advertising budget & developing an ad

8/9/2019 Advertising Budget & Developing an Ad

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Advertising Budget &Advertising Budget &

Developing the Ad. CampaignDeveloping the Ad. Campaign


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Advertising BudgetAdvertising Budget

How does a company know if it isHow does a company know if it isspending the right amount?spending the right amount?

Although advertising is treated as currentAlthough advertising is treated as currentexpense, part of it is really an investmentexpense, part of it is really an investmentin building brand equity.in building brand equity.


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General methods for fixing AdGeneral methods for fixing Ad

budgetsbudgets1.1. Stage in the product life cycleStage in the product life cycle higher inputshigher inputs

for new brands/products and lower budgets forfor new brands/products and lower budgets forestablished onesestablished ones

2.2. Market share and consumer baseMarket share and consumer base LessLessexpensive to reach consumers of widely usedexpensive to reach consumers of widely usedbrand than to reach consumers of lowbrand than to reach consumers of low--sharesharebrandsbrands

3.3. Competition and ClutterCompetition and Clutter Larger the numberLarger the numberof competitors and higher the industryof competitors and higher the industryspending, will necessitate heavy spending for aspending, will necessitate heavy spending for abrandbrand


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5. Frequency5. Frequency The number of repetitionsThe number of repetitions

of the brand ads.of the brand ads.

6. Product substitutability6. Product substitutability Brands inBrands in--lessless--differentiated or commoditydifferentiated or commodity-- productproductclasses like beer, soft drinks, banks, andclasses like beer, soft drinks, banks, and

airlines require heavy advertisingairlines require heavy advertising


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Developing the Ad campaignDeveloping the Ad campaign

It is important to distinguish theIt is important to distinguish the messagemessagestrategystrategy (or positioning of an ad) from its(or positioning of an ad) from its

creative strategycreative strategy (how the ad expresses the(how the ad expresses thebrand claims). Designing an effectivebrand claims). Designing an effectiveadvertising campaign is both a science and anadvertising campaign is both a science and anart. To develop a message strategy, advertisersart. To develop a message strategy, advertisers

go through three steps: message generation andgo through three steps: message generation andevaluation, creative development and execution,evaluation, creative development and execution,and social responsibility review.and social responsibility review.


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Message generation and evaluationMessage generation and evaluation

One should attempt to generate fresh insightsOne should attempt to generate fresh insightsrather than the same old appeals and positionsrather than the same old appeals and positions

as others. If every ad portrays a speeding car onas others. If every ad portrays a speeding car ona curved mountain road, a very weak link onlya curved mountain road, a very weak link onlycould be established between the brand and thecould be established between the brand and themessage. A good ad normally focuses on one ormessage. A good ad normally focuses on one or

two core selling propositions. Market researchtwo core selling propositions. Market researchwould help to determine which appeal workswould help to determine which appeal worksbest with its target audience.best with its target audience.


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Once an effective appeal is discovered, advertiser shouldOnce an effective appeal is discovered, advertiser shouldprepare a creative brief, typically covering one or twoprepare a creative brief, typically covering one or twopages. This will be an elaboration of the positioningpages. This will be an elaboration of the positioning

statement and includes:statement and includes: Key messageKey message Target audienceTarget audience Communication objectivesCommunication objectives

Key brand benefitsKey brand benefits Supports for the brand promiseSupports for the brand promise MediaMedia


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Creative development andCreative development and

executionexecutionThe ads impact depends not only on what isThe ads impact depends not only on what issaid but on how it is said. In preparing an adsaid but on how it is said. In preparing an ad

campaign, the advertiser can prepare acampaign, the advertiser can prepare a copycopystrategy statementstrategy statement describing the objectives,describing the objectives,content, support, and tone of the desired ad.content, support, and tone of the desired ad.

Every ad medium has specific advantages andEvery ad medium has specific advantages anddisadvantages. Each one can be evaluated:disadvantages. Each one can be evaluated:


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Television AdsTelevision Ads

The most powerful advertising medium; reachesThe most powerful advertising medium; reachesa broad spectrum of consumersa broad spectrum of consumers

Low cost per exposure because of wide reachLow cost per exposure because of wide reach Provides effective means to vividly demonstrateProvides effective means to vividly demonstrate

product attributes and explain consumerproduct attributes and explain consumerbenefitsbenefits

Dramatically portrays user and usage imagery,Dramatically portrays user and usage imagery,brand personality, and other brand intangiblesbrand personality, and other brand intangibles


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Major drawbacks of TV AdsMajor drawbacks of TV Ads

Because of the fleeting nature of the messageBecause of the fleeting nature of the messageand the potentially distracting creative elementsand the potentially distracting creative elementsoften found in a TV ad, product relatedoften found in a TV ad, product relatedmessages and the brand itself can bemessages and the brand itself can beoverlooked. Large number of ads and otheroverlooked. Large number of ads and otherclutter make it easy for consumers to ignore orclutter make it easy for consumers to ignore orforget ads. High cost of production andforget ads. High cost of production and

placement is a big disadvantage. Nevertheless,placement is a big disadvantage. Nevertheless,well designed and executed TV ads. can improvewell designed and executed TV ads. can improvebrand equity, and affect sales and profits.brand equity, and affect sales and profits.


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Print AdsPrint Ads

In a stark contrast to broadcast media,In a stark contrast to broadcast media,print media with its selfprint media with its self--paced nature, canpaced nature, can

also effectively communicate user andalso effectively communicate user andusage imagery. But the static nature ofusage imagery. But the static nature ofthe visual images in the print mediathe visual images in the print media

makes it difficult to provide dynamicmakes it difficult to provide dynamicdemonstrations. Another disadvantage isdemonstrations. Another disadvantage isthat it can remain fairly passive.that it can remain fairly passive.


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Although newspapers are timely andAlthough newspapers are timely andpervasive, magazines typically are morepervasive, magazines typically are more

effective at building user and usereffective at building user and userimagery. Advertisers have some flexibilityimagery. Advertisers have some flexibilityin designing and placing newspaper adsin designing and placing newspaper adsbut poor reproduction quality and shortbut poor reproduction quality and short

shelf life can diminish their impact. Formatshelf life can diminish their impact. Formatelements such as ad size, color, andelements such as ad size, color, andillustration affect a print ads impact.illustration affect a print ads impact.


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Radio AdsRadio Ads

Radio is a pervasive medium. In AmericaRadio is a pervasive medium. In America96% of all Americans of age 12 and older96% of all Americans of age 12 and older

listen to the radio daily and on average,listen to the radio daily and on average,for over 20 hours a week. In Rural India,for over 20 hours a week. In Rural India,Radio is the best broadcast medium. ItsRadio is the best broadcast medium. Its

stations can be well targeted, ads arestations can be well targeted, ads arerelatively inexpensive to produce andrelatively inexpensive to produce andplace.place.


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Social responsibility reviewSocial responsibility review

Advertisers and their agencies must be sure thatAdvertisers and their agencies must be sure thatadvertising would not overstep social and legaladvertising would not overstep social and legal

norms. Public policy makers have developed anorms. Public policy makers have developed asubstantial body of laws and regulations tosubstantial body of laws and regulations togovern advertising. To be socially responsible,govern advertising. To be socially responsible,advertisers must be careful not to offend theadvertisers must be careful not to offend the

general public as well as any ethnic groups,general public as well as any ethnic groups,racial minorities, or special interest groups.racial minorities, or special interest groups.

advertising budget & developing an ad

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