The function of advertising is to arouse interest in specific readers and to encourage them to take the next step (to visit you, phone you, or buy your product). With most advertising you are trying to target the message at the person who can make the buying decision. It is therefore essential to choose the best medium for your message. To target your advertising, look back at your market research to help you ascertain who your customers are, where they live or work, what they like, what makes them different. This might help you to form a picture of the places and publications in which they are likely to notice advertising.

Your advertising needs to be part of a campaign. People tend to forget most single advertisements almost as soon as they have seen them, unless they happen to have a need for the product or service at the time they see the advertisement. A successful advertising campaign requires regular advertising. You need not take large advertisements, in fact a little and often is likely to give a better result.

As with any endeavour that will take time, money, and effort, you need to formulate a plan. This should set simple goals (such as an increase in sales of ten per cent within six months), a budget, likely timescales, and a means of monitoring the success of the plan. The clearer you are about your goals at the outset, the more likely you are to be able to measure your success and improve upon your campaign in the future.

Placing an advertisement in response to pressure from advertising salespeople.

Advertising in the wrong place (or at the wrong time).

Advertising without a clear idea as to the objective.

Using your business name for the advertisement’s headline.

Designing an advertisement that promotes image, then expecting a response.

Placing an advertisement too hastily, and not as part of an overall plan.

Omitting a clear call for action at the end of an advertisement.

Allowing too small a budget for advertising.

Continuing to place advertisements without monitoring the results.

• Breaking down into sub-markets
• Weighting to frequency of use
• Weighting to value of customer.

Indeed, much business-to-business advertising does precisely that. It may divide the target audience down into value categories. One way is by recency of purchasing:

• Those who purchased recently
• Those who purchased some while ago
• Those who purchased a long while ago.

Messages and tactics will vary according to the category or, alternatively, by value of customer. Activities could be split by:

• larger customers
• medium-sized customers

• Smaller customers.

Weighting and differential spend are a consequence of these definitions.

Another simple approach is to target by region: by sales region, or wholesaler region, or by area weight of purchasing, via a national average:

• average sales regions

• Above average regions

• below average regions.

The key decision is whether to spend evenly, or to build up weaker regions, or to invest further in strong regions.

Here, too, media can be weighted and money spent in proportion.

At the heart of the campaign plan is the need to decide who counts most: the user, the buyer, or the decision maker? This is a critical decision. If you advertise, how can the advertising best achieve a sale? How will it work? Who best gives a return to the advertising pound spent?

One system often used in business-to-business communication is that of the ‘decision-making unit’ or DMU.

In real life, the decision is often made not by one person, but by a group of people. Overall, the advertising should get to decision makers. They count above all others. So, it is essential to examine the decision-making process in any particular market. And here again, a variety of sub-markets may emerge, each with its own decision-making structure.

Take a typical general market. It might perhaps break down into three sub-markets:

1. sole traders: one simple target group, usually smaller businesses
2. medium-sized companies with decisions by:

- heads of user departments

- the procurement division

The board of directors

3. specialised users, research-based, with decisions by:

- R & D management

The R & D staff themselves

- the procurement division

• The finance director
• The board of directors

From which three programmes may evidently be needed, each targeted, each specific. Business-to-business targeting therefore very much rests on the need to model the market, and to establish the values of business within it.

Despite such claims, there is no scientific or conclusive evidence that shows that advertising can work subliminally, although scientists continue to study the unconscious workings of the brain. A 1996 experiment reported in the journal Science found that words flashed before individuals for a few milliseconds did influence their response to subsequent words presented to them, but that the effect lasted only for a matter of seconds and had no longer after-effects.

Some detractors would argue that it is contradictory to say that we can perceive something when it is presented below our threshold of perception. Many psychological studies that look into how people process advertising messages suggest that consumers, for the most part, take an active role in absorbing the information they read, hear, or see in advertisements.21 Most people will claim they themselves are unaffected by advertising, a phenomenon known as the third person effect. If you ask a group of college students whether their clothing purchases were affected by ads for Gap, most would probably say that they were not, but that those ads probably influence others to buy the product. In this way, they feel the ads have an impact on a third, or different, person. Yet a glance across a college campus will quickly show a large number of students walking around in Gap shirts and jeans.

But it is difficult if not impossible to make a direct relationship between the dollars spent on advertising and how consumers value a brand. While Lexus spent one-fifth of the advertising dollars of Ford in 1993, it was Lexus that ranked higher in customer satisfaction according to the J. D. Power Survey of Potential Car Buyers.⁸ Many goods or services advertise very little, if at all, and yet are still highly appreciated and valued by their users. Hospitals typically only spend a few thousand dollars on advertising, yet they are highly valued. In contrast, cable television companies spend a good deal of money on advertising and promotion, but they have low satisfaction ratings.

