Sampa
Chakrabarty Lahiri
Strategic Management Research Team. |
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AGENCY-CENTRED
Client’s perception of agency
To know how advertisers think about and evaluate advertising
agencies, 260 Korean advertisers were asked to name the
top-of-the-mind advertising agency for each of several
areas, including account management, creative work and
media service. |
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According to the survey, an advertiser’s top-of-the-mind
awareness (TOMA) of an agency for one or more client
services is that agency’s differentiating competitive
advantage with respect to this (potential) client. Studies
confirmed that the Creative Dimension (CD) of an agency
is more important than the Account Management Dimension
(AMD) in driving preferences and, consequently, market
share. Using this idea, management can swiftly realign
its competitive advantage.
The large agencies perceived to be strong in managerial
aspects may find their market share falling at the expense
of the independents, who are perceived to be more creative.
Remedial action can be taken fairly easily by stressing
their creativity through high- profile PR exercises,
this study suggests. —Woonbong, Na, Roger, Marshall,
Yougseok Son, ‘An assessment of advertising agency service
quality’, Journal of Advertising Research, May-June
’99
Risk orientation of advertisers
Advertiser risk orientation is viewed in the context
of the propensity of advertising managers to engage
in risk-taking. Findings based on a survey of top advertisers
in North America measured by advertising expenditure
suggests that taking an advertising risk is not something
that happens in isolation. Risk-taking is inextricably
linked to the confidence and outlook of companies, and
this has important implications for the development
and acceptability of risky creative work by agencies
for clients.
Surveys revealed that risk-seeking advertisers differ
from risk-averse advertisers in their attitudes towards
creative and media decisions. The major difference between
the two groups is that risk-takers are more confident
about their selection of creative strategies and their
choices of creative execution, and are more willing
to try out different market segments, creative approaches
and media and to react to market changes.
—West, Douglas, Sargeant, Adrian, 1999, ‘Advertiser
risk-orientation and opinions and practices of advertising
managers’, International Journal of Advertising, Vol.
18
Agency strategy: global efficiency & local responsiveness
Globally Integrated Marketing Communications (GIMC)
is a system of promotional management which co-ordinates
global communications across countries and promotional
disciplines, regardless of whether a standardized or
adaptive strategy is employed. A survey of GIMC perceptions
and practices among US-based executives of large multinational
advertis-ng agencies reveals that agency perspectives
differ and are broadly subject to organizational as
well as market contingencies. The findings confirmed
and amplified the need to seek a balance between global
efficiency and responsiveness to local conditions, which
is necessary to achieve the desired degree of horizontal
and vertical communication and coordination.
The respondents indicated that coordination was not
necessarily associated with centralization. It was reported
that the creative function was the most coordinated
of the promotion disciplines while media-buying was
the least, which suggests that the media function is
perceived in more localized terms than the creative
function.
The study suggests that not only should agencies think
in GIMC terms but they should also integrate and share
that thinking with their clients and use it to establish
their own usefulness and competitive strategy.
—Gould, Stephen J., Dawn B., Lerman, Grein Andreas F.,
‘Agency perceptions and practices on global IMC’, Journal
of Advertising and Research, Jan-Feb ’99.
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Ad
and sales promotion budgets
An in-depth study based on 21 interviews, highlighting
the practices of companies that are pro-actively coping
with budgetary pressures, indicate that protecting advertising
spending is more likely to happen when they: |
*Tolerate the uncertainty associated with advertising
spending
* Allocate funds based on forward-looking objectives
(rather than historical precedent)
* Use more experienced brand managers who can balance
marketing research information with intuition
*Remain focused on brand equity The factors affecting
advertising and sales promotion budgetary allocations
can be grouped into three main categories. The Good...
...practices which managers felt contributed to an effective
decision process:
* Encouraging risk in an organization, combining
quantitative models with judgment,
* Focusing on brand differentiation The Bad...
...uncontrollable practices which are the frustrating
realities of the decision process:
* retailer power, short term focus, top-down influence
And the Ugly... ...correctable flaws or problems in the
decision process:
*political sales force influence, historical inertia,
ad hoc changes
—Low, George S., Mohr, Jakki J., ‘Setting advertising
and promotional budgets in multi-brand companies’, Journal
of Advertising Research, Jan-Feb ’99
Brokering advertising knowledge efficiently
To tap into, manage and exploit their intellectual capital
and to make a mark as creative knowledge brokers, it has
become essential for advertising agencies to adopt Advertising
Knowledge Management (AKM) strategies which consists of
codification and personalization. |
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Codification
In codification, explicit knowledge is carefully classified
and stored in databases ready to be accessed by anyone.
