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Glossary term

Advertising

Quick definition

Advertising is content you pay to place on a property other than your own to get your messages out to customers and encourage them to take a specific action.

Key takeaways

 

Advertising encompasses all the ways companies communicate with customers about a product.

Digital advertising, when done right, has the best ROI since it can gather information about customers and target them well, but traditional advertising still has its place. 

Advertising campaigns should be driven by a goal — figure out what action you want customers to take after seeing the ad. 

Companies can use cross-channel advertising to reach out to customers throughout their journey, building on information shown in previous ads.

Digital advertising has changed the way consumers make brand choices, so companies need to be able to adapt quickly and reach customers where they are.


Q: What is advertising?

A: Advertising is the technique and practice brands use to bring products and services to the public’s notice for the purpose of getting them to respond to what a brand has to offer — whether product, service, cause, or idea.

Advertising helps sustain brands. It’s focused on getting a message out to a specific customer type or audience in order to get them to take a certain action. Types of advertising include video, display, paid search, paid social, print, email, radio, TV, and outdoor.

Q: What is programmatic advertising?

A: Programmatic advertising is the automation of the process that decides where and when ads are placed, and the automation of the purchasing process. With programmatic advertising, there are usually three types of people involved.

There’s the buyer, who is the person placing the ad. Then there’s the publisher, who is selling space for ads. And then there’s the person in the middle — the broker, who is facilitating these relationships. Programmatic advertising automates the role of the broker. It helps people find where to place ads based on the criteria they've established to reach the people they are targeting..

Q: What is the difference between marketing and advertising?

A: Marketing is a wider discipline. It includes understanding your customers through research and then using that information to promote the value of the product you want them to buy. It goes beyond just telling customers about your product — it's also about understanding how your product relates to the customer and what value it will bring them. And then advertising is used to take action on that understanding. Advertising makes the product or service known to your customer.

Q: How does a company effectively advertise?

A: To effectively advertise, you need to have a goal. Companies will often think of advertising as a non-tangible item used to show people the brand is great. While that can be helpful to tie your brand to a specific product and reinforce your brand name, it’s important to make sure there is some goal you’re trying to achieve. You can change the goal as you get results back, but it's always important to make sure that you're working toward some goal, and you're analyzing that data to know what you do next. If you aren't, then you're not getting the ROI, and you're not sure how effective your advertising is.

With good marketing or good advertising, you want to make sure that you really understand what your product is and what it does, and then who your customer or target audience is. Advertising can run into problems when people don’t think about how to pattern certain associations to their product. You need to attach an emotional response to your product or service. And then the goal of advertising is to create an action toward a purchasing behavior or conversion.

In a perfect world, you’re reaching your target audience in the right place, at the right time, and with relevant content. To effectively advertise, you need to target the right audience during the right point of the sales cycle. Do you want your ad to target a customer at the beginning when they're trying to decide on a brand, or do you want to target somebody who's already picked your brand and is now in your store looking at their options?

Each ad is going to be different depending on your goal and what you want the customer to do, but it’s important to understand where that customer is in the sales funnel to then better tailor that advertising to them. And you also need to make sure that you are tailoring the content for the moment of interaction, to then lead to the action you want.

Q: What are some advertising strategies a company can employ?

A: One strategy is repetition. If you watch a video for a law firm, you’ll notice the phone number is repeated, usually in threes. There's a whole science behind the idea that things repeated in threes are going to stick longer.

Another strategy is making a specific claim about your brand. There’s an association with the customer and product, like eating a certain food will make you feel healthier or happier or a specific brand of body wash that will help you feel beautiful and luxurious.

You can also convince a customer to join the bandwagon. You show them how other people are enjoying the brand, and ask why they haven’t engaged yet, since so many others have.

Another option is to offer promotional rewards. If the customer chooses to interact with your brand, they will get a discount or some other promotional benefit.

Each strategy has its own benefits depending on the needs of the brand, but repetition and brand association are favorable options. These go back to the purpose of advertising, which is to encourage customers to make an emotional connection.

Q: How can companies advertise on a small budget?

A: If you can’t pay, then you have to put in the work. There are a lot of free resources out there, like social media pages or search engine optimization. You don’t have to go all in on a paid search campaign — you can choose a few keywords and craft some text-based ads to appear on a search engine results page. You can make sure you have an effective homepage and effective landing page.

Q: How do companies know which customers to target with ads?

A: It comes down to getting first-party data and behavioral data about user actions and understanding how the different users come onto your site. You need to find out how customers learned about your brand, whether it was through a paid ad or through an organic search or through email advertising, and then also understand what they are doing when they engage with your brand.

Q: How does digital advertising compare to traditional advertising?

A: One of the benefits of digital advertising over traditional methods is that with digital it’s easier to track the customer across their journey. You get more information about your customer and can build a better understanding of their behavior.

