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advantages will be higher sales and more profits, and the appeal will be to

the retailer's desire to make money. In so doing, trade advertising will

also have to compete with the 'selling-in' activities of rival

manufacturers.

Trade advertising will be seen as part of the total advertising campaign

for the product and so will be produced by the same advertising agency that

handles the consumer advertising. However, whereas consumer advertising

aims to persuade the consumer about the benefits to be gained from buying

the product, trade advertising aims to persuade the retailer about the

benefits which will result from selling the product. Trade advertising

supports distribution. It prepares the way. There is no point in

advertising products and encouraging consumers to buy them if the goods are

not in the shops. The demand created by consumer advertising must be

satisfied by the availability of the goods in the shops. That is what is

meant by 'adequate distribution'. If the advertised goods cannot be bought,

customers will buy either nothing or, worse still, a rival product!

Retail advertising

16. Introduction

Here we have a form of advertising which lies between trade and consumer

advertising. The most obvious examples are those for department stores and

supermarkets, but it can include the advertising conducted by any supplier

including a petrol station, restaurant or insurance broker.

A major form of retailing nowadays is direct response marketing or

retailing without shops. This is the modern form of mail-order trading

which has moved from the traditional club catalogues to sophisticated off-

the-page and direct mail campaigns for products and services, of which

financial houses and department stores have become leading participants.

17. Purpose

The purpose of retail advertising is threefold, as outlined below.

(a) To sell the establishment, attract customers to the premises and, in

the case of a shop, increase what is known as 'store traffic', that is the

number of people passing through the shop. If they can be encouraged to

step inside they may possibly buy something which they would not otherwise

be tempted to buy.

(b) To sell goods which are exclusive to the shop. Some distributors are

appointed dealers for certain makes, e.g. the Ford dealer. Others, such as

supermarkets, sell 'own label' goods, having goods packed by the

manufacturer in the name of the retailer. All the goods in the shop may

bear the same brand, or certain lines such as tea, coffee, biscuits or

baked beans may bear the retailer's own label.

(c) To sell the stock of the shop, perhaps promoting items which are

seasonal, or presenting a representative selection, or making special

offers. The latter could be regular policy, or could be organised as

shopping events such as winter or summer sales.

18. Media of retail advertising

The principal of media for retail advertising are:

(a) local weekly newspapers, including numerous free newspapers which gain

saturation coverage of residential areas by being delivered from door to

door;

(b) regional daily newspapers, of which most are 'evenings';

(c) public transport external posters and internal cards, and arena

advertising at sports grounds;

(d) direct mail to regular or account customers, and door-to-door leaflet

distribution;

(e) regional commercial television;

(f) independent local radio;

(g) window bills and point-of-sale displays within the shop;

(h) window and in-store displays;

(i) catalogues.

The shop itself is a considerable advertising medium, and it may well be a

familiar landmark. Marks &: Spencer rarely advertise, but their shops are

so big they advertise themselves. With retail chains, the corporate

identity scheme will quickly identify the location of a branch.

19. Special characteristics

Retail advertising is characterised by four main aspects: creating an image

of the shop, establishing its location, variety of goods offered, and

competitive price offers. Nearly always, the object of the advertising is

to persuade people to visit the shop, although telephone ordering and the

use of credit accounts and credit cards is a growing feature.

Financial advertising

20. Introduction

It is probably difficult to put a limit on what can be contained under this

heading, but broadly speaking financial advertising includes that for

banks, savings, insurance and investments. In addition to advertising

addressed to customers or clients it can also include company reports,

prospectuses for new share issues, records of investments in securities and

other financial announcements.

Some, like building society and National Savings advertisements, may be

addressed to the general public while others will appear in the financial

and business press only.

21. Purpose

The object of financial advertising may be to borrow or lend money, conduct

all kinds of insurance, sell shares, unit trusts, bonds and pension funds

or report financial results.

22. Classes of financial advertising

The main categories in this field are as follows.

(a) Banks advertise their services which today are not confined to

traditional bank accounts but include deposits, loans, insurance, house

purchase, wills and executorship and advice on investment portfolios. Some

banks specialise in certain areas of banking, and others concentrate on

certain kinds of business.

(b) Friendly societies and private medical care organisations like BUPA

offer schemes to provide insurance in time of illness.