This enables lots of people in the firm to retrieve data
without contacting the originators. |
Personalisation
Personalised strategy is based on tacit knowledge
that requires learning by trial and error, leading to
the build-up of skills. Rather than being codified, tacit
knowledge is tied to the person who developed it and is
shared by direct person-to-person contacts. A personalisation
strategy concentrates on the belief that the most valuable
knowledge exists in people’s heads and can be augmented
and shared via interpersonal interaction or social relationships.
The primary drivers pushing the application of AKM to
communications are: accountability, time pressures and
information overload, technology, reduced margins and
leaner organizations and globalization.
AKM will enable leading ad agencies to offer cheap ‘commoditised’
advertising services, especially over the web. Speed will
be of the essence in such services. The first successful
AKM systems will prove themselves and gain the confidence
of clients, and will come to dominate the market. Interactive
commoditised AKM products will potentially generate even
more knowledge and a stronger market position for the
agencies concerned.
A strong and unified corporate vision is a prerequisite
to building a learning framework and developing AKM. Decisions
need to be taken simultaneously to flexibly integrate
and lever learning within the agency. While the starting
point for AKM is to consider the skill and knowledge of
the agency, the organization needs to do the following:
* Develop rewards, recognition and career opportunities
for specialists
* Create a unified vision in an organisation of
specialists
* Devise a congenial management structure to organize
task forces
* Ensure the supply, penetration and testing of
top management
—Ewing, Michael T, West, Douglas, 2000, ‘Advertising knowledge
management: strategies and implications’, International
Journal of Advertising, Volume 19
CONSUMERS’ BEHAVIOUR
Mirroring personality types
A total of 100 adults — 55 female and 45 male, belonging
to the age group 22 to 57 — participated in a study over
a course of three weeks, which indicated that individuals
preferred images and advertisements that were consistent
with the information-processing styles that characterized
their personality types. On the basis of how one prefers
to take in information and becomes aware of his environment,
people were divided into two vast categories:
Intuitives: They tend to focus on possiilities rather
than the concrete. They enjoy solving new problems, dislike
repetitive tasks and tend to focus on future possibilities.
Sensors: They need hard objective facts coupled
with an attention to details. They dislike new problems
unless there are standard ways of solving them. The study
revealed that images and advertisements that are perceived
as realistic, concrete and informative will be evaluated
more favourably and will elicit higher purchase intentions
by individuals with sensor typologies as compared to ads
that are perceived as imaginative, conceptual and abstract.
The latter will find more favour with individuals with
intuitive typologies. —LaBarbera Priscilla A., Weingard,
Peter, Yorkston Eric A., ‘Matching the message to the
mind: advertising imagery and consumer-processing styles’,
Journal of Advertising Research, Sept-Oct ’98
Low-Involvement Processing of Ads
Recent studies indicate that consumers regard the most
reputable brands as performing similarly, and do not think
learning about brands is very important. Brand decisions
are said to be made more intuitively than rationally.
Most ads are processed at very low attention levels, using
low-involvement processing which is a cognitive process
using very little working memory, i.e., it is poor at
interpreting messages or drawing conclusions from ads.
It simply records and stores everything as an association
with the brand. The long-term memory works in such a way
that the more often something is processed, the stronger
are its links with it. Thus, it is these associations,
repeatedly stored through low involvement processing,
which tend to define brands in our minds and influence
intuitive brand decisions.
Creativity does enhance the attention paid to ads. But
it is hardly powerful enough to initiate the sort of high-involvement
processing needed to interpret and store complex messages.
It, however, does strengthen linkage between associations
and the brand.
—Heath, Robert, 2000, ‘Low-involvement processing — a
new model of brands and advertising’, International
Journal of Advertising, Vol. 19. |
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Exposure
continuity rewarded
The notion that a single exposure is not enough to create
the desired effect is so pervasive that most media-planning
models assume an effective frequency of three exposures
a week, and that advertisers would rather plan to be off-air
than to expose their advertising at frequency levels below
the targeted three. However, studies show that being off-air,
as required by the much-prevalent pattern, is equivalent
to being out of stock at the point of sale. Researchers
conclude that continuity of exposure is rewarded and that
the off-air weeks penalize a brand.
