BUSINESS BRIEF: ADVERTISING
This Business Brief provides background information on Advertising and is a source of business
vocabulary and concepts to use in Discussion Board activities or to clarify students' questions.
Whether or not you agree with Marshall McLuhan that advertising is the greatest art form of the
20th century, it is a big part of modern culture. Shared references feed into it and it in turn feeds
into daily life. Advertising catch phrases turn up in TV comedy sketches and everyday
conversation. We become ironic about advertising, perhaps to show that we think we are able to
resist it.
TV advertising is the most glamourous, but the other media are not to be ignored: radio, cinema,
and the press, while hoardings (BrE) and billboards (AmE) are a characteristic part of the urban
landscape. All these will be around for some time, despite Internet advertising and its promises
of online shopping. While there are still shops there will be point-of-sale displays designed,
among other things, to prevent last-minute changes of mind about what brand to buy.
Advertising can be continued by other means with sponsorship of particular events or product
placement in films, where the product's makers negotiate for their products to appear and be used
by the film's characters. A related phenomenon is product endorsement, where a celebrity is used
in advertising a particular product. This can be dangerous if, for whatever reason, the celebrity
falls from favour.
Some very creative minds come up with seductive combinations of sound, image and words, but
tests show that we often don't remember the brand being advertised. Quantifying the effect of
advertising is very difficult and there has been a backlash against it in favour of other supposedly
more targeted forms of communication. This usually means direct marketing, otherwise known
as direct mail, but as those living in apartments who receive mailshots for gardening products
know, the targeting can still be ludicrously imprecise.
Advertising agencies may offer to fund direct mail campaigns, but what they are best at is
creating traditional advertising campaigns. When a client becomes dissatisfied and the agency
loses the account, this is major news in the advertising industry and means a big loss of revenue
(and selfesteem) for the agency.
Until recently, agencies took 15% of the advertiser's budget, and what they did not spend on
advertising (designing ads and media buying—buying time on TV and space in the press for the
ads to be run) they spent on "free" services in pack design, corporate identity (a unified look in
all of a company's communication, from its advertising to its letterhead, perhaps with the use of a
logo), market research, and even strategic advice. These ancillary activities are below-the-line
activities. Today most of these are undertaken by specialist organisations, leaving agencies to
concentrate on their core activity, creating advertisements.
Despite all these activities and all this expenditure, the ultimate in advertising is word of mouth;
friends and colleagues are often our most reliable sources of information. This form of
advertising is usually free. All the advertiser can do is hope that it is positive.