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Definition
| More of an idea studio than an ad agency. It is an independent business, composed of creative and business people, who develop, prepare, and place advertising in advertising media for sellers seeking to find customers for their goods and services. |
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Definition
| An agency that handles planning, creation, production, and placement of advertising for advertising clients. May also handle sales promotion and other related services as needed by client. Simply, it offers clients all the services necessary to handle the total advertising function (planning, creation, production, placement, and evaluation.) The mgmt of all integrated mar-com thru a variety of disciplines. The brand image is reinforced every time the consumer is exposed to a communication. Large agency need a new concept of the role and responsibilities to meet the demands of large clients, opposed to smaller agencies that can adjust more quickly than the large agencies which becomes a selling point. One structure does not fit all. |
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| Diagnosing the Marketing and Brand Strategy |
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Definition
| Research or brand planning develops penetrating insights into the prospects and defining the brand’s core (who are the prime prospects, where are they, demographics, ect.) |
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| Setting Objectives and developing strategy |
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Definition
| A strategy is formulated that positions the product in relation to the prime-prospect customer and emphasized the attribute that will appeal to the prime prospect. Account management defines what is to be accomplished strategically and plan how to carry it out. Strategy involves teams of account, creative, media, and research people. |
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Definition
| Define media strategy by checking objectives to ensure that they parallel your marketing objectives. Must seek to coordinate all elements of the marketing communication mix to ensure maximum exposure. Choice of media leads the process by developing an environment that multiples the impact of the creative team. |
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| Notify Trade of Forthcoming Campaign |
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Definition
| Inform dealers and retailers of the campaign details early enough so that they can get ready to take advantage of the advertising campaign |
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Definition
| creative department, account services, marketing services, and management and finance |
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| The creative director is considered to be responsible for the care and feeding of its most prized possession, the creative product. This director is ultimately responsible for the finished product, advertisement and commercials. |
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Definition
| Responsible for the relationship b/n the agency and the client and is indeed a person of 2 worlds: the client’s business and advertising. Responsible for helping to formulate the basic advertising strategy recommended by the agency, for seeing that the proposed advertising prepared by the agency is on target, and for presenting the total proposal to the client for approval. Their biggest contribution is keeping the agency ahead of its client’s needs, but will continue the overall review of account handling, maintaining contacts with a counterpart at the client’s office. |
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Definition
| : Responsible for media planning and buying, for research, and for sales promotion. Responsible for the philosophy and planning of the use of media, for the selection of specific media, and for buying space and time. The research director (planning director) will help define marketing and copy goals. The promotion director takes care of premiums, coupons, event marketing, and all types of promotion |
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Definition
| Ad agency needs an administrative head to take charge of financial and accounting control, office management, and personnel. |
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Term
| Continuing Evolution of the Agency |
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Definition
| Clients seek solutions from any place, once the exclusive territory of agencies. Must work together as a team to rapidly solve problems. Reengineer the traditional structure and approach problem solving together. |
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Definition
| Some agencies primarily specialize in certain kinds of business. B2B, health care, entertainment & tourism, real-estate, multicultural agencies, Asian markets, African-American markets, Hispanic markets, ect. Each of these operates pretty much as any other agency, but their expertise is narrower than reaching all consumers. |
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Definition
| offer more services and expensive star talent. Negative is that they generally charge more and aren’t very flexible because of their size. Nearly impossible for them to profitably service smaller clients even though there should be room for them to do so. |
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Definition
| Greatest source of creativity historically. As they grow, they will have the resources to hire strong talent. Will continue to produce provocative work. Will become attractive to larger agencies as an acquisition target for larger agencies. Thus, the newly acquired agency will not be medium size any longer but will become only a part of the larger whole. Or remain in the niche prescribed for it by the parent agency. |
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Definition
| Promote that small to medium clients can be serviced by agency’s senior mgmt and creative. They thrive. Either fared very well, or gone under. Success determined by how strong the agency’s financial mgmt was. There should be great opportunities for smaller agencies that combine a marketing-driven creative product with sound mgmt. |
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Term
| Client-Agency Relationship |
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Definition
| Client generally retains agencies as long as the relationship seems to be working. However, most contracts allow for a 90-day cancellation. Agencies can resign an account if they differ the client’s goals and the account isn’t profitable. The average tenure of client-agency relationships has declined from 7.2 years to 5 years since 1984. Although, some clients have been with agencies for decades. (ex: GE has been with BBDO for many, many years.) |
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Definition
| Agency of record relationship offers marketers an advertising team to work solely on their brand, creating a stable team of experts in that particular industry. To coordinate the total media buy and the programming of products in a network buy, the advertiser will appoint of agency the agency of record. This lead agency will make the corporate contracts under which other agencies will issue their orders, keep a record of all the advertising placed, and communicate mgmt decisions on the allotment of time and space in a schedule. |
