1. The World of Advertising and Integrated Brand Promotion
Chapter 1
The World of Advertising and Integrated Brand Promotion
Copyright © 2006 Thomson Business and Economics. All rights reserved.

2. The World of Advertising
We Need to have Perspective!
Firms use advertising to build brands.
Firms of all sizes need and use advertising.
Advertising is just one tool in Integrated Brand Promotion (IBP).
Advertising and promotion do not guarantee success.
People have all sorts of positive and negative (mis)perceptions about advertising and promotion.
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3. What is Advertising?
Three criteria must be met for a communication to be classified as advertising:
The communication must be paid for.
The communication must be delivered through mass media.
The communication must be attempting to persuade.
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4. Distinctions within Advertising
Advertisements
Specific messages designed to persuade an audience
Advertising Campaign
An integrated series of ads and promotions that communicate a central theme or idea
Integrated Brand Promotion (IBP)
Coordinating promotional tools with advertising to build and maintain brand awareness, identity, and preference
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5. Integrated Brand Promotion (IBP)
Coordinated promotional activities reinforce one another.
Special
Events
Television
Advertising C o u p n s
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6. Communication: Human Communication Process
NOISE
Source
Encoding
Message
Channel
Decoding
Receiver
Feedback to be
decoded by a receiver
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McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

7. Communication: Stern Model
Source
Message
Receivers
Within the text of the advertisement
Author
Persona
Sponsor
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McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

8. Communication: Source Dimensions
Legally responsible
Has a message
Sponsor
Author
Persona
Copywriter, art director, or creative group
Creator is invisible to audience
Real or imaginary spokesperson
Represents the sponsor
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McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

9. Communication: Stern Model
Source
Message
Receivers
Within the text of the advertisement
Author
Persona
Sponsor
Literary form
Autobiography
Narrative
Drama
Copyright © 2006 Thomson Business and Economics. All rights reserved.
McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

10. Communication: Message Dimensions
Autobiography
Narrative
Drama
“I” tell a story about myself to “you,” the imaginary audience
Third person tells a story about others to imagined audience
Characters act in front of imagined audience
Copyright © 2006 Thomson Business and Economics. All rights reserved.
McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

11. Communication: Stern Model
Source
Message
Receivers
Within the text of the advertisement
Author
Persona
Sponsor
Literary form
Autobiography
Narrative
Drama
Actual
consumers
Implied
Sponsorial
Feedback
Copyright © 2006 Thomson Business and Economics. All rights reserved.
McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

12. Communication: Receiver Dimensions
Implied consumers
Sponsorial consumers
Actual consumers
Ad texts presume an audience
Ad uses implied consumers, not real ones
Gatekeepers who decide if the ad will run
Sponsor’s executives
People in the real world who comprise the target audience
Copyright © 2006 Thomson Business and Economics. All rights reserved.
McGraw-Hill/Irwin
©2006 The McGraw-Hill Companies, Inc. All rights reserved.

13. Audiences for Advertising
Household Consumers
Business Organizations
The Trade Channel
Professionals
Government
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14. Audience Geography Global International National Regional Local
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15. Advertising as a Business Process: Role of Advertising in Marketing and Brand Promotion
Advertising and the marketing mix
Advertising in brand development and management
Advertising in market segmentation, differentiation, and positioning
Advertising in revenue and profit generation
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16. The Marketing Mix Perceived Value Product Distribution Promotion Price
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17. Advertising in Brand Development and Management
Information and persuasion
Introduction of new brands—extensions
Building brand loyalty/brand equity
Creating an image/meaning
Building brand loyalty in the trade channel
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18. Advertising’s Role in SDP Marketing
Positioning
Segmentation
(heterogeneous > homogeneous)
Differentiation
(perceived as different or unique)
Distinct from other brands
Occupies a “value” level
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19. Revenue and Profit Generation
Economies of scale: higher volume results in lower unit cost
Brand loyalty leads to inelasticity of demand: less price sensitivity to demand
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20. Types of Advertising Primary demand stimulation
Create demand for product category
New to the world products
Selective demand stimulation
Create demand for a particular brand
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