Sheldon Pilot of ABLE Digital Group and has made his career in marketing. On LinkedIn, he posted a short blurb about his frustrations regarding people’s seemingly blanket misunderstanding about how marketing relates (and doesn’t relate) to advertising. He writes:
“I was recently attending an event and was asked what I did for a living. I informed that my profession was within the Marketing Industry and the person responded: are you a "Mad Men"? I realized that the lines were blurred and trying to explain the difference was only going to cause more confusion so I smiled and let the conversation slowly move in a new direction. But during the drive home, I really wanted to have a twitter like definition that could easily convey the difference between the two, especially now that digital and social media are contributing to the mix.”
And Mr. Pilot is not alone. Marketingprofs.com reports that if you ask 20 experts the difference between marketing and advertising, you’ll likely get 20 different answers. For this reason, the subject continues to surface and confuse.
As a small business owner or part of a marketing team, have you ever experienced this confusion in marketing circles? And, have you also dealt with the frustration of not knowing how to explain the difference? If you’re like many, the answer is yes. And, the truth is, this distinction is important. Why? Because both play a key role in making your company successful. So, let’s take a few minutes to explore the difference between the two and why both are important to your company.
What is marketing?
Marketing is everything a company does to ensure a lucrative exchange between itself and its customers in terms of products or services. The key word here is “everything.” For many companies (and if done correctly), marketing starts even before a product or service is created.
To illustrate this, let’s look at Apple. Apple has a product that is revered by its plethora of fans. And, this reverence is not just a fluke. No, it has taken Apple years to develop this reputation, fan culture, and sales strategies around its products.
First, before Apple even mentions a product to its vendors, it develops a focus group to determine what the current consumer challenges are in the industry as well as consumers’ likes and dislikes. Then, it develops a product that will serve all of the customer’s needs, whether conscious or subconscious. As it does so, it creates a luxury product.
Next, it targets exclusive vendors to sell the products. It also relies on buzz to generate interest in new products. With this exclusive image, it works to pit its products against its competitors’ in the minds of consumers, leading bloggers, its social media community and tech gurus to begin talking about Apple products to its target markets well before their launch dates.
With all this buzz going on and exclusive rights of its vendors, the company then sets in motion a premium pricing strategy that is in line with its exclusive image. As it does so, the company focuses on vendors that will advertise the products according to Apple’s meticulous instructions and in keeping with its premium brand image.
All of these moves are part of the company’s marketing strategy, from creating its image, doing market research, and choosing its vendors, to its purposeful rival with competitors, its advertising guidelines, choosing its means of communication with audiences, and premium pricing strategy.
In a nutshell…
As we’ve seen in our Apple illustration, marketing 101 tells us that marketing involves four components: developing the product, the place in which it’s sold, its pricing strategy and the means of promoting it. This makes up the “Four Ps of Marketing,” that, in a nutshell, comprises marketing.
What is advertising?
In understanding what advertising is and its role in creating sales, we must again remember that marketing is everything a company does to ensure a lucrative exchange between itself and its customers in terms of products or services. So, given that advertising is part of ensuring a sale, or lucrative exchange, it only goes to reason that advertising is a part of marketing. But, what is it really? Let’s nail this down. Barron’s Dictionary of Marketing Terms defines advertising like this:
Advertising: a paid form of nonpersonal message communication through various media. [It] is persuasive and informational and is designed to influence the purchase behavior and/or thought patterns of the audience.
To this, I would add that advertising takes place during a limited period of time.
So, though all of your marketing strategy must align, including advertising, advertising is not “everything.” It is the advertising component of marketing that provides informative, persuasive and media-based product or event messages to consumers for a limited time. Simply put, it is making your product or service known to the market.
An advertising campaign repeatedly informs and persuades audiences of a product’s “goodness” through various channels including, but not limited to:
- Newspaper ads
- Television commercials
- Direct mail
- Magazine ads
- Internet ads
To illustrate, Apple’s vendors are responsible for advertising Apple products. When its vendors run television commercials and billboard ads around the latest Apple iPhone, it is advertising the product.
Why does a definition of advertising matter?
Being able to define advertising for your company matters because it is an important part of making your company successful. It’s interesting that, although there’s been a great emphasis on new forms of marketing of late, studies show that successful companies revere paid advertising as just as important as ever. Why? Because consumers love for it has remained steadily strong, if not grown. In fact, in a study done by the Deloitte Digital Marketing Survey, 2,100 US consumers were asked their opinions on different forms of advertising. Specifically, they were asked to rank the effectiveness of many forms of paid advertising.
The results showed that many forms of paid advertising were within the top 10 of 21 advertising channels represented. For example, 65% ranked television ads as highly influential forms of advertising, only second to a friend’s recommendation. 46% said pre-movie theatre advertising was highly influential in their purchasing decisions. And, between 43% and 46% ranked in-theatre advertising, magazine ads, and television show mentions as highly influential in their decision.
Overall, television ads, theatre advertising, magazine ads, television show placements, and newspaper ads all made the top 10 list of most influential forms of influencing consumer behavior.
As a result, companies are responding to what consumers say are most effective in influencing them by raising their paid advertising budgets. Wall Street Journal reports that the top 100 US marketers increased their paid advertising budgets by an average of 2.9% during just the first half of 2014. And, this year, the increase is rising still. In just the last quarter, Coke increased its advertising budget by double-digit percentages. This year alone, Magna Global and ZenithOptimedia revealed that companies are planning to increase their spending by an average of 4.8% to 4.9%.
Apple is a great example of a comprehensive marketing mix that works together to meet all of its consumers psychological needs to bring them to a purchase decision. Yes, it relies on some forms of inbound marketing, including appealing to bloggers’ sense of curiosity. But, it also carefully delineates the rules of paid advertising for its vendors. It does so because it knows that its vendors enjoy a high ROI from their paid advertising efforts.
Why do consumers prefer paid advertising?
So, why does paid advertising continue to be so effective, despite all the new choices consumers have of receiving product information? Because the logic behind the advertising method hasn’t changed. The human mind still works the same way it always did and will continue to do so. Let me explain. Psychology has found that repeat exposure creates familiarity with products and brands. And, that familiarity builds trust and a sense of comfortable acceptance of a product or brand as something good. So, when a consumer is repeatedly exposed to, say, a television commercial, even if the consumer isn’t consciously paying attention, the familiarity with the brand burns its way into the consumer’s consciousness, creating a positive attitude toward the brand and its products.
To answer Mr. Pilot’s question, what tweet definition distinguishes marketing from advertising?
So, as Mr. Pilot eluded to, if you’re on a marketing team or are a small business owner, given the current importance of paid advertising, it’s important to be able to succinctly describe exactly what the difference is so that your company may benefit from both. So, per Mr. Pilot’s request, here’s a tweetable explanation:
Marketing: preparing products to delight target markets. Advertising: making products' “goodness” known to target markets to create sales.
Did I miss anything? What distinctions have you made between marketing and advertising?