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Term
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Definition
| Many major agencies have offices in cities throughout the U.S. Each office functions as an autonomous agency that serves different clients and is able to draw on the talents and services of other offices. Each office handles different kinds of accounts and has different specialties that could be leveraged on behalf of all clients. Generally, however, each office works primarily on its own accounts |
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Definition
| Although cultures and habits vary, people’s emotions are remarkably similar. Simply translating is dangerous (Perdue chicken “sexually excited man to make chick affectionate.”) |
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Definition
| Many small and medium sized agencies that have working agreements with each other to help with information gathering from different markets and sharing. Usually there is only one network member in each market or region. Agency networks provide info and financial skills to enhance agency operations. |
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Term
| "Mega" Agency Holding Companies |
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Definition
| Once an agency reached a certain size, account conflicts hindered the agency’s growth. The solution is to create an organization that would own individual agencies that could handle competing brands. Each of these agencies would operate freely and independently. One-stop shopping. Some of the holding companies are selling integrated services to a number of clients successfully. Mega-agency holding companies have huge networks of their agencies and support around the world to serve clients. They own many advertising agencies and marketing service companies throughout the world. |
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Term
| Advantages: "Mega" Agency Holding Companies |
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Definition
| A greater reservoir of talent and an ability to shift portions of accounts from one agency to another without going though the time-consuming, and often confusing agency review. Keeps business in the family. |
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| Disadvantages: "Mega" Agency Holding Companies |
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Definition
| Conflicts with competing accounts. “Flabby” organizations that have become “more revenue models than consumer solution models.” |
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Term
| Talent & Production agencies creating creative |
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Definition
| Melding of talent sources to develop advertising concepts.(American idol-Fox + Coke) Creative Artists Agency (CAA), a production and talent agency involving entertainment stars, writers, directors, and others. Can add another dimension to the advertising agency and client resources. |
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Term
| Independent Creative Services |
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Definition
| Seek top creative talent on freelance, pre-job basis. No media dpt., no researchers, and no account executives. Its purpose is to strictly develop ideas for its clients. |
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Term
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Definition
| Agencies that offer for a fee just the part of their services that advertisers want. Many agencies have spun off their media departments into independent divisions to seek clients interested only in media handling. |
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| Average Client-Agency Relationship |
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Definition
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Term
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Definition
| When advertisers discovered that all the services agencies could offer could be purchased on a piecemeal basis, they began setting up their own internal agencies. In house agencies are an arrangement whereby the advertiser handles the total agency function by buying individually, on a fee basis, the needed services under the direction of an assigned advertising director. Can employ a creative service to originate advertising for a fee or markup. Can buy the space or time itself of employ a media-buying service to buy time or space and place the advertisements. It is an administrative center that gathers and directs varying outside services for its operation and has a minimum staff. They are generally created to save money or give advertisers more control over every aspect of their business. |
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Term
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Definition
| An agency ran by several advertising specialists, usually account and/or creative people, that has no basic staff. It hires specialists (in marketing, media planning, creative strategy, writing, and art direction) who work on a project basis. Similar to hiring freelance creative people to execute advertisements, except that the experts are hired as needed. It is able to give advertisers expertise that small full-service agencies cannot match. |
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Definition
Some agencies reinvented their media operations to remain competitive with the growing number of media operations to remain competitive with the growing number of media-buying services and to develop their media operations as a stand-alone profit center. Large agencies have made their media services independent of other agency services to better compete. Many agencies are spinning off their media departments into separate profit centers. Reasons for creating separate media companies:
- Media agencies are stronger, with better resources to explore new areas within media.
- The fragmentation of target audiences and media vehicles has made media more important that ever before.
- A media company has the potential to be a major profit center.
- If the agency loses the creative responsibilities of a client, the media agency could continue serving the client because it is separate. |
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Term
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Definition
| Pulling together the media departments into a single, more efficient, separate company. Being huge, it has more negotiating clout and resources by the creation of these joint media alliances. They are free to seek clients that want to consolidate their media regardless of who handles their creative. “It’s simply a big business.” |
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Term
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Definition
straight 15 % remains in theory. Large advertisers rates are closer to 10 %. 2 basic forms of ad agency compensation are commissions and fees.
- Media Commissions (larger the budget, lower the rate for agency, fixed commission based on certain expenditures, after that commission is reduced)
- Production commission or markup (Agencies subcontract production work and charge the client the cost plus a commission-17.65 % in the norm.)
