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Chapter 9 Advertising

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  1. Chapter 9Advertising

  2. Proliferation of Advertising Unusual places where you have seen ads? Social Media- Naming Rights-Chik-fil-a bowl, Naming Rights Deals • Superbowl Ads-a 30s spot cost $4 million in 2014 • $133,000 a second  • 111.3 million viewer However, increases in brand exposure and brand consideration took place for 40 percent of the companies advertising during this football frenzy. Russian Rocket carrying a Pizza Hut logo Scope: $143 billion in 2005 Internet display ads- $8.3 billion in 2005

  3. Objectives of Advertising • Create a need or perception of a product/service • Create or dramatize/inflate problems or offenses (e.g. B.O., halatosis) • Cater to ego/self-centeredness- “have it YOUR way”, stand above the crowd, You deserve a break today” • Any others?

  4. Types of Advertising • Informative advertising provides useful information about the product. • Misleading or deceptive advertising intentionally deceives or confuses consumers. • Puffery uses exaggeration, hyperbole, or imagery to market products.

  5. Ways that Ads Mislead or Deceive • Claims for which there is no documented evidence. • Testimonials – anecdotes from users or people who are paid to say they are users. • Palming off – creating the impression that the products or services are those that are furnished by a competitor. • Misrepresentation – when an advertiser makes false or misleading claims about its products.

  6. Ways that Ads Mislead or Deceive • Product disparagement – when an advertiser intentionally makes false or misleading negative remarks about a competitor’s goods or services.(Comcast and Dish Network) • Bait-and-switch – when goods and services are offered at a low price but the salesperson attempts to lead the consumer into purchasing a more expensive product or service.

  7. Advertising Techniques and Tricks • Word-of-mouth marketing • Testimonials and endorsements- must not be deceptive, must be a bona fide user of the product (commonly violated). “Results may vary” covers them. • Weasel words- lose up to 30 lbs per month, so zero would qualify. “part of a healthy breakfast”- Would it be healthier w/o it? Which part? • Attention grabbers- “All Natural”, “Money Back Guarantee” • Appeal to basic human weaknesses and fears-loneliness, fear, failure, aging, etc. • Visual imagery- associate an attractive image with the product • Statistics- “ Average”, 2/3, etc. • Comedy- we tend to remember funny things, • e.g. Bud frogs, Eat More Chicken” • Sex – attracted to sexual images • P & G assembled 250,000 teenagers to promote the product to friends and relatives.

  8. Advertising Techniques and Tricks • Product placement- movies, video clips, background of interviews, music videos, (drinks, cars, junior mints, etc. • Paid comments on blogs, facebook, etc • Sony Ericson- word of Mouth campaign with mobile/phone and camera in Tourist Spots

  9. Examples of Testimonials • Celebrities and athletes serving as spokespersons and/or claiming that they use the product, e.g. Michael Jordan in underwear commercials • Everyday people claiming to have used the product with remarkable results, e.g. weight loss products. • Physicians or those claiming to be physicians who testify to the product’s value.

  10. Examples of Attention Grabbers • Actors in medical clothing stating that a product is “hospital tested” • An attractive person(s) at the beginning of a television advertisement • The smell of food cooking to attract customers • Loud music or other noise to attract attention • Depiction of unusual settings or activities

  11. Examples of Comedy in Advertising • A cute gecko selling insurance. • A buffoonish father falling into a pool or making outrageous statements. • A ridiculously dressed man in a beer commercial. • A man who is more interested in a mundane product than in a beautiful woman.

  12. Advertising Prescription Drugs • Direct-to-consumer advertising – advertising aimed directly at consumers rather than physicians and pharmacists • Effective • Mostly informative; some contain puffery • Can target specific groups, most often seniors • Regulated by the U.S. Food and Drug Administration • Three types of DTC ads: • Product-claim ads-most common- name, condition, risks/benefits (summary of risks, phone no., web-address)

  13. Advertising Prescription Drugs • Reminder ads-name of product only • Help-seeking ads – “ ask your doctor about using…”

  14. Benefits of DTC Advertising • Favorable claims about DTC prescription drug advertising: • May increase awareness of possible treatments • Patients with undertreated conditions may receive treatment they may not have otherwise received • May increase doctor-patient interaction- MDs claim ads encourage questions/interactions with patients.

