Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public...

Managing Mass Communications:

Advertising, Sales Promotions,

Events and Experiences, and Public Relations

Marketing Management, 13th ed

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Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 18-2

Chapter Questions

• What steps are involved in developing an advertising program?

• How should sales promotion decisions be made?

• What are the guidelines for effective brand-building events and experiences?

• How can companies exploit the potential of public relations and publicity?


What is Advertising?

Advertising is any paid form of nonpersonal presentation and

promotion of ideas, goods, or services by an identified sponsor.


The Five M’s of Advertising

• Mission—setting goals and advertising objectives

• Money—contingent upon stage in PLC, market share, consumer base, competitions, advertising frequency, product substitutability.

• Message—generation, evaluation, selection, execution, social-responsibility.

• Media—reach, frequency, impact, types, vehicles, timing, geographic scope

• Measurement—communication impact, sales impact


Advertising Objectives

• Informative—to create brand awareness and knowledge of new products or new features of existing products

• Persuasive—to create liking preference, conviction, and purchase of a product or service.

• Reminder—to stimulate repeat purchase of products and services

• Reinforcement—to convince current purchasers that they made the right choice.


Factors to Consider in Setting an Advertising Budget

• Stage in the product life cycle—new products (large advertising budgets to build awareness and to gain

consumer trial)

—established brands (lower advertising budgets, measured as a ratio to sales)

• Market share and consumer base—high-market-share brands (less advertising expenditure as a percentage of

sales to maintain share)

—build share by increasing market size (requires larger expenditures)

• Competition and clutter—market with a large number of competitors and high advertising spending

(brand must advertise more heavily to be heard).

• Advertising frequency—number of repetitions needed to put across the brand’s message to

consumers impacts advertising budget

• Product substitutability—brands in less-well-differentiated or commodity-like product class (beer, soft

drinks, banks, and airlines) require heavy advertising to establish a differential image.


Developing the Advertising Campaign

• Message generation and evaluation—what the ad attempts to convey about the

brand

• Creative development and execution—how the ad expresses the brand claims

• Legal and social issues

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PURPOSE OF ADVERTISING

• IN ORDER TO STATE THE PURPOSE:• MUST DECIDE THE PRECISE ACTION WE

WANT THE TARGET AUDIENCE TO TAKE AFTER WATCHING, READING, OR LISTENING TO THE AD

• PURPOSE IS: • TO PERSUADE SOMEONE TO DO

SOMETHING

• MUST DECIDE• WHO

• WHAT TO DO

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PURPOSE OF ADVERTISING--CONTINUED

• ADVERTISING IS THE CAUSE

• BEHAVIOR IS THE EFFECT• BUY, USE, WRITE, CALL, VISIT DEALER, ORDER BY

PHONE

• COMPLETE STATEMENT INCLUDE BUSINESS SOURCE

• KEY TO MARKETING DEFINITION IS SUBSTITUTABILITY

• WHICH PRODUCTS MIGHT THE BRAND BE INTERCHANGEABLE

• SET OF PRODUCTS MIGHT BE SMALLER OR LARGER THAN THE SET OF PRODUCTS BY WHICH THE CATEGORY IS TRADITIONALLY DEFINED

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BARRIER THEORY

• CAN ANY OF THE PROMOTIONAL ELEMENTS OVERCOME THESE BARRIERS IN THE CONSUMER DECISION PROCESS?• AWARENESS• ACCEPTANCE• PREFERENCE• SEARCH• SELECTION• USE• SATISFACTION

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EXAMPLES OF PURPOSE OF ADVERTISING

• PURPOSE OF ADVERTISING IS TO PERSUADE THE AUDIENCE:• TO BUY RUFFLES INSTEAD OF OTHER

BRANDS OF POTATO CHIPS• TO USE BISQUICK INSTEAD OF PANCAKE MIX• TO PERSUADE MEMBERS OF THE TARGET

AUDIENCE TO COME INTO THE SHOWROOM FOR A TEST DRIVE TO THE AUDI 80/90, RATHER THAN OTHER HIGH-LINE SPORTS SEDANS

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TARGET

• THE GROUP OF PEOPLE WHO ARE THE BEST PROSPECTS FOR THE ADVERTISER’S BRAND

• TO WHOM THE ADVERTISING WILL BE ADDRESSED

• NEED A PERSON TO WRITE TO:• BUSINESS TRAVELLERS WHO ARE LIKELY TO

STAY AT MID-PRICED HOTELS• HEAVY USERS OF CHARCOAL• YOUNG WOMEN WHO HAVE ACNE PROBLEMS• PEOPLE IN THE MARKET FOR AN EXPENSIVE

