Advertising – a beautiful lie for emptying pockets or information on goods that are necessary for you

TaTa Toria

It has been a long time since traditional means of doing business remained in history, a new mainstream has appeared on the market – the technique of wrapping and presentation.

We call this advertising. This view is almost a trivial one, but consumers that are participants of the Georgian market notice it perfectly well that 70% of TV commercials is devoted to advertising of various drugs: “Khondro Lits” – and you run freely without any pain; “Veno Rits” – forget about neurosis, etc. Or “Aversi”, or “PSP”, or both of them together, added to this are so-called telemarkets where they urgently sell “Apkinpros” thanks to which your figure will become perfect. Order this advertised product and after taking it three times the problem of superfluous weight will disappear. Unfortunately, the telemarket’s goods have no guarantee, and moreover, even the firm’s address is not indicated. One feels that it is bluff, a well staged performance. The share of a product’s advertising in its prime cost makes up 60-70%, but that is not a news, since we know from history that advertising accounts for 90% of “Coca-Cola’s” expenses. Even in this case advertising is a mirage, cheating of consumers, influencing upon their consciousness and zombing – we do not notice how “Pampucha” has become an indispensable thing for us. All this stipulated for creation of a new business – brand in the world. A brand is a word or name that you chose as the name of your firm or product and then get down to its promotion – so beautifully the deception of people, consumers is called now. It is a separate business, since another performer is behind this brand, let us say the owner of a far-famed brand that manages to sell his product on the world market by means of his branding. On the other hand, it is quite natural and one can say that it is convenient since it is difficult for a consumer to choose the product he really needs out of hundreds of thousands of various goods. Besides, there is also the trust factor. Consumers trust more familiar brands, since they spend large sums for making of image and reputation.
Now selling of goods on the world and local markets is impossible without advertising and promotion, though there is also a part of truth and lie in this advertising. In fact advertising has two functions: first – information of consumers, second – cheating and fuddling of consumers so that they buy this or that product. Advertising has one more function – to habituate to some product and take up a monopolistic position on the market. Advertising of “Coca-Cola” is a vivid example of that…
What does uniqueness of “Coca-Cola” consist in? In Nothing! Then why does it sell best of all? Because it has the best advertising and it has an effect on human mind, especially that of teenagers.
Advertising is implemented by means of the following channels:
– TV transmitting – 60% of the market;
– Billboards in the street and other visual images – 8%;
– Printing media – 12%;
– Internet – 18%;
– Other means – 2%.
Out of these means, advertising via Internet is the most rapidly growing one. Specialists predict a monopolistic future for it. Now TV and radio advertising has the highest rating. It predominates on the market and is growing day by day at high rates. It almost ousted printing media from this market, and that is natural since is more capable of zombing and making an instantaneous effect – it has captured a broader audience. For instance, on TV they are endlessly reiterating about absolutely poor tea Mariam and no one knows out of which tree’s leaves it is made. This action used to be punished under the pretext of violation of consumers’ rights. From this point of view, protection of consumers’ rights was assumed by nongovernmental organizations, though their work is less effective in view of the weakness of the judicial system.
Then what is advertising? Is it a big lie for other people’s enrichment, a necessary information on the goods you need or a serious and indispensable business?
Our journalist Tata Toria will present information for the discussion on this issue.
Editor

Be careful, someone is bitterly cheating you
“If your name does not mean anything,
a visiting card will not help you…”
“Samsung”, “Coca-Cola”, “Mercedes”, “Sony”, “Bentley”, MacDonald’s”, “Procter & Gamble” – these are brands that are trusted and that have a high reputation among consumers.
Nowadays people have less time and strength to choose what they need from the available variety of goods, so famous brands are uniform reference points in a growing mass of goods, services and an endless flow of advertisements. Branding is one of the methods of manipulating consumers. By means of it you can make your product and company different from other ones and get a maximal profit from potential clients. You can achieve that with mentioning your trade mark people would have certain associations that originate in their consciousness in connection with a company’s name, services, design or a product’s use value and other elements. This requires great efforts. A brand is made by means of complex work on the market. The main thing is to correctly choose the target audience, its wishes, to invent simple but convenient and available proposals that will be individual in character and a company will receive no less than 80% of profit out of the brand.
