The advertising management is mainly concerned with planning and decision making. The advertising manager will be involved in the development, implementation, and overall management of an advertising plan. The development of an advertising plan essentially requires the generation and specification of alternatives. Decision making involves choosing from among the alternatives. The alternatives can be various levels of expenditure, different kinds of objectives or strategy possibilities, and kinds of options with copy creation and media choices.
Advertising planning and decision making depends on internal and external factors. Internal factors are situation analysis, the marketing program, and the advertising plan. The three legs of advertising planning concern are the:
- Objective setting and target market identification,
- Message strategy and tactics, and
- Media strategy and tactics.
The advertising plan should be developed in response to a situation analysis, based on research. Once developed, the advertising plan must be implemented as an advertising campaign, in the context of social and legal constraints and with the involvement of various facilitating agencies. Let us discuss these factors one after another.
Situation Analysis – It involves an analysis of all important factors operating in a particular situation. This means that new research studies will be undertaken on company history and experience.
Consumer and Market Analysis.
Situation analysis begins by looking at the aggregate market for the product, service, or cause being advertised, the size of the market, its growth rate, seasonality, geographical distribution. Whereas Consumer and Market analysis is concerned with the following factors:
- Nature of demand
- How do buyers (consumer and industrial) currently go about buying existing products or services?
- Can the market be meaningfully segmented or broken into several homogeneous groups within respect to “what they want” and “how they buy”?
- Extent of demand
- What is the size of the market (units and Pesos) now, and what will the future hold?
- What are the current market shares, and what are the selective demand trends?
- Is it best to analyze the market on an aggregate or on a segmented basis?
- Name of competition
- What is the present and future structure of competition?
- What are the current marketing programs of established competitors?
- Why are they successful of unsuccessful?
- Is there is opportunity for another competitor? Why?
- What are the anticipated retaliatory moves of competitors?
- Can they neutralize different marketing programs we might develop?
- Environmental climate
- What are the relevant social, political, economic, and technological trends?
- How do you evaluate these trends? Do they represent opportunities or problem?
- Stage of product life cycle
- In what stage of the life cycle is the product category?
- What market characteristics support your stage-of –life-cycle evaluation?
- Cost structure of the industry
- What is the amount and composition of the marginal or additional cost of supplying increased output?
- Skills of the firm
- Do we have the skills and experience to perform the functions necessary to be in the business?
- How do our skills compare with those of competitors?
- Financial resources of the firm
- Do we have the funds to support an effective marketing program?
- Where are the funds coming from, and when will they be available?
Advertising planning and decision making are affected by competition and the competitive situation facing the advertiser. Competition is such a pervasive factor that it will occur as a consideration in all phases of the advertising planning and decision-making process. It should include an analysis of what current share the brand now has, what shares its competitors have, what share of a market is possible, from which competitors the increased share of a market is possible? The planner also must be aware of the relative strengths and weaknesses of the different competing companies and their objectives in the product category. It is important to look at competition as a precursor to the planning process.
The Advertising Plan
As pointed out earlier, advertising plan and decision-making focus on three crucial areas: objectives and target selection, message strategy and tactics, and media strategy and tactics.
- Objectives and Target Selection – Objectives in advertising can be understood in many ways. An important part of the objective is the development of a precise, disciplined description of the target audience. It is often tempting to direct advertising at a broad audience; but everyone is a potential customer. It is best to consider directing the advertising to more selected groups to develop stimulating copy. It is quite possible to develop several campaigns, each directed at different segments of the market, or to develop one campaign based on multiple objectives.
- Message Strategy and Tactics – Messages strategy must decide what the advertising is meant to communicate – by way of benefits, feelings, brand personality, or action content. Once the content of the campaign has been decided, decisions must be made on the best-most effective-ways of communicating that content. The decisions, such as the choice of a spokesperson, the use of humor or fear or other tones, and the selection of particular copy, visuals, and layout, are what we call “message tactics”
- Media Strategy and Tactics – Message strategy is concerned with decisions about how much is to be allocated to create and test advertising copy, media strategy concerns decisions on how much money to spend on an advertising campaign. Media tactics comprise the decisions on which specific media (television, radio magazines, etc.) or media vehicles to spend.
The external factors in the planning framework are environmental, social, and legal considerations. To a considerable extent, these exist as constraints on the development of an advertising plan and decision making. In developing advertisement, there are certain legal constraints that must be considered. Deceptive advertising is forbidden by law. What is deceptive is often difficult, because different people can have different perceptions of the same advertisements. Thus, an advertiser who attempts to provide specific, relevant information must be aware of what constitutes deception in a legal and ethical sense and of other aspects of advertising regulation. Even more difficult consideration for people involved in the advertising effort is broad social and economic issues as stated below.
- Does advertising raise prices or inhibit competition?
- Is the use of sex or fear appeals is appropriate?
- Women and minority groups are exploited in advertising by casting them in highly stereotyped roles.
- Is it more irritating than entertaining?
- Is an intrusion into an already excessively polluted environment?
- Advertising directed at children.
Advertiser and the Advertising Agency interface
From a situation analysis point of view, the advertiser needs to know what kinds of facilitating agencies exist and the nature of the services they provide. From a planning point of view much local advertising is done without the services of an advertising agency or a research supplier. On the other hand, a national advertiser may have under contract many different agencies and research suppliers, each serving one or more brands in a product line. Many advertising decisions involve choosing facilitating agency alternatives.
- What advertising agency should be chosen?
- What media should be used?
- What copy test supplier will be best for our particular situation?
Concerning the question of agency selection, characteristics such as the quality of personnel, reputation, integrity, mutual understanding, interpersonal compatibility and synergism were very important.
