Advertising: Relationships vs Business Decisions
How does a company decide what topics to focus on for advertising? Is it just a decision made by the company or do they want feedback from their customers as well? We will explore these questions and more in this post. Read on to learn more about how advertising decisions are made, where companies get ideas for their ads, and how companies review their marketing campaign.
What is Advertising?
Advertising is the practice of promoting products or services through various forms of media like TV, print, radio, online and social media networks. Companies invest money into advertisements in order to make consumers aware of the new product so that they may purchase it. Companies invest the most into advertisements when they have new, innovative products or services that will attract consumers and make them buy it.
How is Advertising Decided?
Advertising is a collaborative effort between companies and their potential customers. Customers provide companies with feedback of their needs and offers to improve the company's products and services. This allows companies to get better at creating ads targeted at specific customers by incorporating the market's responses into their advertising decisions. If customers do not like what they see of an already existing product or service, these companies are able to change the advertisement, or even discontinue their advertisement entirely if the market does not respond favorably (Birdsall and Caldwell 2002).
What Influences Decisions?
The decision to advertise a product is influenced by how much the company can afford in advertising costs, how many people are affected by their current advertising campaign (people who have already seen, or will see the advertisement), and how urgent it is to reach potential customers. Companies base these decisions on the size of their profit margin and if they need new consumers for marketing campaigns. The most urgent advertisement is for products or services that will expire without consumers buying them. This usually occurs in grocery stores where the end consumer may cause an item to expire before it can be purchased, like milk or produce (Birdsall and Caldwell 2002).
How Campaigns Are Reviewed and Changed?
When a company decides to advertise, it does so knowing that this is an ongoing process. After the advertisement has been aired and received by the public, the company analyzes how many customers responded positively or negatively to the ad. The company then decides whether or not they want to continue using the same advertisement in their campaign. They may also change their advertisements because of public feedback on their advertisement. Customers are likely to have easier access to criticism of product advertisements through social media sites, like Twitter and Facebook (Dolman 2014). If they feel like the advertisement should be changed, they will respond online with negative feedback to the advertisement. Companies then have the ability to change their advertisements in an attempt to make a customer like them or make a customer aware of their products or services.
Types of Advertising
Companies advertise different products in different formats. For example, companies sell their cars in television advertisements, print advertisements, and radio advertisements. Print advertising can be over the top with bright color ads and creative layouts such as those found in magazine ads. Radio advertising is very basic with just a voice reading the ad along with pictures of cars and trucks on television screens (Birdsall and Caldwell 2002).
Though TV advertisements may be of a different style and targeted towards specific demographics, they are considered a 'mainstream' advertising format that most companies pay for. TV advertisements are very often for the same product or service under a different name, but the public does not have much difficulty grasping what the advertisement is trying to communicate (Birdsall and Caldwell 2002).Companies also air ads on social media networks such as Facebook and Twitter. Each social media network has its own unique set of rules as to when an advertisement can run on a network as well as restrictions regarding ad content. On Facebook, advertisers must follow strict guidelines regarding topics that can be advertised (Dolman 2014).
There are many different types of businesses that use advertising to generate sales. These include consumer products, non-profit organizations, and political groups.
Consumer Products
Companies which manufacture consumer goods make up a large portion of the advertising industry. Companies in this category sell personal care items, food and beverages, clothing and accessories, household products, etc. Consumer products are advertised to promote their sales and brand name recognition (Dolman 2014).
Non-Profit Organizations
Non-profit organizations use advertising to try to raise awareness for an issue or a cause that they believe in. Many non-profit organizations are very well known and have targeted demographics that they advertise to in order to increase awareness of their cause. They often over-use their advertising campaigns in order to try and reach as many potential customers as possible (Dolman 2014).
Political Groups
Political groups use advertising services to try and promote a positive image towards their candidate (Dolman 2014). Political groups use ads to attract voters and make sure that the public is aware of who the candidate is. Political ads usually target specific audiences with messages about the candidate's platforms. They also use social media sites such as Facebook to create campaigns that will attract many people who need to be convinced (Dolman 2014).
Advertising campaigns are used in almost every country to sell products and services. Most countries have set up regulations and laws that control how the public interacts with advertisements. In the United States, advertisers must follow guidelines set forth by the Federal Trade Commission (FTC). The FTC requires that if an advertisement claims something about a product or service and it is not true, the company must make sure that all customers are aware of what is not true about their product (Birdsall and Caldwell 2002).
Every advertising campaign also has to be reviewed before being shown to the public in order to make sure it follows all regulations of government agencies. This is to make sure that the public has not been persuaded by the advertisement to buy a product or service that they don't really want or need.
Advertising affects the economic activities of a nation by increasing demand for goods and services, changing how income is distributed, and influencing the macroeconomy. The effects of all advertising are not positive. At times, it can lead to negative effects on productivity and efficiency as firms are less inclined to spend their time improving their products if they can merely increase sales through advertising . Moreover, it may divert resources from more efficient producers that do not practice advertising at all (Chung, 2004).
Conclusion
Advertising has a great affect on society. It controls most of the things that we see, hear, and experience in our daily lives. In order to broaden your advertising knowledge, it is important to start by looking at advertisements from different points of view. While developing your strategy for publicizing and advertising a product or service, understanding who the target audience is can become a tricky task for many advertising agencies, especially for those who are new in the business. This paper provides example case studies of how companies use their resources in order to achieve their goals, as well as some helpful hints and tips for new businesses and ad agencies.
The purpose of this paper was to provide information about advertising on a global scale.