Theoretical Understanding and Practical Application of Advertising and Promotion in Business
Basically, marketing communications are the process of information transmission to the target audience about goods and a company. Thus, there are three communication theories which are to be analyzed. They are shortly described below. The first one is the queuing theory. This theory is applied when there should be the solution for choosing the sequence of customer service and other similar tasks. It allows to learn the developing regularities, which are connected to a flow of service demands, and to observe the necessary sequence of their execution. The second one is the theory of communication which considers the mechanism of "feedback". It allows receiving signal information on the processes which are exceeding the limit of established parameters. Application of this theory in marketing organizational structures helps to improve communication between the enterprise and the market. Moreover, it increases an efficiency of using the data derivable from outside. Finally, the third one is the probability theory. It helps to make decisions which are consolidated to value determination of probabilities that certain events may occur. Moreover, this theory shows how to choose the right decision among possible actions of the most preferable planning of goods’ production. All the listed marketing communication processes are important and applicable to advertising and promotion of business. It is offered to prove it at the example of the queuing theory in a restaurant. Whenever a customer needs some service, there is always a question where to require it. Relating to restaurants, queuing theory gets a lot of factors involved. It comes to the action when it is necessary to calculate the amount of time customers usually spend in the restaurant or times when a lot of customers are expected to arrive. To ensure customer satisfaction the queuing theory addresses the psychological issues. First of all this theory is improving wait times. For instance, more servers can be added at busy days or during and after the parties. One more advice is determining of the wait time. People feel much calmer when they know how much time they have to wait for an order. They can easily relax when there is a waiting list on a screen or they get visual paging devices. If the listed above cannot be provided, there is always a good advice to entertain the customers or provide some activity while they are waiting. For instance, customers should be allowed to look at menus or a bar area can be used for a queue into the dining room. Therefore, all the listed tools can be summed up as integrated marketing communications. From the side of the restaurant, in case if chiefs want to attract and keep the client, IMC (Integrated Marketing Communications) are here to create a competitive advantage. Basically, IMC wrap communications around customers. All the activities proposed above help a customer to pass through the buying process. Thus, IMC integrate various promotional tools and link all the messages so that they work together effectively. Using all the tools at the same time helps to engage customers, increase the brand awareness and drive the revenue.
Primarily, the company should decide whether it is ready to use advertising agency help. This decision depends on a company’s financial resources and its’ advertising strategy. An agency has professionals who are useful because they create, organize and place advertising so that it will be much better than most small businesses can do on their own. Despite high expenses, even small and middle businesses trust the agencies to shape and monitor advertising strategies. The core factors of choosing an advertising agency which can organize everything, track and analyze the effectiveness are various. First of all, pay attention to the size of the agency and their clients, because small companies should better not ally with agencies with a large stable of huge corporate clients. It can happen that they will not be treated as afterthought. Moreover, it is necessary to know the agency’s general advertising philosophy and the length of time the principals worked with it. Not the least factor is the primary nature of the agency’s accounts. If they are not familiar with industry company works in, it can be a challenge.
There are three regulatory bodies in the US, which regulate advertising and promotional activities. Generally, advertising is regulated through authority regulation, self-regulation, and state regulation. Federal authorities empower regulatory agencies to enforce them, adopt federal laws and empower them to develop guidelines and policies. Moreover, it is empowered to control advertising industry as a whole. The Federal trade commission (the FTC) is the major regulatory body for the advertising market. Basically, its aim was to prevent unfair methods of competition in commerce. Later, it turned to the consumers’protection. Nowadaysthe FTC works at effective law enforcement, shares its expertise with state and federal legislatures, international government agencies and the U.S., develops recommendations and actively participates in conferences, educational programs and hearings, represents consumers’ interests. There are also federal communications commission(the FCC), which regulates advertising by mass-media and Food and drug administration(the FDA)developsthe Advertising Guidancefor drugs and supplements.
Advertising is also regulated by city, county and state legislators. State civil and administrative codes, professional and business codes provide backgrounds to consider advertisements fraudulent, unfair or deceptive. Besides, county and state laws are based on federal legislation and act bythe FTC. Additionally, they specify such issues as price and quality, benefits of a product or service, place of origin or bait-and-switch tactics, deceptive or misleading comparative price, and disparagement of goods. If it is necessary, consumers are to file a complaint with the state, the city or countyDepartment of Consumer Affairs,the city or county Attorney General. Finally, self-regulatory non-governmental organizations are considered the most effective regulators of advertising industry.One of the most influential among them is the Better Business Bureau(BBB).
The BBB meets accreditation standards and includes a commitment to make a faith effort to resolve customer complaints. The BBB standards consist of the BBB Code of advertising, the BBB Code of business practices and the BBB Standards for Trust. Additionally, it is an alternative dispute resolution service which resolves consumer complaints along with organizations’ disputes. All cases are settled by the means of conciliation, arbitration or mediation.
