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Chapter 2
The structure of adv industry: Advertisers, Ad agencies, and support organizations
24
Other
Not Applicable
02/14/2008

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Cards

Term
2 groups exerting power and control
Definition
consumers and advertisers
Term
Consumers
Definition

insisting on convenience and control in the media exposure (tivo)

-makes branding more important because they choose what and where they will be exposed to these messages

Term
Advertisers
Definition

brand is going to have to be a part of their daly life

-Coke paying to have cups used by American Idol judges

Term
Advertising Process
Definition
set against the backdrop of constant industry and consumer transition, the adv process will not change
Term
4 Major Trends affecting Ad/Promo Industry
Definition

1. Undoing of Agency Consolidation and Globalization

2. Media Proliferation (expansion) and Consolidation

3.Media Clutter and Fragmentation

4. Consumer Control: Blogs-Tivo

Term
Undoing of Agency Consolidation and Globalization
Definition

many olittle companies combined into big ones

-clients felt they were missing out on creativity of small ones

-not always profitable, debt increase for ad companies

Term
Media Proliferation and Consolidation
Definition

-control of media has always been a driving force behind media companies

-FCC says a single company can own TCV stations that reach up to 45% of US houses

-also ended a ban on joint ownership of newspaper and broadcast station in a city

-media companies will expand if it can

-dangerous potential consolidation of power to influence/corrupt??

Term
Media Clutter and Fragmentation
Definition

-increasingly more ways to reach consumers, average consumer has access to 100 channels

-new and increased media has resulted in clutter making effectiveness of ads decrease

-turned to promotional tie ins

-consumers expressing a desire for commerce experience

-Miller light chairs for game day

Term

Consumer Control: Blogs-Tivo

Definition

-blogs as product and brand info

-tivo allowing to skip adv all together 1/4 houses will have it by 2007

-to combat that make ads more entertaining, creative, and informative

-blogs and info from these=caveat emptor on multiple dimensions?

Term
Problem for luxury brands
Definition
Knockoffs, Vp of marketing for Louis Vuitton stresses that making brand is important in helping luxury brands establish themselves, placing brands with right people and with right programs adds validity to the brand
Term
Houses with Tivo by 2007
Definition
1/4 of houses
Term
Companies that invested over $3 billion in adv in 2003
Definition
General Motors, Proctor & Gamble, Time Warner
Term
Structure of Industry
Definition

1. Advertisers

2. Advertising and promotion agencies

3. external facilitators

4. media organizations

5. target audiences

Term
Advertisers
Definition

-manufacturers and service firms

-trade sellers: all organizations in the marketing channel of distribution tha tbuy products to resell to consumers

-federal, state, and local govts

-social organizations (red cross)

*advertisers have to do their homework to help agency do its job effectively

Term
Ad agency
Definition

*-an organization of professionals who provide creative and business services to clients in planning, preparing, and placing ads, and other IBP promotions

-to reflect range of promotions, events, PR, startegies that good ad agencies suggest to clients

Term
5 Types of Ad agencies
Definition

1. full service agency-array of adv professionals to meet promotional needs of clients

2. creative boutiques-emphasizes creative concept development copywriting and artistic services to clients, idea factories

3. interactive agencies-help advertisers prepare communications for new media

4. in house agencies-adv department in a firm and takes responsibility for the planning and preparation of adv materials, greater coordination

5. media specialists-specialize in buying media time and space and offer media strategy consulting to agencies

Term
Promotion Agencies
Definition

1. Direct Marketing-large databases of mailing lists

2. E-commerce Agencies-help firms conduct all forms of promotion through electronic media, internet, sweepstakes, coupons

3. Sales Promotion-operate contests, special displays, coupon campaigns, experts at making incentive programs

4. Event Planning-experts at finding locations and dates, put together a promotional event and makes sure there is publicity for it

5. Design Firms-create a logo for a firm or graphic mark that will indentify the company, designs packaging, brochures, banners

6. PR Firms-manage an organization's relationships with  media, community, competitors, government

Term

Infomercials

Definition
5-60 minute informational program that promotes a brand and offers direct purchase to viewers
Term
Agency Services (AMCAM)
Definition

1. Account Services-work with clients and develop a complete promotion plan, translate consumer values to ads through creative services, develop media strategy

2. Marketing Research Services-reserach group will help the client interpret the research and communicate interpretations to creative and media people, *research is key to successful promotional campaigns

3. Creative and Production Services-develops the message that will be delivered through advertising in interesting and memorable ways

4. Adeministrative Services-managing business to make sure deadlines are met

5. Media Planning and Buying-advertisers can contract for media buying and planning to determine how a client's message can most effectively reach a target audience

Term
4 Agency Compensation
Definition

1. Commision-published rate for the air time is 1 million dollars, the agency bills their client this amount, takes less a 15% discount off the published rate to determine what the agency pays the TV network

2. Markup charges

3. Fee system

4. Pay for results

Term
Broadband
Definition

-offers advertisers the chance to target very specific audiences

-allows users to customize their programming/news broadcasts to their personal preferences

-adv cdan target different types of audiences using broadband for interactive broadcasts

Term
Interactive Media
Definition

-online computer services

-home shopping broadcasts

-interactive broadcast entertainment programming

-kiosks

-CD roms

-internet

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