  15. Risks of DTC Advertising • Negative aspects of DTC prescription drug advertising: • May not convey information about risks very well. • May be harmful to the doctor-patient relationship. • Physicians may be pressured to prescribe a widely advertised drug. • Patients may insist on name brand drugs when generics would be just as effective. • Do they create fear? Shy or Social Anxiety Disorder? • Erectile Dysfunction Drugs now being prescribed for men in 20ss, 30s, 40s, and porn stars. Really? • Oversight- FDA warning letters to big pharma142 in 1979, 21 in 2007 despite a increase in Ad $$$ of 330% • Big Pharma – spent $800 million in federal lobbying and campaign donations over 7 year period.

  16. Advertising Nonprescription/OTC Drugs • Advertised directly to consumers • Often use testimonials, puffery, and imagery • Sometimes use statistics in ways that are designed to promote the product • Ads often fail to identify the active ingredients

  17. Targeting Special Groups • Groups may be targeted by: • Age • Gender-females diet, exercise, beauty • Ethnicity • Location • Interests and attitudes • Targeted marketing allows companies to limit ads to people who are likely to buy their products. • This saves advertising dollars.

  18. Marketing to Children • Companies use research to identify characteristics of ads that appeal to children. • Marketers use research to exploit the suggestibility of children. • Children younger than age 6 may not be able to distinguish between television program content and commercials. • Advertisements sometimes encourage children to pester their parents to buy certain products, undermining parental authority.

  19. Marketing to Children • “Spokes-characters” are used to appeal to children. • Television advertising toward children are often for unhealthy food. • Marketers attempt to build brand awareness and loyalty in youth. • Toys and characters from movies are used to market to children. • Advertising often takes place in schools. Due to lack of public funds schools using more sponsorships. • Regulation of advertising toward children is voluntary.

  20. Marketing Cigarettes to Children • The Master Settlement Agreement of 1998 banned marketing cigarettes to children. What did we learn from the tobacco lawsuits? • Tobacco companies continued to advertise cigarettes in magazines with youth readership. • Product placement of cigarettes in movies has continued. • The Family Smoking Prevention and Control Act of 2009 granted power to the Food and Drug Administration to regulate tobacco products. • The Act required tobacco manufacturers to release all marketing research documents, including those relating to youth-oriented advertising, to the FDA.

  21. Marketing Alcohol to Youth • Alcoholic beverages are often marketed in media and with items – tee-shirts, caps – that appeal to youth. • Magazine advertising of alcohol appears to be associated with adolescent readership. • Research indicates that alcohol advertising influences youth attitudes and help create an environment that promotes drinking. • Parents can influence their children’s attitudes by monitoring television, reading material, and Internet use. • Consumers can affect the advertising of alcoholic beverages through collective action. • What is worse alcohol or cigarettes? Which was restricted and litigated more?

  22. Unmeasured Media • “Unmeasured media” include strategies such as direct mail, sales promotion, couponing, catalogs, and special events, for which ad buy data are difficult to obtain. • They may also include product placement, advertising included in games, branded Internet environments, web-based cross promotions, and cell phone and text messaging advertisement. • Some companies use a strategy that creates interest in a product through online modes such as social media, instant messaging, and chat rooms.

  23. Infomercials • Infomercials are broadcast ads that fill an entire program slot. • Many often resemble regular talk shows. • Infomercials may use testimonials, questionable statistics, and spokespersons who claim to be experts in the field. • Regulation of infomercials is mostly voluntary.

  24. Marketing on the World Wide Web • Internet sites, including those that sell products, store consumers’ personal information, putting consumers at risk. • Bogus products may be marketed on the World Wide Web. • Protect Yourself: • Ghostery • Duck-Duck-Go • Never use debit card • Passwords • Reviews, Angie’s List, etc.

  25. Protecting Yourself while Web Shopping • Common sense practices can provide some protections. Examples include: • Never enter personal or credit card information unless the address line begins with https:// and a symbol of a lock is displayed. • Know the exchange/return/cancellation policies. • Purchase with a credit card. • Keep all of your records. • Notify authorities if you believe you have been cheated.