SPORTY EUROPEAN CAR

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NEED TO KNOW DEMOGRAPHIC AND PSYCHOGRAPHIC PROFILE

• BUSINESS TRAVELLERS WHO ARE LIKELY TO STAY AT A MID-PRICE HOTEL, $45,000 TO $75,000 ANNUAL INCOME. EIGHTY PERCENT ARE MALES. THEY CHOOSE MID-PRICE ACCOMMODATIONS BECAUSE THEY ARE PAYING THEIR OWN WAY, OR BECAUSE THEIR EXPENSE ACCOUNTS ARE LIMITED. THEY WANT BASIC, CLEAN ACCOMMODATIONS WITH A MINIMUM OF HASSLE. THEY ARE FREQUENTLY TIRED, USUALLY INPATIENT, AND ALWAYS CRITICAL. SMALL LUXURIES, SPECIAL RESPECT AND ATTENTION ARE IMPORTANT TO THEM

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NEED TO KNOW DEMOGRAPHIC AND PSYCHOGRAPHIC PROFILE--CONTINUED

• HEAVY USERS OF CHARCOAL, FATHERS BETWEEN 25 AND 49. MOST OF THEM LIVE IN THE SUBURBS OR SEMIRURAL AREAS. THEY GET A BIG KICK OUT OF BARBECUING FOR FAMILY AND FRIENDS. THEY WANT THE MEAT TO TURN OUT JUST RIGHT

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EXAMPLE OF PURPOSE AND TARGET

• PURPOSE• TO PERSUADE FREQUENT NEW YORK TO WASHINGTON, DC

TRAVELLERS TO TAKE AMTRACK INSTEAD OF A PLANE

• TARGET• FREQUENT NEW YORK TO WASHINGTON TRAVELLERS ARE

LIKELY TO BE WELL-EDUCATED, WHITE-COLLAR PROFESSIONALS CONDUCTING A DAY’S BUSINESS IN EITHER CITY. THE NEARLY 10,000 PEOPLE WHO FLY DAILY BETWEEN NEW YORK AND WASHINGTON HAVE GROWN ACCUSTOMED TO NO-FRILLS SERVICE, CROWDED SEATING AND “CATTLE CAR” CONDITIONS. THEIR TIME IS AT A PREMIUM AND, DESPITE AIRPORT DELAYS AND TRAVEL TIME TO AND FROM AIRPORTS, THEY BELIEVE PLANES PROVIDE THE SHORTEST TRIP POSSIBLE. SIXTY TO SEVENTY PERCENT ARE MALES

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PROMISE

• BENEFIT OR REWARD FOR BUYING OR USING THE ADVERTISED BRAND

• WHEN I_________. I WILL__________.• THE “I” IN THIS SENTENCE IS THE TARGET

AUDIENCE• THE 1ST BLANK REPRESENTS THE PURPOSE OF

THE ADVERTISING• THE 2ND BLANK REPRESENTS THE BENEFIT• NUMBER OF PROMISES

• SINGLE MINDED OR ONE IN MOST CASES• COMBINATION, RATHER THAN ONE BENEFIT, IF IT DEFINES THE

ESSENTIAL NATURE OF THE BRAND (WEIGHT WATCHERS’ ENTREES--REDUCED CALORIES AND GOOD TASTE).

