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Advertising effectiveness in mobile phone industry

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Advertising effectiveness in mobile phone industry

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Advertising effectiveness in mobile phone industry

  1. 1. Chapter I INTRODUCTION Advertising effectiveness can be defined as the extent to which advertising generates a certain desired effect. Measuring the effects of advertising is very important, given the amount of investments needed for advertising. While it is not possible to obtain a global measure of the advertising effectiveness, we should seek to develop and apply methods and measures for a partial verification of results. Advertising effectiveness pertains to how well a company’s advertising accomplishes the intended. Small companies use many different statistics or metrics to measure their advertising effectiveness. These measurements can be used for all types of advertising, including television, radio, direct mail, Internet and even billboard advertising. A company’s advertising effectiveness usually increases over time with many messages or exposures. But certain advertising objectives can be realized almost immediately. 1 1. Reach One metric for advertising effectiveness is reach. This measurement pertains to the number of people who actually saw a company’s advertising. Small business owners usually know how many people can potentially see their ads. Local television stations report the number of viewers for certain shows. Similarly, magazines report circulation figures. But not all of these viewers or readers notice the ads. That is why small business owners often use market research surveys to measure reach. For example, 10 percent of a local restaurant’s viewing audience may recall seeing their latest television advertisement. Advertising should be designed to attract attention, build interest and prompt action, according to the experts at “Mind Tools” online.
  2. 2. 2 2. Sales and Profits One of the most important objectives of advertising is to increase sales and profits. A profitable advertisement is an effective one. The best way to build sales and profits is by reaching the right target audience. In other words, small business owners must make sure their advertising reaches the people who are most likely to purchase their products. Companies often develop customer profiles from warranty cards or marketing research to gather this information. Target audience variables or demographics can include age, gender, income and education. For example, a high-end women’s clothing retailer may effectively drive sales and profits by targeting women with higher incomes. 3. Brand Awareness Brand awareness is another metric of advertising effectiveness. Brand awareness is the percentage of people who recognize a company’s brand of products. It usually takes many years and lots of ad exposures to build high brand awareness. Television and radio are two of the best mediums for building brand awareness. Small companies can also build their brand awareness on the Internet by advertising in online Yellow Pages, or promoting their wares through major search engines like Google and Yahoo. 4. Testing Advertising Effectiveness Small companies can test their advertising effectiveness in several different ways. One way is to insert certain “word flags” into the advertising messages, according to “Entrepreneur.” This may be a simple phrase or word that customers recognize and can, therefore, mention when inquiring from an advertisement. The word flag can also be in the form of a question. For example, a small restaurant company may prompt customers to ask, “What’s the super special of the day?” The restaurant owner can then track the number of people who ask about the super special throughout the day. Those who use direct mail can insert codes on order forms. For example, a mail order operator
  3. 3. would know that order forms with the “215” code came from a mailing on February 15. Much scientific evidence is available to put to rest the myth that we cannot measure the effectiveness of advertising in promoting customer brand awareness, knowledge, and purchase behavior. The myth is based on the false premise that because many factors may cause increases in the outcome, we cannot isolate any single influence, such as the influence of advertising, to determine its effect—for example, how many additional sales occurred due strictly to the advertising. 3
  4. 4. 4 1.1. SCOPE OF THE STUDY The area selected for the study is Alappuzha Town. A sample of 90 respondents is taken for the study. Survey was conducted in the area, for this purpose, the mobile phones, dealers, distributors were conducted and information from them was collected. 1.2. OBJECTIVES OF THE STUDY The main object of the study is to test the effectiveness of the advertisement media in mobile phone industry. The other objectives are 1. To find out the reasons for liking the advertisement of mobile phones. 2. To find out the most popular slogan of advertisement regarding mobile phones 1.3. Research Methodology The study is exploratory in nature using primary data and secondary data and is meant to assess the effectiveness of advertising in mobile phone industry, and to find out the best media for advertisement. Research is voyage from known to unknown Research is a procedure of logical and systematic application of the fundamentals of science to the general and overall questions of a study and scientific technique which provide precise tools, specific procedure and technical rather than philosophical means for getting and ordering the data prior to their logical analysis and manipulation. Different type of research designs is available depending upon the nature of research project, availability of able manpower and circumstances
  5. 5. 5 METHODOLOGY Research Design The research design is the blueprint for the fulfillment of objectives and answering questions. It is a master plan specifying the method and procedures for collecting and analyzing needed information. Descriptive Research Descriptive Research is used in this study as the main aim is to describe characteristics of the phenomenon or a situation 1.4. SAMPLE DESIGN Sample design is definite plan determine before any data is actually obtaining for a sample from a given population. The researcher must decide the way of selecting a sample. Samples can be either probability samples or non-probability samples. The sample used for the study is selected from Alappuzha, using random sampling technique. Sample size of the study consists 100 respondents and only 90 respondents give complete answers of my question so the sample selected is 90, who purchase mobile phones from various shops in alappuzha town area. 1.5. COLLECTION OF DATA The source of data includes primary and secondary data sources. Primary Sources: Primary data has been collected directly from sample respondents through questionnaire and with the help of interview. Secondary Sources: Secondary data has been collected from standard textbooks, Newspapers, Magazines & Internet Primary data were collected from 90 respondents using structured interview schedule and through discussion with mobile phones buyers.
  6. 6. The secondary data were collected from various printed and published materials and financial reports , periodic journals, circulars and press releases and also from websites. 6 1.6. PERIOD OF STUDY The period of study is during April-May 2012 RESEARCH INSTRUMENT Research instrument used for the primary data collection is Questionnaire. For the purpose of analysis, statistical tools like percentage were used. Bar diagrams, Pie charts, Tables and Graphs were also used wherever necessary. 1.7. LIMITATIONS  The project relied mainly on the primary data.  Consumer gives very unclear picture.  Since the study was conducted for academic purpose, the time was a major limiting factor.  The study is based on limited sample.  This being a first attempt, the researcher’s inexperience also affected the study.  The respondents were reluctant to answer some questions and this might have affected adversely the purpose of the study.
  7. 7. Chapter II LITERATURE REVIEW 7 Introduction As discussed in the previous chapter, the aim of this study is to investigate the relationship between creative advertising and advertising effectiveness. Accordingly, the purpose of this chapter is to critically review the existing literature on the selected topic to determine what is known about advertising effectiveness, creativity in advertising and their interrelationship. After the literature review, the discussion then moves to identify the factors that may affect the relationship between creative advertising and different measures of advertising effectiveness. Overall, discussion in this chapter provides a base for the conceptual model of this study. The Role of Advertising in Organizational Performance The term “advertising” is defined as “a paid non-personal communication from an identified sponsor using mass media to persuade or influence an audience” (Wells, Burnett & Moriarty, 2003, p.10). Among the other functions of advertising highlighted in this definition, the most important is the persuasion factor which is the consequence of the rest of the functions. An advertisement should have the potential to differentiate one product or service from others so as to produce a desired persuasive effect (Jeong, 2004). If an advertisement does not produce the required impact, it can be assumed as ineffective and as such the substantial amount of money that companies spend on advertising their products goes waste. On the other hand, advertisements producing favorable impact can multiply the effectiveness of advertising expenditures. Hence, it implies that advertising plays a very crucial role in the effective functioning of an organization.