- Fee Arrangements
- Performance Fees (Bonus is advertising is successful) |
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Term
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Definition
| Acquisition of broadcast time by an advertiser or an agency in exchange for operating capital or merchandise. No cash is involved |
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Term
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Definition
| : Acquiring companies with complementary capabilities. Advertisers will buy one-stop coordinated communications. This approach doesn’t work well because the units that make up the conglomerate often don’t blend well with each other and are rivals for the advertiser’s budget. Isn’t necessarily best suited to solve to problem at hand |
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Term
| In-House Generalist Agency |
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Definition
| : To expand the agency’s capabilities to include such functions such functions as promotions and PR. This approach works if the agency has the talent to handle the new services or has the clients or revenues to support such a diverse staff. |
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Definition
| A group of people drawn together from all the agency affiliate organizations. It has the flexibility to change with the needs of the client. It focuses on creating ideas rather than advertisements. |
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Definition
| The agency draws from sources outside the agency and integrates these services for the brand. |
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Term
| Research as informational tool: |
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Definition
: Research is and should be used to help improve an advertiser’s effectiveness and profitability by staying in touch with the consumer. Research is used most often in the following ways:
- To help identify consumers
- To help for look for new ideas in products or services
- To help improve what is offered in products or services
- To help pinpoint causes of possible problems
- To monitor activities
- To help in communications development
- To study promotional tools |
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| Public Attitude Towards Research |
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Definition
| Refusals to cooperate in survey research are on the rise as are negative are on the rise as are negative attitudes toward survey research. Surveys are receiving record high refusal rates. This trend is in part to the growth in answering machine ownership and call-screening devices used by consumers. Even more troublesome is the fact that fewer respondents see the value of participating in survey research. Shorter interviews can help increase the response rate. |
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Term
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Definition
| Agencies found clients doing much of their own research, yet the agency research function remained necessary to understand the information on consumers and the marketplace. The agencies restructured or reduced the size of their research departments and added account planners. Account planners initiate and review research and participate in the creative process. In some agencies, the planner is considered a spokesperson for the consumer. Their task is to discern not just who buys specific brands but also why. They are usually responsible for all research including quantitative and qualitative research. The account planner is charged with understanding the target audiences and then representing it throughout the entire advertising development process ensuring that the advertising is both strategically and executionally relevant to the defined target market. They provide the insight and clarity that move discussion from I think to I know. These planners play crucial roles in strategy development, driving it from the consumers’ point of view. One the work runs, they monitor its effect in depth with a view to improving it the next time around. The planner is more a partner to the account and creative teams than a traditional researcher. The planner is considered the team’s spokesperson for the consumer and an interpreter of available research. |
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Definition
Up-front research, tells us about the product, the market, the consumer, and the competition. Behavioral sciences have had a strong influence on this type of research. Four basic considerations in any market research
- Maintaining a consumer-behavior perspective
- Being sure the right questions are being asked
- Using appropriate research techniques and controls
- Presenting the research findings in a clear, comprehensible format that leads to action |
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Definition
| Principally pre-testing of advertisements and campaign evaluation to get data we need to develop and refine an advertising strategy and message. |
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Term
| Anthropology and Advertising |
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Definition
| Marketers employ anthropologists to study the emotional connection between products and consumer values. Using anthropology research allows advertisers to use cultural differences and subgroup identities when they advertise their products. |
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Term
| Sociology and Advertising |
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Definition
| Advertisers recognize group influences on the adoption of new ideas, media use, and consumer purchase behavior. They use sociological research to predict the profitability of a product purchase by various consumer groups. |
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| Social Class and Stratification |
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Definition
| Experienced advertisers have recognized that people’s aspirations usually take on the flavor of the social class immediately above their own. In today’s marketing environment, research has shown that no single variable, such as age, income, or sex, will accurately predict consumer purchases. Using several variables gives a more accurate prediction of consumer behavior. |
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Term
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Definition
| Trends come from all forms of media and advertising. Fads are like crushes; they burn fast and hot but die quickly and often leave a bitter taste (ex: pokemon, macerena, beanie babies.) Trends are a product of society. They reflect our changing attitudes, behaviors, and values. Trends can be 2 sizes: Macro trends, and Micro trends. Macro trends are about the “big issues.” Micro trends are the details in the bigger picture. |
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Term
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Definition
