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HOW COMPANIES ADVERTISE
Advertising informs consumers about the existence and benefits of products and services and attempts to persuade them to buy them. The best of advertising is probably word-to-mouth advertising, which occurs when people tell their friends about the benefits of products and services that they have purchased. Yet virtually no providers of goods and services rely on this alone, but use paid advertising instead. Indeed, many organizations also use institutional or prestige advertising, which is designed to build up their reputation rather than to sell particular products.
Although large companies could easily set up their own advertising departments, write their own advertisements, and buy media space themselves, they tend to use the services of large advertising agencies. These are likely to have more resources, and more knowledge about all aspects of advertising and advertising media than a single company.The most talented advertising people generally prefer to work on a variety of advertising accounts (contracts to advertise products and services). It is also easier for a dissatisfied company to give its account to another agency than it would be to fire its own advertising staff.
The client company generally gives the advertising agency an agreed budget; a statement of the objectives of the advertising campaign, known as a brief; and an overall advertising strategy concerning the message to be communicated to the target customers. The agency creates advertisements (the word is often abbreviated to adverts or ads), and develops a media plan specifying which media newspapers, magazines, radio, television, cinema, posters, mail, etc. will be used and in which proportions. (On the television and radio, ads are often known as commercials). Agencies often produce alternative ads or commercials that are pre-tested in newspapers, television stations, etc. in different parts of a country before a final choice is мейд prior to a national campaign.
The agencys media planners have to decide what percentage of the target market they want to reach (how many people will be exposed to the ads) and the number of times they are likely to see them. Advertising people talk about frequency or OTS (opportunities to see) and the threshold effect the point at which advertising becomes effective. The choice of advertising media is generally strongly influenced by the comparative cost of reaching 1,000 members of the target audience, the cost per thousand (often abbreviated to CMP, using the Roman numeral for 1,000). The timing of advertising campaigns depends on factors such as purchasing frequency and buyer turnover (new buyers entering the market).
1) What is the best form of advertising and why?
2) What are the functions of advertisement?
3) Why do companies tend to use services of advertising agencies?
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