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Comm245AdvertisingLectureNotes - ADVERTISING Advertising...

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ADVERTISING Advertising provides economic support for newspapers, magazines, TV and radio—generates most of the revenue for these media—plays indirect role in supporting exchange of ideas in a democracy 1914 Congress established Federal Trade Commission 1938 Wheeler-Lea Amendment to FTC Act—added that purpose of FTC is also to protect credulous consumers Advertising Agencies More than 500 advertising agencies in United States (Madison Avenue, Manhattan) Structure of an advertising agency 1) Creative directors 2) Account executives 3) Media buyers 4) Research staff personnel Media buyers use “cost per mille” (CPM) = cost of reaching 1000 potential consumers David Ogilvy: “It would cost $25,000 to have door-to-door salesmen call on 1000 homes. A TV commercial can do it for $4.69.” (So a 30” TV spot that reaches 100,000 viewers @ $5 CPM = 100,000/1000 = 100 groups of 1000 viewers X $5 = $500 for a 30” spot on a local TV station Media buyers use data from Audit Bureau of Circulations to get accurate data on newspaper circulation Newspapers also count how many “hits” they get to their web sites (San Jose, California Mercury News had circulation of 270,000 but its web site was getting 325,000 hits per day—very attractive to advertisers)
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Diffusion of innovation Trade organizations
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Comm245AdvertisingLectureNotes - ADVERTISING Advertising...

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