Advertising
Generally speaking, advertising is the paid promotion
of goods, services, companies and ideas by an identified sponsor. Marketers
see advertising as part of an overall promotional strategy. Other components
of the promotional mix include publicity, public relations, personal selling,
and sales promotion.
History
In ancient times the most common form of advertising
was 'word of mouth'. However, commercial messages and election campaign
displays were found in the ruins of Pompeii. As printing developed in
the 15th and 16th century, the first steps towards modern advertising
were taken. In the 17th century advertisements started to appear in weekly
newspapers in England and within a century, advertising became very popular.
As the economy was expanding during the 19th century, the need for advertising
grew at the same pace. In 1843 the first advertising agency was established
by Volney Palmer in Philadelphia. At first the agencies were just brokers
for ad space in newspapers, but in the 20th century, advertising agencies
started to take over responsibility for the content as well.
Media
Some commercial advertising media include: billboards,
printed flyers, radio, cinema and television ads, web banners, Web Popups,
skywriting, bus stop benches, magazines, newspapers, town criers, sides
of buses, taxicab doors and roof mounts, musical stage shows, elastic
bands on disposable diapers, stickers on apples in supermarkets, the opening
section of streaming audio and video, and the backs of event tickets.
Any place an "identified" sponsor pays to deliver their message
through a medium is advertising. Covert advertising embedded in other
entertainment media is known as product placement.
The TV commercial is generally considered the most effective mass-market
advertising format and this is reflected by the high prices TV networks
charge for commercial airtime during popular TV events. The annual US
Super Bowl football game is known as much for its commercial advertisements
as for the game itself, and the average cost of a single thirty-second
TV spot during this game has reached $2.3 million (as of 2004).
Advertising on the World Wide Web is a recent phenomenon. Prices of Web-based
advertising space are dependent on the "relevance" of the surrounding
Web content. E-mail advertising is another recent phenomenon. Unsolicited
E-mail advertising is known as "spam".
Some companies have proposed to place messages or corporate logos on the
side of booster rockets and the International Space Station. Controversy
exists on the effectiveness of subliminal advertising (see mind control),
and the pervasiveness of mass messages (see propaganda).
Unpaid advertising (also called word of mouth advertising), can provide
good exposure at minimal cost. Personal recommendations ("bring a
friend", "sell it by zealot"), spreading buzz, or achieving
the feat of equating a brand with a common noun ("Hoover" =
"vacuum cleaner") -- these must provide the stuff of fantasy
to the holder of an advertising budget.
Objectives
One of the purposes of advertising is to stimulate demand
for a product, service, or idea. Other factors influencing demand are
price and substitutability. A major way advertising may stimulate demand
is to create a brand franchise for a product. When enough brand equity
is created that the brand has the ability to draw buyers (even without
further advertising), it is said to have brand franchise. The ultimate
brand franchise is when the brand is so prevalent in people's mind (called
mind share), that it is used to describe the whole category of products.
Kleenex, for example, can distinguish itself as a type of tissue or a
label for a category of products. That is, it is frequently used as a
generic term. One of the most successful firms to have achieved a brand
franchise is Hoover, whose name was for a very long time synonymous with
vacuum cleaner (and Dyson has subsequently managed to achieve similar
status, having moved into the Hoover market with a more sophisticated
model of vacuum cleaner).
A brand franchise can be established to a greater or lesser degree depending
on product and market. In Texas, for example, it is common to hear people
refer to any soft drink as a Coke, regardless of whether it is actually
produced by Coca-Cola or not (more accurate terms would be 'cola' or 'soda').
A legal risk of the brand franchise is that the name can become so widely
accepted that it becomes a generic term, and loses trademark protection.
Examples include "escalator", "aspirin" and "mimeograph".
Other objectives include short or long term increases in sales, market
share, awareness, product information, and image improvement.
Public Service Advertising
The same advertising techniques used to promote commercial goods and services can be used to inform, educate and motivate the public about serious non-commercial issues, such as AIDS, energy conservation, and deforestation. Advertising, in its non-commercial guise, is a powerful educational tool capable of reaching and motivating large audiences. "Advertising justifies its existence when used in the public interest - it is much too powerful a tool to use solely for commercial purposes." - Attributed to Howard Gossage by David Ogilvy Public service advertising, non-commercial advertising, public interest advertising, cause marketing, and social marketing are different terms for (or aspects of) the use of sophisticated advertising and marketing communications techniques (generally associated with commercial enterprise) on behalf of non-commercial, public interest issues and initiatives. The granting of television and radio licenses by the FCC is contingent upon the station broadcasting a certain amount of public service advertising. Public service advertising reached its height during World Wars I and II under the direction of several U.S. government agencies.
Regulation
There have been increasing efforts to protect the public interest by regulating the content and the reach of advertising. Some examples are the ban on tobacco advertising imposed in the USA, and the total ban on advertising to children under twelve imposed by the Swedish government in 1991. Though that regulation continues in effect for broadcasts originating within the country, it has been weakened by the European Court of Justice, which has found that Sweden was obligated to accept whatever programming was targeted at it from neighboring countries or via satellite. In Europe and elsewhere there is a vigurous debate on whether and how much advertising to children should be regulated. This debate was exacerbated by a report released by the Henry J. Kaiser Family Foundation in February 2004 which suggested that food advertising targeting children was an important factor in the epidemic of childhood obesity raging acroos the United States.
- Accounting - Accountancy (British English) or accounting (American English) is the process of maintaining, auditing, and processing financial information for business purposes.
- Advertise - Generally speaking, advertising is the paid promotion of goods, services, companies and ideas by an identified sponsor. Marketers see advertising as part of an overall promotional strategy.
- Banking - The essential function of a bank is to provide services related to the storing of value and the extending of credit.
- Capitalism - Capitalism generally refers to a combination of economic practices that became institutionalized in Europe between the 16th and 19th centuries.
- Economics - Economics is the social science studying production and consumption through measureable variables.
- Electronic Commerce - Electronic commerce or e-commerce consists of the buying, selling, marketing, and servicing of products or services over computer networks.
- Entrepreneurship - Many "high-profile" entrepreneurial ventures seek venture capital or angel funding in order to raise capital to build the business.
- Finance - Finance addresses the ways in which individuals, business entities and other organizations allocate and use monetary resources over time.
- Insurance - Insurance is the business of providing protection against financial aspects of risk, such as those to property, life, health and legal liability.
- Investment - Investment is a term with several closely related meanings in finance and economics.
- Real Estate - Real estate is a legal term that encompasses land along with anything permanently affixed to the land, such as buildings.
- Small Businesses - A small business may be defined as a business with a small number of employees. The legal definition of "small" often varies by country and industry, but is generally under 100 employees.
