14.2 Major Decisions in Developing an Advertising Plan

Developing an Advertising Plan

Steps in Advertising Plan Creation

Building an advertising plan follows a logical sequence: figure out where you stand, decide what you want to accomplish, then determine how to get there and whether it worked.

1. Conduct a situation analysis. Assess the current marketing environment, including market trends, consumer preferences, and your brand's positioning. Identify your target audience using demographic, psychographic, and behavioral characteristics. Evaluate competitors' advertising strategies to spot gaps and opportunities for differentiation.

2. Set advertising objectives. Determine the response you want from the target audience, whether that's increased brand awareness, improved brand perception, or higher purchase intent. These objectives should align with your broader marketing goals so everything works together.

3. Determine the advertising budget. Factor in the product's stage in the life cycle (a new product launch typically needs heavier spending than a mature product), your current market share, competitors' spending levels, and the expected return on investment.

4. Develop the advertising strategy. This is where the big creative and media decisions happen. Define your target audience precisely, craft the advertising message, and select the right media channels. A creative brief ties all of this together and keeps the campaign consistent.

5. Create advertising executions. Design ad layouts and produce the actual content. Everything should communicate the core message clearly and maintain quality across every media channel you're using.

6. Implement the campaign. Schedule ad placements according to the media plan and budget. Monitor performance in real time and adjust as needed based on data and audience feedback.

7. Evaluate advertising effectiveness. Measure results against your original objectives using KPIs like reach, engagement, and conversion rates. Gather audience feedback and use it to optimize current and future campaigns.

Key Decisions for Advertising Strategy

Three major decisions shape every advertising strategy: what you're trying to achieve (objectives), how much you'll spend (budget), and how you'll reach people (strategy and execution).

Setting Advertising Objectives

The type of advertising you choose depends on what you need the audience to do:

• Informative advertising builds awareness and knowledge. It's most common for new products or product categories where consumers need education. Coca-Cola's "Share a Coke" campaign, for instance, introduced a new way of interacting with the brand by putting people's names on bottles.
• Persuasive advertising tries to convince consumers to prefer your brand over competitors by highlighting unique benefits. Apple's "Shot on iPhone" campaign showcased real user photos to persuade people that the iPhone camera was superior.
• Reminder advertising keeps an established brand top of mind and reinforces loyalty. McDonald's "I'm lovin' it" campaign doesn't introduce anything new; it simply reminds consumers of the brand's presence and value.

Determining Advertising Budgets

There are four common budgeting methods, each with trade-offs:

• Affordable method allocates whatever funds are left over after other expenses. It's simple but often underfunds advertising, especially when spending is needed most.
• Percentage-of-sales method sets the budget as a fixed percentage of sales revenue (for example, 10% of annual sales). This keeps spending proportional to revenue but has a flaw: it treats advertising as a result of sales rather than a driver of sales.
• Competitive parity method matches what competitors are spending to maintain a similar share of voice in the market. The risk is that competitors' budgets may not reflect what your brand actually needs.
• Objective-and-task method starts by defining specific objectives, identifying the tasks required to achieve them, and then estimating the cost of those tasks. This is the most strategic approach because spending is tied directly to goals.

Developing the Advertising Message

Your message is what you actually say to the audience, and how you say it.

• Unique selling proposition (USP) is the single most compelling reason to choose your brand. Domino's classic "30 minutes or it's free" guarantee gave customers a clear, differentiated promise.
• Emotional vs. rational appeals depend on the product and audience. Perfume ads lean on emotional appeals (desire, romance, identity), while cleaning product ads tend to use rational appeals (effectiveness, ingredients, value). Many successful campaigns blend both.
• Creative execution brings the message to life through techniques like humor (Old Spice's "The Man Your Man Could Smell Like"), fear (anti-smoking campaigns showing health consequences), or testimonials (celebrity endorsements lending credibility).

The message strategy should always align with the brand's identity and speak to what the target audience actually cares about.

Selecting Media Channels

Where you place ads matters as much as what the ads say:

• Traditional media includes TV (Super Bowl commercials that reach massive audiences), radio, and print (magazine ads targeting niche demographics).
• Digital media covers social media (Instagram influencer partnerships), search engine marketing (Google Ads targeting users actively searching for products), and email marketing (promotional newsletters to existing customers).
• Out-of-home media includes billboards (like those in Times Square), transit ads (bus wraps), and point-of-purchase displays (in-store promotions near checkout).

Media planning optimizes the mix of channels to maximize reach (how many people see the ad) and frequency (how often they see it) within the budget.

Methods of Advertising Effectiveness Measurement

You need to know whether your ads are actually working. Measurement happens before, during, and after a campaign.

Pre-Testing

Pre-testing evaluates ad concepts before you commit to a full launch:

• Focus groups and surveys gather qualitative feedback on how audiences react to ad concepts and creative executions.
• Physiological measures like eye tracking (heat maps showing where people look) and brain activity monitoring (EEG) reveal attention levels and emotional responses that people might not report in a survey.

Post-Testing

Post-testing assesses impact after the campaign has run:

• Recall and recognition tests measure whether the target audience remembers the ad and its key messages.
• Attitude and preference changes evaluate whether the ad shifted how people feel about the brand.
• Sales and market share analysis quantifies the ad's effect on actual business results.

Ongoing Optimization

Effective advertisers don't just test before and after; they continuously refine:

• A/B testing compares different ad variations (different copy, visuals, or calls-to-action) to identify which elements perform best.
• Conversion tracking measures specific actions taken as a result of ad exposure, such as purchases, sign-ups, or downloads.
• Return on advertising spend (ROAS) evaluates how much revenue each advertising dollar generates:

$ROAS = \frac{\text{Revenue from advertising}}{\text{Advertising spend}}$

• Continuous monitoring involves analyzing performance data on an ongoing basis and adjusting targeting, messaging, or media placement to improve results over time.