Advertising and Promotions

Advertising and Promotions

Contents


Introduction

Marketing communication process is vital for any organization and can lead to the success of organization in the marketplace. The present paper would evaluate the four key learning objectives which would include scope of marketing communication process, role which advertisement process plays along with its importance in organizational setting, below the line advertisement technique used by the organizations and finally planning for the integrated marketing communication process in the organization. The entire paper has been planned in two parts i.e. part A & B. Part A of the paper would look at the academic theories underpinning marketing communication field while part B of the present paper would design the promotional plan for organization of our choice. 













Part-A       

1. Explain the communication process. Explain how AIDA model can be used to create an impact in the advertising process.

Communication process can be defined as the two way flow of information in order to construct and exchange knowledge with aim of building mutual understanding. In an organizational setting there are several audiences with which it would try to establish communication for developing understanding. The first and foremost reason for communication for an organization would be to persuade its consumers for particular product or service. For example, BMW which is a German based automobile company would need communication process so as to communicate features of its newly launched car (Clow & Donald, 2009). Company would have to develop a message in order to communicate to its consumers so as to tell them about the features and benefits which they would receive through their newly designed car. Key elements of a communication process would include source & encoding, signal & channel, decoding & receiver, noise and feedback. All these elements are vital part of the communication process and absence of any element from the communication process may distort information flowing from person transmitting information to the person receiving it.
AIDA model of communication stands for its four key elements which are attention, interest, desire and action. AIDA model can help an organization to make impact through advertisement process wherein it is desired that before conveying any message to audience their attention should be sought by the organization. After seeking their attention it is vital for the organization to keep them interested by offering solution to their problem and telling them how these solutions would work to resolve their problem. Desire should be created once consumers are interested and listening to the message conveyed by company. Promotion planner should create desire not what consumer want but for the goods which planner want them to have. Finally action should be initiated by offering goods or services to them as consumers have already shown their desired for the products. For example, if consumers are wondering for after sale services then particular information relating with after sales service should be delivered to them in order to resolve the issue.
Role of information communication technology can’t be undermined from the overall marketing communication process. ICT has shaped a new platform for marketing communication process wherein organizations can reduce their cost of advertisement substantially by making use of social media and email marketing tools. Further ICT would be having the role to identify consumer niche which organization can target so as to build significant demand (Tom and Caywood, 2006).

2. Examine ways of working with advertising agencies?

There are two important parameters for working with advertisement agencies and these are selection for the advertisement agency and payment methods used for the advertisement agencies. Companies looking to appoint advertisement agencies would make use of the step by step process for selection of advertisement agency and these steps are as under:
·         Identification of requirements: Company would identify the campaign goals which are to be attained through proposed campaign.
·         Creation of pool list of agencies: Based on the past history of advertisement agencies a pool of suitable agencies is developed.
·         Credential pitch: Some companies ask the agencies to submit their credential before submitting the brief.
·         Submit brief: Brief would vary from company to company and would include situation, objective, strategy and 3Ms (men/women, money and minutes) etc.
·         The pitch: Shortlisted agencies would be invited to make the sales pitch. ABM one of the well known advertisement agency in 1980’s hired Scots guard bigpipe band of 60 member so as to present their pitch for playing Honda Jingle “Believe in freedom, believe in Honda”. 
·         Analyzing and choosing an agency: After analysis of entire pitch final selection of the advertisement agency would be made.
Payment method for the advertisement agencies can be in three ways i.e. commission, fees and pay by result. Commission is charged by the advertisement agency by getting discount of 15% from media such as TV channel e.g. in case of a 10 million campaign, agency would pay TV channel just 8.5 million and rest amount would be there commission. Fees are also charged by the advertisement agency for the work they do and it depends upon the amount to be spent by company on media. New and establishing agencies would be paid by result and positive results would allow them to gain higher amount.
The organizations under communication industry are known as the advertisement agencies and their aim is to help their consumers to design suitable communication message which can be communicated their target consumer segments. Advertising agency has the role to develop & plan advertisement campaign and broadcasting these advertisement campaigns to related consumers segments through attractive media types. Ways of working with advertisement agencies can be in several forms such as full service agencies, creative shops, media agencies and A la carte. Full service agencies are offering everything that relates with advertising and promoting products of the company. For example, WCRS is one of the full service advertising agencies that offer its services to large number of clients such as BMW, The Sky, The Sun, Sony and Transport of London etc. Recent work for WCRS include advertisement for BMW with title “It’s a car only” and “Fairy Tale” for sky broadband. Creative shops are considered hot shops formed by few members of full service agencies and these offer specialized services keeping in mind consumer requirements. Media agencies are offering services related with media and involves in planning and purchase process for media. For example, Carat is an independent and biggest media agency in UK. In A la carte formation different advertisement agencies, creative shops and media agencies integrate to meet specialized needs of consumers (Schultz and Schultz, 2008). For example, Ogilvy &Mather group and J Walter Thompson collaborated along with WPP in order to meet specialized consumer needs and allow their customer to develop competitive advantage.      

