness
ProsPros
message
message
enhances persuasion
enhances persuasion
copy registration
copy registration
reducing counterarguing
reducing counterarguing

Advertising Copy (IMP)
 Copy refers to written material which is to be set in type for the
print media or spoken by announcers for broadcast
commercials.
 Includes all the elements of an advertising message whether
printed or broadcast.
 Print media – heading, subheads, pictures captions slogans and
body copy even trade mark company logo
 Radio commercials – sound effects and music in addition to the
words spoken in the ad message
 T V commercials – includes the words to be spoken by the
character in the script, plus music and sound effect, actions

 Visualization & layout
 Visualization – is concerned with the creation of an
idea which will appeal to the consumer or the target
audience.
 Layout – deals with the arrangement of various
elements in the ads

Elements of ad copy
 Headline – if the headline idea fails to attract the
prospect to the message & the pdt , the remaining
part of the ad are wasted
 Questions
 Statement from celebrities
 Warning and appeals

 Subheads-expands or amplify the headline idea
 Body copy -stimulates linking and preference for a
pdt
, Explains, logically and rationally, pdt attributes,
features & pdt values & give convincing argument in
favor of claim about the superiority of the advertised
pdts
Fact& figures about pdts, test result,gurentees of
satisfactory performance
Emotional / rational appeals

 Closing idea
call to action
Buy now
Visit today our stockiest
Festival discount

 Not literally copy
 Style of copy

Account Brief (Short note)
 The is a document that outlines the
information and objectives to inspire the
creative idea. Creative briefs may take
different forms and include a variety of
elements, including describing what the
advertising is trying to achieve, identifying the
main idea to be communicated, and outlining
the target audience for that idea.

 Proposing the Big Idea requires client agreement that
the idea is right. Thus, both the advertising agency
and the client must agree upon the final brief. The
best briefs are written by account planners
collaboratively with input from the client, account
team, and creative director. One of the key functions
of the SS+K brief is to come up with a single
essential thought that summarizes the idea that will
convince consumers to do what it is that the
communication aims to do. Every agency has a
proprietary brief template it uses to spell out the types
of content it will need to include, such as specifying
the audience, the product features, media placement
ideas, and key point.

The Five M’s of Advertising Model
 In developing an advertisement program, marketing
managers must always start by identifying the target
market and buyer motives. They can make that with
five major decisions which you can see in the model.

The Five M’s of Advertising Model
Mission Money
Media
Message
Measurement

The Five Ms of
Advertising
 Mission
 Objectives can be
classified by aim:
 Inform
 Persuade
 Remind
 Reinforce

Developing and Managing the
Advertising Campaign
 Factors considered
when budget-setting:
 Stage of product life
cycle
 Market share and
consumer base
 Competition and clutter
 Advertising frequency
The Five Ms of
Advertising
 Mission
 Money

 Factors considered
when choosing the
advertising message:
 Message generation
 Message evaluation
and selection
 Message execution
 Social responsibility
review
The Five Ms of
Advertising
 Mission
 Money
 Message

 Developing media
strategy involves:
 Deciding on reach,
frequency, and impact
 Selecting media and
vehicles
 Determining media
timing
 Deciding on
geographical media
allocation
The Five Ms of
Advertising
 Mission
 Money
 Message
 Media

 Evaluating
advertising
effectiveness
 Communication-
effect research
 Sales-effect
research
The Five Ms of
Advertising
 Mission
 Money
 Message
 Media
 Measurement

 Unit 5 Evaluation Monitoring & Control

MEASURING
ADVERTISING
EFFECTIVENESS
Rating
Services
Sales and
Expense Analysis
Test
Marketing
Controlled
Tests
Recall
Tests

Pre-testing and post-testing:
Used to help in judging the effectiveness of the
advertising strategy or medium
Pre-testing is used to increase likelihood of creating
the most effective advertising messages. This helps
in spotting any communication gaps or flaws in the
ad message content before it is used

Post testing is important to evaluate the success or
otherwise of an individual ad or the whole campaign
after it has run.

Evaluation of Advertising Effectiveness
Advertising agencies usually pretest ads or commercials and also conduct post-
testing. Some major pre-testing and post-testing methods are mentioned briefly.
Pre-Testing Methods
Print Advertising
 Direct Questioning
 Focus Group
 Portfolio Test
 Order-of-Merit Test
Cont…

Methods for Pre-testing:
Print Advertising
Direct Questioning:
The researcher using this method asks respondents specific
questions about the ads such as What does the ad say to you?
Does the ad tell you something new and different about the
product, service or the company?
Do you believe what this ad says to you?
What is your perception of the product or service this ad tells you
about?
Do you like the advertisement ?

Focus group:
A group of 8 to 10 people who are potential users of the
product or service, participate in a moderated but
freewheeling discussion and interview.
Lasts for about one hour and supervised by a trained
moderator who provides direction and control.

Portfolio test:
One group of respondents is exposed to a portfolio of
test ads interspersed with other ads. Another group sees
the portfolio without the test ads Paired comparison test:
Respondents compare each ad in a group
Order of merit test:
Respondents see two or more alternative ads and
arrange them in rank order

Mock Magazine tests:
Ads to be tested are “stripped into” into a magazine
which is left with respondents for a specified time.
Direct Mail Test:
Two or more ads are mailed to different potential
customers on a mailing list to test which ad attracts more
orders.

Pre-Testing Methods
Television and Radio Advertising
 Central Location Test
 Clutter Test
 Trailer Test

Pre-testing for television and radio:
Central Location test:
Respondents see TV test commercials in a central
location such as shopping centre
Clutter tests:
Test commercials along with non competing
commercials are shown to respondents
Trailer Tests:
respondents see to commercials at trailers at shopping
centers and receive coupons for the advertised products

Live telecast Tests:
Test commercials are shown on closed circuit
or cable TV and subsequently respondents are
interviewed by telephone.

Post-Testing Methods
 Recall
 Recognition
 Inquiry

Post –testing methods:
Recall Unaided Recall:
respondents are asked without prompt whether
they read saw or heard ad messages
Aided recall:
Respondents are shown certain ads with the
name of the sponsor or brand concealed and then asked
if their previous exposure was through reading, viewing
or listening

Recognition:
refers to whether a respondent cam recognize an
advertisement as having seen before. Such tests are
conducted by mail survey in which questionnaires are
mailed to 1000 households picked from a mailing list or
telephone book. Provides mechanism for breaking a
print ad into important elements such as headline,
visual, copy and how these are remembered by by a
sample of respondents.

Inquiry:
refers to checking the effectiveness of ads appearing in
various print media on the basis of which consumers
respond by requesting for more information. The inquiry
may depend on phone calls from interested persons,
coupons returned or requests for free samples
Researchers can test advertisements’ attention getting
value, readability, comprehension

Day- after- recall –
most popular method of post-testing in broadcast
media. Measure of effectiveness is always the number of people
who can recall the ad. Respondents may be asked simple
question as “While watching programme A last knight, did you see
a commercial for (brand name) ?”

Appropriation & ad agency by manish badhiye

Appropriation & ad agency by manish badhiye

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