COURSE MATERIAL

Program : BBA INDUSTRY INTEGRATED Semester :V

Course : ADVERTISING Course Code : B18BB5312
Unit. No. :I
Unit Title : INTRODUCTION TO ADVERTISING
Course Presenter: PROF. ABHISHEK DUTTAGUPTA
Course Mentor: PROF. RAGHAVENDRA KUMAR SINGH & PROF. JOHN PRAVIN

ADVERTISING
In today’s world, all of us are under the influence of ‘Advertisement’. Right from buying groceries to
children’s study materials, finding a holiday spot to watching a movie, selecting restaurant for dinner
to booking a banquet hall for special events, and searching educational institutions to hunting for a
company to find jobs, almost every act is guided and decided by advertisements.

Advertising is the nonpersonal communication of information usually paid for and usually persuasive
in nature about products, services or ideas by identified sponsors through the various media. The
means of providing the most persuasive possible selling message to the right prospects at the lowest
possible cost. Advertising is the means of informing and influencing a vast audience to buy a product
or service through visual, oral or written messages.

Advertising is a marketing communication that employs an openly sponsored, non-personal message

to promote or sell a product, service or idea. Sponsors of advertising are typically businesses wishing
to promote their products or services. Advertising is differentiated from public relations in that an
advertiser pays for and has control over the message. It differs from personal selling in that the
message is non-personal, i.e., not directed to a particular individual. Advertising is communicated
through various mass media, including traditional media such as newspapers, magazines, television,
radio, outdoor advertising or direct mail; and new media such as search results, blogs, social media,
websites or text messages. The actual presentation of the message in a medium is referred to as an
advertisement, or "ad" or advert for short.

The word advertising comes form the latin word "advertere” meaning “to turn the minds of towards”.
Advertising is a very old form of promotion with roots that go back even to ancient times. In recent
decades, the practices of advertising have changed enormously as new technology and media have
allowed consumers to bypass traditional advertising venues. From the invention of the remote control,
which allows people to ignore advertising on TV without leaving the couch, to recording devices that
let people watch TV programs but skip the ads, conventional advertising is on the wane. Across the
globe, television viewership has fragmented, and ratings have fallen. Print media are also in decline,
with fewer people subscribing to newspapers and other print media and more people favoring digital
sources for news and entertainment.
Some of the definitions given by various authors are:
According to William J. Stanton, "Advertising consists of all the activities involved in presenting to
an audience a non-personal, sponsor-identified, paid-for message about a product or organization."
According to American Marketing Association "advertising is any paid form of non-personal
presentation and promotion of ideas, goods and services by an identified sponsor".
Advertising is used for communicating business information to the present and prospective customers.
It usually provides information about the advertising firm, its product qualities, place of availability of
its products, etc. Advertisement is indispensable for both the sellers and the buyers. However, it is
more important for the sellers. In the modern age of large scale production, producers cannot think of
pushing sale of their products without advertising them. Advertisement supplements personal selling
to a great extent. Advertising has acquired great importance in the modern world where tough
competition in the market and fast changes in technology, we find fashion and taste in the customers.

NATURE OF ADVERTISING
Advertising is the prominent element of the promotion mix. Advertising has a huge reach and is
pervasive in nature. Here’s more about what an advertising message should have:

Attention seeker - The term ‘advertising‘ is derived from the Latin word ‘advertere’ that means ‘to
turn the attention’. Every piece of advertising attempts to seek the attention of your audience towards
a product or service.
Has a unique selling proposition - Often, the advertiser need to have a unique selling proposition
(USP). This unique selling proposition makes the product or service stand out of the crowd.
Advertising attempts to persuade and influence the audience through the different kinds of appeal.
Visually attractive - The visual and non-verbal elements play a dominant role in advertising. An eye-
catching advertisement uses crisp information and focuses on the visual treatment to convey the
message. The visual elements used in the advertisements not only convey the information, but also tell
a story.
Consumer oriented - Advertising broadens the knowledge of the consumers. With this nature of
advertising, consumers can have the know how of the products, brands or services that exist in the
market. In fact, every product or service is designed in a way to keep the consumers satisfied.
Uses various media - Apart from print platforms like newspapers and magazines, its presence can now
also be seen in audiovisual platforms like, films, hoardings, banners and many such promotional
campaigns.
Scope Of Advertising
Advertising is often regarded as the most important means of marketing a company’s services and
tools. The scope of advertising is to communicate a message to current customers or potentially target
new customers. It helps a company get a message or a piece of information across to their customer
base regarding a new product or special deal.
Scope of advertising by budget - There is always a budget allocated for advertising and promotion
within the marketing budget. The budget allocated should be in coordination with the type of
advertisement the organization wants. The resources and other requirements are to be kept in mind for
the budget allocation.
Scope of advertising by deliverables - Once the budget is decided, the marketing plan can be projected
further. A detailed scope of work that deliverables require can be outlined. Agencies can now develop
a proposed resource plan.
Scope of advertising by allocating deliverables - For creative work, allocating the type of deliverables
(TV, online, mobile, press, magazine, etc) based on the previous campaign requirements can be more
insightful after the previous plan.
Scope of advertising by strategy - Once the deliverables are allocated, advertising agencies can define
the strategic requirements by brand or category and develop a scope of work based on past
requirements and remuneration for similar strategic deliverables.

IMPORTANCE OF ADVERTISING
Advertising is a huge industry. It has created opportunities for various domains. The benefits of
advertising include:

Launch of a new product: - Advertising plays very significant role in the introduction of a new
product in the market. It stimulates the people to buy or know about a product.
Increases markets: - It helps the manufacturers to expand their markets. It opens the horizons for new
markets for the product or service.
Mass sales: - Advertising facilitates mass production to goods that ultimately results in a raised
volume of sales.
Keeps the competitive spirit alive: - Advertising helps in keeping the competition and the competitors
at bay. It keeps a regular check on the performance of your brand or product.
Creates goodwill: - Advertising builds goodwill of a brand. Advertising is a crucial source through
which the audience gets to know about a brand or product. If a company is spending on
advertisement, it means they care to make their consumers aware. This increases the goodwill of a
brand.
Creative minds: - Every place has a rich pool of strategic and creative minds, media and professionals.
And every advertising organization possesses such talents.
Consumer awareness: - Advertising is educational and dynamic in nature. It educates the customers
about the new products and their diversifications.
Direct link: - Advertising aims at establishing a direct link between the manufacturer and the
consumer. This rules out the possibility for a middlemen to be involved in between.
Creates employment: - Advertising provides and creates more employment opportunities for many
talented people in the industry.

ADVERTISING TYPES
Product Advertising: Most advertising is product advertising, designed to promote the sale or
reputation of a particular product or brand. This is true whether the advertising is done by a
manufacturer, a middleman, or a dealer, and whether the advertising concerns the product itself or
some of its features, such as service, price, or the quality directly associated with it. The objective of
product advertising is to promote particular products or services that the organization sell. The
marketer may use such promotion to generate exposure attention, comprehension, attitude change or
action for an offering.
Institutional Advertising: Institutional advertising is also called corporate advertising. This type of
advertising is done by institutions to build-up an image of itself in the public mind. It is a public
relations-relations-approach advertising. This type of advertisement is sometimes aimed at general
audience to explain a company or institution and to suggest its positive attributes. There May Be
Various Goals For Doing Institutional Advertising: i. Image building ii. Build confidence and iii.
Advocacy.
Primary Demand Advertising: By primary demand we mean the demand of a class of product or
service and not the demand for a particular brand. Primary demand is the demand for the whole
product category. The main purpose of primary demand advertising is to stimulate the overall demand
of the whole product category. It is most useful when a new type of product is introduced in a market
or when a product is in the introductory stages in a given market. Such type of advertising is done to
inculcate the habit for the product among people in general and to get a favour for it so that a
permanent demand can be created in the near future.

