Corporate Advertising
A) Summary of the textbook
◩ What is Corporate Advertising?
Corporate advertising can be defined as paid use of media that seeks to benefit the image of the corporation as a whole rather than its products or services alone.
A major difference between corporate and product advertising is who pays for each of the two types of advertising. A company’s marketing department typically is responsible for all product-related advertising and pays for such ads out of its own budget. Corporate advertising, on the other hand, falls within the corporate communication area and either comes out of that budget or, in some cases, is paid for by the CEO’s office.
Corporate advertising should present a clear identity for the organization based on a careful assessment of its overall communication strategy, and it generally falls into three broad categories: image advertising, financial advertising, and issue advocacy.
1. Advertising to Reinforce Identity or Enhance Reputation
Many companies use corporate advertising to strength their identities following structural changes. As companies merge and enter new businesses, they need to explain their new vision, organization, and strategy to constituents who may have known them well in an earlier incarnation but are struggling to understand the image to unify a group of disparate activities. Corporate advertising can be an efficient mechanism for changing impressions about organizations if changes have really taken place. Effective image advertising also allows companies to differentiate themselves from rivals.
2. Advertising to Attract Investment
One of the tools that companies use to enhance their images in the financial community is financial-relations corporate advertising. Some corporate advertisers assert that a strong financially oriented corporate advertising campaign can actually increase the price of a company’s stock. Some companies view building their brand with investors as more important than doing so with customers.
3. Advertising to Influence Opinions
This kind of advertising often is called issue or advocacy advertising and is used by companies to respond to external threats from either government or special interest groups. Issue advertising typically deals with either controversial subjects; it is a way for companies to respond to those who challenge the status quo. By taking issues directly to the consumer, companies can compete with journalists for a share of the reader’s mind.
Many other organizations also have adopted the op-ed style for their advocacy ads. However, this advertisement also reveals the problem, however, with much issue advertising. Since companies typically are more conservative than their adversaries, their arguments often fall short of the mark. It is extremely difficult for a large corporation to take on a tough issue in the marketplace without offending someone.
◩ The History of Corporate Advertising in America
Interestingly enough, one of the earliest documented corporate advertisements was issue-oriented. After World WarⅡ, corporate advertising faded from view until its revival in the 1970s, when oil companies found themselves battling allegations of exorbitant profits during the oil crisis.
Today, corporate advertising is highly visible and intensely scrutinized by constituencies. These trends only reinforce the notion that corporate advertising should be aligned with company vision and consistent across advertising media(print, television, Web, etc.)
◩ Who Uses Corporate Advertising and Why?
Usually, a direct correlation exists between size and the use of corporate advertising: The bigger the company, the more likely it is to have a corporate advertising program. In addition, larger companies tend to be more diversified and thus have a greater need to establish a coherent reputation out of a variety of activities, products, and services.
Corporate advertising also is used heavily by companies within more “controversial” industries: Cigarette companies, oil companies, pharmaceuticals, and other large industrial companies all have image problems to deal with, from concerns about health, to drug recalls, to pollution. Overall, heavy industry spends more on corporate advertising than consumer-packaged-goods firms, which lead all other industries in product advertising.
A good corporate advertising program can clarify and enhance a company’s reputation, and the absence of one hurt packaged goods companies and retailers as well.
1. Increase Sales
The relationship between corporate advertising and sales is less clear than that between product advertising sales, because corporate advertising is meant to do things that eventually boost sales but likely won’t directly or immediately do so. Even so, there are growing efforts to identify a closer relationship between corporate advertising and sale. The rise of the Internet has made it increasingly easy to measure newer forms of advertising, such as advertising banners placed on Web sites and in e-mail advertisements. Through corporate advertising, companies can draw out features about themselves that they think will appeal to the public and, as a result, make consumers want to buy products from them.
2. Create a Stronger Reputation
The best corporate advertising creates goodwill and enhances reputation by letting constituents in on what the organization is all about, particularly if it does beneficial things that people might not be aware of. Companies also look to build credibility and enhance reputation by using endorsements from a third-party organization. Corporate advertising also is widely used by companies to publicize their philanthropic activities, which also can lead to an enhanced reputation.
Organizations using corporate advertising to enhance reputation must be prepared for their opponents to respond negatively to what they may perceive as the company’s attempt to smooth over a history of corporate wrongdoing or to apply a “quick fix” to a serious image problem.
3. Recruit and Retain Employees
One of the most critical communication activities for any company is communicating with employees. If a corporate advertising campaign succeeds in explaining in simple terms what a large, complex organization is all about, this can be as helpful to employees as it to the outside world. Corporate advertising is also an indirect way of building morale among employees. Such advertising also helps companies attract the best and the brightest both at the entry level and for senior positions. A good corporate advertising campaign can create excitement among both potential current employees
B) My Experience
As we know like Johnson & Johnson’s case, company’s good image was built by steady efforts through corporate advertising. As a result, when the corporate crisis happens, corporate ads helps companies fast overcome or less the damage. When I worked at public affairs department in the company, the budget of a corporate advertising cost was over half of that of public relation affairs department. Besides, our company attempted various voluntary activities such as teaching programs for low-level living standard children and environment protection campaigns in each local branch to make good relationships with community. I had also ever participated in such activities in order to help the old ages. Like this, today corporate advertising made by a variety of activities is regarded as a critical role of building corporate image by the big companies.
Reference :
1. http://media.ford.com/newsroom/feature_display.cfm?release=21864
2. www.ddb.com/pdf/press/current/6-20-07_United_Technologies_Wins_Best_Corporate_Advertising.pdf
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