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PROMISE IS THE HEART OF THE STRATEGY

• THE BENEFIT IS IN THE MIND OF THE CONSUMER, NOT IN THE PRODUCT. PRODUCTS HAVE ATTRIBUTES, NOT BENEFITS

• THE BENEFIT IS A FUTURE EXPERIENCE. IT IS AN (SUBJECTIVE) EXPERIENCE PROMISED TO THE CONSUMER BY THE ADVERTISER AS A REWARD FOR BUYING OR USING THE ADVERTISED BRAND

• THE BENEFIT IS A CONCLUSION, TO BE DRAWN BY THE CONSUMER FROM THE CAMPAIGN AS A WHOLE. THE PROMISE IS NOT A COPY LINE. THE WORDS USED IN THE STRATEGY MAY OR MAY NOT EVER APPEAR IN THE ADVERTISING ITSELF

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EXAMPLES OF PURPOSE AND BENEFIT

• WHEN I TAKE AMTRACK INSTEAD OF THE PLANE FROM NEW YORK TO WASHINGTON, DC (PURPOSE). I WILL BE MORE COMFORTABLE, BETTER TREATED, AND MORE VALUED (BENEFIT)

• WHEN I BUY INSURANCE FROM STATE FARM INSTEAD OF FROM SOME OTHER INSURANCE COMPANY (PURPOSE). I WILL KNOW THAT A FRIENDLY STATE FARM AGENT WILL BE AT MY SIDE IF I NEED HELP (BENEFIT)

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EXAMPLE OF BENEFITS

• PRACTICAL• REWARDS WHICH COME FROM SAVINGS TIME

OR MONEY, OR EXPERIENCING GOOD HEALTH• SENSORY

• INTERESTING TEXTURE OR DELICIOUS TASTE• SOCIAL

• APPROVAL FROM FAMILY OR PEERS• EGO-SATISFACTION

• PRIDE IN BEING A GOOD MOTHER, OR FEELING OF ACCOMPLISHMENT FROM HAVING COMPLETED A DEMANDING JOB

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WHEN BENEFITS OCCUR

• WHILE THE PRODUCT IS BEING USED

• AFTER THE PRODUCT HAS BEEN USED

• AS AN INCIDENTAL BY-PRODUCT OF THE PRODUCT’S MAIN EFFECT

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BENEFIT MATRIX--POTENTIAL BENEFITS OF REAL CHEESE

POTENTIALLY REWARDING EXPERIENCES

PRACTICAL SENSORY SOCIAL EGO-SATISFACTION

IN-USE EXPERIENCE

CONVENIENCE; KIDS CAN HELP THEMSELVES

NEW TASTE FOR ROUTINE FOODS

FAMILY WILL BE GRATEFUL

I AM A GOOD MOTHER

RESULTS-OF-USE EXPERIENCE

STRONG BONES FEEL BETTER OTHERS THINK I LOOK GOOD

I AM TAKING GOOD CARE OF MYSELF

INCIDENTIAL-TO-USE EXPERIENCE

LOW-COST NUTRITION

NO MESS ADDS VARIETY TO PARTY REFRESHMENTS

I AM A GOOD COOK

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SUPPORT

• LENDS CREDIBILITY TO THE ADVERTISER’S PROMISE

• SUPPORT REFERS TO EVERYTHING IN THE ADVERTISING THAT LENDS CREDIBILITY TO THE ADVERTISER’S PROMISE

• TWO TYPES OF SUPPORT• INTERNAL AND EXTERNAL

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INTERNAL SUPPORT

• PRODUCT OR INTELLECTUAL FACTS • WHEN I TAKE AMTRACK INSTEAD OF THE PLANE

FROM NEW YORK TO WASHINGTON (PURPOSE). I WILL BE MORE COMFORTABLE, BETTER TREATED, AND MORE VALUED (BENEFIT) BECAUSE AMTRACK PROVIDES WIDER SEATS, MORE LEG ROOM, BETTER SERVICE, AND FREEDOM TO MOVE AROUND (SUPPORT)

• DEMONSTRATIONS (SHOW BRAND AT WORK)• LITERAL--SUFFER EXPERIENCE RELIEF ON SCREEN• DRAMATIC--PART OF A PLAY--BUD LIGHT

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EXTERNAL SUPPORT

• SUPPORT FOR THE PURPOSE OR THE PROMISE OF THE ADVERTISING CAMPAIGN THROUGH THE USE OF:• SALES PROMOTION• PUBLIC RELATIONS PROGRAMS• ADVERTISING INTENDED TO ELICIT