Selective Demand Advertising: Relatively few completely new products appear on the market, thus
most new product introductions today are accompanied by selective demand advertising, which
promotes a specific manufacturer’s brand. Most advertising for various products and services is
concerned with stimulating selective demand and emphasizes reasons for buying a particular brand.
Advertisers generally assume that there is a favourable level of primary demand for a product class
and focus attention on increasing their market share.
Comparative Advertising: This is a highly controversial trend in competitive markets that is recently
noticed. Such types of advertising stress on comparative features of two or more specific brands in
terms of product/service attributes. This method is adopted in the maturity stage when similar
products appearing the market fast constitute a stiff competition. Comparative advertising delivers
information not previously available to consumers”. When comparative advertising appears it reveals
the intensity of competition in the market.
Shortage Advertising: When shortage in the supply of products occurs, advertising often disappears
into the background. A concrete example is found in the case of petroleum products that since the oil
crisis in 1974, virtually advertising for these products ceased. But the intelligent marketers have found
that advertising is still a viable marketing tool during times of shortage. This is what is termed as
shortage advertising. In such kinds of advertising new promotional objective may be incorporated
such as:
(a) Educating the user of more efficient means of utilising the product, thus reducing the demand;
(b) To reduce customer pressure on the sales force;
(c) Improving goodwill; and
(d) Making appeal to save resources.

Co-Operative Advertising: When manufacturers, wholesalers and/or retailers jointly sponsor and
share the expenditure on advertising, it takes the form of co-operative advertising. Such advertising
would carry the names of all the parties involved. From the point of view of the customers this is
beneficial as they could get the articles directly from the authorised outlets. For example, the
manufacturers of cars undertake this type of advertising.

Commercial Advertising: It is also termed as business advertising. As the name suggests such
advertising is solely meant for effecting increase in sales. Usually the following forms of commercial
advertising are recognised:
(a) Industrial advertising —this is exclusively used for selling industrial products.
(b) Trade advertising —advertising relating to a trade.
(c) Professional advertising —undertaken by professional people such as doctors, accountants, etc.
(d) Farm advertising —exclusively used for selling farm products such as fertilisers, insecticides,
farm implements, etc.
Non-Commercial Advertising: These are usually published by charitable institutions preferably to
solicit general and financial help (e.g., collection of donations or sale of tickets.)
Direct Action Advertising: Advertising that stresses and persuades immediate buying of the product is
known as direct action advertising. Direct mail advertising is capable of achieving immediate action
to a large extent.

OBJECTIVES OF ADVERTISING
To Inform: Advertisements are used to increase brand awareness and brand exposure in the target
market. Informing potential customers about the brand and its products is the first step towards
attaining business goals.
To Persuade: Persuading customers to perform a particular task is a prominent objective of
advertising. The tasks may involve buying or trying the products and services offered, to form a brand
image, develop a favourable attitude towards the brand etc.
To Remind: Another objective of advertising is to reinforce the brand message and to reassure the
existing and potential customers about the brand vision. Advertising helps the brand to maintain top
of mind awareness and to avoid competitors stealing the customers. This also helps in the word of
mouth marketing.
Other objectives of advertising are subsets of these three objectives. These subsets are:
Brand Building
Increasing Sales
Creating Demand
Engagement
Expanding Customer Base
Immediate Buying Action
Pre-Sold Goods
Dealer Support
Changing Customers’ attitudes, etc.

AUDIENCE SELECTION
The desired audience for the advertising message. Data-gathering technology improves accuracy of
information about customers. Advertisers must recognize the various target audiences they are talking
to and know as much about them as possible. A target audience is a group of people defined by
certain demographics and behavior. Often, businesses use what they know about their target audience
to create user personas. These personas guide their decisions on marketing campaigns. Finding a
target audience means discovering what kind of people are most likely to be interested in your service
or product. Most companies look at demographic information like: Gender, Age, Profession,
Location, Income or education level and Marital status etc. Defining the difference between a target
market and a target audience comes down to the difference between marketing and advertising. In
marketing, a market is targeted by business strategies, whilst advertisements and media, such as
television shows, music and print media, are more effectively used to appeal to a target audience. A
potential strategy to appeal to a target audience would be advertising toys during the morning
children's TV programs, rather than during the evening news broadcast.

ADVERTISING BUDGET
Advertising budget is a financial document that shows the total amount to be spent on advertising and
lists the way this amount is to be allocated. It is a translation of an advertising plan into monetary
units. It helps in meeting advertising objectives of an organisation. It is prepared for a specific future
period of time. It shows the plan of allocation of available funds to various advertising activities.
An advertising budget is an estimate of a company's promotional expenditures over a certain time
period. More importantly, it is the money a company is willing to set aside to accomplish its
marketing objectives. When creating an advertising budget, a company must weigh the value of
spending an advertising dollar against the value of that dollar as recognized revenue.