3. Explain and discuss the role and functions played by an advertising agency in the advertising process?

Advertisement can be defined as the marketing communication which would persuade consumers to buy a particular product or act in a particular way as desired by the marketers. The major functions for advertisement pertaining to business organization would include selling products & services to consumers, imparting key information pertaining to features of products and keeping high mind share for the consumers pertaining to particular products. Example of Coca-Cola can be taken in present context wherein advertisement process allows the company to develop a big consumer base and company persuades them to buy Coca-Cola products.
Advertisement process has played strategic role in order to enhance the business gained by these business organizations through usage of creative advertisement tools. Strategic elements are designed in the advertisement process by advertising agencies such as target audience for the company, benefits to convict consumers, message for establishing active communication and suitable media plan to manage cost & enhance consumer base under particular media (Beakbane, 2013). Advertising agencies would evaluate the marketing plan and marketing objectives framed by an organization so as to build the communication plan in synchronization with them. Advertisement agencies can link the marketing communication plan with particular stage of communication such as persuade, remind or inform. Different business organizations make use of the marketing communication process at one point in life and the major objectives for using marketing communication would be the same to enhance sales for the organization or to create consumer share of mind. Hence advertisement agencies have strategic roles to play in the overall advertisement process developed by an organization in order to inform, persuade or remind their consumers.

4. Assess the role of advertising standards authority (ASA)? Give examples of how promotion is regulated?

Every organization indulging in advertisement processes have to abide by the rules and regulations laid down by the regulating bodies for advertisement so that proper standards are established & followed by the business organizations. Advertising standards authority is one of the key governing bodies for advertisements in UK and plays vital role in establishing standards for advertisements. ASA helps in establishing some of the vital rules for business organizations involving in advertisements such as protecting consumers from unfair trade regulations, sales of goods act, distance selling act, data protection act and consumer credit act (McCarthy, 2012).
Under the unfair trade regulation act for the organization there would be several activities such as barring organizations to convey misleading messages, not allowing the usage of sales technique which harass consumers, false credential claims, not allowing usage of display of false trade mark, avoiding claim of false endorsements and display of particular goods which are available for short time duration with the organization. In addition to this ASA regulates whether organizations are offering what they promise under their advertisements or not.
Sales of goods act regulates the contract for buying and selling goods in UK and was first developed in year 1893 and amended thereafter with minor changes in year 1979. In relation to advertisements, this act regulate whether organizational commitments pertaining to particular goods or service are true or not. This act also examines whether organizations are offering satisfactory products to their consumers wherein product is safe to use by consumers and provided under good working conditions. Finally this act examines whether or not product served to the consumers meets their requirements.
Distance selling act covers the selling process through internet, mobile or fax and this would include abiding by laws pertaining to the goods sold through this channel. Consumers should be provided with key information on the product, contact details and refund policy etc. Customers should be given confirmation on dispatch of product or receipt of return product at their address. Consumers should be given sufficient time in order to return their product so that consumers can check the products and in case the product is not able to fulfil their needs then they can return the product to the company.
Customer credit act was first developed in year 1974 and finally amended in year 2006 for the implementation in the present business context. Customer credit act develops relationship between creditors and debtors of a company. Office of fair trade would help in establishing relationship between debtors and creditors of the company. In order to provide debtors there should be proper license and unfair trade can’t prevail with the creditors (Matt, 2009). Creditors with higher in amount from £ 25000 can be challenged as unfair trade.
Data protection act was developed in year 1984 in UK and was amended in year 1988 in order to make necessary changes and to make it applicable in present context. This act helps the trades to identify the information which relates with the consumers and law talks about maintaining secrecy on the consumer data. Data collected through consumers can’t be used except for the purpose it was taken by the company. Data collected from the consumers have to be erased after certain time period.