| : Marketers can assess consumers’ lifelong values and preferences and develop strategies now for products they will use later in life. These values are formed by significant events b/n the ages 13-20. We study consumers using demographics, psychographics, lifestyles, and behaviors. Cohort Analysis combines these data and adds the consumer profile by examining the past as well as the present. By identifying a generation, advertisers can hone messages and creative persuasive icons to better attract that generation. This kind of research can aid in developing a product marketing plan that follows the lifetime of a consumer. |
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Definition
| Concept that demonstrates changing purchasing behavior as a person or a family matures. Knowledge of this cycle allows a company to segment the market and the advertising appeal according to specific consumption patterns and groups. By examining these subgroups, advertisers begin to get a clearer picture of buying behavior and lifestyles. Researchers refer to these studies as life-stage research. It looks at crucial points in consumers’ lives. It can analyze people of all ages. This helps advertisers develop and understand the changes taking place today in the 21st century so they can create more effective integrated mar-com. |
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Definition
| Advertisers often find it useful to study consumers’ consumption patterns to help them learn more about their target audience. |
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| Psychology and Advertising |
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Definition
| Three psychology concepts of importance to consumer behavior are motivation, cognition, and learning. Motivation refers to drives, urges, and wishes. Cognition refers to all the mental phenomena. Learning refers to those changes in behavior that occur over time. Research is interested in cognitive elements to learn how consumers react to different stimuli and it finds learning especially important in determining factors such as advertising frequency. Advertising uses drives to understanding the underlying motives that initiate consumer behavior. |
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Term
| Values and Lifestyles (VALS) |
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Definition
| Designed to predict consumer behavior by profiling the psychology and demographics of U.S. consumers. It segments respondents into 8 clusters of consumers each with distinct behavioral and decision making patterns that reflect different primary motivations and available psychological and material resources. VALS classifies consumers along 2 key dimensions: Primary Motivation [what it particular about the person or the world governs his or her actions] and resources [range of psychological and material resources available to sustain that self-concept.] An individual purchases certain products and services b/c he or she is a specific type of person. Advertisers can use the VALS typology to segment particular markets, develop marketing strategies, refine product concepts, position products and services, develop advertising and media campaigns, and guide long-term planning. 8 major mind-base segments |
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Term
| 8 major mind-base segments of VALS |
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Definition
- I am expressive
- I am driven
- I am at capacity
- I am rock steady
- I am down to earth
- I am sophisticated
- I measure twice
- I am devoted. |
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Term
| 4 steps of series of research |
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Definition
1. Advertising Strategy Development
2. Advertising Execution Development
3. Evaluating Pre-Testing Cautions
4. Campaign Evolution |
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Term
| Advertising Strategy Development (part of 4 steps in series of research) |
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Definition
| Step 1. Research tries to answer many questions: Who is the market and what does it want? What is the competition? What communication do we want our selected market to get from our advertising? How will we reach the persons selected in our market? |
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Term
| Advertising Execution Development (part of 4 steps in series of research) |
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Definition
| Step 2. 2 kinds of research used, the first, is exploratory research to stimulate the creative people and to help them know and understand the language used by consumers. The other is research to study proposed creative concepts, ideas, roughs, visuals, headlines, words, presenters, and so forth to see whether it can do what the creative strategy expects of it. |
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Term
| Evaluating Pre-Testing Cautions (part of 4 steps in series of research) |
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Definition
| Step 3. Pre-testing is the stage of advertising research at which advertising ideas are tested. Because of the finality of much pre-testing, it is the most controversial kind of ad research. |
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Term
| Campaign Evaluation (part of 4 steps in series of research) |
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Definition
| Step 4.Involves a tracking study to measure the performance of a campaign. |
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Term
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Definition
| Marketers are exploring the use of brain wave research to try to better understand consumers. Brain wave research is trying to understand consumer motivation, not “insert ideas into people’s thinking.” It can provide marketers with an honest consumer reaction to a product or advertisement. Marketers can use a functional magnetic resonance imaging (fMRI) scanner to determine how much oxygen different parts of the brain are using when a person is exposed to an advertisement or a product. Different colors show up on the scan depending on which part of the brain is stimulated with thought. Can be used to assess reactions to all or parts of a commercial message because different parts of the brain show attraction, revulsion, recall, and level of attention, for instance. However, it can be difficult to interpret what this activity means. |
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Term
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Definition
| UPC information allows marketers to determine what their share of market is, if one kind of packaging or in-store advertising sells better, and which retailers sell the most units. This offers the retailer and manufacturer the opportunity to target promotions directly to people who have used the product in the past. |
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Definition
| Online focus groups, surveys, and other market research. Online research shouldn’t replace traditional marketing research, but harnessing the Internet improves the research process. Web-based research should be part of the Mix. |
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Term
| Translating Information into Strategy |
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Definition