SETTING OF ADVERTISING BUDGETING

An advertising budget is part of a company's overall sales or marketing budget that can be viewed as
an investment in a company's growth. The best advertising budgets—and campaigns—focus on
customers' needs and solving their problems, not company problems such as an overstock reduction.
Several methods are used for setting advertising budget. Depending upon internal situations of the
company, the suitable method is followed. Every method has its merits, demerits, and applicability.
The major steps in setting up advertising budgeting are:
Setting advertising objectives
Determining the task to be performed to achieve the objectives.
Preparing advertising budget.
Approval of the top management.
Allocation of advertising budget
Monitor and control

DETERMINANTS OF ADVERTISING BUDGET

Advertising task to be achieved: Know the role which advertising is to play. It’s reasonable to know
that advertising roles merely as a selling job or will be added to other marketing mix elements such as
reduced prices or sales promotion. Some brands aren’t sensitive to advertising and the reason might
be lacking the unique sales proposition or the difficulty of being creative in presenting the main idea
in printed or broadcast media.
Long & Short Term Goals: The goals set for advertising will affect your budget size. The budget
allocated to advertising has to be treated as an investment when the goals are defined as long-term
goals. Goal might be somewhat improving your brand image and this will be met in a long-term
advertising program. In contrast, short-term goals such as immediate sales ask for advertising as an
expense and this kind of goals will be treated in a different way. The relationship between goals and
the advertising of the company will affect to some degree the amount of your budget.
Profit Margins: There is a consensus that when the profit margin is high so the advertising budget has
to be high. The profit margins and advertising budget size depend on each other.
Degree of Product Usage: The products which are used nationwide require more money for
advertising than those which usage is limited to a relatively small region. However, some might find it
necessary to spend a lot to keep up with heavy competitive spending. Such a situation calls for
evaluating the spending in term of advertising expenditure per thousand, not the total expenditure, to
eliminate the effect of the market size.
Difficulty in Reaching Target Markets: Some products have small and unique markets and in this
case, you can’t reach your target by one medium and you have to purchase more media to reach your
target consumers although the wasting of your message. Such products will face you with the
coverage and composition trade-off and generally, you have to spend more money on your advertising
in these cases.
Frequency of Purchase: Most advertisers and planners believe that if a product has a high frequency
of purchase, such as FMCGs, you have to spend more on your advertising campaigns. This is
generally true but an exception is when the advertising goal of infrequently purchased brands calls for
more spending and the reason is something other than frequency of purchase.
Effect Of Increased Sale Volume In Production Cost: Sometimes when your advertising power is
high, your advertising will cause a demand that you can’t supply and overcome that demand you have
to run new facilities which means more expense by your side. This situation needs a trade-off between
cost and benefits which might show you to set a limit or reduce your advertising budget.
New Product Introductions: Almost all believe that the introduction of a new product takes a great
deal of additional money to break into the market. How much more depends on the market size,
competition degree and desirable quality of the new brand image. As a rule of thumb, a new brand
takes at least one and a half times as much as taken by an established brand. Another guideline is that
the share of advertising expenditure for a new product has to be as twice as the anticipated share of
the market.
Market Share & Competition: A market with a high competitive expenditure on advertising and sales
promotion make it necessary to match or even exceed your main competitors’ expenditures. Was once
called the “trap of advertising”.
Stages in Product Life Cycle: Introduction stage - New products typically receive large advertising
budgets to build awareness for early adopters and trade. Growth stage - The consumer awareness
spread in mass market helps to generate consumer trial and further sales. Maturity stage - At this stage
advertisements must create differentiations in brand positioning through different perspectives such as
benefits, applications, price etc. Established brands usually are supported with lower advertising
budgets as a ratio of sales. Decline stage - At this stage, the budget must be reduced to the level
needed to retain loyal customers only.
Frequency of Advertising: The number of repetitions needed to put across the brand’s message to
consumers has an important impact on the advertising budget.
Product Differentiation: Brands in a commodity class such as soft drinks and confectionary require
heavy advertising to establish a differential image. Advertising is also important when a brand can
offer unique physical benefits or features.

