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Advertising Theories 101

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Scarcity Principle

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The concept that limited supply or time limit increases the value of an item. Advertisers use this principle by creating ads that stress the scarcity of a product to incite faster decision-making and purchase.

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The Decoy Effect

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A phenomenon where consumers will tend to have a specific change in preference between two options when presented with a third option that is asymmetrically dominated. Advertisers use this effect to nudge consumers towards choosing a more expensive or higher-margin item.

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Elaboration Likelihood Model (ELM)

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A theory that identifies two routes to persuasion: the central route, involving careful and thoughtful consideration of the true merits of the information presented, and the peripheral route, involving cues outside the message itself, such as the source's credibility or attractiveness. The model's significance in advertising revolves around designing messages that align with the intended persuasive route.

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Brand Equity

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The value of a brand is determined by consumer perception of and experiences with the brand. Strong brand equity can lead to consumer loyalty and willingness to pay higher prices and is often a focus in advertising campaigns.

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Framing Theory

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This theory explores how the presentation or 'framing' of a message can influence the receiver's perception and interpretation. Significantly, advertisers use framing to shape consumers' perception of products, services, or concepts in a positive way.

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AIDA Model

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Stands for Attention, Interest, Desire, Action. The AIDA Model is a hierarchy-of-effects model that defines the stages of consumer engagement, from gaining initial awareness to the ultimate action of purchase. Its significance lies in its application in structuring advertising content to guide consumers through these stages.

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Fear Appeal

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A persuasive message that attempts to arouse the emotion of fear in order to divert behavior through the threat of harm. Its significance in advertising is that fear-based appeals must be designed carefully to avoid backfiring and causing consumers to reject the message.

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Cultivation Theory

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Suggests that long-term exposure to media content can shape an individual's perceptions of reality. In advertising, this theory can explain how repeated ad exposure can affect consumers' product and brand perceptions.

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Social Proof

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The idea that people will adopt beliefs or take actions based on the belief that others are doing the same. In advertising, social proof can be used through testimonials, influencer endorsements, or showing popularity to sway potential customers.

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Attribution Theory

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This theory explains how individuals interpret events and how this relates to their thinking and behavior. Advertisers apply attribution theory to influence consumers’ perception of the causes of product benefits or failures.

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Unique Selling Proposition (USP)

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A marketing concept that emphasizes the unique aspects of a product or service that differentiates it from competitors. In advertising, the USP is often a key message that is highlighted to persuade consumers by pointing out a singular benefit.

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Foot-in-the-door Technique

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This is a compliance tactic that involves getting a person to agree to a large request by first setting them up to agree to a modest request. The significance in advertising is that it allows for gradual commitment leading up to larger purchases.

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The Rule of Thirds

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A principle which states that designing an image by dividing it into nine equal parts with two equally spaced horizontal lines and two equally spaced vertical lines can enhance its visual composition. In advertising, this can be used to create more engaging and aesthetically pleasing imagery.

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Maslow's Hierarchy of Needs

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A motivational theory with a five-tier model of human needs, arranged hierarchically. Advertisers use this model to tailor messages that appeal to specific needs of a target audience, such as safety, love, or self-esteem.

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Reciprocity Principle

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Part of the social psychology of influence, where people tend to feel obligated to return favors. Advertisers leverage this by offering something of value for 'free' with the hope of encouraging future purchases.

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