L3 MarComms 3x.pdf - Session 3 Advertising and Management Planning and Analysis Learning objectives • The functions of advertising • How to set

L3 MarComms 3x.pdf - Session 3 Advertising and Management...

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1 Session   3 Advertising   and   Management Planning   and   Analysis Learning objectives The   functions   of   advertising How   to   set   advertising   objectives The   hierarchy   of   effects   model   and   how   it   influences   advertising   objective   setting Nature   and   importance   of   advertising   budget   setting The   meaning   of   reach,   frequency,   various   rating   point   concepts Different   approaches   to   advertising   allocation Ad investment Ad investments are not just a current expense; they are an investment to ensure long-term success. Consistent investment spending is the key factor underlying successful advertising. Stopping or reducing advertising can cause a brand to lose some of its equity and market share.
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2 Putting advertising in perspective Arguments   for   investing   in   advertising   • Investment   in   advertising   requires   that   incremental   revenue   exceeds   advertising   expense. Arguments   for   reducing   advertising   expenditure • Decreasing   advertising   expenses   will   increase   profits,   if   all   other   expenses   are   held   constant. Profit   =   Revenue   – Expenses Revenue   =   Price   x   Volume Volume   =   Trial   +   Repeat Putting advertising   in   perspective Ad   Spend   and   the   GFC Traditional   media   spend   decreased TV   10.7% Metro   Newspapers    ‐ 20.9% Radio 7.4% Magazines 9.3% Outdoor 13.4% New   media   spend   increased Internet/Online +12% 3 rd largest   Marginally   behind   Metro   Newspapers   and   ~45%   less   than   TV Sinclair,   L   (2009)   The   Australian,   p.21)
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3 Advertising functions Informing Persuading Reminding Adding   value Assisting   other   company   efforts Setting advertising objectives An   expression   of   marketing   management   consensus Guide   the   budgeting,   message   and   media   aspects   of   a   brand’s   advertising   strategy Provide   standards   against   which   results   can   be   measured The hierarchy-of-effects model of advertising
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