Advertising Strategies
Author: Sakshi Chavan
MMS – Roll No.11
Kohinoor Business School
Literature Review
The Impact of Advertising Creative Strategy on Advertising Elasticity.
DALL’OLIO, F. et al. (2023) say that the advertising creative refers to the content and execution of an advertisement, encompassing what is said and how it is said. Researchers and practitioners alike acknowledge the significant role played by advertising creative in driving market performance. While recent research has delved into specific elements of ad creative, such as authenticity or branding cues, and their influence on sales effectiveness ,there is a gap in the literature when it comes to a comprehensive evaluation of how an advertiser’s creative strategy can shape sales effectiveness.
An advertising creative strategy (ACS) comprises both the content and execution aspects of an advertisement. The content aspect focuses on product attributes and benefit claims, while the execution aspect encompasses the manner in which the content is presented, including elements like endorsements, entertainment value, imagery, and more. By considering both content and execution, an ACS aims to optimize the effectiveness of an advertisement in achieving its objectives.
A Near-Optimal Bidding Strategy for Real-Time Display Advertising Auctions.
TUNUGUNTLA, S. et al. (2021) says that a novel bidding algorithm designed specifically for real-time display advertising auctions are a significant platform for internet display advertising. These auctions serve as a crucial distribution channel for online advertisements and have the potential to generate revenue for addressable media.
The proposed algorithm aims to provide an efficient and practical learning approach that can quickly converge to the optimal bidding strategy. It guarantees zero regret, meaning that the algorithm’s performance will not deviate significantly from the best possible strategy over time. Additionally, the algorithm establishes a competitive equilibrium, ensuring fairness and effectiveness in the auction process.
What sets this algorithm apart is its ability to address the online knapsack problem without relying on prior knowledge of object values or costs. The online knapsack problem involves optimizing the allocation of limited resources (budget constraints in this case) to maximize the desired outcome (valuation metric defined by advertisers). By accommodating various valuation metrics and adhering to budget constraints, the algorithm aligns with the requirements of advertisers.
Overall, this article introduces a promising solution for optimizing bidding strategies in real-time display advertising auctions. The algorithm’s theoretical guarantees, practical implementation, and ability to adapt to different valuation metrics make it a valuable contribution to the field of online advertising.
Optimal advertising outsourcing strategy with different effort levels and uncertain demand
XIE, Y.et al. (2020) focuses on the issue of advertising outsourcing and production planning for a manufacturer that faces asymmetric advertising costs and uncertain market demand. The objective is to enhance product sales by hiring an advertising agency to handle professional advertising services prior to production.
To ensure transparency and incentivize the advertising agency to accurately report costs, the paper proposes a contract that incorporates both the level of advertising effort and payment. By doing so, the manufacturer aims to create a mutually beneficial arrangement.
The model developed in the paper aims to maximize the manufacturer’s net profit. It takes into account the impact of the advertising effort level on both product demand and payment to the advertising agency. By considering these interdependencies, the model provides insights into optimal strategies for the manufacturer.
The paper derives analytical solutions for determining the optimal advertising effort level and payment to the advertising agency. These solutions are crucial for making informed managerial decisions. Additionally, the paper determines the optimal retail price and production quantity, further aiding the manufacturer in their decision-making processes.
By considering the various factors influencing advertising outsourcing and production planning, the paper offers valuable insights and practical recommendations for manufacturers looking to improve their product sales through effective advertising strategies.
Joint pricing and advertising strategy with reference price effect.
LU, L. et al. (2016) described the joint pricing and advertising problem , which considers the reference price effect, is a common issue faced by firms in marketing and pricing decisions. To maximize profits, it is crucial to determine the appropriate sales price and advertising effort level.
In this context, the consumer demand rate is influenced by the price sensitivity and the gap between the sales price and the reference price held by consumers. To address this problem, an optimization model can be established to maximize the firm’s total profit through a joint pricing and advertising strategy.The model can incorporate both static and dynamic strategies.