We should also know that investments in a brand require much time in order to get a desirable result. Branding is interesting for the companies that have long-term plans, a strategy of their development and certain ambitions.
Formation of a company as a brand largely depends on correct planning and holding of an advertising campaign. Indeed, in modern conditions and competitive environment, one cannot imagine an effective commercial activity without a well planned and organized advertising campaign. A company’s main task is to determine as correctly as possible how to bring its advertisement to consumers: in what form, by means of what media and within what budget limits. In foreign countries they attach much attention to marketing research in advertising activity, which is caused by high risks related to it. The psychological factor of the effect of advertising on consumers is also very important. In western countries holding of an advertising campaign is unimaginable without a psychologist’s participation. Therefore, an agency is sure to have its own psychologist that particularly specializes in advertising.
Proceeding from its significance, the advertising business is consolidating its positions on the world market to an increasing extent. In 2006 the advertising market grew by 4,9%, and the annual turnover made up 282 billion USD. Pursuant to the data of French institute BIPE, in 2007 the expenses incurred for advertising in the world reached the level of 295 billion USD and the market may grow by 4,8%. According to the explanation of foreign specialists, an insignificant decrease in the rate of the advertising market’s development in 2007 can be explained by the general economic processes taking place in the world. In their opinion, this year will be less favorable for advertising producers in comparison with 2006, since a rise in energy carriers prices and the interest rate on credits is expected along with a drop in demand on the US market. Added to this is an unprofitable exchange rate of the euro in relation to the dollar, as well as a restrictive political course being carried out in Italy and Germany.
Against the background of the processes taking place on the world market, it is interesting what trends are being formed on the Georgian advertising market, who are the main players, whether the market’s growth takes place and what problems arise in the process of its development.
Like in the whole world, advertising campaigns in Georgia are, as a rule, carried out by advertising agencies. Agencies implementing their advertising activities have existed in our country for 16-17 years. Now their total number amounts to 78. Most of them have small size and budget. It should be also mentioned that if abroad agencies are subdivided in accordance with specificity of a certain sphere, in our country the matter stands otherwise. Our companies have to work in rather difficult conditions. Proceeding from the fact that the market is a small one, they have to do everything themselves – be it planning of an advertising campaign, placement or care for the creative aspect. However, there are agencies that specialize only on planning and placement.
According to the director of “A-C Group” advertising agency – Mr. Zurab Iobashvili, “in foreign countries large-scale advertising campaigns are implemented by big organizations, holdings or transnational companies. That is not so in our country. The main reason for that is the fact the market is very small. An agency will not be able to exist only by means of placement or shooting of commercials, it will be very difficult for us. Therefore, an agency should be a multi-profile one in order to retain solid positions on the market.”
The market is small, but, according to the creative manager of “Media-Art” agency – Giorgi Chikviladze, the Georgian market is very good from the creative point of view. One always has an idea, but when it comes to its realization, there arises a problem related to shooting of a commercial. Whereas on the western market there is a dogma that a commercial should be shot on a film, it is often impossible in our country, since it is related to heavy expenses.
In implementation of advertising campaigns, advertising agencies apply such mass media as television, radio, press, street advertising and the Internet. If we take a look at the world advertising market, the largest share, from the viewpoint application, falls on television and press. For instance, in Spain, like in Italy and Russia, television occupies about 50% of the advertisement market, though it does not reach such heights as in Latin America, South-East Asia and Central European Countries. In he US, Japan and China less than 50% falls on television. There are countries in which the role of television is limited, but the press is sufficiently developed and diversified (Northern Europe, Germany, to a lesser extent – Great Britain and France).