MAJOR METHODS OF SETTING THE ADVERTISING BUDGET

Affordable or Fund Available Method: This is, in real sense, not a method to set advertising budget.
The method is based on the company’s capacity to spend. It is based on the notion that a company
should spend on advertising as per its capacity. Company with a sound financial position spends more
on advertising and vice versa. Under this method, budgetary allocation is made only after meeting all
the expenses. Advertising budget is treated as the residual decision. If fund is available, the company
spends; otherwise the company has to manage without advertising. Thus, a company’s capacity to
afford is the main criterion.
Percentage of Sales Method: It is a commonly used method to set advertising budget. In this method,
the amount for advertising is decided on the basis of sales. Advertising budget is specific per cent of
sales. The sales may be current or anticipated. Sometimes, the past sales are also used as the base for
deciding on ad budget. Companies have tendency to maintain certain percent of sales as ad budget.
Based upon the past, the current and the expected sales, amount for advertising budget is determined.
This method is based on the notion that sales follow advertising efforts and expenditure. It is assumed
that there is positive correlation between sales and advertising expenditure.
Competitive Parity Method: Competition is one of the powerful factors affecting marketing
performance. This method considers the competitors’ advertising activities and costs for setting
advertising budget. The advertising budget is fixed on the basis of advertising strategy adopted by the
competitors. Thus, competitive factor is given more importance in deciding advertising budget. It is
obvious that a company differs significantly from the competitors in terms of product characteristics,
objectives, sales, financial conditions, management philosophy, other promotional means and
expenses, image and reputation, price, etc. Therefore, it is not advisable to follow the competitors
blindly.
Objective and Task Method: This is the most appropriate ad budget method for any company. It is a
scientific method to set advertising budget. The method considers company’s own environment and
requirement. Objectives and task method guides the manager to develop his promotional budget by
(1) defining specific objectives, (2) determining the task that must be performed to achieve them, and
(3) estimating the costs of performing the task. The sum of these costs is the proposed amount for
advertising budget. The method is based on the relationship between the objectives and the task to
achieve these objectives. The costs of various advertising activities to be performed to achieve
marketing objectives constitute advertising budget.
Judgement Method (Arbitrary Allocation Method): This method seems to be a weaker method than
the affordable method for setting a budget. The arbitrary allocation method is completely dependent
on the management’s discretion and hence has no theoretical basis. The budget is determined by
management solely. They on the basis of what they feel to be necessary. So ultimately the decision
depends on the psychological and economical build up of the people in the management and not on
the market requirements.
Incremental Concept Approach: Advertisers can keep on increasing the advertisement budget to the
extent where the last unit spent on advertising is equal to the net profit contribution by the additional
sales generated from the promotion. From managerial economics viewpoint, this is the optimum
advertisement expenditure giving maximum profit. This is also referred to as the concept of
marginality. In other words, the advertisement expenditure should be carried on to that point where
there is no further scope of increasing the incremental revenue from the incremental expenditure on
advertising. Also, the total advertisement budget should be apportioned among various media and
product lines until marginal returns are equal.
Return on Investment (ROI):In the ROI budgeting method, advertising and promotions are considered
investments, like plant and equipment. In other words investments in advertisements lead to certain
returns. Like other aspects of the firm’s efforts, advertising and promotion are expected to earn a
certain return. To many the ROI method is an ideal method of setting advertisement budget. But in
reality it is rarely possible to assess the returns provided by the promotional effort-at least as long as
sales continue to be the basis for evaluation.
Quantitative Method: In this method, advertisers use mathematical modelling to devise advertising
budget. There are sub-methods like (i) Operational Modeling - Market research gives advertising
expenses, market response and sales per advertising figures and the modeling is done to explain the
budget. (ii) John little model - This method is an adaptive control method for setting the advertising
budget. According to this, suppose the company has set an advertising expenditure rate based on its
most current information. (iii) Vidale and Wolfe’s model -This model calls for a larger advertising
budget, as it believes that higher the sales response rate, higher the sales decay rates i.e. the rate at
which customers forget the advertising and brand, and higher the untapped sales potential.
The Experimental Approach method: It is an alternative to quantitative models. The advertising
manager conducts tests or experiments in one or more selected market areas. The advertising strategy
is tested in market areas with similar population, brand usage, market share etc. Different advertising
expenditure levels are kept for each market. Brand awareness and sales levels are measures before and
after. Results are compared and variation of influence of advertising expenditure studied. The
feedback results determine the advertising budget levels. Manager may decide a certain budget level
according to the advertising objectives.