For example, somebody finds your webpage through search and then goes onto your social media platform and then starts following you and sees your Instagram photos. If you want people to understand or be able to research your brand, digital advertising tends to be the favorite.

But digital advertising can also be expensive, so if you don’t know who your target audience is or how to effectively reach them, if you aren’t tracking your audience, you could spend a lot of money and not get the return you expect.

Traditional advertising can still be relevant depending on the brand or what your goal is. Print advertising — that appears in newspapers or magazines — can help capture the essence of what the brand is and what it stands for, and it projects that concept to the audience.

The problem with print advertising is that we don't know all the people it reaches. We can assume based on the report from the newspaper or magazine about their circulation or statistics, but we don't really have that actual data of who that person is. But you still get the benefit of building brand awareness and associating your brand with a certain idea. For example, if you run an ad in a publication like Vogue, you’re connecting your brand with the lifestyle offered by Vogue. You're invoking a general feeling about your name.

Television advertising has generally managed to adapt to the new market, since many people now watch TV online. We're now able to track and connect with those customers through either source. Traditional TV is still a valid option for advertisers because you get to visually tell a story. It's interactive, in a sense, because it's more than just a phrase or one static image. With both TV and podcasts, you get to tell a story about your product or service.

Q: How do companies combine advertising types to create a holistic strategy?

A: Many companies do try to run ad campaigns in conjunction with each other, but they can be limited by marketing budgets. Ideally, a company will rely on repetition across the different channels to engage a customer. They may show the customer a display ad, then later show a video ad describing a few additional benefits of the subject. All the ad types play into each other to solidify the brand’s significance and reliability as well as the product being offered.

Q: How has digital advertising changed the way customers engage with products?

A: In the past, there used to be a moment called the first moment of truth, where a customer goes into a store, looks at the variety of options, and chooses one. Later, at home, they use the product and decide if they would like to continue with it or choose a new brand.

Now, in the digital advertising age, customers can now research multiple brands online and use inferences they get from social media, display ads, or reviews to choose a product. You could be part of the decision process in the first five minutes, and then you get pulled out when they move on to a different brand. Even if you’re a brand that’s in the final running to be a product the customer is going to purchase, customers are now making last-minute decisions to try a totally different brand, even up until the moment of purchase.

The problem with digital advertising is that you’re not sure where you're falling in that funnel. You have to be agile enough to respond to customers in the right way, and catch their attention, at the moment that you know they're willing to change their mind.

Q: How can technology improve advertising strategies?

A: Using artificial intelligence (AI) and machine-learning technology to look at historical data is key. It can help companies make decisions on how to pinpoint those moments when customers, who have similar behaviors, might potentially engage or convert. Technology that tailors ads to customers and sends them on a specific journey based on their behavior and needs helps companies understand and retain customers.

The important thing is to be fluid and adaptable to the space. Technology can help companies understand their customers and that allows for more effective targeting.

Companies need to be careful not to over-automate though. Humans — the advertisers — still need to have a hand in some of these decisions. But AI and machine learning are really going to be helpful and effective in brands getting the most out of their digital marketing budgets and running more efficient campaigns that have a better ROI.

Q: How can companies ensure their ads stand out without becoming annoying?

A: There are a lot of little things that marketing channel publishers are doing to try to force the hand of customers to engage with an advertisement. For example, when YouTube added ads to videos, people suddenly were getting bombarded with ads they didn’t want to watch. As a solution, YouTube added an option where users could skip an ad after five seconds. Customers are still exposed to the ad, and can continue to watch it, but they have the option to skip it if doesn’t appeal to them. And it gives the advertiser five seconds to convince the customer to engage with their brand.

As advertisers look for ways to stand out, they need to be smart and understand the value of their product and the needs of their customers.

Q: What does poor advertising look like?

A: Advertising can be considered bad when it isn’t prudent, thoughtful, or conscious of what’s happening in the world. It can usually be tied back to some kind of social inappropriateness or a lack of awareness about the current market. There’s a lack of consideration about how an ad will be perceived.

Inauthentic advertising is also a problem, like one brand copying another brand’s spontaneous moment. Inaccurate advertising, advertising that misrepresents a product, can also be considered bad.

Also, any advertising that doesn’t target correctly or speak to the brand’s customer base won’t be effective.

Q: What is the future of advertising?

A: Right now, we’re getting more specific. We’re getting hyper-focused on first-party data. The trend in advertising is becoming about identifying specific customers and their specific behaviors and then understanding how to either target or retarget them.

Privacy laws and regulations will also have an impact since data collection is so vital. We’ve seen some challenges already as far as how limited data is affecting how you can get the right ads or get the right information in front of your customers. And further restrictions on customers' first-party data will probably present some more challenges.

But what we're finding is that there's a level of acceptance that customers have in the Americas where they understand that without giving some information to advertisers, the advertising experience will diminish. The ads you see won’t necessarily be relevant and that’s one thing that creates a frustrating experience.

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