As foreign experts point out, though television still has a leading position on the market, the “golden age” of television advertisement is coming to the end. Anyway, there is such situation in the developed countries. True, it will retain high television incomes, but its role will slacken under the influence of innovative, interactive communication means. Television’s hegemony will soon remain in the past and that is conditioned on unprecedented rates of growth of the Internet’s significance.
In many countries press holds the second place after television from the viewpoint of its importance. It should be stressed that in the US, Japan and China they are mainly oriented for magazines, and in France and Russia most part of advertisement falls on magazines. In Italy, Great Britain and Germany advertisement investments are evenly distributed to magazines and journals.
As for radio, it has a potential for considerable increasing of its audience, though here serious problems are made by high rates of the digital technology’s development.
The future of street advertising is a promising one, which is determined by the balance of two important factors: on the one hand, the fact is that mobility of people being outdoors contributes to growing of potential of the audience for this kind of communication and , at the same time, the quality of offers of international companies- operators of street advertising is rising; one the other hand, there is the risk that quality and volume of advertising constructions will be lowered for environmental protection purposes.
It should be stressed that in Georgia street advertising is also quite popular, though television accounts for 75-80% of advertising campaigns’ budgets. Currently there are several TV channels that have a rather high rating in the society. The development of advertising business is in direct relation with the media’s development indicators. It is interesting whether the quality of mass media’s rating is studied in Georgia or not. This kind of data is very important for agencies with the purpose of elaboration of a correct advertising strategy and planning of a campaign. From this point of view, one can welcome the fact that “AGB Nielsen Media Research” company has been working on the Georgian market since September 2004. It is an international organization that has representative offices in 45 countries of the world, including Georgia. It is a rather serious structure of delegation and monitoring that offers its services to TV companies and advertising campaigns. “AGB Nielsen” offered a special program “Arianna” to its consumers. These are television ratings, with the help of which the agencies will elaborate their advertising campaigns. “AGB Nielsen” carries out these studies using people meters. In Georgia they are installed in approximately 300 families and by means of them it is possible to monitor what TV programs or channels are watched by viewers more often.
However, according to the director of “Ad Corporation” company – Mrs. Maia Metreveli, “AGB Nielsen” is not the first on this market, since this kind of studies were held by IPM marketing research centre in 1999.
The following advertising companies use the services of “AGB Nielsen”: “A-C Group”, “Ad Corporation”, “Imperiali”, “Imedi-Contact”, “G.S.G”, “Sarke”, “Starcom MediaVest”, “TBS”, “TV”, “TV+”, “Universal McCann Georgia”.
The director of “AGB Nielsen” – Mrs. Manana Aborjanidze says: “We study television ratings, then present them to both television and agencies. On the basis of this data, advertising agencies make their media calculations. Correspondingly, the agencies that purchase this data are the leading companies in Georgia since they have this knowledge and technical base in order to use this program correctly and work in accordance with the European standards. In accordance with the ratings and on the basis of the corresponding software they correctly plan advertising campaigns and hold them at a rather high professional level. One cannot but mention the fact that the quality of advertising is gradually increasing. Several studios are carrying out interesting work in this direction. Of course, a lot still has to be done for the development, but a good local product will soon be available. Taking into account the mentioned factors, it can be said that the advertising market is developing somehow. In realty companies make more investments in advertising than a few years ago.”
A big part of Georgian advertising agencies have a positive attitude towards entering of “AGB Nielsen” into the market. According to the deputy director of “Imedi-Contact” agency – Eka Samadashvili, “AGB Nielsen” makes a very good product. It studies television ether with its GRP (evaluation of the TV rating in your segment) and this is done by means of people meters. We process this data. The development of advertising business is significantly related to holding of the mentioned studies. Our main advantage is media planning. We are not occupied with advertisement production, but only take care of its placement. We implement appraisal, monitoring, post-monitoring, plan the budget, study the companies that are competitors for a brand. Studies of “AGB Nielsen” help us in this matter. Of course, the fact that metering of all this takes place in Georgia is very important. In many developing countries, e.g. in Ukraine, companies do not have this kind of opportunity.