BASIC COMMUNICATION MODEL

Adler and Towne describe communication as a process between at least two people that begins when
one person wants to communicate with another. Communication originates as mental images within a
person who desires to convey those images to another. Mental images can include ideas, thoughts,
pictures, and emotions. The person who wants to communicate is called the sender (see figure). To
transfer an image to another person, the sender first must transpose or translate the images into
symbols that receivers can understand. Symbols often are words but can be pictures, sounds, or sense
information (e.g., touch or smell). Only through symbols can the mental images of a sender have
meaning for others. The process of translating images into symbols is called encoding. Once a
message has been encoded, the next level in the communication process is to transmit or communicate
the message to a receiver. This can be done in many ways: during face-to-face verbal interaction, over
the telephone, through printed materials (letters, newspapers, etc.), or through visual media
(television, photographs). Verbal, written, and visual media are three examples of possible
communication channels used to transmit messages between senders and receivers. Other
transmission channels include touch, gestures, clothing, and physical distances between sender and
receiver (proxemics). When a message is received by another person, a decoding process occurs. Just
as a sender must encode messages in preparation for transmission through communication channels,
receivers must sense and interpret the symbols and then decode the information back into images,
emotions, and thoughts that make sense to them. When messages are decoded exactly as the sender
has intended, the images of the sender and the images of the receiver match, and effective
communication occurs.
TRADITIONAL RESPONSE HIERARCHY MODELS
AIDA MODELS: The AIDA model is an acronym - it stands for attention, interest, desire and action.
It is a model used in marketing that describes the steps a customer goes through in the process of
purchasing a product. The AIDA model has been in use since the late 19th century. The AIDA model
was developed by the American businessman, E. St. Elmo Lewis, in 1898. The original main purpose
was to optimize sales calls, specifically the interaction between seller and buyer concerning the
product. The AIDA model is based on four individual stages that attract interested parties who are
deciding on a product or service.

1. Attract attention: The product must attract the consumer's attention. This is done via the advertising
materials. It is a type of “eyecatcher.” Examples: a window designed in a striking way, a sensational
YouTube clip, or a themed newsletter, or a graphic on a landing page.
2. Maintain interest: In the first phase, the attention of the potential customer is piqued; their interest
in the product or service should be aroused. Example: detailed information on the product is
presented, for example, the product description on a website, a product brochure or flyer, photos, or
video clip of the product.
3. Create desire: If interest in the product is aroused, it is the seller’s task to persuade the customer
that they want to own this product. In the best-case scenario, the advertisement or the product itself
creates the desire to purchase. Example: the seller provides clear examples of the advantages of the
product or service, taking into account the daily lives of the target group. In the online shop, a bullet
point list can generate the desire to buy. This desire to buy can also be awakened by an advertising
medium that specifically addresses the emotions of the customer.
4. Take action: As soon as the desire to buy is aroused, this must be transferred into an action, that is,
the purchase. Example: In the case of online shops, this would ultimately be the shopping cart
process, in which a customer is lead to a conversion. The customer can be encouraged to buy the
product with a call-to-action.

HIERARCHY-OF-EFFECTS MODEL:
The hierarchy-of-effects theory is a model of how advertising influences a consumer's decision to
purchase or not purchase a product or service. The hierarchy represents the progression of learning
and decision-making consumer experiences as a result of advertising. A hierarchy-of-effects model is
used to set up a structured series of advertising message objectives for a particular product, to build
upon each successive objective until a sale is ultimately made. The objectives of a campaign are (in
order of delivery): awareness, knowledge, liking, preference, conviction, and purchase. Hierarchy-Of-
Effects Theory Stages
The awareness and knowledge (or cognitive) stages are when a consumer is informed about a product
or service, and how they process the information they have been given. For advertisers, it is essential
to key brand information in this stage in a useful and easily understood fashion that compels the
prospective customer to learn more and make a connection with a product.
The liking and preference (or affective) stages are when customers form feelings about a brand, so it
is not a time when an advertiser should focus on a product, its positive attributes or technical abilities.
Instead, advertisers should attempt to appeal to a consumer's values, emotions, self-esteem, or
lifestyle.
The conviction and purchase (or conative) stages focuses on actions. It is when an advertiser attempts
to compel a potential customer to act on the information they have learned and emotional connection
they have formed with a brand by completing a purchase. It may involve the conversion of doubts
about a product or service into an action. In these stages, advertisers should attempt to convince
potential customers that they need a product or service, possibly by offering a test drive or sample
item. Advertisers should also build a level of trust with them by focusing on the quality, usefulness,
and popularity of a product or service.