5. Examine the current trends in advertising and promotion with appropriate reference to practical examples and sources?

Information communication and technology is taking the organizational advertisement and promotional strategies up to the next level. ICT has shaped the effectiveness of various advertisement and promotion strategies prevailing in the organizational context. In the present context example of BMW can be considered in order to understand the impact of ICT on the advertisement and promotion strategies. Analysing the entire advertisement and promotion strategy of BMW for the impacts of ICT below points can be considered which shows the improvement which has been made by ICT in development of advertisement and promotion domain:
§  Website: Website of BMW has been shaped in such a way that it is adding to the promotion and advertisement for the company. Consumers can look for the wide range of benefits which are offered through BMW car by just one click on their website. In addition to this consumers can make customization for their car through website only. Further BMW has launched its website with the name of BMW TV and this contains several videos for the BMW car and these videos act as the advertisement material for the company. Hence advertisement made through online tools and videos help the company to take their advertisement to next level (Moskowitz, 2006).
§  Video conferencing: Video conferencing tools provided at the BMW offices allows them to directly talk to their potential consumers. BMW representatives now have the facility to talk to their client through video conferencing services and explain features of their car through video conferencing. In addition to this, video conferencing services developed at BMW Company are helping them to hold their meeting with the corporate clients just by sitting in their offices and explain various features of their car with attractive video material. Hence ICT has not only helped in making promotion to the next level but also make it easier for the organization to interact with their consumers.
§  Email: Email marketing tools adopted by BMW are helping them to reach out to their clients in effective way. BMW is making use of the attractive email designed by the technical staff of the company and these email are sent to consumers in order to explain various features of the BMW cars. In addition to this email marketing tool adopted by the company helps to reach out to the clients with newly launched products and offers circulated by the company for their consumers. Email marketing tool is highly effective as this can be considered as the low cost and high impact tool.
§  Mobile telephone: BMW has tied up with several telephone network providers in order to make promotion for their newly launched cars. By making collaboration with the network providers there are several video ads run by the company for their consumers and consumers are being encouraged to watch these videos. Consumers are watching these videos and these videos are helping the company to develop wide customer base for the company without physically contacting the consumers for selling their products. In addition to selling the products to consumers, mobile advertisements would be helpful in enhance consumer loyalty and brand awareness among the consumer base of the company.
Hence present example has shown that BMW has been benefited through usage of ICT tools in order to take their advertisement and promotion process to the next level wherein effectiveness of their promotional campaign is much higher as compared to the traditional advertisement methods. Enhancement in effectiveness for the media can be added in terms of higher exposure for their advertisement, lower cost of running advertisements and higher number of consumers attracted towards the advertisement shown by the company as ads are having highly attractive content which force consumers to respond to the company advertisements.

6. Explain the concept of branding? Give examples of how it is used to strengthen a business or product?

Brand can be represented by a sign, symbol or word and these show a particular company or product of the company. Every company represents itself from a unique sign or symbol in order to differentiate itself from other products or companies available in the marketplace. Branding can be considered as the methodology used by an organization in order to differentiate its product offering from other competitors present in the market (Elliott, 2010). For example BMW and its car mini owns unique brand symbol in order to differentiate themselves from the other product offering present in the market such as Rolls Royce.
Some of the key objectives which can be attained through branding for an organization can be given as under:
§  To motivate consumers from psychological perspective
§  To develop connection with consumers from emotional perspective
§  To develop loyal base of consumers
§  To confirm the credibility of the product
Some of the key objectives for which branding is done in the organizational context includes to develop high brand equity, to develop product awareness, to obtain premium pricing and obtain competitive advantage in the marketplace. In context to the branding strategies used by the organizations there are mainly four types of brand name strategies used by the organizations and these are individual names, blanket family brand name, separate family name and company brand name combined with individual brand name etc. (Mick, 2006). Individual names are referred for the products which are having their individual identity without name of their company e.g. Pillsbury, Green giant and Yoplait etc. Blanket family name is used for the products which are launched from the producer’s name e.g. Campbell soup’s all products are launched from the family blanket name. In separate family name a product establishes its own family identity along with identity of its manufacturer company e.g. Kenmore and Craftsman etc. Company brand name along with individual brand name strategy used by the company exists between individual brand name and blanket family brand name. For example, Kellogg’s every product has name of the company along with its separate product name such as Nutri-grain.