Advertising Provides a Sense of Belongings

When Hallmark reminds you to send a Valentine’s Day card, “When you care enough to send the very best,” your participation in this annual ritual links you to millions of others who are doing the same. Advertising depicts familiar activities or scenes to help consumers feel that they belong to a larger social organization. For example, commercials for Shout stain remover help mothers of young children feel they are not alone in trying to cope with grass or ketchup stains; and Subaru has begun targeting lesbians with creative advertisements designed specifically for that part of the gay market.

A sense of belonging is one reason why minority groups argue for specific creative executions for their customers. Major advertisers such as McDonald’s and Seagram’s have ethnic advertising agencies develop separate ad campaigns to reach African American ora Hispanic consumers. These ads show people from those ethnic groups using the product, and they may also reflect different cultural preferences or customs that these minorities will be more likely to recognize and appreciate. Dominick’s Finer Foods, a midwestern chain of grocery stores, not only creates ads in Spanish to reach its Hispanic customers, it even shows different cuts of meat in these ads to reflect the pieces that this ethnic group prefers to buy.

Advertising Reflects the Value of Society

Advertising’s supporters maintain that the messages it conveys merely reflect the values of society as a whole. In the 1980s, when the United States was enjoying an economic boom and materialistic values became more important, there were numerous ads that focused on having more and buying more. Society’s compassionate value is expressed in public service ads that try to raise awareness for some of today’s social problems, such as child abuse or AIDS discrimination.

Long-term relationships are becoming far less common. The reasons for breakups between advertiser and agency are many. Sometimes an advertiser has worked with several agencies and found that some are more responsive and creative than others, so it drops the one it finds less effective and reassigns the business to one of the remaining shops. Or it may decide to sever ties with its agency and put the account under review, asking several agencies to put a presentation together to solicit the piece of business. This solicitation for business is known as a pitch. Occasionally, the current agency is asked to be part of that review, as was the case for Leo Burnett and United Airlines, but it is quite uncommon for an agency to hold onto a piece of business that goes under review.

Less frequently, it is the agency that decides it no longer wishes to work for a particular advertiser. This may occur if the working relationship has deteriorated to the point where it is no longer feasible, or if the compensation received is not acceptable to the agency. In another scenario, an agency will drop an advertiser if it wishes to go after a competing account, such as another brand in the same category. In recent years, the problem of conflicting accounts has grown in the U.S. In this country, advertisers do not like their agencies to work on any business that they perceive to be a competitive threat to their own. They consider it a conflict of interest, as well as a security problem, to let the agency handle sensitive, proprietary advertiser information. This seems to be less of a concern elsewhere in the world, where agencies may handle brands in different categories even if the parent companies consider themselves competitors.

As both agencies and advertisers expand their reaches, it is almost inevitable that one branch of an agency will end up working on an account in the same industry as that of another branch. Young & Rubicam, for example, does work for both Colgate-Palmolive and Johnson & Johnson in its different worldwide offices. Because both companies manufacture oral care products, a potential conflict would exist if, for example, Colgate decided to introduce a mouthwash into the South American markets where Y&R does the advertising for Johnson & Johnson.

Agencies spend a good deal of time, effort, and money soliciting new business. They may do so by direct contact with advertisers who have publicly acknowledged that they are searching for a new agency for a given brand or brands.

Or they may work behind the scenes to develop relationships with key personnel at an advertiser to exhibit their interest in working for that company. Often, a small project conducted either openly or in secret can turn into a new account for the agency. This was the case for Leo Burnett Company, which after working on a piece of the Reebok business, went on to win the worldwide account (although it later resigned the account).

When advertisers ask agencies to participate in a review, they usually ask the agencies to put together a speculative advertising plan, or a plan on spec. This means that the agency has to create the plan for free, or with only minimal expenses paid for by the advertiser. While the cost of the preparation may be small compared to the size of the account, some agencies decline to participate if they feel the costs involved are too high compared to their chances of winning the business. Ammirati & Puris, for example, spent an estimated $250,000 to win the creative portion of the Burger King account. The new client compensated the agency about $100,000. Agencies that tried to win the business of Kmart were thought to have spent up to $1.5 million each to obtain the $175 million piece of business.

More and more, advertisers are turning to special consultants to help select their agency partners. These people find out from the company what their needs and preferences are, and then listen to the agency presentations (along with the prospective clients) and advise them on who they believe would be the best match. Consultants maintain that they help make the search process easier, while their critics say they get in the way of a free exchange of ideas and information.