DIRECT RESPONSE

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PROMISE VS SUPPPORT

• THE PROMISE IS THE MEANING TO BE DRAWN FROM THE AD.• PROMISE TO THE END

• THE SUPPORT IS THE MEANS BY WHICH THAT PROMISE IS CONVEYED.• SUPPORT IS THE MEANS

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WHERE TO LOOK FOR SUPPORT

• BACKGROUND MUST COME FROM CONSUMERS• PRODUCT TESTING• CONSUMER SURVEYS• USER THEMSELVES (i.e., WRITER OF

AD)• MUST BE RELEVANT TO TARGET• MUST OPERATE IN A COMPETITIVE

WORLD

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ROI

• RELEVANCE• MESSAGE MUST BE RELEVANT--TO PRODUCT, TARGET, AND

SPECIFIC BEHAVIOR ADVERTISER INTENDED TO PROMOTE

• ATTRIBUTE IS NOT SUPPORT FOR PROMISE UNTIL CUSTOMER UNDERSTANDS HOW ATTRIBUTE MAKES BRAND A BETTER SATISFIER OF NEEDS

• ORIGINALITY• NEEDS TO BE ORIGINAL TO ATTRACT ATTENTION--BREAK THE

PATTERN

• IMPACT• ABILITY TO BREAK THROUGH INDIFFERENCE AND FOCUS

ATTENTION UPON MESSAGE THE ADVERTISEMENT IS INTENDED TO CONVEY

• INTRUSIVENESS--TWO SOURCES: MEDIA AND STRUCTURE OF ADVERTISING MESSAGE--ELEMENT OF SURPRISE

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LEGS

• IMPACT OF AN INDIVIDUAL ADVERTISEMENT OR LONG-TERM CAMPAIGN

• IDEA MAY YIELD EFFECTIVE VARIATION--LONG WAY• JOE GREEN COMMERCIAL

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BRAND PERSONALITY

• DEFINTION• CONSISTENCY OF TRAITS (DRESS, SPEECH, LOOKS,

HABITS, TRAITS THAT GO TOGETHER IN A MORE-OR-LESS COHERENT WAY) AND PREDICTABILITY

(CONSISTENCY OVER TIME)• BRAND

• SET OF ENDURING CONSUMER PERCEPTIONS WHICH FORMS A BASIS FOR EXPECTATION OF BRAND BENEFITS

• INTERNALLY CONSISTENT, TRAITS MUST FIT TOGETHER, PACKAGE, PRICE, LOOK, SOUND, SMELL, SIZE, NAME, COLOR, SHAPE--MUST HAVE A SINGLE THEME

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BRAND PERSONALITY--CONTINUED

• BRAND PERSONALITY• SEPARATES THE BRAND FROM ITS COMPETITORS• PREDICTS THE FUTURE EXPERIENCE WITH THAT

BRAND

• ROLE OF ADVERTISING• BECOMES PART OF THE IMAGE AND TELL WHAT THE

BRAND IS• BUSH BEER--HONEST, RUGGED, MANNLY• STATE FARM INSURANCE--STRAIGHT-FORWARD,

WARM, A GOOD NEIGHBOR• METROLINER--CIVILIZED, INVITING,

COMFORTABLE, CLEAN, DEPENDABLE, SAFE

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MEDIA

• MEDIA• WHAT MEDIA WILL MATCH THE PURPOSE OF THE

ADVERTISING?

• C.P.M. (COST PER THOUSAND IMPRESSIONS)• WHAT MEDIA WILL DELIVER THE MESSAGE TO THE

TARGET AT THE LOWEST POSSIBLE COST?• WHAT IS THE AVAILABILITY, REACH AND FREQUENCY,

AND NEGOTIATED COST PER THOUSAND IMPRESSIONS THAT THE ADVERTISER CAN SPEND WHICH WILL ACHIEVE THE PURPOSE--TO REACH THE TARGET, COMMUNICATE BENEFIT(S) AND SUPPORTING EVIDENCE?

