ch01 Where marketing communication began.ppt

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Copyright  2012 McGraw-Hill Australia Pty Ltd
PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell
Chapter 1
Where marketing communication
began: the development of
advertising in Australia and New
Zealand

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Learning objectives
1. To define advertising—looking at its importance
and its function.
2. To trace the history of advertising in Australia and
New Zealand.
3. To explore the changing advertising environment.
4. To introduce marketing communication
concepts—such as consumer empowerment and
engagement, the push–pull marketplace and
interactive advertising, digital and social media—
that will be fundamental to the rest of the book.

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Future of
advertising
News
channels
Definition
History
Empowered
Consumers
Changes in
ad agencies
Importance
Structure &
function
Social media
Interactive
advertising
Digital media
Advertising
Engagement

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What is advertising?
Traditional definition
Advertising is any paid form of non-personal communication about
an organisation, product, service or idea by an identified sponsor.
Paid: The space or time for
an advertising message must
be purchased.
Non-personal: Involves mass
media (e.g. TV, radio,
newspapers, magazines) in one-
way communications.

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The best job in the world
The best job in the world campaign, but how much
advertising did it use?

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A new definition of advertising
New, improved definition
Advertising is a paid, mediated form of communication
from an identifiable source, designed to persuade the
receiver to take some action, now or in the future.
Advertising is any paid form of non-personal
communication about an orgnisation, product,
service or idea by an identified sponsor.

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Importance of advertising

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Importance of advertising

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Advertising has many functions
The nature and
purpose of
advertising differs
from one industry
to another and
across situations.
Engage & involve
Brand awareness
Brand equity
Brand image
Communicate & interact

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Brand awareness
Building brand awareness is especially important for
new products.

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Brand image
Even established brands need to build and maintain
brand image.

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History of advertising

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Function and structure
Advertising
agency
Client options
In-house
advertising

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Types of agencies
Types of agencies
Full service
Creative boutiques
Media buying services
Other

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Creating
advertising
Planning
advertising
Producing
advertising
Research
Selecting media
Full-service agencies
Full range of
marketing,
communication
and promotion
services
General
communications
 Sales promotion
 Direct marketing
 Interactive
 Package design
 Public relations
 Publicity

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Artists
Ad agencies have skilled
specialists
Copywriters Researchers
Photographers Media analysts Other skills

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Great Australian ads

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PowerPoint Slides t/a Advertising and Promotion 2e by Belch, Belch, Kerr & Powell 1-18
Future of
advertising
News
channels
Definition
History
Empowered
consumers
Changes in
ad agencies
Importance
Structure &
function
Social media
Interactive
advertising
Digital media
Engagement
Advertising

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Advertising timeline (Australia)
1800
First ad
(poster)
1803
First
newspaper
ad
1901
First advertising
service agency
(Sydney)
1946
National industry
association
(AANA)
1821
First
magazine
13-19
1911
Media
commissions
introduced
1912
First industry
association
(Melbourne)
1923
Commercial
radio
1956
Commercial
TV

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Advertising timeline (NZ)
1901
Newspaper
Publishers
Association
1906
First
advertising
agency
1923
Broadcasting
regulations
1960
1st television
broadcast
1821
First
magazine
13-20
1927
Advertisers
Association of
NZ
1931
11 accredited
agencies in
operation
1989
Te Mangai
Paho
(Maori
Broadcasting)
established

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History of advertising
Early newspaper
advertisements
were confined to
printed text only.
Illustrations were
rare until the
1860s.
Source: Walter Powell Advertisement for Paragon Kitchens, 1862 State Library of Victoria, Pictures Collection

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Advertising today—Australia
Advertising agencies: 1000+
Media expenditure: $12.6 billion

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Advertising today—Australia (cont.)
Radio licences
374 commercial
358 community
Television (FTA)
54 commercial
83 community
Subscription TV
2588
Metro and regional daily
newspapers: 50+
Consumer magazines
140 (audited)
Cinema screens: 1994
Population: 21 million

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Advertising today—NZ
Advertising agencies: 200+
Media expenditure:
$2045 million

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Advertising today—NZ (cont.)
6000 magazines
455 cinema screens
300 radio stations
87 TV channels
150 newspapers
Population: 4.18 million

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Breakdown of advertising
expenditure (Australia)