The advertising industry consists of three principal groups:
- Media ;
- Advertising agencies or advertising departments.
Advertising agencies are of two basic types
- An independent agency is a business that is free to compete for and select its
- A house agency is owned by its major client. A house agency is not completely free to serve other clients. The advertising department an integral part of the organization it serves.
he advertising agency provides for the client a minimum of:
- Media information, such as the availability of time and space;
- Creative skills, such as “campaign planning” and “appeal planning” and
- Research capabilities, such as providing brand preference data.
What is an Advertising Agency?
An advertising agency is an independent organization set up to render specialized services in advertising and in marketing in general.
Working with Advertising Agency
Some organization does not employ advertising agencies because they may be eligible for the media discount. Others feel that they can accomplish the advertising objectives more effectively than the agencies themselves. These marketers often employ their own advertising specialists. Various organizations use captive agencies that work primarily or solely for the organization.
Those organizations which do employ agencies are well-advised to establish a strong working relationship with them. It is especially important that the marketer fully inform the agency personnel of his marketing strategy and advertising objectives.
Advantage of Using Agencies
- The marketer gains a number of benefits by employing agencies. An agency generally has an invaluable experience in dealing with various advertising and marketing issues.
- The lessons which agency learned in working with other clients are useful inputs for the marketer.
- An agency may employ specialists in the various areas of preparation and implementation of advertising plans and strategies.
- The personnel are not members of the marketer’s management team. They bring objective and unbiased viewpoints to the solution of advertising and other marketing problems.
- The discounts that the media offer to agencies are also available to advertisers. This is a strong stimulus to them to use an agency, for the media cost is not much affected thereby.
- The company normally does not have as many types of specialists as a large or medium-sized advertising agency has because an agency can spread the costs or its staff over many clients. It can do more for the same amount of money.
- The company can also get an objective, outside viewpoint from an agency, assuming that the agency representatives are not acting as “Yes man” to keep the advertiser’s account.
- A related point is that the company can benefit from the agency’s experience with many other products and clients.
- Another advantage is that agency feels a greater pressure than the company’s own department to produce effective results. The relations between an agency and a client are very easy to terminate; but it is difficult to get rid of an ineffective advertising department.
- The way agencies are compensated, the use of an agency may not cost the advertiser a single peso.
Selecting an Agency
While selecting an advertising agency, the importance of compatibility should be borne in mind. An agency takes a long time to grasp the problems and accumulate the facts that are necessary for the smooth functioning of a client. Though this investment period is long, it pays rich dividends. Therefore, an agency should not be frequently changed.
Getting the Best Out of an Agency
- The agency should be given all possible information if good service is expected from it.
- The advertiser should go as far as possible to keep the agency on its toes.
- The agency should be challenged to produce results.
- Criticism, when it is handed out, should not be only unfavorable. It should also be favorable.
- Unnecessary details should not be fussed over.
- The advertiser should appoint a special person for liaison work between his company and the agency, and not expect the agency to contact the junior staff.
- The advertiser should allow the agency, where necessary, to break away from convention in its presentations.
- The agency should be paid extra if it does any extra work.
- The advertiser should examine the work his agency does for other parties to get new ideas.
Setting Advertising Objectives
Without objectives, it is nearly impossible to guide and control decision making. Good performance occurred in the absence of objectives can rarely be sustained. The challenge today is to bring effective management to the advertising process in such a way as to provide simulation as well as direction to the creative effort. The solution is the meaningful objective.
Advertising objectives, like organizational objectives, should be operational. They should be effective communication tools, providing a line between strategic and tactical decisions. A convenient and enticing advertising objective is immediate sales or market share.
However, an increase in immediate sales is not operational in many cases for two reasons:
- Advertising is one of many factors influencing sales, and it is difficult to isolate its contribution to sales. The other forces include price, distribution, packaging, product features, competitive actions, and changing buyer needs and tastes.
- The second reason involves the long-term effect of advertising on sales. If advertising generates a substantial lagged effect on sales, then the impact of an advertising campaign may not be known until an unacceptable length of time has passed.
basis of operational objectives
- Who is the target segment?
- What is the ultimate behavior that advertising is attempting to precipitate, reinforce, change, or influence?
- What is the process that will lead to the desired behavior and what role can advertising play in the process?
- Is it necessary to create awareness, communicate information about the brand, create an image or attitude, or associate feelings or a type of user personality with a brand?
Identify the target audience. The specification of the target audience should be a part of the marketing objectives.
The analysis of the ultimate desired behavior such as trial purchases of new customers, maintenance of loyalty of existing customers, creation of a more positive use experience, reduction of time between purchases, or the decision to visit a retailer use experience, reduction of time between purchases, or the decision to visit a retailer.
An analysis of the communication and decision process they will affect the desired behavior. It might be that the key variable in inducing a new customer to try your brand is to inculcate high levels of brand awareness. The best way to maintain loyalty is to strengthen an attitude. Which intervening variables provide the best link to the desired behavior and which can be influenced economically by advertising are to be determined.
An analysis of market dynamics can lead to behavioral measures that by themselves can provide the basis for operational objectives. If the advertising’s target is new customers, the goal may be to get new customers to try a brand for the first time. The results would be measured by the number of new customers attached.
The use of behavioral measure as objectives is often appropriate in retailing (store traffic measures), direct marketing, and sales promotion and in lead generation for salespeople. It is useful to analyze the communication and decision process relevant to the desired behavior and to identify intervening variables on which to base objectives. Some situations could dictate the joint use of intervening and behavioral objectives.