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APERTURE

• WHEN, WHERE, AND UNDER WHAT CIRCUMSTANCES WILL THE TARGET BE MOST RECEPTIVE TO THE MESSAGE

• WHEN THE RELEVANT DECISION GETS MADE• MOTHER’S DAY, FATHER’S DAY, EASTER, CHRISTMAS--

ALL INCREASE INTEREST IN PRODUCTS AND SERVICES APPROPRIATE FOR THOSE TIMES

• BREAKFAST EATERS THINK ABOUT WHAT TO HAVE FOR BREAKFAST AT BREAKFAST TIME, AND ARE LIKELY TO BE OPEN TO MESSAGE ON MORNING RADIO

• PLACE WHERE THE DECISIONS GETS MADE

• UNDER WHAT CIRCUMSTANCES THE DECISION GETS MADE

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EXAMPLES OF APERTURE

• READING FASHION MAGAZINE, MAY MAKE INTERESTED READER EVEN MORE INTERESTED IN MESSAGES ABOUT EXERCISE, DIET, MAKEUP, OR CLOTHES

• MICHELIN PLACED MESSAGES IN WEATHER REPORTS ON CABLE TELEVISION’S WEATHER CHANNEL. THE PREMISE WAS THAT DRIVERS WHO ARE CONCERNED ABOUT THE WEATHER MIGHT ALSO BE CONCERNED ABOUT SECURITY, AND MIGHT THEREFORE BE ESPECIALLY RECEPTIVE TO MESSAGES CONCERNING MICHELIN TIRES

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FIVE VENUES

• DEFINITION

• EACH VENUE REPRESENTS A DIFFERENT RELATIONSHIP BETWEEN THE ADVERTISED PRODUCT AND THE SOURCE OF BUSINESS--PRODUCT (MIGHT BE BOUGHT OR USED INSTEAD)

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VENUE ONE

• OBVIOUS SUPERIORITY

• FOCUS ON THE CUSTOMER--ROI

• EXPAND THE CATEGORY

• PREPARE FOR COMPETITIVE RESPONSE

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VENUE TWO

• MARGINAL SUPERIORITY• LINKS BETWEEN MINOR PHYSICAL

DIFFERENCE AND MAJOR PSYCHOLOGICAL NEEDS CAN PROVIDE DECISIVE COMPETITIVE BENEFITS

• BUSH BEER--MINOR PHYSICAL DIFFERENCE BETWEEN BUSH AND OTHER BRANDS IS THE BUSH MOUNTAIN LOGO. WHEN LINKED WITH THE NOTION THAT BUSCH GOES DOWN “SMOOTH AS A MOUNTAIN STREAM.” THE LOGO SYMBOLIZES A COMPETITIVE LEVERAGE FOR THE BRAND

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VENUE THREE

• PERCEIVED INFERIORITY• TARGET THOSE WHO INFLUENCE THE

BEHAVIOR OF OTHERS• CORRECTION OF ERRONEOUS BELIEFS--

UNDERSTANDING WHY THE BELIEFS ARE STILL HELD

• THE TARGET IS NEVER EVERYONE, EVEN THOUGH EVERYONE MAYBE WRONG

• AMTRACK--UNREALIABLE, UNCOMFORTABLE, AND PROBABLY LATE

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VENUE FOUR

• REAL INFERIORITY• SEEK OUT AND STRIKE AT ANY WEAKNESS

OF THE OTHERWISE SUPERIOR BRAND• ADVERTISING MUST STILL PROMISE A

COMPETITIVE BENEFIT. COMPETITOR’S WEAKNESS IS NOT ENOUGH

• CAN NOT BE SOLD BY ADVERTISING ALONE

• THE BEETLE--DEPENDABLE AND ECONOMICAL, AND WOULD NOT GO OUT OF STYLE

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VENUE FIVE

• PARITY• IMPORT

• FOCUS ON A MAJOR BENEFIT THAT THE BRAND DOES NOT PROVIDE BEFORE THE ADVERTISING STARTS--THAN THE BENEFITS BECOMES TIGHTLY LINKED TO THE BRAND AND IT BECOMES A PROPERTY OF THE BRAND

• BREAKFAST OF CHAMPIONS

• THE NIGHT BELONGS TO MICHELOB

• PREEMPT STRATEGY• NON-EXCLUSIVE BENEFIT THAT THE BRAND ALREADY PROVIDES

IS MADE THE EXCLUSIVE PROPERTY OF ADVERTISER’S BRAND• LIKE A GOOD NEIGHBOR

• WE SELL NO WINE BEFORE ITS TIME

• SINGLE MINDED• PERSONALITY

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SUMMARY OF ROIFIVE BASIC QUESTIONS