INNOVATION-ADOPTION MODEL:

Innovation-Adoption Model was developed by Rogers in 1995. He postulated various stages in which
a target customer sails through from the stage of incognizance to purchase. The 5 stages of the
Innovation-Adoption Model are Awareness, Interest, Evaluation, Trial, and Adoption.
1. AWARENESS - This is the primary stage of Innovation-Adoption Model. takes action is the
awareness stage of the model where the consumer becomes aware of a brand or a product
mostly through advertisements.
2. INTEREST - This is the second phase of the Innovation-Adoption Model. This is a stage in
which the information about the brand or a product multiplies in the market and triggers the
 interest of the potential buyers of the product to gain more knowledge and information about
the product.
3. EVALUATION - Evaluation is the third stage of the Innovation-Adoption Model that
supplements the necessary information regarding the product to the consumers. In this stage,
the consumers evaluate and try to gain a deeper understanding of the product that stimulated
interest in them.
4. TRIAL - In this stage, the customers try the product before making the final choice to
purchase the product.
5. ADOPTION - Adoption is the final stage of the Innovation- Adoption Model. In this stage,
the customer accepts the product, makes a purchase decision and finally purchases the
product. In the Innovation- Adoption Model, the Awareness happens at the Cognitive Stage,
developing an interest and evaluation phases fall under the conviction phase, and the trial of
the product and the actual adoption fall in the Behavioural phase.

INFORMATION-PROCESSING MODEL: The Information-Processing Model is a structure used by

cognitive psychologists to define the mental processes. This model links the human thought process to
the computer functions. It signifies that the human mind, like the computer takes in information,
organizes, and stores the information to be repossessed later. It claims that just like the computer
possesses an input device, a processing unit, a storage unit, and an output device, the human mind also
has a parallel framework. The Information-Processing Model comprises of 6 stages namely the
Presentation, Attention, Comprehension, Yielding, Retention and the Behavioral stage.

 PRESENTATION - The presentation is the fundamental stage in the Information-Processing

Model. This is the awareness phase where the consumer becomes aware of his needs and
seeks a product to satiate his needs.
 ATTENTION - This is the second stage of the Information-Processing Model, where the
product seizes the attention of the potential customers.
 COMPREHENSION - In this stage of the Information-Processing Model, the consumer
compares and evaluates various products of different brands accessible in the market to
ascertain the product that actually meets his requirement.

 YIELDING - This is a stage in which the customer figures out what exactly he wants and the
brand and its product that balances his needs to its specifications.
 RETENTION - This is the fifth stage in the Information-Processing Model. This is the stage
in which the customer remembers the key features and attributes, the benefits and all the
positive aspects of the products that he is seeking to purchase.
 BEHAVIOR - This is the last stage of the Information-Processing Model in which the
purchase action of a product of a particular band takes place.
In the Information-Processing Model, the Presentation, Attention and Comprehension take place in
the Cognitive stage, Yielding and Retention of information fall under the Affective stage, and the final
Behavioral action takes place in the Behavioral stage.