  8. 8. Streams of Research on Advertising Effectiveness To assess the effectiveness of advertisements, there have been two streams of research (Jeong, 2004). One stream of research focuses on the psychological aspects of advertising impact and the other focuses on the sales and market response aspects of advertising effects. These two different areas of advertising effectiveness research are discussed in the next sections. Market Response Approach of Advertising Effectiveness The market response method of advertising effectiveness research assesses the impact of advertising in terms of the relationship between advertising expenditures and sales for the respective advertising brand during a particular period. However, advertising studies in market response analysis have resulted in conflicting findings. For instance, Telser (1962 cited in Kocabiyikoğlu, 2004) utilized the time series data for three different cigarette brands. Simultaneous equation models were used to explore the relationship between advertising and sales. The study found that different cigarette brands earn different return on advertising spending. Furthermore, Telser (1962) states that other marketing variables such as economic conditions and the level of competition in the market also influence the advertising-sales relationship (Kocabiyikoğlu, 2004). While studying the relationship between advertising and sales, Quandt (1964) also argued that other variables like disposable income, education etc. should be considered as these factors affect the advertising-sales relationship. Murphy and Cunningham (1993) state that linking advertising with sales impact is not appropriate as other marketing variables such as economic factors, market factors, etc., affect the company sale. In fact, previous research investigating the real effectiveness of advertising has not found a clear link between advertising and its effect on company sale (Vakratsas and Ambler 1999). Neslin (2002) found that other 8
  9. 9. variables like sales promotion can have a significant influence on the advertising and sales relationship and consider such variables responsible for inconsistent results in previous studies on the effectiveness of advertisements. On the other hand, advertising researchers, exploring the psychological and behavioral impact of advertising, concentrate on the psychological factors such as recall, attitude towards the advertisement and brand, and purchase interest for the advertised brands (Jeong, 2004). According to this method, consumers are shown advertisements and then their responses on how they perceive the advertisements are tapped. Furthermore, responses about their future behavior regarding the advertised brands are also recorded. Based on such responses from viewers, inferences are then made about the overall success or failure of the respective advertising campaign (Barban, Dunm, Krugman & Reid, 1990; Kover, Goldberg & James, 1995; Till & Baack, 2005). The behavioral perspective of advertising effectiveness provides insight into the antecedents of consumer behavior like attitude, recall and brand choice. It, therefore, supersedes in importance than the market and sales response method of advertising effectiveness. This is also more important as it is more consistent with the marketing concept which focuses on the final consumer as a fundamental business philosophy (Ang, Lee & Leong, 2007). Consistent with such views, Lucas and Britt (1963 cited in Kocabiyikoğlu, 2004) stated quite earlier that the basic purpose of advertising is to provide information about the actual receivers of advertisements that are instrumental in the selection of appropriate advertising strategies. This ultimately improves the effectiveness of advertisement and hence will positively affect the market result. Behavioral Perspective of Advertising Effectiveness The behavioral perspective of advertising effectiveness concerns how people perceive, process, respond to, and use advertising information in making purchase decision about certain product or service (Jeong, 2004). As human psychology is complex, researchers have used various measures of 9
  10. 10. advertising effectiveness. These include association among recall, recognition and attractiveness of advertisement (e.g.,Wells, Burnett & Moriarty, 2003), effects of attention on memory (e.g., Rajaram, Srinivast & Travers, 2001), likeability as a measure of advertising effectiveness (Leather, McKechnie & Amirkhanian, 1994), recall, attitude towards the advertisement and brand (Ang & Low, 2000; Kover et al.,1995; Higie & Sewal, 1991). However, the behavioral perspective of advertising effectiveness in general focuses on recall or and persuasion (Till & Baack, 2005). There are many reasons why these two types of measures are consistently used as a useful criterion for evaluating advertising effectiveness: First, viewers’ recall of the advertising information shows that the advertisement has been well attended to and the advertising information has got a place in consumers’ minds which increases the likelihood of the advertised brand to become member of consumers’ evoked set (Stewart, 1989). Evoked set represents the number of brands in the priority list of a consumer while considering purchase of goods and services (Loudon & Della Bitta, 2002). Recall is also of particular interest because an advertisement must first command attention before it can persuade. Hence, researchers have consistently used recall as a measure of advertising effectiveness (Till & Baack, 2005; Finn, 1992; Wells et al., 2003). Similarly, attitude as another measure of advertising effectiveness is important because it is related to how consumers evaluate the advertised products. A strong positive attitude towards a product means that the person may buy the brand in future (Wells et al., 2003). As Mitchell and Olson (1981) state that as attitudes are relatively stable and enduring predispositions to behave, they should be useful predictors of consumers’ behavior towards a product or service. Gresham and Shimp (1985) consider attitude as an attempt to influence consumers’ choice. Hence, it implies that attitude has got a central place in consumer’s brand choice. Attitudes are also important because they reflect the likes and dislikes of consumers (Wells et al., 2003). The importance of attitude can also be mainly understood from the empirical findings of studies stating that consumers’ attitude towards advertisements affects their subsequent evaluation of the 10
  11. 11. advertised brands and hence their choice of the respective brands (Mitchell & Olson, 1981). The above discussion reveals that both recall and attitude are the important measures of advertising effectiveness. Literature on the effectiveness of creative advertising also indicates that previous studies have used these measures as the common dimensions of advertising effectiveness. Since this study also covers the effects of creative advertising on consumers’ advertisement and brand-related attitude as well as their recall and purchase intention for the advertised brands, each of these measures is discussed in the next section in detail. 11 Advertising and Brand Attitude According to Mitchell and Olson (1981), an attitude is the process of internal evaluation of an object by an individual. Wells et al. (2003) define attitude as “a learned predisposition, a feeling that an individual holds towards an object, a person, an idea that leads to a particular behavior” (p.112) . Thus, it can be positive or negative, reflecting the likes and dislikes or it can be neutral. According to Wells et al. (2003), attitude represents the image of a certain brand and it is an image in customers’ minds that reflects what they think and feel about the brand. Perhaps, it is the importance of consumers’ attitude that Advertisers are so much concerned about the likeability of their commercials because emotions and feelings evoked by an advertisement carry over to the brands. It is due to this reason that attitude is considered an important determinant in consumers’ actual behavior about certain brand (Batra & Ray, 1986; MacKenzie, Lutz & Belch, 1986; Bruner & Kumar, 2000). The next section provides an elaborate view of the relationship between consumers’ advertising and brand-related attitude. Relationship between Creative Advertising And Advertising Effectiveness Having discussed advertising effectiveness and creativity in advertising this section attempts to find association between the two constructs. This is
  12. 12. done in two ways: First, whether the empirical finding of previous studies on the relationship between creative advertising and effectiveness, though few in numbers, (Kover et al., 1995; Stone et al., 2000; Ang & Low, 2000; Till & Baack, 2005) support the notion that creative advertising positively influences advertising effectiveness. This has been discussed in section below. Second, whether the components of creative advertising as found in previous studies and commonly discussed in the advertising text influence advertising effectiveness. It has been discussed in section Previous Studies 1. Relationship between Creative Advertising and Advertising Effectiveness. The role and importance of advertising creativity is widely recognized, both among academicians and practitioners. Normally, every advertising textbook devotes one or two chapters to advertising creativity (Smith & Yang, 2004). Advertising practitioners consider creativity as a solution of greater media clutter (Rossiter & Percy, 1985; Pieters et al., 2002). In this sense, creative advertisements are considered as an effective tool to break through the media clutter, reach the consumers’ minds, build an impression and lead to more effectiveness of the campaign (Ang et al., 2007). Furthermore, to recognize the excellence in advertising creativity, advertising agencies are rewarded with creativity awards (Till & Baack, 2005). However, do advertisements, being recognized as creative by the industry peers, provide any added advantage to the brand? Does creative advertising as defined by academicians, exert positive psychological influence on viewers’ purchase behavior? There are very few studies that have addressed these questions (Till & Baack, 2005; Stone et al., 2000; Kover et al., 1995). These questions are most commonly found in the advertising literature (Till & Baack, 2005). However, despite the widespread recognition of creativity in the advertising industry and academia, surprisingly, very few studies have addressed these questions (e.g., Stone et al., 2000). 12
  13. 13. 13 The Findings of Kover et al. (1995) Kover et al. (1995) investigated the relationship between creative advertising and advertising effectiveness among household consumers. Participants watched a set of television commercials containing creative, effective and normal advertisements. Creative and effective advertisements were those having won the creativity and effectiveness awards. However, these advertisements were further assessed by participants for effectiveness and creativity. Kover et al. (1995) used commercial liking, congruency and purchase intent as the measures of advertising effectiveness. Advertising creativity was measured in terms of old/new and dull/exciting. Responses obtained on these measures were categorized into four clusters. Their study found that commercials in cluster I were more creative, more liked and produced greater purchase interest for the advertised brands. Commercials in cluster II and III evoked moderate response while commercials in cluster IV elicited the poorest response on the creativity and effectiveness measures. Overall, their study found that creative advertisements as measured in terms of newness and exciting were more liked and led to greater purchase intent. The Findings of Ang and Low (2000) Ang and low (2000) also examined the association between creative advertising and advertising effectiveness. Effectiveness of creative advertisements was measured in terms of attitude towards the advertisement, attitude towards the brand and purchase intent. Similarly, participants were shown creativity award-winning television commercials for assessing its creativity in terms of the advertising novelty, meaningfulness and emotional content. Their study found that creative advertisements as judged by the participants were more liked and consistently evoked favorable attitude towards the respective creative advertisements, however, to a lesser degree resulted in a more favorable view of the brand and increased purchase intent for the respective brand. The finding of Ang and Low (2000) polarized the result of Kover et al. (1995) to some extent which stated that creative advertisements are more liked and produce greater purchase intent for the
