Advertising

Advertising is paid promotion with an identified sponsor that reaches many people at one time and can be repeated many times. One of the biggest issues an organization must address is which medium or media provides the biggest bang for the buck, given a product’s characteristics and target market. For example, a thirty-second ad aired during Super Bowl XLII cost $2.7 million. Since 97.5 million people watched the game, the cost per ad was less than three cents per viewer. For Super Bowl LVII, the cost for a thirty-second spot increased to $7 million, and approximately 113 million viewers watched. However, do the ads pay off in terms of sales? Many advertising professionals believe many of the ads don’t, yet the ads probably do create brand awareness or a PR type of effect since many people tune in and then talk about Super Bowl commercials.

Whether it’s a commercial on the Super Bowl or an ad in a magazine, each medium (e.g., television, magazines, social media) has different advantages and disadvantages. Mobile phones provide continuous access to people on the go, though reception may vary in different markets. Radios, magazines, and newspapers are also portable. Radio advertising can be cost effective, but there are so many radio stations in each market that it may be difficult to reach all target customers. People are also typically doing another activity (e.g., driving or studying) while listening to the radio, and without visuals, as radio relies solely on audio. Both television and radio must get a message to consumers quickly. Although many people change channels or leave the room during commercials, television does allow for visual demonstrations. In an effort to get attention, advertisers changed the volume for television commercials for years. However, CRTC passed a regulation effective in 2009 that prohibits advertisers from increasing the volume level of commercials on television, though this doesn’t apply to streaming services.

Some people save magazines for a long time, but advertisers must plan in advance to have ads in certain issues. With the Internet, both magazines and newspapers are suffering in terms of readership and advertising dollars. Many major newspapers have gone out of business. Other newspapers, such as USA Today, are free online, though printed copies are also available. The fact that local retailers get cheaper rates for advertising in local newspapers may encourage both local businesses and consumers to support newspapers in some markets.

Direct Marketing

Direct marketing allows organizations to target a specific set of customers, measure the return on investment (ROI), and test different strategies before implementing them to all targeted consumers. Direct marketing can be personalized as a call for consumers to take action, which is a desired response. However, direct marketing is intrusive, and many consumers may ignore attempts to reach them. Catalogs and direct mail provide popular alternatives for many marketers, though the volume of mail sent may drop significantly in a weak economy.

Telemarketing involves direct marketing by phone. You may have just sat down for dinner when the phone rings with a local charity calling to raise money. The calls always seem to come at dinner or at other inconvenient times. Although expensive, telemarketing can be extremely effective for charitable organizations and different service firms and retailers. However, because some consumers have negative perceptions of telemarketers, many organizations do not use this method. The Do Not Call Registry (USA), or Do Not Call List (Canada) prevent organizations from calling any numbers registered with the government.

Direct response advertising includes an offer and a call to action. You may be watching television when an interesting product is shown. The announcer says, “Call now and receive a bonus item.” They want consumers to call to purchase the product or to get more information. The Internet provides the preferred direct response medium for direct marketing because it is less expensive and easier for the organization to utilize.