Chapter 2 notes - Chapter 2 The Structure of the...

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Chapter 2 – The Structure of the Advertising Industry: Advertisers, Agencies, Media Companies and Support Organizations The Big Power Struggle o How the ad industry can adapt to the new technologies that we as consumers are willing and eager to use to gain more control over our information and entertainment environment We like Facebook and YouTube; we do not like TV commercials and find them boring and usually skip over them with TiVo Since this is how we grew up, it creates many new opportunities for us in advertising The Adv industry is in constant transition o But the fundamental process of Adv and the role it plays in organizations remains the same: persuasive communications directed at target audiences o Advertisers struggle to decide whether to use tradional Adv or new Adv but the focus should always be on the brand and how to most effectively reach the target audience Five trends affecting Adv and promotion industry o The “undoing” of agency consolidation and globalization – or not? 1999-2002 – Adv industry went through a period of extreme consolidation and full-service agencies acquired and merged with other full-service agencies and interactive shops Not all clients were impressed with giant agencies because they thought they would miss out on the creativity of small shops Bigger has not always meant better or more profitable Main Point – Adv agencies are trying to do whatever it takes to keep pace with advertisers needs in effectively reaching and communicating with target audiences o Media Proliferation, Consolidation, and “Multiplatform” Media Organizations Media Companies of all types tend to pursue more and more “properties” if they are allowed to and create multiplatform media organizations o Media Clutter and Fragmentation More ways to try to reach consumers than ever before There are so many different forms of advertising that the possibility of any one ad breaking through and making a real difference continues to diminish o Consumer Control: From Blogs to TiVo Consumers are now in greater control of the information they receive about product categories and the brands within those categories Blogs are done by consumers and are a new source of product and brand information TiVo lets consumers skip commercials on TV by fast-forwarding through them o Web 2.0 A phrase coined by O’Reilly Media in 2004 and refers to a second generation of web based use and services Social networking sites and wikis They emphasize online collaboration and sharing among users
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Chapter 2 notes - Chapter 2 The Structure of the...

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