  14. 14. advertised brand. As such, the questions whether creative advertisements result in more brand specific effects like greater brand recall, positive brand attitude and greater purchase intent, are still unanswered. The Findings of Stone, Besser, and Lewis (2000) Stone et al. (2000) in a telephone survey obtained responses from general public on commercials’ likeability. To find the link between creativity in advertising and likeability, these advertisements were further shown to undergraduate business students to assess how much these advertisements are creative. To judge an advertisement as creative, the rule was that eighty percent of the participants had to agree that the advertisement is creative. Stone et al. (2000) found that majority of advertisements previously liked were found as creative. More specifically, seventy percent of the previously liked commercials were judged as creative. However, though relatively less in percentage, forty six percent of the disliked advertisements were also judged as creative, thus diluting the overall results. As such, it becomes difficult to conclude that only likeable advertisements are always creative. The Findings of Till and Baack (2005) While the findings of previous studies have portrayed a mixed view of the relationship between creative advertisements and advertising effectiveness, Till and Baack (2005) further investigated the effects of creative advertisements on recall, attitude and purchase intent. They found that creative advertisements do not differ from normal advertisements on the basis of aided recall of the respective advertisement and brand information. Furthermore, their study also revealed that a one-week delayed unaided recall of advertisement and brand-related information for creative advertisements were significantly higher than the normal advertisements. This shows that creative advertisements are more capable of maintaining the stored information in consumers’ unconscious memory. In the third experiment, Till and Baack (2005) investigated the effects of creative advertisements on consumers’ brand attitude and greater purchase intent. This experiment did not find any significant difference for brand attitude and purchase intent between creative 14
  15. 15. and control commercials. Similarly, no significant difference was found between creative and control commercials for purchase intention. To conclude, Till and Baack (2005) suggest that creative advertisements generate significantly greater advertisement and brand recall, particularly unaided recall, however, creative advertisements do not bestow any added advantage in terms of forming positive brand attitude and greater purchase intent. The above studies have been useful in providing worthwhile insights about the association between creative advertising and advertising effectiveness. As such, these studies have provided a base for future research on this issue. However, due to differences in the findings of these studies, no well-established theory has yet been developed on the relationship between creative advertising and advertising effectiveness (Till & Baack, 2005). In addition to the empirical findings of previous studies on the effectiveness of creative advertising, Maitra (2008) reported the expert comments of different advertising agency’s executives concerning their views of creativity awards and effectiveness awards. Different advertising executives have different opinions for these awards with some executives favoring the effectiveness awards as compared to creative awards and some equate both the creativity and effectiveness awards. Those in favor of advertising effectiveness awards argue that clients look at the results of the campaign and not the creativity of their advertising. On the other hand, those equating the winning of creativity award (creative advertisements) to the winning of advertising effectiveness awards (Effective Ads) argue that most of their advertisements having won the creativity award have also won the advertising effectiveness award. At the same time, Executive Vice President Marketing and CMO "Max New York Life" states that there is a very small percentage of such advertising campaigns that have won both the advertising creativity and advertising effectiveness awards and as such it is a big question mark whether advertisement having won the creativity awards are really effective as well or not (Maitra, 2008). As such, questions concerning the relative effectiveness of creative advertisements have yet to be answered. An extensive review of literature on the effectiveness of creative advertising 15
  16. 16. reveals that advertising creativity research is limited (Stone et al., 2000). Hence, in addition to the empirical findings of previous studies on the effectiveness of creative advertising, as discussed above, this research also utilized the literature related to the components of creative advertising (Novelty, Meaningfulness and Connectivity) and their effects on the measures of advertising effectiveness. This has been discussed in section below. 2. Components of Creative Advertising and Advertising Effectiveness As discussed in section 2.5.1, creative advertisements were found to be novel, meaningful and congruent (Kover et al., 1995) and developed significantly greater advertisement likeability and purchase intent. Similarly, creative advertisements being more novel, meaningful and emotional (Ang & Low, 2000) were perceived as more favorable and also developed brand likeability and purchase intent to some extent. In addition, creativity in advertising has been commonly defined as novel and meaningful (Haberland & Dacin, 1992) as well as relevant to its target viewers (Wells et al., 2003; Kover et al., 1995). The next section, therefore, discusses the greater recall and persuasive effects of the components of creative advertising as found in previous creativity studies and commonly stated in the advertising text. Effects of Creative Advertising Components on Recall Extensive review of literature states that novelty is the most common feature of creative advertisements which is advocated by advertising practitioners and academia (Till & Baack, 2005; Ang et al., 2007; White & Smith, 2001). Literature related to consumers’ processing of advertising information in human minds and its retrievability states that the unexpected and novel stimuli elicit better recall than an expected and nonnovel timuli (Heckler & Childers, 1992; Srull, 1981). The main reason they state is that novel stimuli are unexpected and new to the minds of viewers which grabs more attention and requires greater and in-depth processing efforts in order to encode the information to derive some meaning from it. Furthermore, due to increased processing efforts required to encode the desired unexpected information, such 16
  17. 17. novel and unexpected information results in the formation of greater number of linkages in consumers’ memory due to which retrievability of information from memory increases (Srull, Lichtenstein, & Rothbart, 1985). Similarly, the other dimension of creative advertising as found in previous creativity studies and commonly advocated in advertising text is “meaningfulness” of the advertisement (Ang et al., 2007). Meaningfulness of advertisement facilitates the processing of advertising information in consumers’ minds (Lee & Mason, 1999). In addition, researchers have also found that irrelevant and meaningless information receives little processing efforts due to which viewers do not properly encode the advertising information. Due to poor and weak encoding of such meaningless information, poor or no associative linkages are formed within the memory network and hence, the probability of information retrieval remains very low (Srull, 1981; Craick & Lockhart, 1972). Heckler and Childers (1992) found that novel advertisements produce relatively greater recall of the individual pictorial elements contained in the advertisement. Lee and Mason (1999) further extended the work of Heckler and Childers (1992) and found that novel and meaningful advertisements produced significantly higher recall of the advertising information. Furthermore, Srull et al. (1985) suggest that unexpected but meaningful advertisements are more successful in eliciting grater amount of recall. More recently, the finding of Ang et al. (2007) also supported this theory. While initially validating their conceptualization of “advertising creativity cube”, Ang. et al. (2007) found that novel and meaningful advertisements (that is, Unexpected-Relevant advertisements) led to significantly higher advertising and brand recall than the other possible combinations of advertising novelty and meaningfulness. The third component of creativity in advertising is “advertising connectivity”. Connectivity refers to the relevancy of advertising information to its target audience (Ang et al., 2007). It shows an understanding of the characteristics of the target people that the advertiser is communicating with. Kover et al. (1995) termed such advertisements as “congruent and self enhancing” advertisements which in other words, reflect the “Ideal Self” and the “Inner Self” of a person while the 17
  18. 18. person is watching an advertisement. The associative network memory model also provides support for greater recall potential of creative advertisements. The associative network memory model suggests that information in human memory resides in the form of information nodes (Anderson, 1983). Information nodes serve as the storage of relevant information and can be assumed as the pockets of information (Anderson, 1983). Relevant information nodes are connected with each other which form a network of memory (Keller, 1993). The retrieval (recall) of certain information is based on the excitation of the relevant information node in memory. The excitation of relevant memory node further depends upon the number of associations and linkages that it forms with other information nodes in the memory network (cited in Ang et al., 2007). Thus, the more an advertisement is connected and related with its target audience, the greater number of associative linkages will be formed in consumers’ memory and hence the greater excitation of the respective information node will occur (Anderson, 1983; Keller, 1993). Due to greater excitation of the respective information node, viewers will be more capable to retrieve the information stored in the respective nodes (Ang et al., 2007; Srull, 1981). Therefore, creative advertisements being more connected and related with its target market as found in previous creativity studies (Kover et al., 1995) and advocated in the advertising text (Marra, 1990; Jewler & Drewniany, 1998; Haberland & Dacin, 1992; Belch & Belch, 1998) are believed to elicit significantly higher advertising and brand-related recall than normal advertisements. The above discussion reveals that the components of creativity in advertising, that is, novelty of the advertising idea, meaningfulness and connectivity of the advertisement, increase the encoding as well as recallability of the stored information in consumers’ minds. The major reasons considered for such superior recallability effects of these dimensions are increased processing efforts, greater facilitation in the processing of the advertising information and the formation of more associative linkages in consumers’ minds respectively. Thus, on the basis of the above discussion and empirical findings concerning advertising creativity dimensions, this study proposes that 18
  19. 19. creative advertising will lead to significantly greater recall than advertisements which are less creative. Furthermore, as earlier stated, this study is investigating recall from both aided as well as unaided perspective. Though, both aided and unaided recall measure the retrievability of information, their mechanism and tasks are different (Till & Baack, 2005). While assessing the aided recall, viewers are assisted with a relevant cue such as product category, etc. Hence, aided recall is considered as an easier memory access (Till & Baack, 2005). Previous research has found that there is a close link among novelty, attention and the amount and difficulty of recall (Rossiter & Percy, 1985; Pieters et al., 2002). Since, every advertisement has some degree of novelty (Ang et al., 2007) and novelty has been consistently found to have a close link with recall (Mulligan, 1998; Rajaram, Srinivas, & Travers, 2001), it is expected that viewers of normal advertisements, at its best, will be able to have access to advertising and brand-related information if they are given product or advertisement-related aid. In other words, due to easier memory access for the participants, when they are provided relevant assistance such as product cue, it is expected that creative advertisements should have little difference than normal advertisements on aided recall basis. More specifically, this study argues that aided brand and advertisement features recall (that is, information about the television commercial) will not differ between creative and normal advertisements. On the other hand, unaided recall represents a relatively difficult task for the participants as no relevant cue is provided as recall prompt while viewers are asked to recall the advertising information. Literature on processing of advertising information in human minds states that the more an advertisement is novel and unexpected, the more the advertising information is processed at a deeper level in consumer memory and requires greater efforts (Srull, 1981; Srull et al., 1985). Further, the in-depth processing of information leads to the formation of greater number of associative linkages with the relevant memory nodes already existing in consumers’ memory or new linkages if no memory nodes are preexisting (Anderson, 1983). The greater number of associative linkages formed increase the likelihood of recall 19