• WHAT IS THE PURPOSE OF THE ADVERTISING?• TO WHOM WILL THE ADVERTISING BE

ADDRESSED?• WHAT COMPETITIVE BENEFIT WILL BE PROMISED,

AND HOW WILL THAT PROMISE BE SUPPORTED?• WHAT PERSONALITY WILL DISTINGUISH THE

BRAND?• WHEN, WHERE AND UNDER WHAT CIRCUMSTANCE

WILL THE TARGET BE MOST RECEPTIVE TO THE MESSAGE? AND, WHAT MEDIA WILL DELIVER THAT MESSAGE TO THAT TARGET AT THE LOWEST POSSIBLE COST?

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Problem--Multiple Vitamin Supplements • Multiple vitamin supplements make up a large, well-established market

with a substantial number of different brands and manufacturers. The market also displays a wide variety of marketing approaches even though the products themselves are largely homogeneous in physical characteristics. The differences in marketing approaches revolve around the choice of distribution channel. There are five different marketing approaches that are currently in use. They are:

Mail Order—vitamins offered through catalogs mailed directly to prospective consumers. Price to the consumer is low.Proprietary—vitamins sold through retail drug, food, and discount stores and advertised to consumers by the manufacturer. Retail price is high.Ethical—vitamins sold through drugstores and sold to consumers based on recommendations from doctors or druggists. Retail price is high.Door-to-Door—vitamins sold directly to consumers in their home by salespeople of the manufacturer. Price to consumers is high.Private Label—vitamins sold to druggists for resale under the druggist’s own label to consumers. Retail price is low.

Even if it is assumed that the product under each marketing approach is the same,the advertising effort will vary substantially because of differences is price anddistribution channels.For each marketing approach:

1) will the amount of advertising tend to be high or low compared to the other alternatives?

2) what will be the task of advertising?

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Multiple Vitamin Supplements

Approach Distribution Price Task of Advertising

Amount of Advertising

Mail Order Direct to consumer by mail

Low Make direct sales High—no other selling expense

Proprietary Through retailers by “pulling”

High Develop brand preference through retail outlet

High—must overcome lack of retail selling effort

Ethical Through retailers/

Physician recommendation, push

High Get recommendations and prescriptions

Low—narrow target, high retailer margins

Door-to-Door Direct to consumer by personal selling

High Get sales agent into the home

Low—funds devoted to selling commissions

Private Label Through retailers Low Price Comparisons

Low—margins narrow due to low price


Media Selection—finding the most cost-effective media to deliver the desired

number and types of exposures

• Reach—the number person or households exposed to a particular media schedule at least once during a specified time period

• Frequency—the number of times within the specified time period that an average person or household is exposed to the message

• Impact—the qualitative value of an exposure through a given medium

• Exposure—reach X frequency = Exposure or gross rating point


Choosing Among Major Media Types• Target audience and media habits—radio and television are

the most effective media for reaching teens• Product characteristics—media types have different potential

for demonstration, visualization, explanation, believability, and color. Women’s dresses are best shown in color magazines, but high-tech products requiring dynamic presentation such as digital cameras, printers, or cell phone are best demonstrated on television

• Message characteristics—timeliness and information content will influence media choice. A message announcing a major sales tomorrow will require radio, TV, or newspaper. A message containing a great deal of technical data might require specialized magazines or mailings

• Cost—television is very expensive, whereas newspaper advertising is relatively inexpensive. What counts is the cost per thousand exposures.


