The purpose of advertising
Advertising is a company's communication to potential customers in order to increase its sales. Short term an advertising effort can lead to customers placing or increasing orders. Long term advertisements can increase the potential customers' awareness of the firm and its products and services, i.e. improved brand recognition, but also make the customer trust the firm and its value proposition, i.e. increasing customer loyalty and the brand value
Types of advertisements
There is a wide range of medium that can be used to deliver a company's message to potential and existing customers; the Internet, television, radio, cinema, magazines, newspapers, billboards and prints on textiles and corporate gifts. Advertisements are seen on the seats of shopping carts, on the walls of airport walkways, in any store or client serving office, on the sides of buses, and are heard in telephone hold messages. Advertisements are placed anywhere a target audience can easily or frequently access visual, audio and printed information
Practical marketing tips
First of all you need to identify the target group for products and services your want to sell. A segmentation analysis will help a lot in this process; Divide the customers based on geographical location, gender, age, wealth, job types, habits and any other characteristic that may help defining a unique target group for your products and services. Analyse also the competition for each of the segments you are considering to enter. You want to indentify a target group that is not well served by competitors, but still offers a good business opportunity regarding size and profitability
Once the target group has been defined, it should be fairly simple to find and select different medium that can be used for advertising your products and services. You want to use the medium that offer a good cost benefit, i.e. returning more value than the cost of the advertisement. A mix of medium can enhance the overall marketing effect, e.g. both using television and the Internet
An advertisement campaign should have clear requirements for achievements, and the results should be well measured. The short term direct effect of an advertisement campaign is relatively easy to measure, while the long term effects on brand recognition, customer loyalty and brand value are more difficult to measure, but should still be estimated with some proxy model. When goals are clearly defined and results properly measured, the advertiser can learn to improve the cost benefit for the overall advertisement budget
The fastest growing medium for advertising is the Internet. With the Internet you can use highly targeted web sites and measure the effects of spending by click-through for links and consequent customer actions. An excellent example of a platform for targeted advertisements is the Thoresen Ads Network, which has many web sites specifically aiming at investors, managers and entrepreneurs