  20. 20. of such information (Ang et al., 2007). Since creative advertisements are relatively more novel and unexpected (Haberland & Dacin, 1992), it is argued that creative advertising will grab relatively greater attention of viewers and the advertising information will be processed at a deeper level. As a result, creative advertising will lead to the formation of more associative linkages in memory (Srull, 1981) as well as the formation of new information nodes in viewers’ memory if the relevant nodes are not preexisting (Anderson, 1983; Keller, 1993). In addition, the greater amount of associative linkages formed lead to ease of retrievability of the stored information (Craick & Lockhart, 1972; Heckler & Childers, 1992; Lee & Mason, 1999). Therefore, this study argues that creative advertisements will be processed in more depth, form more associative linkages and particularly elicit relatively greater unaided recall than normal advertisements. More specifically, unaided brand and advertising features recall (Information about a commercial) will significantly differ between creative and normal advertisements. Effects of Creative Advertising Components on Consumers’ Attitude Though the increased recall result of novel stimuli is now well evident (Till & Baack, 2005; Ang et al., 2007), its sole effect on attitude is not clear. Different studies have found that novelty elicits greater cognitive elaboration (Lee & Mason, 1999) and as such increased elaboration should exert favorable influence on attitude. However, there is little empirical evidence that novelty alone is the sole determining factor of greater positive attitude. It is argued that mere unexpected and novel objects produce futile and useless processing which leads to frustration and unfavorable evaluative responses (Heckler & Childers, 1992; Lee & Mason, 1999). The well-known ‘two factor theory’ of Berlyne (1970) states that understanding the meaning of novel stimuli is an important factor in knowing the effects of the respective stimuli. One of the main characteristics of novel and unexpected stimuli is that they create “arousal jag” effects (Ang et al., 2007). The “arousal jag” characteristic of novel stimuli 20
  21. 21. creates tension in the first instance due to its ambiguous nature. This tension serves as the motive behind more elaborative processing of the novel stimuli. Once, the reader of the viewer successfully comes out of the ambiguity phase and understands the information that the novel stimuli contain, the tension is resolved. Thus, applying the same theory to advertising, it is suggested that if a novel stimulus is augmented with meaningful information, it will produce pleasing effects and ultimately favorable attitude will form (Berlyne, 1971). This may be due to the fact that meaningful information supports and facilitates the understanding of the main theme of an advertisement (Lee & Mason, 1999). On the other hand, if viewers do not become successful in deriving some positive meaning of the novel stimuli, it will produce bizarre and disturbing effects. This bizarre and non-identification type of effect will produce disappointment and negative effects on attitude of viewers (Lee & Mason, 1999). An example for airline advertisement communicating seat comfortability which was already discussed in section (2.4.1) may help to clarify the importance of meaningfulness for advertising novelty. If the person sitting in the seat with feet stretched and reading a newspaper is replaced with a stylish elephant sitting on the seat and feeling so comfortable that it goes to sleep (Novel and Meaningful), then this is more likely to produce greater positive effects on viewers’ attitude and recall than if the elephant seen in the advertisement is just moving around in the aeroplane (Novel but Not Meaningless) (Heckler & Childers, 1992). Various studies have found that the effects of novel stimuli are synergized when they possess some meaningful information (Lee & Mason, 1999; Bransford & Johnson, 1972). Lee and Mason (1999) hypothesized that unexpected but relevant (Novel – Meaningful ads) advertisements will lead to more favorable advertising and brand attitude as compared to expected – relevant ads (Non-novel but Meaningful). The study found that novel and meaningful advertisements produced more favorable advertising attitude than non-novel and meaningful advertisements. Brand attitude was found similar for both ‘novel and meaningful’ and ‘non-novel and meaningful’ ads. However, ‘novel and meaningful’ advertisements elicited 21
  22. 22. greater favorable brand response than ‘non-novel and meaningful’ advertisements. In addition, Lee and Mason (1999) found that ‘novel and meaningful’ advertisements produce more favorable advertisement and brand-related thoughts than ‘non-novel and meaningful’ advertisements. Goldenberg, Mazursky, and Solomon (1999) also advocate the same theory and state that, while generating creative ideas, it should follow certain regularities because such regularities provide logic and meaning to the advertising viewers about the advertisement (Ang et al., 2007). Kover et.al (1995) investigated the effects of award-winning creative advertisements on advertising effectiveness. The study found that novel and congruent advertisements (parallel to unexpected-relevant advertisements in Heckler & Childers, 1992 and Lee & Mason, 1999) elicited significantly greater favorable attitudinal response about the respective commercials (Kover et al., 1995). In addition, such congruent and creative advertisements (Unexpected and Relevant ads) also produced greater purchase interest for the advertised brand. Furthermore, the definition of congruent advertisements in Kover et al. (1995), Heckler and Childers (1992) and Lee and Mason (1999) is parallel to novelty and meaningfulness of an advertisement proposed by Ang et al. (2007). While validating their conceptualization of “advertising creativity cube” Ang et al. (2007) found that novel and meaningful advertisements develop significantly more favorable advertising and brand attitude as well as higher advertisement and brand recall than other combinations of advertising novelty and meaningfulness. In addition to novelty and meaningfulness, award-winning creative advertisements have also been found as more relevant and congruent (Ang & Low, 2000). Kover et al. (1995) found that award-winning advertisements are perceived as more new (novel), meaningful and congruent, (relevant to target audience) and have a significant positive effect on consumers’ attitude and purchase intent. The same theory was supported by Ang et al. (2007) who found that those advertisements which are novel, meaningful and relevant (Connected) to the target audience are more liked and elicit greater purchase intent for the advertised brands. Therefore, based on the indication that creative advertisements also consider 22
  23. 23. the target market (Relevance), this study proposes that creative advertisements will have more pleasant effects on consumers’ advertisement and brand-related attitude. Effects of Creative Advertising on Consumers’ Brand Knowledge and Purchase Intention The above discussion reveals that advertisements influence the perception of consumers and their subsequent behavior through brand knowledge, in other words, brand equity. This section attempts to relate the resultant effects of creative advertising components as discussed in sections on consumers’ brand knowledge and their respective purchase intent for the advertised brands. Section concluded that creative advertising, being more novel, meaningful and relevant to its target consumers are deeply processed and form more associative linkages in consumers’ minds. This results in greater excitation of information nodes in memory that leads to retrieval of greater amount of information stored in consumers’ minds. Similarly, section discussed that understanding the central theme of a novel stimuli produces pleasant and satisfying effects on consumers’ evaluation of the advertisements. Therefore, the superior performance of creative advertising to elicit greater recall and develop more favorable advertisement and brand attitude implies that creative advertisements are relatively more capable of building favorable brand knowledge which in turn leads to positive brand equity and hence greater purchase intent. In addition to the argument that links creative advertisements with more favorable brand knowledge, positive customer-based brand equity and hence greater purchase intent; previous studies have also provided some initial signs that award-winning creative advertisements develop significantly greater purchase intent (Kover et al., 1995; Ang & Low, 2000). Consistent with this theoretical and empirical background, creative advertisements are, therefore, believed to have relatively greater potential of building favorable brand knowledge, positive brand equity and hence greater amount of purchase 23
  24. 24. intent for the respective advertised brands as compared to normal and conventional advertisements. Creative Advertising and Advertising Effectiveness- A Broader Perspective The components of creative advertising and its effects on measures of advertising effectiveness as discussed in above sections reveal that creative advertisings are relatively more memorable and more persuasive. In addition, empirical findings in previous creativity studies as discussed in above section have found a link between creative advertising and different measures of advertising effectiveness including advertisement and brand attitude (Ang & Low, 2000), advertisement likeability (Stone et al., 2000), greater recall potential (Till & Baack, 2005) and purchase intent (Kover et al., 1995; Ang & Low, 2000). However, each study while individually finding a link between creative advertising and one or two measures of advertising effectiveness (recall, attitude or purchase intent), have not found similar and cohesive results. This study attempts to measure the relative effectiveness of creative advertising in a broader perspective and addresses some of the important methodological issues which were given little consideration in previous studies on the effectiveness of creative advertising. While measuring the relative effectiveness of creative advertising, previous studies have given little consideration to the effects of brand familiarity, advertising exposure level, and the issue of differences in creativity measurement among different groups (Till & Baack, 2005). Review of literature for each of these factors reveals that these factors significantly affect consumers’ assessment of advertisements and hence the relationship between creative advertising and advertising effectiveness. The next section briefly elaborates the effects of each of these factors on consumers’ memory and attitude, and its implication for understanding the true nature of creative advertising in terms of its effectiveness. 24
  25. 25. Chapter III ADVERTISING EFFECTIVENESS The objectives of all business are to makes profits and a merchandising concern can do that by increasing its sales at remunerative prices. This is possible, if the product is widely polished to be audience the final consumers, channel members and industrial users and through convincing arguments it is persuaded to buy it. Publicity makes a thing or an idea known to people. It is a general term indicating efforts at mass appeal. As personal stimulation of demand for a product service or business unit by planting commercially significant news about it in a published medium or obtaining favorable presentation of it upon video television or stage that is not paid for by the sponsor. ` On the other hand, advertising denotes a specific attempt to popularize a specific product or service at a certain cost. It is a method of publicity. It always intentional openly sponsored by the sponsor and involves certain cost and hence is paid for. It is a common form of non- personal communication about an organisation and or its products idea service etc. that is transmitted to target audiences through a mass medium. In common parlance the term publicity and advertising are used synonymously. What is Advertising : The word advertising is derived from the Latin word viz, “advertero” “ad” meaning towards and “verto” meeting towards and “verto” meaning. “I turn” literally specific thing”. Simply stated advertising is the art “says green.” Advertising is a general term for and all forms of publicity, from the cry of the street boy selling newspapers to the most celebrate attention attracts device. The object always is to bring to public notice some articles or service, to create a demand to 25
  26. 26. stimulate buying and in general to bring logethel the man with something to sell and the man who has means or desires to buy”. Advertising has been defined by different experts. Some of the 26 quoted definitions are: American marketing association has defined advertising as “any paid form of non personal presentation and promotion of ideas, goods or services by an identified sponsor. The medium used are print broad cast and direct”. Stanton deserves that “Advertising consists of all the activities involved in presenting to a group a non- personal, oral or visual openly, sponsored message regarding a product, service, or idea. This message called an advertisement is disseminated through one or more media and is paid for by the identified sponsor”. Advertising is any paid form of non – personal paid of presentation of ideas goods or services by an identified sponsor. Advertising is a “non- personal paid message of commercial significance about a product, service or company made to a market by an identified sponsor. In developing an advertising programme, one must always start by identifying the market needs and buyer motives and must make five major decisions commonly referred as 5M (mission, money message, media and measurement) of advertising. 3.1. HISTORY OF ADVERTISEMENT Edo period advertising flyer from 1806 for a traditional medicine called Kinseitan. Egyptians used papyrus to make sales messages and wall posters. Commercial messages and political campaign displays have been found in the ruins of Pompeii and ancient Arabia. Lost and found advertising on papyrus was common in Ancient Greece and Ancient Rome. Wall or rock painting for commercial advertising is another manifestation of an ancient advertising form, which is present to this day in many parts of Asia, Africa, and South America.