| It acquires value only when the strategist takes “a point of view” about what the information means, a point of view that is relevant to the marketing and advertising issues. The secret of effective strategy formation lies in deciding which data are important and which are not. It is a process of organizing simplicity out of complexity, for the best strategic insights are usually very simple ones. Begin with an analysis of how people behave rather than an analysis of how they feel of what they believe. |
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Term
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Definition
| A qualitative research interviewing method using in-depth interviews with a group rather than with an individual. Provides a more in-depth way to explore creative ideas through rigid quantitative tests. A way of getting early consumer feedback to an idea without putting it through the artificiality of a formal test. It helps find out why consumers behave as they do. The focus group offers a means of obtaining information through a discussion-group atmosphere. Provides elicit spontaneous reactions to products or advertisements. A trained moderator leads a group of 8-12 consumers, usually prime prospects. The client will usually watch the interview from behind a one-way mirror so as not to disrupt the normal function of the group. |
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Definition
| Some think that many good ideas often get killed prematurely because they did not do well with a focus group. One increasing criticism is the growing number of “professional” respondents who are savvy enough to go from focus group to focus group, speaking the marketer’s language and picking up easy cash (Jake Moskowitz.) Most account planners agree that focus groups should never be used as a replacement for quantitative research. |
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Term
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Definition
| : A method to determine the best of a number of possible appeals to use in your advertising. The target audience evaluation of creative strategies. Testing attempts to separate good and bad ideas and provide insight into factors motivating acceptance or rejection. A Creative Concept is a simple explanation or description of the advertising idea behind the product. The advertiser tries to obtain a rank order of consumer appeal of the various concepts and diagnostic data explaining why the concepts were ranked as they were. One drawback of concept testing is that consumers can react only to the themes presented to them. You may find that they have chosen the best of several bad concepts. |
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Definition
| A particular advertisement passes or fails or is selected as being better than all the others. The only alternative is for the client to depend solely on the judgment of the agency or its own personnel. Pretesting is the stage of advertising research in which a complete ad is tested. It is important that the objectives of pretesting research relate back to the agreed-upon advertising strategy. It would be wasted effort to test for some characteristic not related to the goal of the advertising. A number of variables can be evaluated including the ability the advertisement to attract attention, comprehension by the reader/viewer, playback of copy points (recall), persuasion (the probability that the consumer will buy the brand), attitude toward the brand, credibility, and irritation level. Pretests should be used as guides and not as absolute predictors of winners or losers. Testing can be useful, but it is not a foolproof science. |
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Definition
Measuring the effectiveness of advertisements. A good copy testing system provides measurements that are relevant to the objectives of the advertising. A primary purpose of copy testing is to help advertisers decide whether to run the advertising in the marketplace. A useful approach is to specify action standards before the results are in. To succeed, an advertisement must have an effect on the eye are ear (reception), the mind (comprehension), and the heart (response.) Copy testing is done in 2 stages:
- Rough copy research is needed to determine if the copy is effectively achieving its goals in terms of both message communication and attitude effects.
- Finished copy research is done of the final form of the copy to evaluate how well the production process has achieved communication and attitude effects. |
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Term
| Campaign Evaluation Research |
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Definition
| Advertisers should analyze the market and competitive activity and look at advertising as a campaign, not as individual advertisements. This information can help determine whether changes in the advertising strategy are needed to accomplish the objectives established for the campaign or to deal with a changed situation. Advertisers frequently conduct tracking studies to measure trends, brand awareness and interest. |
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Term
| Testing Finished Commercials |
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Definition
| Those that attempt to evaluate a commercial’s effectiveness in terms of viewers’ recall of a certain aspect of the commercial. Those that attempt to evaluate a commercial’s effectiveness in terms of what it motivates a viewer to do. The more closely the test spot resembles the finished commercial, the more accurate the test result will be. |
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Term
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Definition
| It is important to have the ability to determine if an ad is being seen. One such readership service that supplies this kind of info is the Starch Readership service from Roper starch. It is designed to measure the extent to which ads are being seen and read and the level of interest they arouse. It uses the recognition method of interviewing. With the publication open, the respondent explains the extent to which he or she has read each ad prior to the interview. They are asked “Did you see or read any part of the advertisement?” If yes, a prescribed questioning procedure is followed to determine the observation and reading of each component part of each ad. Each respondent is classified as either a Noted Reader ( remembers having seen the ad in the issue) an Associated Reader ( not only noted the ad, but saw or read some part that indicated the brand/advertiser) or Read Most ( person who read half or more of the written material in the ad.) |
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Term
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Definition
| Clients receive this data which enable advertisers to compare readership data of the advertisement in a given magazine issue to the norm for ads of the same size and color in the same product category. This data can help advertisers identify the types of layouts that attract and retain the highest readership. They can also compare current ads against those of competitors, compare the current campaign against previous ones, compare the current campaign against a competitor’s previous one, and compare current ads against the adnorm tables. |
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Term
| Criticisms of Copy Testing |
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Definition
