fusion point research Marketing Research Reports

Marketing to Advertising Leaders in CPG

Understanding Their Role

Advertising is one of the most powerful brand building tactics utilized by consumer products companies. Advertising has a proven history of establishing brands, generating growth and maintaining a brand’s position over time.1 The CPG companies are the largest purchasers of advertising, spending billions of dollars per year. 2 3 Advertising has a unique capability to differentiate and elevate a brand when there is no (or minimal) real functional differences between competitive products.4 There are many media alternatives for advertising, including television, magazines, newspapers, radio, outdoor and the internet.5 The key to selecting media channels is matching the target market for a product with that target’s preferred media in the most cost effective way possible.6 CPG companies usually work with outside advertising agency that provides the creative element of the ads, along with consulting on media planning and purchasing. Large ad agencies now provide additional services, such as public relations, and operate globally.7 Levels of advertising spend can be somewhat cyclical, with periods of cost cutting and doubts about the most effective approach, followed by periods of large investments to spur growth and reinforce brand equities.8

“Our work is based on managing different kinds of political, economic, and technological issues, reacting to the needs of the consumers and dealing with a world that is changing all the time. This environment forces us to constantly transform our standards and the way we work.” - Maurice Lévy, Publicis CEO.9

1 Tybout, Alice M. and Calder, Bobby J., ed. Kellogg on Marketing. 2nd ed. John Wiley and Sons, Inc., 2010.

2 Ridley, Louise. “FMCG Category Leads the Way as Brands Increase Adspend.” Campaign (UK), 2013, 08. EBSCOhost(92674148).

3 “Kantar Brings out Data on U.S. Advertising Expenditures.” Entertainment Close-Up, 2013. HighBeam(335205400).

4 Tybout, Alice M. and Calder, Bobby J., ed. Kellogg on Marketing.

5 “Kantar Brings out Data….”

6 Tybout, Alice M. and Calder, Bobby J., ed. Kellogg on Marketing.

7 See, as examples: www.wpp.com, www.omnicomgroup.com, and www.publicisgroupe.com

8 Ridley, Louise. “FMCG Category Leads the Way as Brands Increase Adspend.” Campaign (UK), 2013, 08. EBSCOhost(92674148).

9 “Interview with Publicis CEO Maurice Lévy.” Egon Zehnder International, Inc. Available at: www.egonzehnder.com/us/the-focus-magazine/topics/t...

 

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Consumer products companies invest heavily in advertising to build brands. Working with advertising agencies, they have spent decades attempting to master the mixture of creativity and business sense required to cost effectively promote brands.