  27. 27. The tradition of wall painting can be traced back to Indian rock art paintings that date back to 4000 BC. History tells us that Out-of-home advertising and billboards are the oldest forms of advertising. As the towns and cities of the Middle Ages began to grow, and the general populace was unable to read, signs that today would say cobbler, miller, tailor or blacksmith would use an image associated with their trade such as a boot, a suit, a hat, a clock, a diamond, a horse shoe, a candle or even a bag of flour. Fruits and vegetables were sold in the city square from the backs of carts and wagons and their proprietors used street callers (town criers) to announce their whereabouts for the convenience of the customers. As education became an apparent need and reading, as well as printing, developed advertising expanded to include handbills. In the 18th century advertisements started to appear in weekly newspapers in England. These early print advertisements were used mainly to promote books and newspapers, which became increasingly affordable with advances in the printing press; and medicines, which were increasingly sought after as disease ravaged Europe. However, false advertising and so-called “quack” advertisements became a problem, which ushered in the regulation of advertising content. As the economy expanded during the 19th century, advertising grew alongside. In the United States, the success of this advertising format eventually led to the growth of mail-order advertising. In June 1836, French newspaper La Presse was the first to include paid advertising in its pages, allowing it to lower its price, extend its readership and increase its profitability and the formula was soon copied by all titles. Around 1840, Volney B. Palmer established the roots of the modern day advertising agency in Philadelphia. In 1842 Palmer bought large amounts of space in various newspapers at a discounted rate then resold the space at higher rates to advertisers. The actual ad - the copy, layout, and artwork - was still prepared by the company wishing to advertise; in effect, Palmer was a space broker. The 27
  28. 28. situation changed in the late 19th century when the advertising agency of N.W. Ayer & Son was founded. Ayer and Son offered to plan, create, and execute complete advertising campaigns for its customers. By 1900 the advertising agency had become the focal point of creative planning, and advertising was firmly established as a profession. Around the same time, in France, Charles- Louis Havas extended the services of his news agency, Havas to include advertisement brokerage, making it the first French group to organize. At first, agencies were brokers for advertisement space in newspapers. N. W. Ayer & Son was the first full-service agency to assume responsibility for advertising content. N.W. Ayer opened in 1869, and was located in Philadelphia. An 1895 advertisement for a weight gain product. A print advertisement for the 1913 issue of the Encyclopedia Britannica Advertisement for a live radio broadcast, sponsored by a milk company and published in the Los Angeles Times on May 6, 1930 At the turn of the century, there were few career choices for women in business; however, advertising was one of the few. Since women were responsible for most of the purchasing done in their household, advertisers and agencies recognized the value of women’s insight during the creative process. In fact, the first American advertising to use a sexual sell was created by a woman – for a soap product. Although tame by today’s standards, the advertisement featured a couple with the message “The skin you love to touch”. Advertisements of hotels in Pichilemu, Chile from 1935. In the early 1920s, the first radio stations were established by radio equipment manufacturers and retailers who offered programs in order to sell more radios to consumers. As time passed, many non-profit organizations followed suit in setting up their own radio stations, and included: schools, clubs and civic groups. When the practice of sponsoring programs was popularised, 28
  29. 29. each individual radio program was usually sponsored by a single business in exchange for a brief mention of the business’ name at the beginning and end of the sponsored shows. However, radio station owners soon realised they could earn more money by selling sponsorship rights in small time allocations to multiple businesses throughout their radio station’s broadcasts, rather than selling the sponsorship rights to single businesses per show. This practice was carried over to commercial television in the late 1940s and early 1950s. A fierce battle was fought between those seeking to commercialise the radio and people who argued that the radio spectrum should be considered a part of the commons – to be used only non-commercially and for the public good. The United Kingdom pursued a public funding model for the BBC, originally a private company, the British Broadcasting Company, but incorporated as a public body by Royal Charter in 1927. In Canada, advocates like Graham Spry were likewise able to persuade the federal government to adopt a public funding model, creating the Canadian Broadcasting Corporation. However, in the United States, the capitalist model prevailed with the passage of the Communications Act of 1934 which created the Federal Communications Commission (FCC). However, the U.S. Congress did require commercial broadcasting companies to operate in the “public interest, convenience, and necessity”. Public broadcasting now exists in the United States due to the 1967 Public Broadcasting Act which led to the Public Broadcasting Service (PBS) and National Public Radio (NPR). In the early 1950s, the DuMont Television Network began the modern practice of selling advertisement time to multiple sponsors. Previously, DuMont had trouble finding sponsors for many of their programs and compensated by selling smaller blocks of advertising time to several businesses. This eventually became the standard for the commercial television industry in the United States. However, it was still a common practice to have single sponsor shows, such as The United States Steel Hour. In some instances the sponsors exercised great control over the content of the show—up to and 29
  30. 30. including having one’s advertising agency actually writing the show. The single sponsor model is much less prevalent now, a notable exception being the Hallmark Hall of Fame. In the 1960s, campaigns featuring heavy spending in different mass media channels became more prominent. For example, the Esso gasoline company spent hundreds of millions of dollars on a brand awareness campaign built around the simple and alliterative theme Put a Tiger in Your Tank. Psychologist Ernest Dichter and DDB Worldwide copywriter Sandy Sulcer learned that motorists desired both power and play while driving, and chose the tiger as an easy–to–remember symbol to communicate those feelings. The North American and later European campaign featured extensive television and radio and magazine ads, including photos with tiger tails supposedly emerging from car gas tanks, promotional events featuring real tigers, billboards, and in Europe station pump hoses “wrapped in tiger stripes” as well as pop music songs. Tiger imagery can still be seen on the pumps of successor firm ExxonMobil. The late 1980s and early 1990s saw the introduction of cable television and particularly MTV. Pioneering the concept of the music video, MTV ushered in a new type of advertising: the consumer tunes in for the advertising message, rather than it being a by-product or afterthought. As cable and satellite television became increasingly prevalent, specialty channels emerged, including channels entirely devoted to advertising, such as QVC, Home Shopping Network, and Shop TV Canada. With the advent of the ad server, marketing through the Internet opened new frontiers for advertisers and contributed to the “dot-com” boom of the 1990s. Entire corporations operated solely on advertising revenue, offering everything from coupons to free Internet access. At the turn of the 21st century, a number of websites including the search engine Google, started a change in online advertising by emphasizing contextually relevant, unobtrusive ads 30
  31. 31. intended to help, rather than inundate, users. This has led to a plethora of similar efforts and an increasing trend of interactive advertising. The share of advertising spending relative to GDP has changed little across large changes in media. For example, in the US in 1925, the main advertising media were newspapers, magazines, signs on streetcars, and outdoor posters. Advertising spending as a share of GDP was about 2.9 percent. By 1998, television and radio had become major advertising media. Nonetheless, advertising spending as a share of GDP was slightly lower about 2.4 percent. A recent advertising innovation is “guerrilla marketing”, which involves unusual approaches such as staged encounters in public places, giveaways of products such as cars that are covered with brand messages, and interactive advertising where the viewer can respond to become part of the advertising message. Guerrilla advertising is becoming increasingly more popular with a lot of companies. This type of advertising is unpredictable and innovative, which causes consumers to buy the product or idea. This reflects an increasing trend of interactive and “embedded” ads, such as via product placement, having consumers vote through text messages, and various innovations utilizing social network services such as Facebook (www.facebook.com). Basic Features of Advertising On the basis of various definitions it has certain basic features such as : 1. It is a mass non-personal communication. 2. It is a matter of record. 3. It persuades buyers to purchase the goods advertised. 4. It is a mass paid communication. 5. The communication media is diverse such as print (Newspapers and magazines) 31
  32. 32. 6. It is also called printed salesmanship because information is spread by means of the written and printed work and pictures so that people may be induced to act upon it. 32 Functions of Advertising For many firms advertising is the dominant element of the promotional mix – particulars for those manufacturers who produce convenience goods such as detergent, non – prescription drugs, cosmetics, soft drinks and grocery products. Advertising is also used extensively by maters of automobiles, home appliances, etc, to introduce new product and new product features its uses its attributes, pt availability etc. Advertising can also help to convince potential buyers that a firm’s product or service is superior to competitor’s product in make in quality, in price etc. it can create brand image and reduce the likelihood of brand switching even when competitors lower their prices or offer some attractive incentives. Advertising is particularly effective in certain other spheres too such as: i) When consumer awareness of products or service is at a minimum. ii) When sales are increasing for all terms in an industry. iii) When a product is new and incorporates technological advance not strong and. iv) When primary buying motive exists. It performance the following functions: i) Promotion of sales ii) Introduction of new product awareness. iii) Mass production facilitation iv) Carry out research v) Education of people.