(c) Building societies both borrow money from savers and lend money to

house-buyers. Most of their advertising is directed at not only raising

funds but keeping funds so that they have sufficient money to meet loan

applications. Competitive interest rates are important sales points, and

today in Britain there is rivalry between building societies, banks and

insurance companies for the same kind of business.

(d) Insurance companies exist to insure against almost any risk from big

commitments like ships and aircraft worth millions to covering [he risk

that rain may stop play. Some insurance not only covers risks but provides

benefits to savers or pensions in old age. In the cases of fire and theft,

insurance companies are also selling peace of mind should damage or loss be

suffered.

(e) Investments are offered, not only in share issues but in unit trusts

and other investments in which smaller investors can share in the proceeds

of a managed portfolio of shares.

(f) Savings and banking facilities are offered through post offices which

sell National Savings certificates and various bonds and operate the Giro

and Post Office banks.

(g) Brokers offer insurance, pension and investment schemes and advise

their clients on how to manage such financial commitments. The Automobile

Association acts as a broker for motor insurance.

(h) Credit and charge card companies, such as Access, and Barclaycard,

American Express and Diners' Club, promote plastic money facilities, often

on an international scale.

(i) Local authorities borrow money from the public, usually on short-term

loans which are advertised.

(j) Companies announce their intentions and final dividends, giving

summaries of annual reports, and often offering copies of annual reports

and accounts.

23. Media of financial advertising

Choice of media will depend on the target audience. Building societies

appeal to small savers and therefore use the mass media of the popular

press and television. The big national banks with branches everywhere also

use the national press and television. Investment advertising will appear

in the middle-class and business press. Prospectuses for share issues,

which usually occupy two or more pages, appear in newspapers like The Times

and Financial Times. Banks may take stands at exhibitions. They also

produce sales literature about their services, as do insurance companies

especially in the way of proposal forms.

24. Special characteristics

Financial advertising in the press, and especially the business press,

tends to occupy large spaces and contain detailed information necessary to

explain schemes and achieve confidence. The emphasis is generally on

benefits which are usually represented by figures such as interest rates

and returns on investments. Profit, benefits, security, confidence,

credibility and reputation are the keynotes of the copy appeals.

Recruitment advertising

25. Introduction

This form of advertising aims to recruit staff (including personnel for the

police, armed forces and other services) and may consist of run-on

classified advertisements or displayed classified, although other media

such as radio and television are sometimes used.

26. Different kinds

Recruitment advertising is mainly of two kinds, that inserted by employers

whether identified or using box numbers, and that placed by employment or

recruitment agencies which have been commissioned to fill vacancies.

27. Media of recruitment advertising

Except for the occasional recruitment advertisement on radio and

television, the media are mainly made up of the following categories of

press.

(a) National newspapers. Different newspapers appeal to different target

groups, e.g. the managerial advertisements in the Daily Telegraph and

Sunday Times and the teacher advertisements in the weekly education feature

in the Guardian and the Independent.

(b) Trade, technical and professional journals. These are the more obvious

market-places for recruitment advertising addressed to those with special

skills, qualifications and experience.

(c) Regional press. Local dailies and weeklies are used to advertise jobs

offered by local employers.

(d) Free publications. A number of freely distributed publications gain

their revenue chiefly from recruitment advertising, e.g. those which are

distributed in the street to office workers such as secretaries.

Recruitment advertising is also featured in the free newspapers delivered

weekly to homes.

28. Special characteristics

The art of recruitment advertising is to attract the largest number of

worthwhile applications at the lowest possible cost. The advantage of using

a recruitment or selection agency is that applications can be obtained

discreetly and they can be screened to provide employers with a short list

of the best candidates. Two skills have to be applied. The advertisements

must be so worded that they both sell the job and attract the best

applicants, while correct choice of media will bring the vacancy to the

notice of the largest number of good applicants as economically as

possible.

The Higher Purpose of Marketing

What is the higher purpose of marketing? What should an enlightened

marketer try to accomplish?

This question is raised because managers sometimes lose sight of their

ultimate goals and settle for short-term gains of dubious benefit to

themselves and others. When they lose a sense of higher purpose, their work

becomes unsatisfying and their attitude cynical.