7. Review the creative aspects of an advertisement? Use and describe an advertisement (TV) that you are familiar with to answer this question.

Creativity can be considered as the main aspect for the advertisements and creativity refers the ability of advertisers to develop a unique advertisement which has capability to persuade consumer base of the company. The main objective behind creative advertisement is to attain high consumer attention and to make brand memorable among the consumers. In order to describe an advertisement from creative perspective example of BMW’s “The Ultimate driving machine” can be considered. This TV advertisement shows that how an advertisement does not allow consumers to forget the brand. 
This advertisement has mainly two dimensions i.e. communication brief and creative brief. Communication brief for the present advertisement would include targeting, positioning and content developed in the advertisement in order to persuade or remind consumers. Targeting for the BMW advertisement include consumers in middle to old age range, with high income range and brand loyal to BMW. Positioning of the company is such to include high range cars with ultimate luxury offered to the consumers. Message developed by the company is appealing to enhance utility of their car. Creative brief of the advertisement would include advertisement design, idea generation and copy writing etc. BMW design its advertisement in such a way that slogan developed by the company sends a strong message to their consumers. As shown in the advertisement given below that BMW communicate the message for ultimate driving machine which present the idea of comfort, luxury, technology and status symbol to the consumers which also matches with the positioning of the brand. Idea generated here is so strong that it sends a unique message to the consumers and attain the marketing objectives of the organization. New ideas are added to the advertisement for seeking consumer attention and copy writing is to transform ideas collecting into aims & objectives of the company (Benjamin & Baker, 2012).

8. Explain various below the line promotion techniques? Evaluate how these techniques can be used by an organization?

Below the line promotional techniques are the channels through which an organization can directly interact with its consumer segment or channels at which company has direct control. Below the line technique makes use of the sales promotion, personal selling and public relations. Sales promotions are the techniques used by the organization in order to persuade consumers to purchase particular product or try out the goods for enhancing sales. Sales promotions are being used for immediate sales increase. There can be three categories for sales promotion i.e. customer promotions (such as gifts and vouchers), trade promotions (distributing free stuff or special terms) and sales force promotions (motivation and incentive schemes). Public relations would include developing and maintaining good relations with the public (different group of people associated with organization). There are two ways of PR i.e. marketing or product PR and corporate PR. In product PR companies promote their product while in corporate PR companies promote themselves. Personal selling is one of the effective ways for promotion and is being used for sales of high end products so that direct impact can be made on decision making units.
The main objective of communicating through below the line promotional techniques would be to establish relationship with the consumer base of company. Below the line promotion techniques deployed by the organization can be enforced through three major sales promotion techniques which are customer promotions, trade promotions and sales force promotions. Customer promotion techniques included under below the line promotion techniques contains offering gift, voucher or loyal points offered to the consumers of the company based on their loyalty with the company. Sales promotion would include distributing free items with the main product sold by the company such as pen, diaries or organizing competition etc. Finally, sales force promotion would include imparting incentives or motivational schemes for the sales forces deployed by the organization (Ademola, 2010). Sponsorship is also a part of the below the line promotional techniques and used by the organization to build consumer awareness. For example, BMW sponsored USA Olympic team. A motor show was also organized by BMW in order to launch their new car named BMW X3 series.       