  33. 33. 33 3.2. TYPES OF ADVERTISING Broadly speaking, advertising may be classified into two categories viz., product and institutional advertising. a) Product Advertising The main purpose of such advertising is to inform and stimulate the market about the advertisers products of services and to sell these. Thus type of advertising usually promote specific, trended products in such a manner as to make the brands seam more desirable. It is used by business government organization and private non-business organizations to promote the uses features, images and benefits of their services and products. Product advertising is sub-divided into direct action and indirect action advertising, Direct action product advertising wages the buyer to take action at once, ice he seeks a quick response to the advertisement which may be to order the product by mail, or mailing a coupon, or he may promptly purchase in a retail store in response to prince reduction during clearance sale. Product advertising is sub-divided into direct & indirect action advertising & product advertising aims at informing persons about what a products is what it does, how it is used and where it can be purchased. On the other hand selective advertising is made to meet the selective demand for a particular brand or type is product. b) Institutional Advertising : It is designed to create a proper attitude towards the sellers to build company image or goodwill rather than to sell specific product or service. Its purpose is to create a frame of mind and to implant feeling favorable to the advertisers company. Its assignment is to make friends for the institution or organization. It is sub-divided into three categories: patronage, public, relations and public service institutional advertising.
  34. 34. i) In patronage institutional advertising the manufacturer tells his prospects and customer about himself his policies and lives personnel. The appeals to the patronage motivation of buyers. If successful, he convinces buyers that his operation entitles him to the money spent by them. ii) Public relations institutional advertising is used to create a favorable image of the firm among employees, stock-holders or the general public. iii) Public service institutional advertising wages public support. c) Other Types : 34 The other types are as follows: i) Consumer advertising ii) Comparative advertising iii) Reminder advertising iv) Reinforcement advertising Barriers to Great Advertising Advertising testing could provide a reliable feedback loop and lead to much better advertising, but many obstacles stand in the way. The first great barrier to better advertising is self-delusion. Most of us believe, in our heart-of-hearts, that we know what good advertising is and that there is no need for any kind of independent, objective evaluation. Agencies and clients alike often think that they know how to create and judge good advertising. Besides, once agencies and clients start to fall in love with the new creative, they quickly lose interest in any objective evaluation. No need for advertising testing. Case closed. Strangely, after 40 years of testing advertising, we cannot tell you if a commercial is any good or not, just by viewing it. Sure, we have opinions, but they are almost always wrong. In our experience, advertising agencies and their clients are just as inept at judging advertising as we are. It seems that none of
  35. 35. us is smart enough to see advertising through the eyes of the target audience, based purely on our own judgment. A second barrier to better advertising is the belief that sales performance will tell if the advertising is working. Unless the sales response to the advertising is immediate and overwhelming, it is almost impossible to use sales data to judge the effectiveness of the advertising. So many variables are beyond our control, as noted, that it’s impossible to isolate the effects of media advertising alone. Moreover, some advertising works in a few weeks, while other advertising might take many months to show positive effects, and this delayed response can confound our efforts to read the sales data. Also, advertising often has short-term effects that sales data might reflect, and long-term (years later) effects that most of us might easily overlook in subsequent sales data. Because of these limitations, sales data tends to be confusing and unreliable as an indicator of advertising effectiveness. Sophisticated marketing mix modeling is one way to measure these advertising effects on sales, but it often takes millions of dollars and years of effort, and requires the building of pristine databases of sales information along with all of the marketing input variables. Few companies have the budget, the patience, the accurate databases, and the technical knowledge necessary to succeed at marketing mix modeling. Even so, marketing mix modeling does not help us evaluate the contribution of a single commercial but rather the cumulative effects of many different commercials over a long period of time. Also, marketing mix modeling does not tell us why the advertising worked, or failed to work. Was it message, or media weight, or media mix that made the advertising effective? Generally, marketing mix modeling cannot answer these types of questions. So, again, sales data is of limited value when you make critical decisions about your advertising. A third barrier to better advertising is a pervasive tendency of many (but not all) advertising agencies to delay, undermine, and thwart efforts to 35
  36. 36. objectively test their creative “babies.” Who wants a report card on the quality of their work? It’s very threatening. The results can upset the creative folks. The results can upset clients. The agency can lose control. Agencies can be quite creative in coming up with reasons to avoid copy testing. Some of our favorites:  There’s no time. We have to be on air in five days, so we’ll just have to 36 skip the testing.  These ads are built on emotion and feelings, and you can’t measure such delicate, artful subtleties.  We’ve already tested the ads with a focus group during the development process.  These are image ads, and you can’t test imagery with standard advertising testing techniques.  We have so much equity in this campaign that it doesn’t matter what the testing results are. We can’t afford to change.  We’re in favor of testing, but let’s remove those questions about purchase intent and persuasion from the questionnaire.  We are in a new age, with new media and new messages, and none of the old copy testing measures apply any more. The fourth barrier to more effective advertising is the big creative ego. The belief that only the "creatives" in the agency can create advertising—and the conviction that creativity is their exclusive domain—constitute a major barrier. Great advertising tends to evolve over time, with lots of hard work, fine-tuning, and tinkering—based on objective feedback from target consumers. Big creative egos tend to resist such evolutionary improvements. We have seen great campaigns abandoned because agencies would not accept minor tweaks to the advertising. To be fair, big egos are not limited to advertising agencies. Big client egos can also be a barrier to good advertising. Research firm egos are yet another problem. Big egos create barriers because
  37. 37. emotion is driving advertising decision making instead of logic, reason, and consumer feedback. Big egos lead to bad advertising. A fifth barrier to better advertising is the widespread belief that one’s major competitors know what they are doing. So, just copy the advertising approaches of the competition, and success will surely follow. We recently had a client who was about to copy the advertising strategy of a major competitor, but we were able to persuade the client to test all major competitive commercials as a precaution before blindly copying the competitor’s advertising approach. This competitor was the industry leader in market share and profitability. Our testing quickly revealed that this industry leader was the industry leader in spite of its bad advertising. The testing also revealed that another competitor, in contrast, had great advertising. Needless to say, the client’s desire to copy the industry leader quickly vanished. The sixth barrier to better advertising is lack of strategy, or having a poor strategy. The client is most often at fault here. The client has not done his homework, has not thought deeply about his brand and its future, and has not developed and tested strategy alternatives. The client tells the agency to go forth and create great advertising, without providing any strategy guidelines. The agency is left to guess and speculate about strategy. Great advertising is rarely created in a strategy vacuum. If the client cannot define a sound strategy, the agency cannot create great advertising. Again, the responsibility for strategy falls squarely on the client. A seventh barrier to better advertising is client ineptness. Some clients’ processes, policies, and people tend to discourage the creation of great advertising. Arrogance, ambiguity, impatience, ignorance, risk aversion, and inconsistency tend to be the hallmarks of these “agency killer” clients. Bad clients rarely stimulate or tolerate great advertising. 37
  38. 38. The eighth and last barrier to better advertising is poor copy testing by research companies. Many advertising testing systems are limited to a few markets (and cannot provide representative samples). Some systems are so expensive that the cost of testing exceeds the value of the results. Research companies have been guilty of relying on one or two simplistic measures of advertising effectiveness, while completely ignoring many other very important variables. For instance, for several years research companies argued publicly over which was more important, persuasion measures or recall measures? The truth is that both are important, but of greater import is the fact that neither of these measures alone, or in combination, measures advertising effectiveness. To judge the effectiveness of an ad, many different variables must be measured and considered simultaneously. 38 Creating Better Advertising Given all of these barriers to better advertising, how can client, agency, and research company work together to create more effective advertising? 1. The client must craft a sound strategy for its brand, based on facts, not wishful thinking and self-delusion. The client must carefully define the role of advertising in the marketing plan and set precise communication objectives for the advertising. What exactly does the client want the advertising to convey, to accomplish? Agencies are too often asked to create advertising in an informational vacuum. Agencies are not miracle workers. Once strategy and positioning alternatives are identified and tested, the strategy should be locked down…and rarely changed thereafter. 2. As creative executions are developed against the strategy, each execution should be pretested among members of the target audience (pretesting refers to testing advertising before it is aired, and/or before final production. When the term “testing” is used in this article, it is a
