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Advertising

• In 1998, $351 billion world wide
• Source: The Penguin Atlas of Media and Information, Penguin, 2001.
• Average Expenditure per person: $300 or more in the US ( which has 43% share of world market)
• Canada ( which has 1.9% share of world ad market) averages between $100 and $199
• Almost equal 6 way split: radio,TV,mags, news, cinema, outdoor

Learning Objectives

• What is advertising?
• What are its economic characteristics?
• Three views of advertising
• Typical Regulation of Advertising
• What are its effects?

Definition

• Persuasive message to buy, sell or change behavior
• Biagi: involves payment to place message and identification of sponsor as well as selling of goods and services
• Also involves the latin meaning of take note or consider– that is the goal is to be noticed
• Fleras argues there are structural, functional and ideological elements to the definition ( text: 176)

Definition Cont’d

• One element of the 4 Ps of marketing ( production, pricing, promotion, etc)
• An indirect or third party form of financing the media
• Used to be the dominant form of media financing– still is in television,mags and newspapers
• But in 1990 in electronic media direct consumer payment ( subs, pay per view) exceeded ads
• Central to consumer culture: establishing the codes, cultural norms, expectations of consumption, and market signalling

Main Forms of Financing the Media

• Advertising
• Direct Subscription ( cable, newspapers, etc)
• Transaction Revenues
• Licence Fees ( BBC)
• Taxes ( CBC/ matched by Ads)

Role of Advertising

• Principal sources of revenue for: newspapers, radio, television, magazines
• Not books, film, sound recording, or telecommunication
• Uncertain but growing role in the Internet