8/9/2019 KOTL19

1/8

Managing Advertising,Sales Promotions and Public Relations

In this chapter, we will address the following

questions:

What steps are involved in developing an

advertising program?

What explains the growing use of sales promotion,

and how are sales-promotion decisions made?

How can companies exploit the marketing potential

of public relations and publicity?

19Chapter

Kotler

Woman trying on a dress (or getting on an elevator),

takes a drink of water. Another woman puts on thedress (or gets on the elevator) in front of the woman,but must take it off again (or get off of the elevator)because she does not fit.

These ads converted Bonafont into a very successfulbottled water company.

Woman trying on a dress (or getting on an elevator),Woman trying on a dress (or getting on an elevator),

takes a drink of water. Another woman puts on thetakes a drink of water. Another woman puts on thedress (or gets on the elevator) in front of the woman,dress (or gets on the elevator) in front of the woman,but must take it off again (or get off of the elevator)but must take it off again (or get off of the elevator)because she does not fit.because she does not fit.

These ads converted Bonafont into a very successfulThese ads converted Bonafont into a very successfulbottled water company.bottled water company.

Bonafont

8/9/2019 KOTL19

2/8

Advertising as a Percent of Sales in

the U.S. (Selected Industries)Advertising as aAdvertising as a

IndustryIndustry percent of salespercent of sales

Candy 17.4

Watches and Clocks 15.9

Games and Toys 13.1

Books 10.7

Perfumes and Cosmetics 8.5

Apparel 5.8

Farm Machinery 1.0

Construction Machinery & Equipment 0.3Source: 1997 Advertising to Sales Ratios for the 200 Largest Ad Spending Industries,

Advertising Age, June 30, 1997. P. 35.

Determine ObjectivesDetermine Objectives

DecideBudgetDecideBudget

Decide

Message

Decide

Message

Evaluation of CampaignEvaluation of Campaign

Decide

Media Allocation

Decide

Media Allocation

Principle decisions in advertising

8/9/2019 KOTL19

3/8

Informative advertisingCreate primary demand and

awareness

Informative advertisingCreate primary demand and

awareness

Persuasive advertisingCreate selective demand

Persuasive advertisingCreate selective demand

Objectives of Advertising:The task of communicating a specific message

To a specific target public

During a specific period

Reminder advertisingMaintain the product in the mind

of the consumer

Reminder advertisingMaintain the product in the mind

of the consumer

Determine objectives

Stage in

product life cycle

Stage inproduct life cycle

CompetitionCompetition

Market shareMarket shareAdvertising

frequency

Advertising

frequency

Product substitutabilityProduct substitutability

Factors thatdetermine the

advertisingbudget

Methods for determining the advertising budget:

Ability to finance, percent of sales, competitive parityand task-objectives

Determine the budget

8/9/2019 KOTL19

4/8

Advertising message

Social responsibility review:Do not overstep social or legal norms

Social responsibility review:Do not overstep social or legal norms

Message execution:

Rational positioning vs. Emotional positioning;Creative, Memorable, Attention-getting

Message execution:

Rational positioning vs. Emotional positioning;Creative, Memorable, Attention-getting

Content evaluation and selection:1) Interest; 2) Distinctiveness; Believability

Content evaluation and selection:1) Interest; 2) Distinctiveness; Believability

Message creation:Concentrate on the benefits to the customer

Message creation:Concentrate on the benefits to the customer

Examples from Mexico

Identify the message in the following ads. Do these messages

concentrate on the benefits to the customer? Do the ads

meet the three desired characteristics in message content:

i) interest; ii) distinctiveness; iii) believability.

1) Hair color product: woman at side of road cannot get a

ride, so she lets down her hair, and a car stops

2) Axe ad: Man w/ 2 women; mosquito; frog; old man; worm

3) Liverpool ads: Woman walking with Liverpool shopping

bag. Other women are so impressed they spill things.

Contrast this with Palacio de Hierro ads.

