Marketing Communications

Download free eBooks at bookboon.com

Marketing Communications

Organizination And Management Of Advertising

Agencies And Advertising Departments

4. OBJECTIVE METHOD: This is a more rational approach which determines advertising
   budget by relating the tasks to be performed by the company’s advertising to the size of
   sales territory in which the company is operating. The basic steps in such a procedure are:
   
   
   1. The objectives of the advertising campaign are defined and possibly defined in
      quantifiable terms.
   
   
   2. Each specific task is listed and cost as necessary to achieve its goals. The sum of all the
      costs for all the sales territories is then computed to give the desired advertising budget.
      (Kleppner, 1979; Warshaw and Kinnear, 1983)
   
   
   
   

ECONOMIC ROLES OF ADVERTISING IN THE SOCIETY

1. PROVISION OF INFORMATION UTILITY: Information about new products reach
   consumers through advertising before physical presence of products in the market.


2. ENCOURAGEMENT OF CAPITAL INVESTMENT: Advertising enables manufacturers to
   create favourable demand for product, which in turn, attracts investor or capital investment.


3. MASS PRODUCTION: Products preference or brand loyalty built in the minds of consumer
   encourages constant product demand and mass production on such product.


4. REDUCTION IN DISTRIBUTION COST: Advertising has a capacity of reaching mass
   consumer audience simultaneously, thus creating a huge product awareness. Cost associated
   with personal selling can be reduced when promotional efforts are targeted at distributors.
   Distributors can achieve rapid sales turnover of advertised products.


5. PROVISION OF PRODUCT UTILITY: The generation of association between products and
   peoples lifestyle can add to the utility a consumer receives from the product, through the
   creation of status symbols, personality and established sense of independence.


6. SUPPORTING THE MEDIA: Advertisements run through magazines, newspapers,
   billboards, radios, television and others, provide constant source of revenue for the media.


7. CREATIOIN OF ARTIFICIAL MONOPOLY: Product differentiation created by advertising
   can create brand loyalty which may prevent entry of new competitors and slow down growth
   of competing products – this could result in artificial monopoly or reduction in competition.

SOCIAL ROLES OF ADVERTISING IN THE SOCIETY

1. BETTER STANDARD OF LIVING: Advertising can motivate consumers to increase their
   income which they will spend on goods and services. Consumers are stimulated to search
   for higher income, which usually result in better living standard.


2. AVAILABILITY OF BETTER PRODUCTS AND SERVICES: The creation of increase in
   demand for goods and services caused by advertising attracts more manufacturers into
   the market which may result in better production innovations, development and research.


3. SUSTAINANCE OF THE SOCIAL VALUES : Advertising, through the provision of product
   information, reinforces or changes social values and norms.