The advertiser—agency relationship is not as stable today as in the past. One reason behind this is the flurry of mergers and acquisitions that started in the mid-1980s and continues still. Such changes of ownership often result in cutbacks in advertiser spending or agency size. Saatchi & Saatchi, a U.K.—based agency, purchased the Ted Bates Agency, Compton Worldwide, Dancer Fitzgerald Sample, Backer & Spielvogel, and several smaller shops to create the world’s largest agency group, called Cordiant. It was soon followed by Martin Sorrell’s WPP Corporation, which purchased J. Walter Thompson and Ogilvy & Mather. Doyle Dane Bernbach merged with Needham Harper Worldwide to form DDB Needham Worldwide, which then, in turn, linked with BBDO under the corporate umbrella of Omnicom. In a reversal of that trend, Cordiant was divided again into two separate entities, the Saatchi & Saatchi agency network and the Bates agency network.

On the advertiser side, Philip Morris Companies purchased Kraft General Foods (itself the product of the merger of Kraft and General Foods), while R.J. Reynolds bought out Nabisco, to become RJR Nabisco. The British pharmaceutical giant, Glaxo, bought out Wellcome to create one of the largest pharmaceutical companies in the world. Bayer Group, a German company, renamed the U.S. business that had been called Miles and spent $60 million in advertising and promotions to announce the new name to the public. Federated Department Stores now owns Abraham & Straus, R. H. Macy’s, Bloomingdale’s, and Bon Marche. Whenever these kinds of changes take place, it is fairly certain that the advertising, and the advertiser—agency relationship, will be affected too.

Today, the world has changed. Instead of three major broadcast television networks from which to choose, there are now at least 50 different broadcast and cable networks, plus numerous independent stations. Instead of a few hundred magazines, there are now thousands, with scores of new ones appearing each year. These changes make the tasks of the media department more challenging; indeed, media is now considered to be the “second creative department” in many agencies.

There are two main functions in media: planning and buying. Media planners put together a schedule of different media vehicles (programs, magazines, etc.), deciding which ones will best reach the target audience and at what cost. Once the plan receives client approval, it is then executed by the media buyers, who negotiate with the media themselves for space and time. Both groups work to determine which media will be most effective at delivering the brand’s message and at what cost. Some agencies also employ media researchers, who help planners and buyers better understand how people use media.

Media Planners. It is the task of media planners to focus on the media habits and activities of the target to whom the ads are being addressed. Very often that target is determined by the planner, in conjunction with account managers at the agency and brand managers at the client. Once the audience is agreed upon, the planners then have to find out which media forms are preferred by those people. Planners ask questions such as, Does the target audience watch many hours of television, or prefer reading magazines? Which TV shows are preferred, and how many of the target group watches those particular programs? After evaluating the various media alternatives, the media planners come up with a recommendation of which media to use. In addition, the plan recommends how to schedule the media, showing when to use different forms, and for how long. The options are then discussed, first within the agency and then with the client.

Media Buyers.After a plan has received client approval, the media buyers negotiate space in printed media (newspapers and magazines) or time in broadcast media (television and radio). They look for the best rates available to stretch the client’s dollar the farthest. After the buy has been made, media buyers are responsible for ensuring that the ads appear when and where they are scheduled. On the occasions that an ad does not appear, the buyers negotiate compensation with the media.

Within the media buying group is another sub-department called media business services. This group provides the accounting portion of the media process. It is here that bills are processed and invoices are paid. The people in this unit must ensure that the media are paid for all ads that appear and that the client is billed appropriately for that space and time.

Media Research.A third unit sometimes found within an agency is the media research department. This is a support group for the media planners and buyers (as well as the rest of the agency) that helps answer questions that pertain to how people use media. These questions may be as general as, Are people watching less television? or Do people use coupons placed in magazines? Media research also answers more specific questions, such as, Should

I place most of my dollars into the first four weeks of my schedule on cable television, or should I put them into the second four weeks on broadcast TV? Media researchers are involved both in conducting original (primary) research that they undertake themselves, such as a survey or experiment, and in analyzing existing (secondary) data, such as numbers on how many people are watching “E.R.” in Las Vegas or how many copies of Good Housekeeping magazine are distributed each month. In smaller or midsize agencies, the role of media research is often designated to a media planner.

2. Cease and desist order. If a consent order is not signed, the case goes before an Administrative Law Judge, who may recommend a dismissal or issue a cease and desist order. The accused party must stop the alleged deceptive act immediately, but the order carries no punishment unless the company fails to comply. The judge’s decision may be appealed to a Federal Court of Appeals by either party.