Moreover, together with the American Association of Advertising Agencies, the Association of National Advertisers and the American Advertising Federation, the BBB forms an alliance – the National Advertising Review Council(NARC).
Often advertising plays an important role as a strategy for promoting a product. It is offered to prove this statement on the example of Coca-Cola. The first bottle was bought in Atlanta in 1886; however, the very first advertising was started 9 years later, in . The company directed the following advertising to female audience, showing as Coca-Cola is capable to help hostesses refreshing feelings after homework. Key phrases in posters and announcements promised them to become "lunch refreshed" and "shop refreshed", which showed to consumers that their refreshing drink is capable to turn the homework into pleasure.
Every year the number of Cola fans was increasing around the world. Therefore, advertising became more verbose and enticing. In the 1955 the company popularized the brand by posters on which there were images of smiling women and men, enjoying freshness of drink.
Later, when American business grew up, the majority of Americans were unemployed. That time the Coca-Cola advertising propagandized that further work is continued easily when the one had drunk a glass of Cola and received an energy charge during a break.
For the entire history of brand development, Coca-Cola mentioned a set of environmental issues and health, getting interested each following concrete generation.
The Coca-Cola Company also created a new trend for people with bigger concern of goods’ quality, having offered them a drink, Cola Light. This innovation was demonstrating a company’s health care initiative.
Developing and advancing the brand of Coca-Cola, the company created new highly demanded products and new advertising methods stimulating high sales all around the world.
The basis of marketing policy success was a promotion strategy development in the direction of the consumers’ values. These campaigns were effective only because they corresponded to desires of the last time.
Hiring an advertising agency is a great investment for the company, so it is better to be familiar with the major ways of working with an advertising agency in order to benefit from it 100%. Primarily, before calling an agency, think what the company really needs and wants, specify timeframe, targeted audience and funding. Also, it is important to be patient and wait calmly. Plan the work carefully and rely on specialists. The third tip is to stay open, spend the time with the agency and try on truly big ideas, moreover, be consistent. In order to get a good counsel, trust your agency and inform them about any changes. Finally, the most important point is to appreciate hard and good work when you receive it. Do not forget about human relationship.
Advertising is impossible without creativity. Generally, a creative idea is most likely identified while brainstorming. When the company needs to get a creative advertisement it should be imaginative, sharp and intelligent in order to catch potential customers’ attention. This message should motivate people to buy a product you advertise. If you can make positive impact on the consumers then your message is suitable. Thus, to further fulfill the desired requirement the creativity develops new useful ideas. The main point is to focus a buyer’s attention on the product. He should want to purchase that product for same benefit. Therefore, creative advertising is aimed to create demand for the product after its introduction for the first time.
There are three primary advertising techniques which companies use as integrated promotional strategies to sell their products. The first theory called Above-the-Line (ATL) is an advertising which uses media for brand-building. The most applicable instruments are radio, print, television, cinema, web banners and web search services. This communication type is considered impersonal to customers as far as is conventional in its’ nature.
In turn, Below-the-Line (BTL) advertising uses unconventional brands’ promotion strategies. For instance, it can be direct mail or printed media. Moreover, it usually involves no motion graphics. This sales promotion is much more effective when the target group is difficult to define or very large. Here the BTL type of advertising is a delayed or immediate incentive to purchase. Furthermore, it is expressed in kind or in cash and has short duration. The BTL is cost-effective and efficient for targeting a specific group. The usual BTL channels of advertising use less conventional methods than the ATL and typically focus on direct means of communication, most frequently they are e-mail and a direct mail. In order to maximize response rates, the BTL often uses very much targeted names’ lists. These advertising services include those for which a fee is charged up and agreed front. The BTL is an ordinary technique which is used for "touch and feel" products. That means consumer items where the customer will not rely on previously researched items, but on immediate information. These techniques highlight the features of the product while at the same time guarantee recall of the brand. Another BTL technique gets sales personnel involved near targeted products at retail stores. These techniques are good to be used for generating samples of newly launched products.
Sometimes, clients and agencies switch to through-the-line approach, also called the approach with integrated communication. This approach is a mix of the BTL and the ATL. This advertising strategy is used for integration of a marketer’s efforts and optimizing returns from such kind of separate investments. The modern idea of the TTL approach shifts its emphasis more towards the BTL approach and remains to optimize the return on marketing budget. It is better approach because focusing the energy on winning more crucial, but yet smaller BTL battles, returns more than investments spent for the ATL wars with well-paid competition.
