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FAQ
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Advertising:
What is the difference between advertising and promotion?
Advertising is generally targeted at end consumer (as opposed to the
channels of distribution). It can be used for many purposes, including
establishing awareness, providing information for knowledge, and creating
brand loyalty. In its knowledge role, advertising can communicate a
positioning (or modify a positioning) and even promote new uses of a product
(think "Orange Juice isn’t just for breakfast anymore").
Promotion is a general term. It is so general, in fact, that most
communications that are not strictly advertising (paid and non-personal) are
characterized as promotions. But this distinction is blurry at times, so
looking for a clear definition is useless. It’s better to just recognize
that there are many types of promotions.
Some promotions -- special events, sampling, rebates, and coupons, to name a
few -- are aimed directly at consumers.
How
much should be spent on advertising vs. promotion?
Magic
formulas really don't exist in marketing (even though lots of people may try
to get you to believe such magic, tricks, or tips may exist). Having said
that, the question you ask is interesting. First, advertising is meant to
establish awareness, build interest in the market, educate, change brand
attitudes, and influence perceptions of customer consistent with a chosen
positioning (assuming you have a clear position in mind). Promotion (and I
assume you're not talking about public relations here) is typically of a
short term nature that is typically meant to encourage trial. Marketing
encompasses both of these activities, and more, so I could really say
anything about budget allocation to marketing since it's too broad a term.
But focusing on advertising versus promotion, you need to first think about
what is the objectives of the marketing campaign. If it's heavy on getting
people to just try your product or service (or web site), then promotion
should be heavily weighted. Give stuff away, special deals, etc. These are
short term objectives and often just produce short term effects. That makes
sense since they are designed to get people to try out something.
Advertising is more designed for longer term objectives, such as
establishing awareness or interest as mentioned above. If you really are
interested in getting people aware of your offering, then advertising should
also be a critical part. The same is true if you want to change customer's
perceptions.
Since often companies want to get both awareness, interest, and trial
(especially with brand new companies), you have to think about a combination
of advertising and promotion. Should it be 50/50, or some other number? That
really depends on your best analysis of the market. For example, if you
potential market would not be motivated by promotions and gimmicks, or
discounted prices, then it makes less sense to put a heavy weight on
promotions. If, on the other hand, your customers are an easily defined
market such that building awareness could readily be done via certain
advertising vehicles (such as magazines, afflilate web sites, etc.), then
this suggests putting a higher weight on advertising.
In short, as in all things in marketing, the more you know about the
customers you will be targeting, the clearer your objectives are for the
marketing campaign, the easier it is to know what type of mix between
promotions and advertising you should have.
What makes a successful ad?
The ad
must be relevant, engaging, and motiviating. But brands must listen to
customers as well as communicating messages that cover those three factors
in order to truly be successful. It is necessary to give customers a stake
in the brand by letting them tell you what is important to them, why your
brand is good and how it can be improved.
Does Advertising really work?
General findings from advertising studies include the following:
Decreases in the level of advertising do not lead to an immediate decrease
in sales. An increase in the level of advertising by itself does not lead to
an increase in sales.
On average, half of all ongoing ad campaigns are ineffective.
Changes in the creative, medium, target segment or product itself sometimes
lead to change in sales, even though increases in the level of advertising
alone do not.
When advertising is effective, it is effective either early on or never.
When advertising does affect sales, its impact is not large and is much
smaller than that of price. In fact, research shows that the elasticity of
sales to advertising is .1, while the elasticity of sales to price is –2.5.
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| Advertising -
The activity of attracting public attention to a product or
business, as by paid announcements in the print, broadcast, or
electronic media. |
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Often when reading publications,
you say to yourself, "This may be
a good one to advertise in." It
would be very helpful to have,
prepared in your folder,
advertisements for your products
and services all ready to go.
Different publishers offer
opportunities for different ad
sizes. Either create different ads
or one larger one that can be
modified to fit the word count. |
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