TRADITIONAL ADVERTISING
According to a recent IBIS world report there are close to 13,000 advertising and marketing companies employing almost 170,000 marketing professionals while the Bureau of Labor Statistics reports more than 2,600,000 supporting workers for the advertising, marketing and promotion industries. These include sales managers, producers, animators, art director, actors, editors writers and graphic designers along with many other professionals that have direct input in the creation, management and monitoring of ads for Print, Radio, Film, Broadcast TV, Cable and the internet.
A good advertising campaign can help larger companies that can afford to budget for expensive production and extensive coverage to launch, grow and innovate as they cycle, mature and decline. They can purchase multiple branding channels of communication and saturate a market so a consumers mind is filled with their message. Pervasiveness of brand at the consumers point of sale will reinforce and stimulate the IMPULSE BUY from need to WANT which account for 2/3 of all purchases made at malls and in general throughout the economy as a whole.
Today's agencies know this and charge a standard 15% commission on their media buys while accounting for 2%-3% of the 17 trillion in US GDP. Their advertising effectiveness depreciates by 30% within a short 12 month cycle. The 300-500 billion in advertising spending is split 60% nationally and 40% on local markets among the various mediums roughly as follows : 23% on print advertising and direct marketing although the general consumer is only engaged in that activity 6% of the time, 42% on TV as it should be considering that the average American spends 44% of their free time watching the tube, 22% on web advertising reflecting the average American who spends 26% of their free time surfing and 10% of the ads go to radio which takes up 14% of consumers discretionary free time. Last but not least 2% of the money goes to mobile which is expected to grow from its current 12% of our free time to more than 50% due to smartphones and broadband ubiquity. By the way, mobile advertising is expected to grow by 2015 to almost 400 billion usd in ad spends and account for more than 10% of all retail sales.
So how do companies and advertising agencies decide where to spend 1/4 trillion dollars?
They segment the 314 million US population into geographic, demographic, psychographic and psynographic categories. Conduct market and marketing research in order to determine message, tone, voice, reach, frequency and distribution variables for their ad campaigns and media buys.
GEOGRAPHIC fields are generally standard labels like country, state, city, zipcode, area code but things get a bit more sensitive when talking about demographic data.
DEMOGRAPHIC data like gender as in male, female, gay, lesbian bi-sexual, trans-gender or religion, ethnicity, language, education, income, and family size. Age is one of those values that we are all accustomed to. ( 13-17, 18-24, 25-34, 35-44, 45-54 , 55-64, 65-74, 75+ ).
PSYCHOGRAPHIC and PSYNOGRAPHIC attributes are given to lifestyle purchasing options like attitudes, beliefs, values and social versus self image as it relates to purchasing decisions like "Keeping up with the Jones" and the psychology of impulse buying.