The most common view is that the marketer's goal is to maximize the

market's consumption of whatever the company is producing. In this view,

the marketer is a technician who engineers sales gains. Marketing success

means selling more and more gum, cars, and ice cream bars as if the

consumer were a huge consumption machine that must constantly be stuffed

with goods and services. Even if consumers don't want this much

consumption, it is good for the economy and creates jobs. Yet Adam Smith

observed that hunger is limited by the size of the human stomach. More

generally, people will eventually run out of time to consume all that they

could buy. They may rebel against overeating and overdressing, and start

thinking "enough is enough" or even "less is more." Frederick Pohl wrote a

science-fiction short story, "The Midas Touch," in which factories are

completely automated and the goods roll out continuously and people consume

as much as they can in order not to be buried under the goods. In the

story, ordinary people are given high consumption quotas, while the elite

are excused from having to consume so much. Furthermore, the elite are

given the few jobs that are still left to do, so that they don't have to

face the bleakness of no work.

A sounder goal for the marketer is to aim to maximize consumer

satisfaction. The marketer's task is to track changing consumer wants and

influence the company to adjust its mix of goods and services to those that

are needed. The marketer makes sure that the company continues to produce

value for the target customer markets.

Even consumer satisfaction, however, is not a complete goal for the

marketer. The act of creating "goods" to satisfy human desires also creates

some "bads" in the process. Every car that is produced satisfies a

transportation need and at the same time contributes to the level of

pollution in society. The economist Kenneth Arrow noted that high gross

national product also means high gross national pollution. The sensitive

marketer has to take responsibility for the totality of outputs created by

the business. First, the marketer is a member of the public and therefore

victimizing himself to some extent. Second, the society has spawned

consumerists, environmentalists, and other public-action groups, who make

life difficult for those firms that are indifferent to the "bads" they

create in the process of pursuing profits.

Ultimately, the enlightened marketer is really trying to contribute to the

quality of life. The quality of life is a function of the quantity and need-

satisfying quality of goods and services, the quality of the physical

environment, and the quality of the cultural environment. Too often the

firm rests its case on its ability to produce great quantities of goods and

services and does not pay enough attention to its impact on the other

components of life quality.

Marketing

Marketing is the cornerstone discipline of some of the most successful

companies in America and a discipline of growing interest to companies and

nonprofit organizations throughout the world. All organizations face the

problem of how to increase value for target markets that are undergoing

continuously changing needs and wants. Organizations must thoughtfully

define their products, services, prices, communications, and distribution

in a way that meets real buyer needs in a competitively viable way. That is

the task of marketing.

Although selling is a very old subject, marketing is a relatively new

subject. It represents a higher-order integration of many separate

functions - selling, advertising, marketing research, new-product

development, customer service, physical distribution - that impinge on

customer needs and satisfaction. Many organizations at first resist

marketing because it threatens vested interests within the organization and

their own concepts of how to manage the organization effectively. Marketing

gradually gets established, however, first as a promotion function, later

as a customer service function, still later as an innovation function, then

as a market positioning function, and ultimately as an analysis, planning,

and control function. Few companies understand and install marketing in its

full form when first considering it. Even after marketing is effectively

implemented in an organization, there is a tendency for many managers to

forget its main principles in the wake of success.

Marketing's task in the organization is not only to help it recognize

business opportunities and serve the various publics but also to harness

the organization's energy to enhance the quality of life in society.

Marketing is human activity directed at satisfying needs and wants through

exchange processes.

Human Needs and Wants

The starting point for the discipline of marketing lies in human needs and

wants. Mankind needs food, air, water, clothing, and shelter to survive.

Beyond this, people have a strong desire for recreation, education, and

other services. They have strong preferences for particular versions of

basic goods and services.

There is no doubt that people's needs and wants today are staggering. In

one year, in the United States alone, Americans purchased 67 billion eggs,

250 million chickens, 5.5 million hair dryers, 133 billion domestic air

travel passenger miles, and over 20 million, lectures by college English

professors. These consumer goods and services led to a derived demand for

more fundamental products, such as 150 million tons of steel and 3.7

billion pounds of cotton. These are a few of the wants and needs that get

expressed in a $1.3 trillion economy.

