1. tutor2u ™ GCSE Business Studies Revision Presentations 2004 Advertising

2. tutor2u ™ GCSE Business Studies What is Advertising? An important part of the way a business promotes its products and services to customers Use of “media” to reach and communicate with potential customers Encourages customers to buy through information and/or persuasion

3. tutor2u ™ GCSE Business Studies How is Advertising Used in the UK?

4. tutor2u ™ GCSE Business Studies Choice of Advertising Medium Who does the medium reach?  National or local audience?  How many customers will see the advert? Nature of product  Media needs to reflect image of product  E.g. a recruitment advert would be placed in a trade magazine or newspaper but a lipstick advert would be shown on TV or women’s magazines Position in product life cycle  Launch stage will need different advertising than adverts for a product that is well established Cost of medium  Television is the most expensive; national advertising is more expensive than local advertising  May want to consider cost per head if reaching a larger audience

5. tutor2u ™ GCSE Business Studies Television Advertising Advantages  Use of pictures and sound very powerful combination  Can reach a large audience  Can target audience with different adverts going out with certain programs (children’s TV and toys) Disadvantages  Very expensive – both the cost of making the adverts – and the cost of buying the broadcasting time  Need to get message across in very short space of time – e.g. 15-30 seconds  Need to look good against some other very clever and attractive advertising by other businesses and/or competitors

6. tutor2u ™ GCSE Business Studies Classified and Display Advertising Classified advertising  Normally put into a newspaper or magazine  Expressed solely in words and numbers  Less space – therefore lower cost Display advertising  Space also bought in newspapers or magazines  Can be filled with words and/or pictures  Takes up more space and is more expensive  Often more effective in attracting attention of readers

7. tutor2u ™ GCSE Business Studies Persuasive and Informative Advertising Persuasive advertising  Aims to convince customers that they really like the product or service  Focuses on product benefits and features  Aims to persuade customers to buy – i.e. increase demand for the product or service Informative advertising  Provides customer information  Mostly done by government (e.g. health campaigns, new welfare benefits)

8. tutor2u ™ GCSE Business Studies Newspaper Advertising Advantages  Cheaper than TV advertising  Market segments can be targeted better: National, regional and local newspapers Target different socio-economic groups – e.g. popular tabloids (Sun, Mirror)  Newspapers also have special sections, such as Homes, Travel and Gardens where advertising will reach target audience Disadvantages  Newspaper readership is falling – adverts do not reach as many people  Still expensive – particularly for smaller businesses

9. tutor2u ™ GCSE Business Studies Advertising Agencies Role  Plan, organise and produce advertising campaigns  Design and produce advertising material (e.g. posters, display adverts, television commercials)  Monitor and report on effectiveness of advertising Advantages:  Expertise a business may not have, e.g. copywriters, designers and media buyers  Specialise in particular markets (e.g. agencies

10. tutor2u ™ GCSE Business Studies Advertising and the Law Advertising is covered by legislation (law)  Trade Descriptions Act – goods advertised for sale must be as they are described. However, the advertising industry is largely “self-regulated”  Advertising Standards Authority – regulates adverts that appear in “non broadcast media” (e.g. newspapers, magazines, posters)  Broadcasting regulator (OFCOM) regulates adverts on television and radio Misleading adverts can be referred to the Office of Fair Trading

11. tutor2u ™ GCSE Business Studies “Above Line” and “Below Line” Above the line  Paid for communication in independent media  E.g. advertising on TV or in newspapers  All advertising done via advertising agencies is “above the line” – because the agency is paid to arrange publication of the adverts Below the line  Promotional activities where business has direct control  No payment made for the “advertising” itself  E.g. direct mail, point of sale displays, giveaways