Marketing Communication Expenditures (2007)

Media $ % of Total

TV 72.1 32

Radio 20.9 9

Internet 16.7 8

Magazines 23.7 11

Newspaper 45.8 20

Comparing Advertising Media

MediaMedia2004 spend.(billions)

2004 spend.(billions)

2-year % growth

2-year % growth

AdvantagesAdvantages DisadvantagesDisadvantages

Television & cableTelevision & cable

$67.8$67.8 25.3%25.3%Demonstrates well, good attention, wide reach

Demonstrates well, good attention, wide reach

Expensive in total, “clutter,” and less selective audience

Expensive in total, “clutter,” and less selective audience

Direct mailDirect mail

$52.2$52.2 16.816.8Selected audience, flexible, can personalize

Selected audience, flexible, can personalize

Relatively costly per contact, “junk mail,” hard to retain attention

Relatively costly per contact, “junk mail,” hard to retain attention

News-paperNews-paper

$46.6$46.6 5.95.9Flexible, timely, local marketFlexible, timely, local market

May be expensive, short life, no “pass along”

May be expensive, short life, no “pass along”

RadioRadio $19.6$19.6 9.59.5Wide reach, low costsegmented audienceWide reach, low costsegmented audience

Weak attention, many different rates, short exposure

Weak attention, many different rates, short exposure

Comparing Advertising Media

MediaMedia2004 spend.(billions)

2004 spend.(billions)

2-year % growth

2-year % growth

AdvantagesAdvantages DisadvantagesDisadvantages

Yellow pagesYellow pages

$14.0$14.0 1.4%1.4%Reaches local customers seeking purchase info.

Reaches local customers seeking purchase info.

Many competitors listed in same place, hard to differentiate

Many competitors listed in same place, hard to differentiate

MagazineMagazine $12.3$12.3 11.811.8Very targeted, good detail, good “pass along”

Very targeted, good detail, good “pass along”

Inflexible, long lead timesInflexible, long lead times

InternetInternet $6.9$6.9 40.840.8

Ads link to more detailed site, some “pay for results,” easy to track results

Ads link to more detailed site, some “pay for results,” easy to track results

Hard to compare costs with other mediaHard to compare costs with other media

OutdoorOutdoor $5.8$5.8 11.511.5Flexible, repeat exposure, inexpensive

Flexible, repeat exposure, inexpensive

“Mass market,” very short exposure“Mass market,” very short exposure


Measures of Audience Size• Circulation—the number of physical

units carrying the advertising• Audience—the number of people

exposed to the vehicle (if the vehicle has pass-on readership, then the audience is larger than circulation

• Effective audience—the number of people with target audience characteristics exposed to the vehicle

• Effective ad-exposed audience—the number of people with target audience characteristics who actually saw the ad


Evaluating Advertising Effectiveness

• Communication Effect Research• Consumer feedback method—ask consumer questions

(e.g., What is the main message you get from this ad? How likely is it that this ad will influence you to undertake the action?)

• Portfolio tests—consumers view or listen to a portfolio of advertisements. Consumer are than asked to recall all the ads and their content, aided or unaided by the interviewer. Recall level indicates an ad’s ability to stand out and to have its message understood and remembered.

• Laboratory tests—use of equipment to measure physiological reactions—heartbeat, blood pressure, pupil dilation, galvanic skin response, perspiration—to an ad; or consumers may be asked to turn a knob to indicate their moment-to-moment liking or interest while viewing sequenced material

• Sales-Effect Research—What sales are generated by an ad that increases brand awareness by 20% and brand preference by 10%


Print Ad Evaluation Criteria

• Is the message clear at a glance?• Is the benefit in the headline?• Does the illustration support the headline?• Does the first line of the copy support or

explain the headline and illustration?• Is the ad easy to read and follow?• Is the product easily identified?• Is the brand or sponsor clearly identified?


Factors Affecting Timing Patterns

• Buyer turnover—rate at which new buyers enter the market (the

higher this rate, the more continuous the advertising should be)

• Purchase frequency—the number of times during the period that the

average buyer buys the product (the higher the purchase frequency, the more continuous the advertising should be)

• Forgetting rate—the rate at which the buyer forgets the brand (the

higher the forgetting rate, the more continuous the advertising should be)


Media Schedule Patterns• Continuity

—exposures appear evenly throughout the period• Concentration

—spending all advertising dollars in a single period• Flighting

—advertising for a period, followed by a period with no advertising, followed by a second period of advertising activity

• Pulsing

—continuous advertising at low-weight levels reinforced periodically by waves of heavier activity

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Most Organizations Use One of These Three Scheduling Strategies


Measuring Sales Impact of Advertising• Share of expenditures• Share of voice—proportion of company advertising

of that product to all advertising of that product• Share of mind—percentage of customers who

named the competitor in response to the statement, “Name the first company that comes to mind in this industry.”