ALTERNATE RESPONSE HIERARCHY MODEL

 1. Standard Learning Hierarchy
In many purchase situations, consumers go through the response process in the manner depicted by
the traditional communications models or sequence or hierarchy.
“Learn -> Feel -> Do”
The receiver is viewed as an active participant in the communications process who actively seeks or
gathers information through “active learning.”+
2. Dissonance/Attribution Hierarchy
In some situations, consumers may behave first then develop attitudes or feelings as a result of that
behavior and learn or process information that supports their attitudes and behavior.
The dissonance or attributional hierarchy consists of the following sequence.
“Do -> Feel -> Learn”
This hierarchy usually occurs when consumers are trying to reduce post-purchase dissonance or
apprehension that results from doubt or concern over a purchase.
3. Low-Involvement Hierarchy
The low involvement hierarchy is thought to characterize situations of low consumer involvement in
the purchase process and consists of the following sequence

“Learn -> Do -> Feel”

The receiver is viewed as engaging in “passive learning” and “random information catching” rather
than active information seeking. A popular creative strategy used by advertisers of low-involvement
products is what advertising analyst Harry McMahan calls VIP, or visual image personality.
Basically, advertisers use symbols that lead consumers to identify and retain ads.

THE FOOTE AND CONE & BELDING (FCB) GRID

The FCB grid or Foote, Cone and Belding model is an integrative approach to interpret the
consumer’s buying behaviour and its implication for adopting suitable advertising strategy. It is
depicted on a matrix with the help of four significant factors, i.e., thinking, feeling, high involvement
and low involvement. FCB matrix works on the four significant factors arranged in a pattern. Here,
the thinking to feeling aspect stretches from left to right on the x-axis, while the high to low
involvement moves from top to bottom on the y-axis.

Informative (Quadrant 1): The expensive products having a high level of importance to the consumers
and requires intense thinking for decision-making, lies in this category. The prospective buyer first
learns or gathers complete information about the product; then, he/she feels the need of buying it; and
later makes the final purchase.
Affective (Quadrant 2): The valuable products which hold an emotional attribute and requires
consumer engagement are considered to be affective products. The buyer follows a feel, learn and do
order. That is he/she first develops a connection with the brand or the product; gains complete
knowledge of it; finally buys it.
Habitual (Quadrant 3): This category of products includes everyday essentials. Thus, the customer
experiences a low involvement but analytical decision making while purchasing these items. The
buyer first obtains the product; tries it out and determines whether it solves the purpose or not; then
develops a trust in the brand.
Satisfaction (Quadrant 4): The products whose purchase is driven by the emotions; however, the
buying decision does not require much consumer involvement, lies in this quadrant. The consumer
buys the product; feels positive or negative about the purchase; and then learns about the product.

THE COGNITIVE RESPONSE APPROACH

Usually, the change in consumer’s perception and belief is a result of learning through the
advertisements. Cognitive response refers to the response in individuals generated on seeing an ad
which is evaluated in the light of past experiences, knowledge and attitudes. The consumers are asked
to either write down or verbally express their cognitive responses to an ad message through exposure.
It is through these cognitive processes and reactions that help marketers to know if the advertisement
has been accepted or rejected by consumers. The focus of this approach has been to determine the
types of responses elicited by an advertising message and how these responses associate to attitudes
towards the advertisement, the brand and purchase intention. The three basic cognitive responses the
research has identified are, (i) Product/Message Thoughts, (ii) Source Oriented Thoughts and (iii)
Advertisement Execution Thoughts.
THE ELABORATION LIKELIHOOD MODEL (ELM)
Developed in the mid-1970s by the cofounder of the field of social neuroscience, John Cacioppo, and
Richard Petty, a distinguished psychology professor at Chicago University, the Elaboration
Likelihood Model (ELM) seeks to explain how humans process stimuli differently and the outcomes
of these processes on changing attitudes, and, consequently, behaviour.

The ELM posits that when a persuader presents

information to an audience, a level of “elaboration” results. Elaboration refers to the amount of effort
an audience member has to use in order to process and evaluate a message, remember it, and then
accept or reject it. Specifically, the ELM has determined that when facing a message, people react by
using either of two channels (but sometimes a combination of both, too), reflecting the level of effort
they need. As such, they either experience high or low elaboration, and whichever of these will
determine whether they use central or peripheral route processing. Central route processing involves a
high level of elaboration. Here, the audience (or user) scrutinizes the message’s contents (rather than
reads casually) because of a high motivation level. Users know what’s important to them;
consequently, they will invest in examining a credible design’s message. Peripheral route processing
involves a low level of elaboration. The user isn’t scrutinizing the message for its effectiveness. As
such, other factors can influence him/her, including distractions. These include such users as those
who know that they want an item, but do not know much about the detail of that item.