Part-B

1. Formulate appropriate process for formulating a budget for an integrated promotional strategy?

A promotional plan for the organization would help in order to communicate with various stakeholders such as customers, suppliers and employees etc. For development of a promotional plan a company need to understand its current situation in market based on which goals & objectives for the promotional plan would be developed. SWOT analysis would be conducted in order to understand the current situation of the organization. Looking into the BMW example its strength are luxury, loyal customer base, high end technology and efficient plant such as Spartanburg. Weakness for BMW includes its high concentration in Germany and attached with traditional bound. Opportunity for BMW can be to evolve as European brand by positioning itself as first European brand planting outside Europe. Major threat for the company is growing competitors such as Lexus. Based on the situational analysis objective of the BMW would be to sell 275,000 cars in USA in present year as in last year company has sold 2, 40,000. Promotional planning tools are being used by the organization and two most effective tools are AIDA and DAGMAR. In AIDA model there are four important elements i.e. attention, interest, desire and action. Before communicating any message audience attention to be obtained, after obtaining their attention interest should be sustained, once consumers start listening marketer needs to develop desire in their mind and once need is revealed goods and services should be provided to them. DAGMAR stands for defining advertising goals for measured advertising results wherein four important elements are used i.e. awareness, comprehension, conviction and action.    
Budgeting for the organization would define the expenditure and income of the organization. There can be different methods for development of budget for the promotion of company’s product and services such as All we can afford, percentage of sales, competitive parity, objective & task, computerized modelling and cost & benefit etc. Each of the budgeting method has their own objective and adopted in the organization in order to accomplish their strategic objectives. For the present task of formulating appropriate process for budget allocation towards integrated promotional strategy BMW has been selected. It has been revealed through historical records that BMW follows percentage of sales method in order to decide on the budget for the advertisement & promotion of the company’s product (Goldstein and Lee, 2011). In the percentage of sales method, budget to be allocated on the advertisement and promotion for the organization would be decided through a fix percentage of the sales achieved by the organization in last period. BMW has adopted sales percentage method in order to decide on the total budget that is allocated for the promotion of company’s product as company invested $150 million on promotion in year 2004 where company achieve high amount of sales in last period while budget allocated in the next year i.e. 2005 was just $60 million. These figures indicates budget allocated by the company for their integrated promotional plan along with relevant fluctuations in the total sales achieved by the company in their last period.
Hence in case company achieve total sales of $10 billion in the present financial year and decides to invest 10% of the total sales towards the promotions for the organization then the next year budget of the company would be $1 billion. Total budget of integrated promotional technique allocated for BMW would be divided into different media used by the organization in order to promote their products such as sponsorships, broadcast media (TV, radio), online channels (social media, emails, online banner etc.), exhibitions, consumer promotion, trade promotions and other media type planed by the organization. Budget allocation for each media type would be done based on the historic performance of each media type for BMW.

2. Explain the role of advertisement in an integrated promotional strategy for a business or product.

Advertisement is one of the integral parts of the overall promotional strategy for the organization. Advertisement can be considered as the most cost efficient way so as to reach the big target audience thereby enhancing overall reach for the integrated promotional campaign designed by the organization (Dacko, 2008). There are different roles which are being played by advertisement in integrated promotional strategy for a business or product such as the informing about a new product to existing customer, informing to a new customer, reminding to an existing customer, persuading the consumers for purchasing & keep using their products and differentiate their product from competitors. Some of the principle roles which are played by advertisement in integrated promotional strategy for a business or product would include drawing attention, increasing sales and building competitive advantage. Advertisement draws attention of the consumers towards the offering made by the organization. Advertisers make advertisement in such a way that consumer gets forced to look at the product. Advertisement methods adopted by the businesses would be able to enhance sales by successful exchange of product features and benefits (Adcock and Halborg, 2001). Advertisement helps in building a unique product identity so that consumers can differentiate between similar products available in the market.

3. Contain mechanism (s) on measuring the effectiveness of the campaign.

There are mainly two mechanism used by BMW in order to measure the effectiveness of campaign used by the organization and these are direct sales result analysis and indirect sales result analysis for the organization. Direct sales result analysis technique is deployed by looking into the fact the sales and promotional techniques are having high degree of positive correlation among them. Direct sales result analysis makes use of the two techniques which are sales result test and trail area test. Sale result test for the organization would make comparison between the sales before and after making advertisement campaign by the organization. Trail area test is done before launching a campaign wherein organization would take two areas and in one of the area advertisement would be launched and its sales data would be compared with other area where company has not launched the advertisement (Dev and Don, 2005). Indirect sales analysis test include two techniques which are recognition test and Gallup and Robinson recall test. Recognition test would be done with the people in order to analyse how many of them identify the advertisement shown to them. In Gallup and Robinson test particular advertisement type such as magazine would be shown to them so as to check recall from the consumers.

Conclusion

Advertisement and promotion can be considered as the backbone for any business in present businesses wherein competition is increasing in the business domain. Information communication technology has made remarkable changes in the way advertisement is developed in the organizational context. Advertisement agencies are helping the present age organizations in order to design attractive ads so as to build loyal consumer base and attain competitive advantage. Branding has become an important part of the overall business and business organizations are making use of different promotional technique such as below the line technique. Development of the integrated communication plan is important for the business organization to decide on its budget, media plan and low cost advertisements. Finally, it is important to measure the impact of advertisement in the organizational context so as to judge its performance.

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