| They see many of these techniques as giving an unfair advantage to boring and/or irritating ads while penalized more innovative approaches. Copy testing can undermine the ability to produce breakthrough creative ideas. |
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Term
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Definition
| Virtually no generalization encompasses an entire consumer segment, especially age groups. We know better that to generalize. Cardinal rule is to know your market. This means defining your target in as much detail as circumstance allow and necessity requires. Market research looks at multiple factors such as age, gender, income, net worth, ethnicity, geography, lifestyle, and family status. |
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Definition
| Identifying and communicating with groups of prime prospects. The search of the best prospects among all consumers. Not limited to products; services, cities, almost any organization may need to target their prospects. |
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Definition
| offers marketers a wealth of information about people and how the live in the U.S. Topologically Integrated Geographic Encoding and Reference System (TIGER) provides the data for computer maps to plan sales territories and pinpoint direct-marketing prospects. Can be linked to a number of relevant characteristics (age, income, and race.) |
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Term
| Age Demography of the Population |
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Definition
| : 71+ → 9.1 %, 61-70→ 6.5 %, 55-60 → 5.7 %, 35-54→ 28.2 %, 22-34 → 16.4 %, 6-23→ 25.8 %, 0-5 → 8.3 %. Numbers don’t alone tell the whole story, but the numbers themselves indicate change. |
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Definition
| : The population for the next quarter century will be larger, older, and more diverse, one with many opportunities and challenges for business. The niche market of today may become a mass market in its own right, segmented not only by nationality, but also by spending behavior and other psychographic characteristics. This trend is called beehiving. It is the growth of tight-knit, alternative communities sharing common values and passions. A large opportunity for marketers in the next few decades will be in the age 65 and older set. The baby boomers will almost double in size. In addition to focusing on youths, marketers will also pay more attention outside the youth market. The clue in the future will be how to establish brands that attract older consumer without alienating younger ones. |
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Term
| Multicultural Overview (pop. trend) |
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Definition
| Defining the multicultural market appears to be a problem for some. Think outside the traditional ‘multicultural box’ to include gay and lesbian consumers, senior consumers, and members of Generation X and Y. These are cultural markets, not ethnic. The minority population is about 30 % of the total population. If a marketer were to include gay and lesbian people into the mix, they would account for another 20 million potential consumers. Multicultural marketing has evolved since the term Minority marketing (targeting African Americans), to Ethnic Marketing (included Hispanic), to the term preferred today, multicultural marketing, which encompasses not only a range of ethnicities but also lifestyle-related targets such as gay and lesbian markets. |
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Term
| African American Population |
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Definition
| This population is both younger and faster growing than the white population. Some advertisers consider African Americans as darker versions of white people, that they don’t have to do anything different to reach them. |
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Definition
| Demographic markers such as Spanish-language usage, country of origin, and length of time in the U.S. are becoming much less relevant as the number of bilingual, bicultural households grows quickly. Collectivist culture that favors cooperation and values family needs over those of the individual. For marketers, that means understanding the family as a unit, including decision making, and avoiding conflict between individual needs and group expectations. |
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Term
| Asian and Pacific Islander Population |
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Definition
| High value placed on education. 40 % of Asian families had incomes of $ 75,000 +, compared to only 35 % of white people. Percentage increase in numbers of Asian Children rises faster than Hispanics; ages 5-9 will increase by 22 %, and ages 10-14, will increase by 31 %. The Asian market will become increasingly more important over the next decade. |
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Definition
| Spending patterns depend strongly on the unique age and income characteristic of individual markets. Many products/services depend on disposable income of consumers for their existence |
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Definition
| # of births in a give year can be important in projecting market size. |
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Definition
| : In 2003, 1/8 Americans were 65 years or older. It is estimated that by 2020, one in every six Americans will be 65+. Census estimates indicate that the seniors segments of the population will more than double by 2050. This will have a significant implication for both marketers and society as a whole. A large opportunity for marketers in the next few decades will be in the age 65 and older set. In addition to focusing on youths, marketers will also pay more attention outside the youth market. The clue in the future will be how to establish brands that attract older consumer without alienating younger ones. |
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| Women earn close to 60 % of the bachelor’s degrees and master’s degrees in this country. Women purchase or influence 85 % of all products. The demands on marketers will increase as women increase their wealth, education, and longevity. Women drive all obvious categories of food, beauty, and household products. |
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| Many businesses have made decisions based on the assumption that one generation, will grow up and make the same kinds of choices made by the group that went before it at the same stages of life. A generation is composed of 2 disparate parts: the number of people in any age group and what it portends about size and shape of tomorrows market, AND the issue of shared attitudes, a common history, and formative experiences. Both parts are important. Generation is usually defined as 30 years and extends past a single decade. Marketers think experiences bind people together that are born in continuous years into a Cohort - a group of individuals who have a demographic statistic in common. Date of birth is the easiest way to define generations. In generational marketing, people take the statistical analysis of birth and overlay major world event that occurred during a generation’s formative years to construct a picture of a generation’s personality. Knowing how many babies are born, and the tracing the numbers through different stages of their lives, give marketers a rough idea of the challenges and opportunities over 10, 20, and even 30 years. |