  39. 39. shorthand term for “pretesting.”) The greater the number of executions pretested, the more likely it is that great advertising will emerge. Testing the creative provides a reliable feedback loop that helps agency and client alike become smarter over time. Once a conceptual family of commercials is identified as the optimal campaign of the future, then the campaign should be locked down. Long-term continuity of advertising message is essential to maximizing effectiveness. 3. Use the same pretesting system consistently. There is no perfect advertising pretesting system. Some are better than others, but any system will help improve your advertising. The secret is to use one system over and over, so that everyone (client, agency, and researchers) learns how to interpret the pretesting results for the category and the specific brand. 4. If budget permits, test the advertising at an early stage in the creative process (i.e., the “storyboard” or “animatic” stage) and also test at the finished commercial stage. Early-stage testing allows rough commercials to be tweaked and fine-tuned before you spend the big dollars on final production. Early-stage testing tends to be highly predictive of finished commercial scores, but not always. Testing the finished commercials gives you extra assurance that your advertising is “on strategy” and working. 5. Build your own “action standards” over time. As you test every execution, you will begin to learn what works and what doesn’t work. Think of the pretesting company’s norms as very crude, rough indicators to help you get started with a testing program. But, as quickly as possible, develop your own norms for your category and your brand (yes, all of the advertising effectiveness measures vary by product category and brand). What you are searching for, long-term, are not norms, but action standards (that is, the knowledge that certain advertising testing scores will translate into actual sales increases). 39
  40. 40. 6. Use a mathematical model to derive an overall score for each execution. It doesn’t matter that an ad has great persuasion if it does not register the brand name. It doesn’t matter that an ad registers the brand name if no one will notice the commercial itself. It doesn’t matter that an ad increases short-term purchase interest if it will damage the brand’s quality reputation over time. So, all of the key variables must be put together intelligently to come up with a composite or overall measure of advertising effectiveness. 7. Use the pretesting results as a guide, as an indicator, but do not become a slave to the mathematical model. Read all of the open-ended questions carefully. Make sure you really understand the underlying reasons. Base your decisions on this comprehensive assessment of the results, and leave yourself some wiggle room. No model or system can anticipate every marketing situation, or give a 100% perfect solution every time. Informed human judgment remains important. 8. Client and agency need to accept that “continuous improvement” of the advertising is an important goal. This means that every execution is tested and tweaked based on scientific evidence from the target audience. We are not talking about changing the strategy or changing the campaign, but making sure that every execution is “on strategy” and working as hard as possible. 9. The ultimate goal of testing is an advertising success formula that works. That is, the goal of advertising creative development, and the goal of advertising testing, is to identify the elements/ideas essential to advertising effectiveness, and then to make sure that those elements/ideas are consistently communicated by all advertising executions. 40
  41. 41. 41 The Power of Advertising We believe in the power of advertising, based on thousands of studies in our archives. Advertising has the power to persuade, the power to influence the mind and shape destiny. It has the power to change markets and improve profit margins. Advertising has short-term power (conveying new information, building awareness, enhancing credibility, etc.) and long-term power (conveying brand image, attaching emotional values to the brand, building positive reputation, etc.). The great power of advertising is seldom achieved in practice, but we can’t give up. The potential and the promise are too great. The companies that master the creative guidance and the testing systems to consistently develop and deploy great advertising will own the future and the fortunes that go with it. Great advertising is a cloak of invincibility. 3.3. ADVERTISING OBJECTIVES The long term objectives of advertising are broad and general, and concern the contribution advertising should make to the achievement of overall company objectives. Most companies regard advertising main objective as hat of proving support to personal selling and other forms of promotion. But advertising is a highly versatile communications tools and may therefore by used for achieving various short and long term objectives. Among these objectives are the following 1. To do the entire selling job (as in mail order marketing). 2. To introduce a new product (by building brand awareness among potential buyers). 3. To force middlemen to handle the product (pull strategy). 4. To build brand preference 9by making it more difficult for middleman to sell substitutes). 5. To remind users to buy the product (retentive strategy).
  42. 42. 6. To publicize some change in marketing strategy (e.g., a price change, a new model or an improvement in the product). 7. To provide rationalization (i.e. Socially acceptable excuses). 8. To combat or neutralize competitors advertising. 9. To improve the moral of dealers and/or sales people (by showing that the company is doing its share of promotion). 10. To acquaint buyers and prospects with the new uses of the product (to 42 extend the PLC). BENEFITS OF ADVERTISEMENT The functions of advertisement, and that purpose its ethics, may be discussion below: 1. It leads to cheaper prices. “No advertiser could live in the highly competitive arena of modern business if his methods of selling were more costly than those of his rivals.” 2. It acquaints the public with the features of the goods and advantages which buyers will enjoy. 3. It increases demand for commodities and this results in increased production. Advertising: a) Creates and stimulates demand opens and expands the markets; b) Creates goodwill which loads to an increase in sales volume; c) Reduces marketing costs, particularly product selling costs. d) Satisfied consumer demands by placing in the market what he needs. 4. It reduces distribution expenses in as much as it plays the part of thousands of salesman at a home. Information on a mass scale relieves
  43. 43. the necessity of expenditure on sales promotion staff, and quicker and wider distribution leads to diminishing of the distribution costs. 5. It ensures the consumers better quality of goods. A good name is the breath of the life to an advertiser. 6. By paying the way for large scale production and increased industrialization, advertising contributes its quota to the profit of the companies the prosperity of the shareholder the uplifts of the wage earners and the solution of the unemployment problem. 7. It raises the standard of living of the general public by impelling it to use to articles of modern types which may add to his material well being. “Modern advertising has made the luxuries of yesterday the necessities of today. It is a positive creative force in business. It makes two blades of grass grow in the business world where one grew before. 8. It establishes the goodwill of the concern for the test articles produced by it and in course of time they sell like hot cakes consumer search for satisfaction of their needs when they purchase goods what they want from its beauty, superiority, economy, comfort, approval, popularity, power, safety, convenience, sexual gratification and so on. The manufactures therefore tries to improve this goodwill and reputation by knowing the buyer behavior. To sum up it may be said that advertising aims at committing the producers, educating the consumer, supplementing the salesman converting the producer and the dealer to eliminate the competitor, but above all it is a link between the produce and the consumer. 43
  44. 44. 3.4. WHY & WHEN TO ADVERTISE Advertising as a tool to marketing not only reaches those who buy , but also those whose opinions or authority is counted for example a manufacturer of marble tiles and building boards advertises not only to people who intend to build houses but also to architect and engineers. While the manufacturers of pharmaceuticals products advertise to doctors as well as to the general public. At time it is necessary for a manufacturer or a concern to advertise things which it does not sell but which when sold stimulates the sales of its own product. There are concerns like electric heaters, iron etc. because the use of these increases the demand for their products. Advertising should be used only when it promises to bring good result more economically and efficiently as compared to other means of selling. There are goods for which much time and efforts are required in creating a demand by sending salesman to prospective buyers than by simply advertising them. In the early days of the cash register in America it was sold by specially trained salesman who called on the prospective users and had the difficult task of convincing them that they could no longer carry on with the old methods, and that they urgently needed a cash register. In our country certain publishers have found it less costly to sell their books by sending salesman from house to house among prospective buyers than to advertise them. In these two examples the cost of creating demand would be too high if attempted by advertising alone under such circumstances advertising is used to make the salesman acceptable to the people they call upon to increase the confidence of the public in the house. Naturals when there are good profits competitors will be attracted and they should be kicked out as and when sufficient capital is available by advertising on a large scale. Immediate result may not justify the increased expenditure but it will no doubt secure future sales. 44
  45. 45. 3.5. DESIGNING ADVERTISING CAMPAIGN Advertising is an organized series of advertising messages. It has been defined as “a planned, co-ordinate series of promotional efforts built around a central theme and designed to reach specified goals.” In other words, it is an orderly planned effort consisting of related but self – contained and independent advertisements. The campaign may appear in one more media. It has single theme or keynote idea and a single objective or goal. Thus, “a unified theme of content provides psychological continuity throughout the campaign while visual and oral similarity provides physical continuity. In short run, all campaign want pre-determined psychological reaction in the long run, practically all campaigns have sales goal. The series of advertisements used in the campaign must be integrated with the sales promotional efforts and with the activities of the sales force. Campaign varies in length some may run only for a few days, other for weeks, yet other for a season or the entire year. Usually a range of 3 to 6 months includes many campaigns. Many factors influences campaign length such as competitors advertising media, policies, seasonal falls curves of the product involved, the size of the advertising funds, campaign objectives and the nature of the advertisers marketing programme. 45 3.6. OBJECTIVES OF CAMPAIGN The advertising campaign, especially those connected with the consumers aims at achieving these objectives: i) To announce a new product or improve product. ii) To hold consumers patronage against intensified campaign use. iii) To inform consumers about a new product use. iv) To teach consumers how to use product. v) To promote a contest or a premium offer. vi) To establish a new trade regional, and
