Exercise 2. Read and translate the following text. What do you think of when you hear the word promotion?

WHAT IS PROMOTION?

What do you think of when you hear the word promotion? Most people think of advertising. But promotion is much more than just advertising. Promotion is an attempt by marketers to persuade others to participate in an exchange with them. Marketers use many different tools to promote their products and services. Besides advertising, they use personal selling, word of mouth, public relations, publicity, and sales promotion to inform potential consumers about their organization and its goods and services. This combination of promotional tools is called the company’s promotional mix.

One reason most people mistake promotion for advertising is that they do not understand the differences among promotional tools such as advertising, personal selling, publicity, and word of mouth. Advertising is limited to paid, nonpersonal communication through various media by organizations and individuals who are in some way identified in the advertising message. Word of mouth is not a form of advertising because it does not go through a medium (newspaper, TV, etc.), it is not paid for, and it is personal. Publicity is different from advertising in that media space for publicity is not paid for. Personal selling is face-to-face communication and does not go through a medium; thus, it is not advertising. Anyone who watches television, listens to the radio, or reads magazines cannot help but notice the importance of advertising in our lives.

The importance of advertising in the United States is easy to document; one need only look at the figures. The total ad volume exceeds $118 billion yearly. The number one advertising medium in terms of total dollars spent is newspapers with about 26 percent of the total. Many people erroneously think that the number one medium is TV.

When people refer to advertising, they are usually talking about TV advertising. For example, the debate about the effect of advertising on children is really а debate about TV advertising and children. Similarly, when people talk about advertising being offensive, intrusive, manipulative, and so on, they are thinking primarily of TV advertising. But since only about 22 percent of advertising is TV advertising, there is much more to advertising than most people imagine.

Some of the leading TV ads of 1988 included those featuring the California Raisins and Michael Jackson for Pepsi. Joe Isuzu was also а big hit along with the ads for Bud Light and McDonald's. Such ads are memorable and tend to overpower the ads in other media.

The public benefits from advertising expenditures. First, advertising is informative. The number one medium, newspapers, is full of information about products, prices, features, and more. Does it surprise you to find that businesses spend more on direct mail than on radio and magazines? Direct mail (the use of mailing lists to reach an organization’s most likely customers) is an informative shopping aid for consumers. Each day consumers receive minicatalogs in their newspapers or in the mail that tell them what is on sale, where, at what price, for how long, and more.

Advertising not only informs us about products but it also provides us with free TV and radio programs because advertisers pay for the production costs. Advertising also covers the major costs of producing newspapers and magazines. When we buy a magazine, we pay mostly for mailing costs or promotional costs. Newspapers and radio are especially attractive to local advertisers.

Television has many advantages to national advertisers, but it is expensive. The average cost of a 30-second prime-time commercial in 1987 was $121,860. How many bottles of beer or bags of dog food must a company sell to pay for such a commercial? Is it any wonder that companies are now buying 15-second commercials to save money? Most companies selling consumer goods use ad agencies to prepare their advertisements.