3. Affirmative disclosure. With affirmative disclosure, the company can say what it wishes to say, but in order to do so, it is required to qualify it with another statement. Warnings on cigarette packages and in ads for that product are examples of affirmative disclosure.

4. Advertising substantiation. Similar to affirmative disclosure, advertising substantiation requires that if a company wishes to make a particular statement, it must include proof for that statement. The goal is to let consumers make informed decisions in the marketplace. Responsibility for providing the information rests with the advertiser, its agency, any retailers who might disseminate the ads, and even a celebrity endorser. Substantiation is designed to make sure that advertisers can support their claims before they run the ads.

5. Corrective advertising. The most stringent remediation the FTC can impose is corrective advertising, which forces an advertiser to rectify misleading statements from previous advertising. The advertiser has to admit publicly that the product claims it had previously made were wrong. This is the only remedy that acknowledges that consumers may still remember the effects of any deceptive advertising.

In imposing corrective advertising, the FTC has determined that simply stopping the deceptive or misleading advertisement is not sufficient to stop the deception.

The criticisms of advertising as unethical range from advertising cigarettes that are known to cause cancer, to implying that the use of a particular perfume will bring hordes of admirers to your doorstep, to claiming that a sugar-coated cereal is “part of a nutritious breakfast” for children when only the accompanying milk or toast has any nutritional value. In some cases, legal issues do become involved. The use of excessive glue or paint to make a product look more appetizing in a TV commercial is not only unethical, it is also illegal. Similarly, there are legal restrictions on the advertising of sweepstakes or lotteries, both of which have been criticized for misleading innocent consumers into believing they have won large monetary prizes.

The question of advertising ethics is clearly linked with the question of the nature and purpose of advertising. Most people can understand that advertisements, at the very least, take liberties with the “truth.” This practice of using exaggerations that consumers will know are factually false is known as advertising puffery. Most women understand, for example, that they will not look like the models in the commercials simply by buying Salon Selectives hair shampoo. Businessmen realize that when they travel, American Airlines does not literally provide “something special in the air.” The use of puffery does not mean that any of those brands is unethical in its advertising. It would only become so if Salon Selectives guaranteed that use of its product would really turn you into a model.

Ultimately, advertising ethics depend to a large extent on your beliefs about the purpose of advertising and your view of consumers. If you believe that consumers are rational, skeptical, and self-aware, and accept that advertising is designed to persuade the audience to think, feel, or act in a certain way in order to increase sales, then you will probably not find advertising inherently unethical in trying to get you to “Be like Mike” (Michael Jordan) and drink Gatorade, or “Have your break today” and eat at McDonald’s. On the other hand, if you think that consumers are completely innocent with regard to the ads they see, hear, or read, then you are likely to find advertising, by and large, to be unethical with its promises of leaner bodies, cleaner homes, faster cars, or money-saving credit cards.

The Vatican issued a 37-page text on “Ethics in Advertising” in which it emphasized the need for advertisers to adhere to three basic moral principles: truthfulness, upholding human dignity, and social responsibility. It noted that advertising in and of itself is not necessarily unethical, but that it “can distort the truth by implying things that are not so or withholding relevant facts.”33 Importantly, however, the report did not call for increased regulation of advertising; rather, it states that advertisers should work harder at monitoring themselves, with a view to remaining ethically responsible.

Unethical behavior does occur. The most common occasions are advertising to children and the promotion of controversial products such as alcohol, tobacco, and contraceptives.

In this school of thought, advertising is considered an incentive for companies to be innovative and compete vigorously. Many new products introduced in the past 10 years have succeeded, in part, because advertising was used to increase consumer awareness of their existence, which in turn increased demand. Examples include personal computers, satellite television, computer online services, and new cars and trucks such as minivans or sport utility vehicles.

As you can see, the distinctions between the two models reflect somewhat negative or positive views on advertising’s role in society, respectively. Under the market power model, advertising is helping to shape society by raising the cost of goods and services. Because consumers are less price sensitive, that allows companies to charge more for what they are selling. In contrast, the information model tends to view advertising’s role in society more positively, seeing it as a relatively benign influence that merely offers information to consumers. In doing so, advertising is really reflecting the value of brands and allowing consumers to make their own decisions, which will encourage greater competition in the marketplace and keep prices in check. The difficulty with either approach—and with assessing advertising’s economic impact in general—is that it is very hard to measure accurately. Because advertising is usually just one of many variables that impact a consumer’s decision over which brand to buy, it is almost impossible to determine advertising’s precise role in that process.