  46. 46. vii) To help solve a coca regional problem. The institutional advertising campaign on the other hand, has these objectives. i) To create a corporate personality or image. ii) To build a company prestige. iii) To keep the company name before the public. iv) To emphasize company services and facilities. v) To enable company salesman to see top executive consistently when making sales calls, and vi) To increase friendliness and goodwill towards the company. Developing the campaign programmes. The advertising campaigns are prepared by the advertising agencies, which work an behalf of their clients who manufacture product or service enterprises, which have services to sell. The word campaign is used because advertising agencies approach their task with a sum Blanca of military fanfare in which one frequently hears words like target audience logistics, zero in and tactics and strategy etc. The account executive co-ordinates of the work in a campaign. The creation of an advertising campaign starts with an exploration of consumer’s habits and psychology in relation to the product. This requires the services of statistical trained in survey techniques and of others trained in social psychology. Statisticians select samples for survey which are done by trained interviewers who visits individuals, included in the sample and ask question to find out about their taste and habits. This enquiry often leads to a change in a familiar product. For instance bathing soap may come in several new colours or cigarette in a new packet or talcum powder in another size. Such interviews are often quite essential to find out the appeal of advertising message for a product that would be most effective with consumers. David Ogilvy describes a consumer’s survey to find out the most meaningful benefit in which women are interested when they buy a face cream. 46
  47. 47. The largest preference as given to “Cleans deep into pores” followed in order of importance by prevent dryness, “is a complete beauty treatment, recommended by skin doctors” makes skin look younger’ contains estrogenic hormones, pasteurized for purity, prevent skin form aging, smooth our wrinkles Ogilvy concludes, form this voting come one of Helena Rubinstein’s most successful face creams. We christened it deep cleanser, thus, building the winning form into name of the product. After getting the data the account executive puts together the essential elements of his clients brief, interprets the research findings and draws up what he calls the “advertising strategy”. 3.6. STAGE IN ADVERTISING CAMPAIGN Several steps are required to develop an advertising campaign the number of stages and exact order in which they are carried out may vary according to organisations resources, the nature of its product and the types of audiences to be reached. The major stages/steps are: 1. Identifying and analyzing the advertising. 2. Defining advertising objects. 3. Creating the advertising platform. 4. Determining the advertising appropriation. 5. Selection media plan. 6. Creating the advertising message. 7. Evaluating the effectiveness of advertising. 8. Organizing of advertising campaign. 1. Identifying & Analyzing the Advertising target: Under this step it is to decide as to whom is the firm trying to reach with the message. The advertising target is the group of people towards which advertisements are aimed at four this purpose complete information 47
  48. 48. about the market target i.e. the location and geographical location of the people, the distribution of age, income, sex, educational level, and consumers attitudes regarding purchase and use both of the advertising product and competing products is needed with better knowledge of market target, effective advertising campaign can be developed on the other hand, if the advertising target is not properly identified and analyzed the campaign is does likely to be effective. 2. Determining the advertising objectives: The objectives of advertisement must be specifically and clearly defined in measurable terms such as “to communicate specific qualities about a particulars product to gain a certain degree of penetration in a definite audience of a given size during a given period of time”, increase sales by a certain percentage or increase the firm’s market shares.” The goals of advertising may be to: i) Create a favorable company image by acquainting the public with the services offered available to the employees and its achievements. ii) Create consumers or distributor awareness by encouraging requests providing information about the types of products sold; providing information about the benefits to be gained from use of the company’s products or services; and indicating how product (or services) can be used; iii) Encourage immediate sales by encouraging potential purchasers through special sales contests, getting recommendation of professional people about company’s products etc. iv) It secures action by the reader through associating ideas, repetition of the same name in different contexts, immediate action appeal. 48
  49. 49. 49 3. Creating the Advertising platform: An advertising platform consists of the basic issues or selling points that an advertiser wishes to include in the advertising campaign. A single advertisement in an advertising campaign may contain one or more issues in the platform. A motorcycle producers advertising platform should contain issues which are of importance to consumers filling and such issues also be those which the competitive product do not posses. 4. Determining the Advertising Appropriation: The advertising appropriation is the total amount of money which marketer allocates. For advertising a specific time period. Determining the campaign budget involves estimating now much it will cost to achieve the campaigns objectives. If the campaign objectives are profit relating and stated quantitatively, then the amount of the campaign budget is determined by estimating the proposed campaigns effectiveness in attaining them. If campaigns object is to build a particular type of company image, then there is little basis for predicting either the campaigns effectiveness or determining the budget required. 5. Selecting the Media: Media selection is an important since it costs time space and money various factors influence this selection, the most fundamental being the nature of the target market segment, the type of the product and the cost involved. The distinctive characteristics of various media are also important. Therefore management should focus its attention on media compatibility with advertising objectives.
  50. 50. TABLE 3.1: SELECTING MEDIA OF ADVERTISEMENT Media Form 1. Press Advertising or Print i) Newspapers City, Small town, Sundays, 50 Daily, weekly, Fortnightly, quarterlies, financial and annuals, English, vernacular or regional languages. ii) Magazines General or special, illustrated or otherwise, English, Hindi, Regional language. iii) Trade & Technical Journals, Industrial year books, commercial, directories, telephone, Directories, references books & annuals. Circulated all over the country and among the industrialist and business magnates. 2. Direct Mail Circulars, catalogues, leaflets, brochures, booklets, folders, colanders, blotters, diaries & other printed material. 3. Outdoor or Traffic Poster and bills on walls, railways stations platforms outside public buildings trains, buses. 4. Broadcast or radio and T.V. Spot, Sectional or national trade cost 5. Publicity Movie Slides and films non theatrical and documentary films metal plates and signs attaches to trees. 6. House to house Sampling, couponing, free gifts, novelties, demonstrations. 7. Dealer aids Counter and widows display demonstration given by retailer or the advertises goods. 8. Internet Today, Internet is a big spot for advertising. Source: www.wikipedia.org So these are the media of the advertising campaign of the selecting of the media.
  51. 51. 6. Creating the Advertising Messages: This is an important stage of advertising campaign. The contents of the message have to be very carefully drafted in the advertisement. Characteristics of person in the advertising target influence the message content and form. Advertisers must use words, symbols and illustration that are meaningful, familiar and attractive to those persons. The type of media also influences the content and form of the message. 7. Evaluating the Effectiveness of Advertising: The effectiveness of advertising is measured for a variety of reasons: a) To determine whether a campaign accomplished its advertising 51 objects. b) To evaluate the relative effectiveness of several advertisements to ascertain which copy, illustrations or layout is best. c) To determine the strengths and weaknesses of various media and media plans. In other words, measuring advertising effectiveness is needed to determine whether proposed advertisement should be used and if they will be now they might be improved; and whether going campaign should be stopped, continued or changed. In accomplishing these purposes, pretests and post test are conducted. The former tests before exposing target consumers to advertisements and the letter after consumers have been exposed to advertisements and the letter after consumers have been exposed to advertisements.
  52. 52. For an effective advertising programme, the advertising manager requires a basic understanding of the medium that is going to carry it. For effectively using advertising the management must test advertising to know which of the advertisement to know which of the advertisement have proved profitable and why as compared to others. 52
  53. 53. Chapter IV ANALYSIS AND INTERPRETATION OF PRIMARY DATA PRESENTATION AND ANALYSIS OF DATA Analysis is the core of the research. Analysis means treatment of information in such a way that full diagnosis of the problem can be made. Only through analysis of data the researcher can arrive at logical conclusions. In this segment the data collected through analysis of data the researcher can arrive at logical conclusions. In this segments the data collected through the issue of questionnaire and schedule are presented by way of tables’ analysed using various mathematical and statistical tools. 53
  54. 54. SELECTING SAMPLE Number of respondents 54 SELECTING SAMPLE The Table- 4.1 shows the Method of selecting sample. Table - 4.1 : Method of selecting sample. Total consumer decided to be interviewed 120 Total consumer interviewed 100 Number of respondents 100 Complete answer given 90 Incomplete answer given 30 Survey sample selected for analysing 90 Source: Primary data Graph - 4.1 : Method of selecting sample. Total consumer decided to be interviewed Total consumer interviewed Complete answer give Incomplete answer give 140 120 100 80 60 40 20 0 The table 4.1 shows the method of selecting sample. Survey sample selected for analysing Series1 120 100 100 90 30 90
  55. 55. RESPONDENTS CLASSIFICATION ACCORDING TO AGE The table – 4.2 shows the age wise classification of respondents. Table – 4.2: Age wise classification of respondents. AGE NO: OF CLASSIFICATION ACCORDING TO AGE Below 25 25 to 35 35 to 45 Above 45 27% 55 RESPONDENTS PERCENTAGE Below 25 33 37 % 25 to 35 24 27 % 35 to 45 20 22 % Above 45 13 14 % Total 90 100 % Source: Primary data Graph – 4.2: Age wise classification of respondents. 37% 22% 14% The chart 4.2 shows that the 37 % of respondents age is below - 25 and 27 % of respondents age is 25-35 and 20 % of respondents age is 35 - 45 and finely 13 % of respondents are under the category of above 45 age group.
  56. 56. RESPONDENTS CLASSIFICATION ACCORDING TO SEX. The table 4.3 shows the classification of respondents according to sex Table - 4.3: Classification of respondents according to sex SEX NO. OF CLASSIFICATION ACCORDING TO SEX. 56 RESPONDENTS PERCENTAGE Male 52 58 % Female 38 42 % Total 90 100 % Source: Primary data Graph - 4.3: Classification of respondents according to sex The table 4.3 shows that male respondents are 58 % and the female respondents are 42 %. 58% 42% MALE FEMALE

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