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O Level · Commerce 7100

Advertising

Revise Advertising for Commerce 7100 (O Level) — revision notes, 132 practice questions and instant AI marking.

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  Cambridge O Level Commerce 7100

Advertising

The big idea: Advertising tells people a product exists and gives them a reason to buy it. The skill tested is choosing: the right type of advert, the right medium for the audience and budget, the right appeal, and the right sales promotion for the product and the moment.

Summary — What This Chapter Covers
  • Purposes of advertising: to inform, to persuade, to launch a new product, to build brand awareness and image, to remind, to increase sales and to meet competition.
  • Four types: informative, persuasive, collective (generic) and competitive, each with advantages and disadvantages.
  • Media are traditional (television, radio, cinema, newspapers, magazines and trade journals, leaflets, packaging, direct mail, sponsorship, catalogues, posters, transport vehicles, window and point of sale displays, signboards, word of mouth) or digital (social media and other internet advertising, display and video advertisements, email marketing, digital billboards, influencers).
  • Choice of medium depends on audience, cost, cultural and legal considerations, flexibility to change, local or international coverage, multi-channel advertising, timing and type of product.
  • Methods of appeal: emotion, fear, humour, rational, ambition, social acceptance, romantic, adventure, music, celebrities and influencers.
  • Sales promotion is a short-term incentive to buy. Methods and the factors that decide which to use.
1. Purposes and Types of Advertising
Syllabus 5.1.1 · Papers 1 & 2

Why advertise, and four kinds of advert

Advertising is an aid to trade: it removes the barrier of lack of knowledge between producer and consumer. Its purposes are:

  • to inform customers about a product, its price and where to buy it;
  • to persuade them to buy it rather than go without or buy a rival’s;
  • to launch a new product and make people aware of it;
  • to build brand awareness and a good image, and remind customers of an existing product;
  • to increase sales and market share, and to meet competition.
TypeMeaningExample
InformativeGives facts: what the product is, its features, price, where and when it is availableA bus company advertises its new timetable and fares
PersuasiveTries to make people want the product, often by linking it to a lifestyle or feeling“Feel unstoppable” over a video of an athlete in the brand’s trainers
Collective (generic)Paid for by a group of producers or an industry to increase demand for a type of product, not one brandDairy farmers together advertise “Drink more milk”
CompetitiveCompares the product with rivals to show it is better or cheaper and win market share“Our data plan gives you twice the data of the leading network for the same price”
TypeAdvantagesDisadvantages
InformativeHelps consumers make a sensible, informed choice; builds trust; essential for new products and servicesCan be dull, so may not be noticed or remembered; may not persuade people to buy
PersuasiveCreates desire and brand loyalty; can raise sales stronglyCan mislead or pressure people into buying things they do not need; may exaggerate; costly campaigns
Collective (generic)Cost is shared by many producers, so each pays little; raises demand for the whole industryRivals in the group gain as much as the business that paid; does not promote any one brand
Competitive
Practice Question 1
Memorise
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Also in the full note
  • Where the advert appears
  • The reason the advert gives you to buy
  • A short-term reason to buy now
  • Choose, then justify against the alternatives
What's inside
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