Most of the companies prefer the BTL technique to the other two types of techniques, and it happens because of different reasons. Primarily, this technique is closer to the potential consumer. The majority of companies state that the main plus of the BTL is the low price policy of service payment when they work with this type of advertising. One more benefit is an opportunity to create a perspective communication between trade partners and sales representatives. Due to this communication, the end user desires not only to get acquainted with product that is advertised, but, moreover, to reveal merits of represented goods and try it. Besides, the greatest benefit if it is compared with television and radio advertisement is that the BTL technology can work at the most unusual platforms. When the company plans to conduct an effective promotion campaign, it transforms models of goods to a part of daily occurrence which surrounds us. For example, the company hires promoters who wear costumes of a promoted product, such as Mars chocolate bar or Coca-Cola bottle. This type of advertisement makes the product more habitual for the target consumer. Furthermore, these technologies enable involving in advertising not only specially prepared platforms, but even natural objects. It allows the consumer get a new look at an advanced brand and, influenced by bright impression, give the preference to an advanced product at the level of subconsciousness. One more reason is that the BTL influence customers in retail outlets. Considered as indirect advertising, the BTL does not annoy potential consumers through regular radio or TV advertisements. It purposefully influences a buyer at the places where he can purchase that immediately. Moreover, it is a well-known fact that the majority of modern buyers tend to the impulse purchasing and the BTL influence them the best way.
Usually in the first turn a business owner develops the advertising strategy while the advertising budget can be written before or after that. The resources available to the business and the importance of advertising basically condition when it should be created. The most common and progressive methods that look to perpetuate the growth of developing a valuable budget are the competitive approach, all available funds, the market share, the task or objective approach and the percentage of future or past sales. In most cases, the percentage of future or past sales method is the easiest and the most often used. However, to ensure the growth a lot of industry experts advise to base spending on anticipated sales.
In order to initiate a promotion plan and explain how to carry out the development
of an integrated promotional strategy, it is offered to choose rather popular brand Fujitsu, a leading provider of information technology products and services.The advertising budget is £16,000. In order to promote the product it is offered, primarily, to advertise it in mass media, as well as in the Internet (for example, to place banners on different web-sites about information technology, to provide SEO optimization, make information distribution – to place articles, news, advertising on branch portals; advertising on TV, radio and advertising in the press) – all these advertisements will approximately cost £5,000.
One more tool of advertising which can be used is advertising on big boards, small boards, street banners, advertising in the subway (printing and sound ones), signs on shops and internal registration of shop (posters, booklets), the printing of posters, leaflets and booklets for distribution and for actions will cost around £2,000.
For the effective product the company takes a decision to conduct promotion campaign. The budget of it concludes: rental of premise (£1000), payment for delivery of promotion examples (£1000), payment to the personnel of the PR company which carries out the promotion campaign (£1500), fee for inviting mass media (£500). For higher efficiency it is advisable to employ promoters which will distribute handbills near the venue (£1000). Moreover, there is a better option to insure the product examples in case of any force majeure during its transportation because of the high value. Insurance will cost £4000. Altogether total price of promotion campaign is £16000.
Communications with the staff of other shops around the globe is mainly planned to be organized through e-mail as it is the cheapest option; there is no special need to talk on the phone. Internet costs are already included in costs of fee of the telecommunication company.
These communications can be conducted successfully if the employees will follow corporate culture and discipline. It is also supposed that each point of promotion campaign is equipped at least with one computer connected to the Internet.
Furthermore, employees will be offered to choose the most perspective for advertising and influential newspapers, TV channels, radio stations and city sites, where advertisements are to be placed. The head of the advertising department will tell them in advance which points need more attention. Thus, what is very important, it will be offered to them to prove their opinion. If it still seems unconvincing or wrong to the head of the advertising department, he will ask to revise the decision.
There are four integrated promotional marketing techniques (IMT) which are going to be analyzed. First of all, there is an IMT called the increase engagement. This technique is a method of marketing organization by the principle of distribution and expansion of responsibility for understanding and performance of functions of marketing among all firm personnel – from the worker who is directly serving the client, to the top management of a firm. One more IMT is social media as the market research. These programs focus on efforts that create the unique content which is going to attract the attention of potential customers. It also should encourage readers to share it with their friends within social networks. Location based-marketing techniques are presented by mobile “check-in” platforms, google places, mobile websites and local SEO. The person enters the Internet and marks that the one is at the particular place. Usually, these are the restaurants, cafes, and brand shops. And the last technique focuses on the quality content. These identified IMT techniques can be successfully used all together in a promotional campaign. In this case, it is offered to take an example of a restaurant. It is necessary to remember that whenever the effectiveness of integrated online marketing campaign is to be improved, the organizers of the campaign are to be clear on what they try to achieve. Therefore, the measure of the campaign effectiveness is the number of people that attended the restaurant and checked in there. One more quantity characteristic is the number of people who shared information about the targeted restaurant in their social networks.