Furthermore, the study shows that dynamic pricing and dynamic advertising strategies are strategic complements, meaning that they reinforce each other’s effects. When implemented together, they have a greater impact on maximizing profits compared to individual strategies.
The length of the sales period also plays a significant role in determining the effectiveness of the dynamic strategies. A relatively short sales period emphasizes the value of dynamic advertising, indicating that targeted and time-sensitive advertising efforts are crucial for generating consumer interest and driving sales. On the other hand, a longer sales period highlights the importance of dynamic pricing, indicating that adjusting prices over time can have a greater impact on maximizing profits.
In summary, the joint pricing and advertising problem considering the reference price effect can be addressed through an optimization model. The dynamic strategies derived from the model, which involve adjusting pricing and advertising efforts over time, are found to be superior to static strategies. The dynamic pricing and advertising strategies are strategic complements, and the length of the sales period influences the relative importance of these strategies.
Managing the Power of Curiosity for Effective Web Advertising Strategies.
MENON, S. et al. (2002) investigates the impact of curiosity on the effectiveness of Internet advertising. The study aims to understand the processes underlying curiosity resolution and its effects on consumer motivation and learning. The researchers conducted a simulated Internet experiment and collected a dataset that includes clickstream data from ad-embedded links, traditional attitude and behavioral intention measures, and open-ended protocols.
The findings of the study suggest that using a curiosity-generating advertising strategy leads to increased interest and learning compared to a strategy that provides detailed product information. Although curiosity does not significantly increase the quantity of search behavior, it appears to enhance the quality of search. This means that individuals who are curious spend more time and attention on specific information, resulting in better memory and comprehension of neIn summary, this research highlights the positive effects of curiosity on consumer motivation and learning in the context of Internet advertising. By adopting a curiosity advertising strategy and incorporating the recommended elements, advertisers can potentially enhance the effectiveness of their campaigns for new products.
The Impact of Advertising Positioning Strategies on Consumer Price Sensitivity
KALRA, A. et al. (1998) says that investigate the connection between advertising and its impact on prices, suggesting that this relationship is influenced by the specific advertising positioning strategy employed by advertisers. They argue that advertising serves different purposes depending on the competitive context of the brand, with some advertisers aiming to highlight the differences between brands, while others attempt to minimize the perceived differences.
The authors further identify specific types of non price advertising positioning strategies that have different effects on brand equity and category price sensitivity. Some positioning strategies increase both brand equity and category price sensitivity, while others decrease both variables. Additionally, certain positioning strategies are found to increase brand equity while simultaneously increasing category price sensitivity.
To test their hypotheses, the authors conduct two experiments across various product categories. The results of these experiments indicate that measuring the effectiveness of advertising requires going beyond brand attitudinal measures alone.
In summary, the study suggests that the impact of advertising on prices is dependent on the specific advertising positioning strategy employed by advertisers. Different positioning strategies can have varying effects on brand equity and category price sensitivity. To accurately assess advertising effectiveness, it is crucial to consider factors beyond brand attitudinal measures.
Informative Brand Advertising and Pricing Strategies in Internet Markets with Heterogeneous Consumer Search.
MCDONALD, S.et al. (2012) explains the impact of consumer search on the relationship between brand advertising and pricing strategies in online markets. Specifically, it focuses on the motor insurance industry in the UK using data from a prominent motor insurance comparison website. This dataset allows for the analysis of price rankings in relation to consumer search characteristics and advertising expenditure of firms.
The findings of the paper suggest that firms that engage in more advertising have lower price rankings on the comparison website. This indicates that advertising plays an informative role in this particular market. In other words, consumers perceive more-advertised firms as offering better pricing in relation to their competitors.
However, the main result of the analysis is that consumer search weakens the relationship between advertising and pricing. This implies that when consumers actively search and compare prices on comparison websites, the influence of brand advertising on pricing becomes less significant. In essence, the paper suggests that increased usage of price comparison sites diminishes the importance of informative brand advertising.