It is impossible to hold a correct campaign without effective planning, and it will be very difficult for the agencies that do not carry out the mentioned studies to retain their positions on the market. Carrying out of marketing research is also important for the companies that are our customers. When a client comes to us we, first of all, find out whether any research was carried out or not before entering the market. I should stress that it is easier to work with foreigners since they already know about the importance of marketing research. However, Georgians have also realized that it is necessary and about 90% already carry out this kind of research, which, in its turn, has largely contributed to the growth of the market. Last year it grew by about 80% in comparison with 2005.”
Advertising business in Georgia is taking steps towards the international standards, which is confirmed by the fact that in the near future advertising agencies will switch to buying television time in accordance with more modern methods. In future they will buy not time, but 1 point of the rating. According to Mr. Zurab Iobashvili, for the time being agencies purchase television time at fixed prices. As for 1 point of the rating, it is a percent of the rating a particular TV channel or program, and it is calculated resting upon the target audience. Different programs have different ratings proceeding from the fact what target audience they are intended for. Currently, purchasing of time takes place in accordance with the cost of a minute or half a minute, though this cost does not exactly reflect the rating of a program. However, there is a more civilized method of appraisal. The cost of 1 rating point or 1 spot (SPP) is accepted in Europe as a reference point, and the lower is this cost of a program or advertising campaign cost the higher rating the program and the agency have. Any customer of advertisement, especially television, should be interested in offering as lower SPP to a customer as possible, i.e. to achieve a certain result at the lowest possible price. For instance, the cost of 1 minute in “Droeba” makes up 1550 USD and here it is more preferable for us than one issue of a spot, let us issue the same spot in the daily chronicle even 5-6 times and this way reach the same rating as “Droeba” has at a lower price. Before the beginning of the daily chronicle the cost of 1 minute makes up 140%. Prices of one minute are much higher at “Rustavi 2”, but currently its programs have a higher rating than those of “Imedi”, though the difference is not very big. The difference in prices is bigger than in ratings. There are other TV channels that have rather high prices, but the rating of their programs is very low. Placing of commercials in such programs is not profitable and the amount of advertisements on these channels is minimal. For the time being we purchase minutes or more often even half a minute on TV, shoot a commercial, the duration of which is different at different time. We place it in some program several times, then find out the price of 1 minute and multiply it by the cost of the minutes’ total. However, purchasing of the total time in accordance with ratings is a more progressive method, i.e. a certain rating will be conferred to the program and the advertisement’s customer purchases the total rating. For instance, a customer requires that television should collect 500 GRP, i.e. the total rating of 500 for him during a month. Here the priority is given to the collectable rating. The customer is already not interested in what program and with what number of goings on the advertising air you will achieve this result. At this stage the main thing for the customer is to collect 500 GRP at the lowest possible price. According to Mrs. Nana Aborjanidze, the market is already ready to take this step.
True, “Ariana” program has already been inculcated in Georgia, but, according to the director of “TV+” – Mr. Giorgi Sulakauri, “most of the companies do not know how to use this program correctly. It should be pointed out that Ariana has is shortcomings as well, since it is intended for the people having European mentality. Georgians have a specific way of thinning. It is necessary to take the nation’s culture into account in any situation. For instance, at the weekend Europeans or Russians watch political talk shows and cognitive programs on TV and they have a rather high rating. In Georgia this does not work and never will for one reason – at this time Georgians visit their friends or are in the country. It is not interesting for them to stay at home, watch a talk show and analytically interpret it. Therefore, information should be presented to Georgians in a somewhat different way. Here one must resort to psychology. But, unfortunately, the advertising psychology is not so developed in our country as abroad.”
The role of psychology in making of advertisements is really big. However, our agencies seldom use psychologists’ recommendations in advertising and their commercials are the evidence of that. According to psychologist Nana Chachua, “advertisement is an artificially made object or an artifact that has an effect on the integrity of a person’s mentality and activation of his unconscious condition. It is clear that peculiarities of human mentality should be taken into account in the process of creation of advertisements, especially unconscious psychological ones along with their archetype images that, together with associations, represent an integral of unconsciousness and that can appear in people regardless of their education and consciousness.