8/9/2019 KOTL19

5/8

Step 1. Decide reach, frequency and impactStep 1. Decide reach, frequency and impact

Step 2. Choose media and vehiclesMedia that the target customer are used to seeing

Nature of productType of message

Costs

Step 2. Choose media and vehiclesMedia that the target customer are used to seeing

Nature of productType of message

Costs

Step 3. Choose timingShow advertisement in periods of high demand

Pattern: continuous, concentrated, intermittent

Step 3. Choose timingShow advertisement in periods of high demand

Pattern: continuous, concentrated, intermittent

Step 4. Geographic allocationMarket size

Advertising responseMedia efficiency

Competition

Step 4. Geographic allocationMarket size

Advertising responseMedia efficiency

Competition

Media selection

Typesof

Media

Typesof

Media

InternetInternet

NewspapersNewspapers

MagazinesMagazines

TelevisionTelevision

Yellow pagesYellow pages RadioRadio

Outdoor mediaOutdoor media

Media Selection Involves Assessing

8/9/2019 KOTL19

6/8

Effect of communicationIs the advertisement communicating effectively?

Effect of communicationIs the advertisement communicating effectively?

Share ofmarket

Share ofmarket

Effect on salesIs the advertisement increasing sales?

Effect on salesIs the advertisement increasing sales?

Evaluating the advertisement campaign

Share ofheart and

mind

Share ofheart and

mind

Share ofVoice

Share ofVoice

AdvertisingExpenditures

AdvertisingExpenditures

Sales Promotion

Sales promotions are demand-stimulating

programs, mostly short-term, designed to

stimulate trial or quicker or greater purchase. Sales promotions have increased because:

Product managers are under greater pressure to

increase current sales.

There is increased competition.

The efficiency of advertising has decreased.

Consumers are more price-oriented.

Increased power of retailers relative to producers.

8/9/2019 KOTL19

7/8

Point of purchase (POP) displaysPoint of purchase (POP) displays

WarrantiesWarrantiesPrice packsPrice packs

Cash refundsCash refunds

CouponsCoupons

Short term incentives for increasing salesof a good or service.

Objectives of consumerpromotion

Promotion tools forconsumers

Money-backGuarantees

Money-backGuarantees

Free trials and

samples

Free trials and

samplesEncourage customers to

try new products

Encourage customers totry new products

Attract competitionscustomers

Attract competitionscustomers

Attract people whootherwise would not buy

Attract people whootherwise would not buy

Retain and rewardloyal customers

Retain and rewardloyal customers

Consumer Promotional Tools

Loyalty awardsLoyalty awards

Prizes and

Premiums (gift)

Prizes and

Premiums (gift)

Free goodsFree goods

Repurchase guaranteesRepurchase guarantees

Price discountsPrice discounts

Short term incentives directed atretailers and wholesalers.

Objectives of tradepromotion

Tools for tradepromotion

Allowances for

advertising or displays

Allowances for

advertising or displays

Convince retailers andwholesalers to carry a brand

Convince retailers andwholesalers to carry a brand

Provide good shelf spacefor a brand

Provide good shelf spacefor a brand

Induce retailers to providedisplays and price reductions

Induce retailers to providedisplays and price reductions

Stimulate retailers to pushthe brand to consumers

Stimulate retailers to pushthe brand to consumers

Trade Promotional Tools

8/9/2019 KOTL19

8/8

Short term incentives directed at industrialcustomers and your sales force.

Objectives of business andsales force promotion

Tools for business andsales force promotion

Stimulate salesStimulate sales

Reward businesscustomers

Reward businesscustomers

Motivate sales forceto greater effort

Motivate sales forceto greater effort

Trade shows andconventions

Trade shows andconventions

Sales contestsSales contests

Specialty advertising(free gifts)

Specialty advertising(free gifts)

Business- and Sales-Force

Promotional Tools

Public relations strives to:

promote or protect a companys image or individual

products. Its principle tools are:

News: Present news and information about the

organization in the most positive light. Publications: To reach and influence target markets.

Events: Uses news conferences, seminars, etc. to increase

awareness of new products or activities.

Public Service Activities: Create a positive company

image in the community.

Lobbying: Deal with legislators and government officials

to promote or defeat legislation and regulation.