Page 40 - Encyclopedia of Business and Finance

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Advertising

Institutional Advertising. Institutional advertising takes a Reminder Advertising. Reminder advertising is used for
broad approach to advertising, concentrating on the ben- products that have entered the mature stage of the prod-
efits, concept, idea, or philosophy of a particular industry. uct life cycle. The advertisements are simply designed to
Companies often use it to promote image-building activ- remind customers about the product and to maintain
ities, such an environmentally friendly business practices awareness. For example, detergent producers spend a con-
or new community-based programs that it sponsors. Insti- siderable amount of money each year promoting their
tutional advertising is closely related to public relations, products to remind customers that their products are still
available and for sale. Reminder advertising is often used
since both are interested in promoting a positive image of
the company to the public. As an example, a large lumber during the maturity stage of the product life cycle.
company may develop an advertising theme around its
Point-of-Purchase Advertising. Point-of-purchase adver-
practice of planting trees in areas where they have just
been harvested. A theme of this nature keeps the com- tising uses displays or other promotional items near the
pany’s name in a positive light with the general public product that is being sold. The primary motivation is to
attract customers to the display so that they will purchase
because the replanting of trees is viewed positively by most the product. Stores are more likely to use point-of-
people. For example, the idea that “The Future Is Grow-
purchase displays if they have help from the manufacturer
ing,” is noted on the Weyerhaeuser (http://www.weyer-
in setting them up or if the manufacturer provides easy
haeuser.com) Web site.
instructions on how to use the displays. Thus, promo-
tional items from manufacturers who provide the best
Outdoor Advertising. Billboards and messages painted on instructions or help are more likely to be used by the retail
the sides of buildings are common forms of outdoor stores. For more information regarding point-of-purchase
advertising, which is often used when quick, simple ideas advertising, see the Point-of-Purchase Advertising Interna-
are being promoted. Since repetition is the key to success- tional Web site (http://www.popai.com//AM/Template.
ful promotion, outdoor advertising is most effective when cfm?Section=Home).
located along heavily traveled city streets and when the
product being promoted can be purchased locally. Only Specialty Advertising. Specialty advertising is a form of
about 1 percent of advertising is conducted in this sales promotion designed to increase public recognition of
manner. For more information on outdoor advertising, a company’s name. A company can have its name put on
see the Lamar Advertising Company Web site at a variety of items, such as caps, glassware, gym bags, jack-
http://www.lamaroutdoor.com/main/home/default.cfm. ets, key chains, and pens. The value of specialty advertis-
ing varies depending on how long the items used in the
Lamar Advertising Company is among the largest in the
effort last. Most companies are successful in achieving
United States.
their goals for increasing public recognition and sales
through these efforts. For more information about spe-
Persuasive Advertising. Persuasive advertising is used after cialty advertising, see the Specialty Advertising Associa-
a product has been introduced to customers. The primary
tion of California Web site (http://www.SAAC.net).
goal is for a company to build selective demand for its
product. For example, automobile manufacturers often
ADVERTISING OBJECTIVES
produce special advertisements promoting the safety
The objectives of advertising are to reach specific cus-
features of their vehicles. This type of advertisement could
allow automobile manufacturers to charge more for tomers during a particular time frame and get them to buy
their products because of the perceived higher quality the a particular product. A company that advertises usually
strives to achieve one of four types of advertising objec-
safety features afford. Both Ford Motor Company
tives: trial, continuity, brand switching, and switchback.
(http://www.ford.com) and General Motors Corporation
Which of the four advertising objectives is selected usually
(http://www.gm.com) provide extensive information
depends on where the product is in its life cycle.
regarding product safety on their Web sites.
Trial. The purpose of the trial objective is to encourage
Product Advertising. Product advertising pertains to non- customers to make an initial purchase of a new product.
personal selling of a specific product. An example is a reg- Companies will typically employ creative advertising
ular television commercial promoting a soft drink. The strategies in order to cut through other competing adver-
primary purpose of the advertisement is to promote the tisements. The reason is simple—without that first trial of
specific soft drink, not the entire soft-drink line of a com- a product by customers, there will not be any repeat pur-
pany. chases.

ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION 17