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Media expenditure in New
Zealand: 2007
Media Platform 2008
($million)
2009
($million)
Newspapers 760 623
Television 647 570
Radio 268 236
Magazines 249 217
Outdoor 74 68
Cinema 9 6
Addressed mail 56 58
Unaddressed mail 64 65
Interactive 193 214
Source: New Zealand Advertising Standards Board

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Future of
Advertising
News
Channels
Definition
History
Empowered
Consumers
Changes in
Ad Agencies
Importance
Structure &
Function
Social Media
Interactive
Advertising
Digital Media
Engagement
Advertising

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The changing advertising
landscape
 Consumer empowerment
 Push-pull marketplace
 Digital media and interactive advertising
 Social media
 New rules of engagement

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Consumer empowerment and
the push-pull marketplace
• Insert figure 1.7
• Push pull marketplace

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Digital media and interactive
advertising

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Interactive advertising

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• Interactive advertising is a form of media-based marketing
that businesses and product manufacturers use to
promote products, services and other announcements and
information. A businesses targets consumers from the
websites they visit as well as on smartphones and other
hand-held media devices. Companies use interactive
advertising to build brand recognition and connect with
consumers where they spend the most time researching
products and services.

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Pop-Ups
• Many businesses and product manufacturers utilize
pop-ups as a form of interactive advertising. Pop-up
advertisements are new browser windows that
appear on the computer screen with advertisement-
rich content. Businesses utilize pop-up
advertisements to make announcements, sell
products, offer discounted services or get
consumers to visit a new website.

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Videos
• Video ads are forms of interactive media advertisements
that display short advertisement messages to consumers
who visit various websites. Videos may appear
automatically when a consumer visits a particular site, or
consumers may have the option to view videos at their
disposal. Many product manufacturers utilize video
advertisements to build brand recognition of the products
consumers use every day, such as cleaning or food
products. Department store and home improvement store
chains also utilize video ads to build brand recognition.

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Displays
• Display ads use visually stimulating graphics to get
the attention of website visitors. Display
advertisements can appear anywhere on a web
page and vary in size, shape and content. These
ads have the same concept as traditional picture
advertisements in the yellow pages. They draw the
visitor's attention to the ad with colors, pictures and
relevant content. Effective displays entice
consumers to click on the ad to obtain additional
information about the product or service
advertised.
•

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Social media
Social media defined:
Social media has been defined as ‘a group of
internet-based applications that build on the
ideological and technological foundations of
Web 2.0, and that allow the creation and
exchange of user-generated content.
David Schumann, Andy Artis & Rachel Rivera, ‘The future
of interactive advertising through an IMC lens’, Journal of
Interactive Advertising, vol. 1, no. 2,. 2001

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Social Media
• An effective interactive advertising method is Internet
marketing via social media and networking websites.
Social media marketing involves advertising to consumers
through outlets such as social networking websites, online
communities and blog operations. Advertising through
social media outlets provides a direct marketing approach
because it targets an audience based on its interests. For
example, a health company may target an online group of
fitness enthusiasts by marketing supplement products on
websites dedicated to health and well-being.

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Social media
Key opportunity: How to engage consumers by
inviting them to create content around a product?
Consumers are
consumers of content
Consumers are
producers of content
Brands are owned
by companies
Brands are a shared
creation
Marketers define brand
meanings and values
Consumers define brand
meanings and values
Traditional view Contemporary view

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Social media

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New rules of engagement

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Future of
Advertising
News
Channels
Definition
History
Empowered
Consumers
Changes in
Ad Agencies
Importance
Structure &
Function
Social Media
Interactive
Advertising
Digital Media
Engagement
Advertising

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The future of advertising
 Harsh economic environment leading to advertising
budget cuts
 Mass media advertising is dying
 Rise of new communications technologies
 Fragmentation of media and markets
 Search for big ‘consumer insight’
 From great executions to strong strategy

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Summary and conclusions
 Advertising in Australia and New Zealand has a long
heritage with its roots dating back to the 1800s.
 Advertising has evolved from a push by marketers to
reach audiences to a more complex and interactive
approach.
 Consumer empowerment has led to an emphasis on
shared dialog rather than pushed messages.
 Definitions of advertising have changed to accommodate
new technologies and interactivity.
 The advertising industry has also adapted to current
changes.
 Advertising continues to be the best way to reach large
audiences.

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