In summary, the research highlights that while advertising is informative and can impact price rankings on comparison websites, consumer search behavior mitigates the influence of advertising on pricing strategies. The implication is that the growing popularity of price comparison sites reduces the significance of brand advertising in influencing consumer choices in online markets.
Communication strategies to counter deceptive advertising.
LORD, K. R.et al. (1997) states that The first study focused on the impact of the copy style of an advertisement on consumer susceptibility to deceptive advertising. The copy style refers to the language and tone used in the ad. The researchers examined whether certain styles of advertising copy would make consumers more or less likely to be deceived by misleading claims. The results indicated that certain copy styles, such as those using a straightforward and factual tone, were more effective in reducing consumer susceptibility to deception compared to copy styles that employed exaggerations or vague language.
The second study investigated the role of the consumer’s time of reference and their store of product-relevant information in memory in influencing susceptibility to deceptive advertising. The time of reference refers to the consumer’s state of mind or context at the time they encounter the advertising message. The researchers examined whether consumers who were primed with relevant information about the product prior to exposure to the deceptive ad would be less susceptible to deception. The findings showed that consumers who had prior knowledge or information about the product were indeed less likely to be deceived by misleading claims.
Overall, these studies shed light on the factors that moderate consumer susceptibility to deceptive advertising and provide strategies to help prevent consumers from being deceived. The findings suggest that using a straightforward and factual copy style, having prior product knowledge, and fostering a positive frame of reference can reduce the likelihood of consumers being misled by false or misleading claims. This research contributes to the ongoing efforts in understanding and addressing the issue of deceptive advertising in the contemporary business environment.
Advertising media strategies in the film industry.
ELLIOTT, C.et al. (2018) focuses on analyzing and estimating the various factors that influence film advertising expenditures across four key media channels: television, press, outdoor, and radio, specifically within the context of the UK. The study begins by focusing on television advertising, which is the dominant medium for film advertising, and examines its relationship with other variables in a system of equations. These equations capture the interdependencies between advertising, the number of screens on which films are initially shown, and box office revenues.
Subsequently, a reduced form model is proposed to uncover the determinants of film advertising across all four media channels. This model aims to identify the factors that influence advertising decisions in each medium. The results reveal that different major distribution companies may have distinct preferences for utilizing alternative advertising media.
Overall, the study provides insights into the complex dynamics of film advertising expenditures in the UK, highlighting the interplay between different media channels, the influence of critical reviews, and the potential signaling role of advertising in the film industry.
Marketing and Advertising for CPAs: Leading-Edge Strategies.
COPELAND et al. (2010) says that a well-designed and user-friendly website is an essential marketing tool for CPA firms in the 21st century marketplace. Here are some key considerations for website marketing:
The website should clearly communicate the value and differentiating characteristics of the CPA firm.
With the increasing use of mobile devices, it’s important to ensure that the website is responsive and adapts to different screen sizes. A mobile-friendly website enhances the user experience and improves accessibility.
The website should provide valuable content that educates and engages visitors. This can include articles, blog posts, videos, infographics, and case studies relevant to the target audience. Content should showcase the firm’s expertise and establish credibility.
In summary, the research highlights that a website is just one component of a comprehensive marketing strategy. Integrating other online marketing tools, such as firm-sponsored blogs, mass email campaigns, and social networking tools, can further enhance the reach and impact of the firm’s marketing efforts.
Conclusion:
In summary, the advertising creative is widely recognized as a crucial driver of market performance. It encompasses both the content and execution of an advertisement, and an advertiser’s creative strategy plays a pivotal role in influencing sales effectiveness. Advertising strategy plays a crucial role in the success of any business or organization. It is a planned approach that outlines how an organization will effectively communicate its products, services, or messages to its target audience. An advertising strategy helps identify the target audience for a product or service. By understanding the needs, preferences, and behaviors of the target market, companies can create tailored messages that resonate with their audience.