Ethnic character, which is formed depending on geographical environment and historical processes, can be considered as a special style of adaptation of a semblance. It is clear that formation of the Georgian psychotype was also determined by the aspect of paucity, and from the very beginning experience imparted it a great ability to be flexible and sturdy. High sensibility, deep emotional experience of events, poetry, impulse of enjoyment – that is what, by which a Georgian speaks to the outside world and himself. Therefore his perception channels, i.e. “perception threshold”, and representation systems are more represented by the kinesthetic channel than by the visual or the audio one. Kinesthetic is what we feel, inhale and taste.
The Georgian advertising space more needs an advertisement based on kinesthetic modality, but, proceeding from its commercial character, it must reach each person, so an advertisement has to be made up so that its visual, audio and kinesthetic components should be equally represented, though it still has to end with the kinesthetic one. From this point of view, well made is the advertisement of “Coca-Cola”, in which the feeling of pleasure (kinesthetic) experienced from its drinking is shown (visual) to the accompaniment of music (voices) and with abundance of red color. A person notices and picks out from the environment something that he needs. An advertisement made with consideration of psychological factors is sure to reach the audience it is intended for, so creators of advertisements should take particular care of ecology, i.e. an advertisement should not harm anybody or anything. Prudence is indispensable in relation to human psychology.
A certain preparedness for advertising includes cultural, economic, social and political sentiments. An advertisement that directly shows a person his negative sides and presents him in a bad light will not be able to achieve a positive goal. Unfortunately, the Georgian advertising space is infested with this kind of advertisements.”
As it was mentioned above, the development of the advertising market largely depends on the development of independent mass media. Georgian advertising agencies plan an advertising campaign proceeding from specificity of an advertisement object and apply a combination of almost all existing means for placing of advertisements. However, it should be pointed out that 58-65% of advertising budgets falls on television, 15% – on street advertising, 10% – on radio and the remaining part – on the press. Here advertisements are mainly represented in the form of articles. Proceeding from the fact that television covers quite broad masses of population, it has the highest percent indicators from the viewpoint of advertisement placement. According to Mrs. Manana Aborjanidze, in 2006 the television market was valued at 13,5 million USD, and in 2007 its growth by 3-4% is expected. For the time being, about 9 companies work in the Georgian media space. Some of them offer television programs of quite a high quality to viewers and have high ratings. The leading TV channels already purchase the projects the budgets of which exceed a million and a half GEL. In 2006 the main part of advertising budgets was distributed to “Imedi” and “Rustavi 2” TV channels. A very small part falls on other channels. It is also noteworthy that the television ether is filled by multinational companies. Georgian companies are represented on the television market to a lesser extent because of their small number, the factor of a certain fear existing in them or for some other reason.
Thanks to increasing of significance of an advertising campaign in business circles and concurrently with the development of the television channels, a system, by means of which the relations between advertisement and television companies has acquired a more civilized form, has been formed in Georgia. As early as in 2004 “Media House” company and from 2005 – “Video International” entered the Georgian market and they have exclusive rights to selling of TV channels’ advertising time to advertising agencies.
Irakli Chikovani, the director of “Media House” company: we sell advertising time of “Rustavi 2”, “Mze” and “I Stereo”. Besides, we implement “product placement” of these channels and place advertisements on the web site of “Rustavi 2”. Till then television used to sell its advertising time itself. There was no formed system of selling, which did not have a positive effect on the market. In 2004 we established a firm that started to sell time. This practice is accepted all over the world. Television itself does not sell time, there are special organizations that take care of it. The mentioned service has had a serious effect from the viewpoint of general market growth. Besides, the relations between television companies and agencies have been put in good order. Civilized rules, which are more or less observed by all agencies, have been formed.