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| : 4 generations (matures, boomers, and generations X and Y.) There are distinct differences in how each generation thinks and buys. The Xer’s view of convenience has moved from the matures’ “do it quickly” and the boomers’ “do it efficiently” to their own ‘Eliminate the task.” |
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| close to what are considered classic American Values. Favor a puritan work ethic, with plenty of self sacrifice, teamwork, conformity for the common good and so forth |
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| the boomers are self-assured and self-absorbed, much better educated than any generation before them, and they are aware of this. Think they are more sophisticated and believe they know better than their predecessors. Very self-conscious about changing the world and fixing things. Fighting the concept of Old. |
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| Post baby boom born in from 1963-1978. Longtime media whipping post, once labeled as overeducated slackers, with distrust for social institutions, politics, and religion. Self-reliant, entrepreneurial, techno focused, and slowly but surely, parents. Not a life stage, but a birth group ultimately moving through the life stages. Much more likely than their boomer counterparts were some 20 years ago to want to return to traditional standards across a number of domains, especially family life. |
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| : born between 1979 and 1995. Members of this group outspend all previous generations. They’re techno savvy, coddled, optimistic, prone to abrupt shifts in taste, and tough to pigeonhole. More racially diverse: 1/3 is not Caucasian. Deeply motivated by television. Technology has been so much a part of their lives, to them, life before email and internet was a “stone age.” |
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| Late 1990s – Early 200s. Expected to run though about 2017. This generation will come from a wider mix of backgrounds and will bring different experiences for marketers to understand. |
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| A management orientation that views the needs of consumers as primary to the success of the firm. Achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. “Find a need and fill it” or “make what you can sell instead of trying to sell what you can make.” The concept of consumer value is at the heat of the new marketing concept and must be the central element of all business strategy. |
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| Old marketing concept had the objective of making a sale, whereas under this new marketing concept, the objective is to develop a customer relationship in which the sale is only the beginning. Under both marketing concepts, market segmentation, market targeting, and positioning are essential requirements for effective strategic planning. In the new marketing concept, the focus is sharpened by adding the idea of the value proposition. |
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| Products and Brand Loyalty Segments |
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| : Products that we purchase say something about us and group us with people who seek similar satisfactions from life and products. Studying the purchasing of these products tell us how loyal people are to the brands. They can be grouped into 6 segments: |
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| 6 product and brand loyalty segments |
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Definition
- National-Brand Loyal [buy a single nat’l brand at its regular price]
- National-Brand Deal [most purchases made on a deal]
- Private-Label loyal [buy the private label offered by the store they’re shopping at (ex: cvs, Costco)
- National Brand switcher[switch regularly among national brands]
- Private-Label switchers [not deal prone & purchase the private labels at regular price.] |
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| A group of people who can be identified by some common characteristic, interest, or problem – who could use our product to advantage, who could afford to buy it, and who can be reached through some medium (Ex: weight watchers, golfers, mothers of young children, singles, matures, newly married, adventure seekers, ect.) |
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| a term applied to the assumption, once frequently made, that every product should be aimed at and acceptable to a majority of all consumers. Brands aimed at the majority of consumers in a given market will tend to have rather similar characteristics and will neglect an opportunity to serve the needs of consumer minorities. |
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Marketers divide the market into major market segments whose similarity makes them a market, evaluate them, and target those segments they can best serve. This focus on specific groups of buyers is called Market Segmentation. It is about maximizing your potential in the marketplace by targeting your product to certain segments of the population with similar behaviors, such as people your age, your gender, and with a similar lifestyle. You must understand each segment’s cultural nuances and choose the right message so you don’t stereotype the service or product you’re selling as one designed only for that segment. “If you try to talk to everyone, you’ll end up talking to nobody.” The market segmentation process runs through a number of steps:
- Segment your market
- Target a segment
- Position your product for the segment
- Communicate your positioning |
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| The part of the advertising plan that answers the questions: where are we today and how did we get here? It deals with the past and the present. Consists of four components: a description of the current situation; and analysis of strengths, weaknesses, opportunities, and threats; major issues; and assumptions about the future. |
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| Designates customers by geographic area. Geomarketing is of particular importance to media planners in deciding on national, regional, and local ad campaigns. Micromarketing is treating each individual store as its own market and trading area. |
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| Product-User Segmentation |
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| : A strategy to identify consumers based on the amount of usage and/or consumption patterns of a brand or category. The advertiser is interested in product usage rather than consumer characteristics. |