A useful distinction can be drawn between needs, wants, and intentions,

although these words are used interchangeably in common speech. A need is a

state of felt deprivation of some generic satisfaction arising out of the

human condition. People require food, clothing, shelter, safety, belonging,

esteem, and a few other things for survival. People actually need very

little. These needs are not created by their society or by marketers; they

exist in the very texture of human biology and the human condition.

Wants are desires for specific satisfiers of these ultimate needs. A person

needs food and wants a steak, needs clothing and wants a Pierre Cardin

suit, needs esteem and buys a Cadillac. While people's needs are few, their

wants are many. Human wants are continually shaped and reshaped by social

forces and institutions such as churches, schools, corporations, and

families.

Intentions are decisions to acquire specific satisfiers under the given

terms and conditions. Many persons want a Cadillac; only a few intend to

buy one at today's prices.

These distinctions shed light on the frequent charge by marketing critics

that "marketers create needs" or "marketers get people to buy things they

don't need." Marketers do not create needs; needs preexist marketers.

Marketers, along with other influentials in the society, influence wants.

They suggest to consumers that a particular car would efficiently satisfy

the person's need for esteem. Marketers do not create the need for esteem

but try to point out how a particular good would satisfy that need.

Marketers also try to influence persons' intentions to buy by making the

product attractive, affordable, and easily available.

Products

The existence of human needs and wants gives rise to the concept of

products. Our definition of product is very broad:

A product is something that is viewed as capable of satisfying a need or

want.

A product can be an object, service, activity, person, place, organization,

or idea. Suppose a person feels depressed. What might the person do to get

out of his or her depression? What products might meet the need to feel

better? The person can turn on a television set (object); go to a movie

(service); take up jogging (activity); see a therapist (person); travel to

Hawaii (place); join a Lonely Hearts Club (organization); or adopt a

different philosophy about life (idea). All of these things can be viewed

as products available to the "feeling depressed." If the term product seems

unnatural at times, we may substitute the term resource or offer or

satisfier to describe that which may satisfy a need.

In the case of physical objects, it is important to distinguish between

them and the services they represent. People do not buy physical objects

for their own sake. A tube of lipstick is bought to supply a service:

helping the person look better. A drill bit is bought to supply a service:

making a needed hole. Every physical object is a means of packaging a

service. The marketer's job is to sell the service packages built into

physical products.

Exchange

Marketing exists when people decide to satisfy needs and wants in a certain

way that we shall call exchange. Exchange is one of four ways in which a

person can obtain a product capable of satisfying a particular need.

The first option is self-production. A hungry person can relieve hunger

through personal efforts at hunting, fishing, or fruit gathering. The

person does not have to interact with anyone else. In this case there is no

market and no marketing.

The second option is coercion. The hungry person can forcibly wrest food

from another. No benefit is offered to the other party except the chance

not to be harmed.

The third option is supplication. The hungry person can approach someone

and beg for food. The supplicant has nothing tangible to offer except

gratitude.

The fourth option is exchange. The hungry person can approach someone who

has food and offer some resource in exchange, such as money, another good,

or some service.

Marketing centers on that last approach to the acquisition of products to

satisfy human needs and wants. Exchange assumes four conditions:

There are two parties.

Each party has something that could be of value to the other.

Each party is capable of communication and delivery.

Each party is free to accept or reject the offer.

If these conditions exist, there is a potential for exchange. Whether

exchange actually takes place depends upon whether the two parties can find

terms of exchange that will leave them both better off (or at least not

worse off) than before the exchange. This is the sense in which exchange is

described as a value-creating process; that is, exchange normally leaves

both parties with a sense of having gained something of value.

Market

The concept of exchange leads naturally into the concept of a market:

A market is the set of all actual and potential buyers of a product.

An example will illustrate this concept. Suppose an artist spends three

weeks creating a beautiful sculpture. He has in mind a particular price.

The question he faces is whether there is anyone who will exchange this

amount of money for the sculpture. If there is at least one such person, we

can say there is a market. The size of the market will vary with the price.

The artist may ask for so high a price that there is no market for his

sculpture. As he brings the price down, normally the market size increases

because more people can afford the sculpture. The size of the market

depends upon the number of persons who have (1) an interest in the object,

(2) the necessary resources, and (3) a willingness to offer the resources

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