In 2005 Russian company “Video International”, a seller that its representative offices in Belarus and Ukraine, entered this market. Our and their principles of work are the same, but, unlike them, we sell advertising time of 3 TV channels from 2007. They sell time only of “Imedi” channel. I believe that it is good for a media seller that you sell time of three television channels, though it is better for customer organizations from the viewpoint of planning. Our services are more attractive for them since there is an alternative and they can place advertisements at a comparatively low price.
It is also important that we offer the same service terms regardless of the size of an agency. Then it depends on its skill how correctly it will plan the advertisement campaign of a company.
Along with the mentioned factors, the development of competition in different spheres of business contributes to the growth of the advertising market. Competitions has become keener in such spheres as mobile communication, finances, construction and pharmacy. They know the significance of advertising very well. The main part of television time is filled by the companies working in the mentioned spheres. For the time being, they are rather strong and successful organizations having big budgets and a correct strategy. In 2002-2003 all this was in its infancy, but in the past three years this sphere has been developing at rather high rates, especially from the viewpoint of advertising. There was a serious growth in 2005 and particularly in 2006.”
Right after television, street advertising has serious positions from the viewpoint of application on the market. Georgian companies are applying it rather actively. The role of radio in the advertising sphere is increasing as well. As for the press, for the time being it accounts for the smallest share of advertising budgets. So far, the Internet is not very popular in Georgia either.
True, the market is developing somehow, though at low rates. However, one of the most important problems in the advertising business remains unsolved. There is no intensive work on training of qualified staff in this sphere. Mrs. Maia Metreveli says: “Advertising agencies really face this problem. In spite of the fact that in Georgia there are several rather prestigious educational establishments that give students a certain education in this sphere, we still have no opportunity of employing trained cadres. As it can be seen, that is not enough and we shall have to train our staff ourselves.”
Probably, the state should also have a special role in training of cadres and development of advertising business in general, though it should be emphasized that advertising agencies do not feel a particular support of the state, and it has no serious problems with them. Representatives of the agencies believe that the legislative base should be perfected, the cases of breach of the law are also frequent. In this situation the controlling bodies are not up to the mark. Unfortunately, introduction of any serious amendments to the law is not planned in the near future.
The interests of consumers are really violated. No one denies the role of advertising and its significance, but very often we hear and see such commercials in the media that can not be considered otherwise than cheating of people. Advertisement creators of often maliciously apply the ability of advertisements’ psychological effect for selling low-quality products and palm off absolutely useless goods that can have a negative effect on both people’s health and their budget. Probably, everyone remembers very well what advertisement was made for Zeikidze’s cooked meats, but later on it turned out that production process took place in absolutely inconceivable conditions. In spite of it, these products enjoyed wide popularity with consumers and that is just a merit of the advertisement, the purpose of which was deception of customers. True, later on it became clear what quality this produce had and its positions on the market slackened considerably, but it is necessary to enable protection mechanisms so that gross violations of consumers’ rights and interests should not take place in future. For instance, let us take the advertisement of “Apkinpros”, according to which we can get rid of superfluous fat in just three weeks. It is just a barefaced lie…
Unfortunately, even a widely advertised “Fastum Gel” does not have an anesthetic effect!!!
Everybody know it well that “Coca-Cola” contains ingredients that are hazardous for human health, but it is the leader among tonics, it is a brand. And it has achieved that by means of effective advertising…
According to the director of “Sarke Consulting” advertising company – Mr. Rezo Charkviani, “advertising is a method of handing over information to consumers in an embellished form. I would not agree with the idea that advertising is a lie. Now everybody avoids telling lies. Just embellishment of information takes place. In foreign countries it is inadmissible to tell a lie in advertisements since heavy fines can be imposed in case it is revealed, so they do not need one-time lies. Elements of lie were observed in Georgia in the past years, since there were not protection elements, but now the companies are more correct and it will be more proper to say that they tell an embellished truth or do not tell the whole truth in advertisements. If it were not so, it would sound in “Coca-Cola’s” advertisements that its products contain a small quantity of chemical substances as well, but that has not happened.”
It is a crime to tell a lie, but is not it a bigger crime when you conceal the truth?