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| : Identifying consumers by combining several demographics and lifestyles. It makes the assumption that if you would live a certain way, so do your neighbors, and therefore, any smart marketer would want to target clusters filled with these clones. VALS which is all based on the premise that people in the same ZIP code or neighborhood tend to buy the same products, is a program that has popped up to find the most fruitful target audiences who have similar demographics and lifestyles. “Birds of a feather flock together.” VALS will help break up the worlds into pieces, but the pieces may or may not have any relevance for any one brand. One approach to determining lifestyle characteristics to identify consumers is AIO (Activities, Interests, and Opinions.) |
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| Benefits and Attitude Segmentation |
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| Not everyone wants the same things from a product. The objective here is to cluster people into groups based on what they want in a product. |
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| Once the outer limits of the niche are reached, sales growth will be limited unless the company can expand beyond its niche. BY too narrowly defining a market, by excessive segmenting, a marketer can become inefficient in media buying, creating different ads, and obtaining alternative distribution channels. |
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| Staying focused on one target segment in a category enables your product to be different by becoming the preferred product by the segment. When you chase after another target segment, chances are you’ll chase away your original customer. Whatever you do, you should not get greedy but stay true to your product type, your attribute, and your segment. |
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| A combination of product and target marketing strategy. It is a flanking strategy that focuses on niches or comparatively narrow windows of opportunity within a broad product market or industry. Its guiding principle is to pit your strength against their weakness. Can serve 2 purposes: can gain a product entry into a larger market by attacking a small part of it not being served by the competition, AND can cater to latent needs that existing products do not adequately satisfy. Usually smaller groups of consumers with more narrowly defined needs or unique combinations |
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| Short for Bourgeois Bohemian, these creative people seem to have combined the countercultural 1960s and the achieving 1980s into one social ethos. These people work in a range of fields from science to entertainment, but their jobs are to create new ideas, new technology, and new content |
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has to be done with a target in mind. You position a product in the mind of the specific prospect. It is another term for fitting the product into the lifestyle of the buyer. It refers to segmenting a market by either or both of 2 ways:
- Creating a product to meet the needs of a specialized group
- Identifying and advertising a feature of an existing product that meets the needs of a specialized group. |
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| A demographic and psychographic description of the people or the households of a product’s market. It may also include economic and retailing information about a territory. |
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| Take any product category and you will find that a small percentage of users is responsible for a disproportionately large share of sales. The principle of heavy usage is sometimes referred to as the 80/20 rule- that is, 80 % of the units sold are purchased by only 20 % of the consumers. Heavy users are identified not only by who they are but also by when they buy and where they are located. Another issue for marketers is not only hot to reach these consumers but also what to say or do once they make contact. Heavy users are an important part of the market; however, they are also the group that most advertisers are trying to target making the competition fierce and expensive. Some advertisers find that aiming for a less lucrative segment – medium or light users – may offer more reasonable expectations. In defining their market, then, they must determine who the heavy users are and identify their similarities, which would define the marketing goal. |
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| A description of a market based on factors such at attitudes, opinions, interests, perceptions, and lifestyles. There may be a big difference in the nature and extent of purchases between any two groups of buyers that have the same demographic characteristics. Psychographics, or studying lifestyles, sharpens the search for prospect beyond demographic data. Lifestyle information is the soul of the person. Good creative people can devise copy that appeals to a specific segment’s lifestyle interest. The media are then selected, and advertising is directed to that special target group or groups. Put very simply, lifestyle information gives the soul of a person; demographics alone give only a skeleton and not a whole person. |
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| Colonial Times to 1917. The first AMericans to act as advertising agents were colonial postmasters |
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| Volney Palmer is the first person known to worked on a commission basis. In the 1840s he solicited advertisements for newspapers that had difficulty getting out-of-town advertising |
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| George Rowell bought large blocks of space for cash from publishers at very low rates, less agents commissions. would sell the space in small squares at his own retail rate. selling by list |
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| Rowell in 1869 published a directory of newspapers with their card rates and his own estimates of their circulation. Beginning of the Media Estimate |
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| Agency becomes a creative center |
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| Charles Austin Bates began writing ads nad selling his services to whoever wanted them, whether advertisers or agents |
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| founded their own agency where they brought together planning, copy, and art. Showing the way to combine all 3 into effective advertising. Helped establish the agency the CREATIVE CENTER for advertising ideas |
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| Francis Ayer and Agency-Client Relationship |
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| Francis Ayer established NW Ayer and Sons and proposed to bill advertisers for what her actually paid the publishers, adding a fixed charge in lieu of commission. In exchange, advertisers would agree to place ALL their advertising through Ayers agents. Established the relationship of advertisers as CLIENTS of agencies rather than as customers |
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| 1917, newspapers set a 15% standard agency commission (still in effect for all media to this day). Commission granted only to agencies that publishers associations "Recognized" |
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| American Association of Advertising Agencies. Founded in 1917 |
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