—F. Von Gonten, Michael, Donius, James F., Journal
of Advertising Research, July-August ’97
Medium, message and time in advertising
According to the newly proposed Double Helix model, advertising
is non-linear, multi-dimensional, and achieves its effect
over time, within limited parameters of medium and message.
The model points out that the time span over which media
and message interactions occur is an important variable
in the advertising environment and central to the current
debate about effective frequency. According to this model,
the exposure to the advertising may result in attention,
sometimes in interest, desire or action, but not in a
linear sequence as AIDA.
The helix structure is a useful metaphor for understanding
brands with one strand forming the physical and functional
virtues and the other strand forming the emotional values
of a brand. Brand extensions are offspring that inherit
part of the parent brand’s genetic material.
Ad effects are presented in this model as part of a continuous
process rather than a series of steps oriented towards
an end game of purchase or adoption. This model suggests
that one ad, one exposure, even one campaign cannot communicate
the compound of signals attached to the brands to create
perceptions of value. The model challenges account-planners
to develop more conclusive methods of measuring effectiveness
and suggests that the thrust should be on how much advertising
should be applied at each stage of persuasion process.
—Huey, Bill, ‘Advertising’s Double Helix: A proposed new
process modal’, Journal of Advertising Research, May-June
’99
Six factors that shape buying decisions
Factors like the nature of the target audience, the purchase
motivation and the importance of the decision to the consumer
can dominate the consumer decision-making as explained
in the six-segment message strategy wheel. It primarily
consists of two halves: the ‘transmission view’ or the
rational approach and the ‘ritual view’ or emotional approach.
The transmission view of communication deals with imparting
information. The ritual view conceptualizes communication
as constructing and maintaining an ordered, meaningful
cultural world that serves as a control and container
for human action. Those within the industry adhered to
a transmission view while advertising could be more readily
understood under the ritual view.
The factors influencing our decisions in the ritual view
are categorized in the following segments:
Freudian psychoanalytic model
The consumer’s emotional needs are fulfilled by brands
that are ego-related. Purchase decisions are emotionally
important to the customer to allow him to make a statement
to himself about who he is.
Veblenian social-psychological model
Emotional needs are fulfilled by brands that are visible
to others. Appeal can be directed to gaining social approval
through product consumption. Sensory factor
Products provide consumers with ‘moments of pleasure’
based on any of the five senses: taste, sight, hearing,
touch or smell. The Cyrenaics strategy, that considers
pleasure to be the sole end of life, seems apt in this
segment.
The factors influencing our decisions in the transmission
view are categorized in the following segments:
Marshallian economic model
Consumers are assumed to be rational and deliberative
individuals. Their desire for product information is high.
Appropriate strategies include generic, pre-emptive, USP
and positioning. The role of advertising is to inform
and to persuade. Acute need factor The consumers are driven
by an acute need to buy a product. They desire information,
but time limits the amount of information that can be
gathered.
Pavlovian learning model
Consumer decisions are made on the basis of rational buying
motives, but consumers do not invest large amounts of
deliberation time, and buy according to habit. Advertising
provides a cue to how the needs of the consumer can be
satisfied by an introductory brand — once the habit is
formed, ads remind the consumer to continue buying.
—Taylor, Ronald E., ‘Six-segment message strategy wheel,
Journal of Advertising Research, Nov-Dec ’99
Can consumers be manipulated?
Consumers possess the ultimate sovereignty in a consumer
society. Though the silent majorities cannot change the
way things are drastically, they are endowed with the
supreme power to take the system to its extreme, self-defeating
logic; they can tear things down as quickly as they can
build things up, if they so desire. The masses, who react
to advertising on a mediated ‘knowing’ level, can never
be manipulated with the disarmingly ‘fooling’ ads. Perhaps
they have always known more than advertisers gave them
credit for. The people in the advertising business ought
to remember that as image-makers, they are not shadowy
manipulators but the very conscience of the new society.
—Boutlis, Paulie, 2000, ‘A theory of post-modern advertising’,
International Journal of Advertising, Vol. 19. |
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