In summary, an advertising strategy is vital for businesses and organizations to effectively communicate with their target audience, build a strong brand, gain a competitive edge, increase sales and revenue, engage with customers, and adapt to changing market conditions. It serves as a roadmap for successful advertising campaigns and helps achieve marketing objectives.
References:
COPELAND, M. K. Marketing and Advertising for CPAs: Leading-Edge Strategies. CPA Journal, [s. l.], v. 80, n. 8, p. 58–62, 2010. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=8af73866-c3de-3e65-8366-1020d803607f. Acesso em: 30 maio. 2023.
DALL’OLIO, F.; VAKRATSAS, D. The Impact of Advertising Creative Strategy on Advertising Elasticity. Journal of Marketing, [s. l.], v. 87, n. 1, p. 26–44, 2023. DOI 10.1177/00222429221074960. Disponível em:https://discovery.ebsco.com/linkprocessor/plink?id=a3d99b2d-7091-3bc1-9580-8b8d5cd37b32. Acesso em: 28 maio. 2023.
ELLIOTT, C.; SIMMONS, R. Advertising media strategies in the film industry. Applied Economics, [s. l.], v. 43, n. 29, p. 4461–4468, 2011. DOI 10.1080/00036846.2010.491466. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=ba87e2cc-b225-34b5-8284-c38a1a4886ec. Acesso em: 29 maio. 2023.
KALRA, A.; GOODSTEIN, R. C. The Impact of Advertising Positioning Strategies on Consumer Price Sensitivity. Journal of Marketing Research (JMR), [s. l.], v. 35, n. 2, p. 210–224, 1998. DOI 10.2307/3151849. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=bb3c2977-70a5-374e-b1d9-ce161057507d. Acesso em: 29 maio. 2023.
LU, L. et al. Joint pricing and advertising strategy with reference price effect. International Journal of Production Research, [s. l.], v. 54, n. 17, p. 5250–5270, 2016. DOI 10.1080/00207543.2016.1165878. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=e10d57ac-50a2-3b4f-b4ca-1098f133758f. Acesso em: 29 maio. 2023.
LORD, K. R.; KIM, C. K.; PUTREVU, S. Communication strategies to counter deceptive advertising. Review of Business, [s. l.], v. 18, n. 3, p. 24, 1997. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=e0b4478f-8979-309c-9c26-e67f742a506f. Acesso em: 29 maio. 2023.
MENON, S.; SOMAN, D. Managing the Power of Curiosity for Effective Web Advertising Strategies. Journal of Advertising, [s. l.], v. 31, n. 3, p. 1–14, 2002. DOI 10.1080/00913367.2002.10673672. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=8303d9b4-d78b-3bae-9754-4f92be39fcae. Acesso em: 29 maio. 2023.
MCDONALD, S.; WREN, C. Informative Brand Advertising and Pricing Strategies in Internet Markets with Heterogeneous Consumer Search. International Journal of the Economics of Business, [s. l.], v. 19, n. 1, p. 103–117, 2012. DOI 10.1080/13571516.2012.642642. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=5fd368a6-fe7c-3f14-96fd-a184fe0627aa. Acesso em: 29 maio. 2023.
TUNUGUNTLA, S.; HOBAN, P. R. A Near-Optimal Bidding Strategy for Real-Time Display Advertising Auctions. Journal of Marketing Research (JMR), [s. l.], v. 58, n. 1, p. 1–21, 2021. DOI 10.1177/0022243720968547. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=64555b32-c846-3394-918e-ab947267e246. Acesso em: 28 maio. 2023.Top of Form
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XIE, Y. et al. Optimal advertising outsourcing strategy with different effort levels and uncertain demand. International Journal of Production Research, [s. l.], v. 58, n. 7, p. 2016–2035, 2020. DOI 10.1080/00207543.2019.1641235. Disponível em: https://discovery.ebsco.com/linkprocessor/plink?id=0e65f9f3-3b61-3876-a0da-d2fe3b68ce3d. Acesso em: 28 maio. 2023.