• Share of heart—percentage of customers who name the competitor in responding to the statement, “Name the first company from which you would prefer to buy the product.”

• Share of market


What is Sales Promotion?

Sales promotion consists of a collection of incentive tools, mostly short term, designed to stimulate

quicker or greater purchase of particular products or services by

consumers or the trade.

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Sales Promotion TacticsConsumer-directed• Samples—offer of a free amount of

a product or service.• Coupons—certificates entitling the

bearer to a stated saving on the purchase of a specific product

• Cash refund offers—provide a price reduction after purchase

• Price offs—offers to consumers of saving off the regular price of a product

• Premiums—merchandise offered at a relatively low cost or free as an incentive to purchase a product

• Prizes—offers of the chance to win cash, trips, or merchandise as a result of purchasing something

• Patronage rewards—values in cash or in other forms that are proportional to patronage

• Free trials—inviting prospective purchases to try a product

• Tie-in promotions—two or more brands or companies team up on coupons, refunds, and contests to increase pulling power

Trade-directed• Price offs—straight discount off the

list price on each case purchased during a stated time period

• Allowances—amount offered in return for the retailer’s agreeing to feature the manufacturer’s products in some way—advertising or special product display

• Free goods—offers of extra cases of merchandise to intermediaries who buy a certain quantity or who feature a certain flavor or size

• Sales contests—aims at inducing the sales force or dealers to increase their sales results over a stated period, with money or prizes, etc.

• Spiffs—sales performance Incentive• Trade shows—industry associations

organize annual trade shows and conventions

• Specialty advertising—useful, low-cost items bearing the company’s name and address, etc.

Sales Promotion: Do Something Different to Stimulate Change


Events and Experiences

• $14.9 billion spent on sponsorship in 2007• 66% sports• 11% tours• 5% festivals, fairs• 5% arts• 10% causes


Why Sponsor Events?

• To identify with a particular target market or life style

• To increase brand awareness• To create or reinforce consumer perceptions

of key brand image associations• To enhance corporate image• To create experiences and evoke feelings• To express commitment to community• To entertain key clients or reward employees• To permit merchandising or promotional

opportunities


Using Sponsored Events

• Establish objectives (e.g., to identify with a particular target market or lifestyle; to increase awareness of company or product name; to enhance corporate)

• Choose events (e.g., naming rights to a sports facilities—Staples)

• Design programs (e.g., fund-raisers, anniversary celebrations, art exhibits)

• Measure effectiveness (e.g., Supply-side measurement method focuses on potential exposure to the brand by assessing the extent of media coverage; and demand-side method focuses on reported exposure from consumers)


Ideal Events

• Audience closely matches target audience

• Event generates media attention

• Event is unique with few sponsors

• Event lends itself to ancillary activities

• Event enhances brand image of sponsor


Customer Experience Management: Experience Providers

• Communications—advertising, public relations, annual reports, brochures, newsletters

• Identity—names, logos, signage, and transportation vehicles

• Product presence—product design, packaging, and point-of-sales displays

• Co-branding—event marketing and sponsorships, alliance and partnerships, licensing, and product placement in movies or TV

• Environments—retail and public spaces, trade booths, corporate building, office interiors, and factories

• Electronic media—corporate sites, product or service sites, CD-ROMs, automated e-mail, online advertising, and intranets

• People—salespeople, customer-service representatives, technical support or repair providers, company spokespersons, and CEOs and other executives


Steps in the CEM Framework• Analyze the customer’s experiential world—gaining insights into

socio-cultural context of consumer or the business context of business customers

• Build the experiential platform—developing a strategy that includes the positioning for the kind of experience the brand stands for, the value proposition of what relevant experience to deliver, and the overall implementation theme that will be communicated

• Design the brand experience—implementing their experiential platform in the look and feel of logos and signage, package, and retail spaces, in advertising, collaterals, and online

• Structure the customer interface—implementing the experiential platform in the dynamic and interactive interfaces including face-to-face, in stores, during sales visits, at the check-in desk of a hotel, or the e-commerce engine of a web site

• Engage in continuous innovation—implementing the experiential platform in new-product development, creative marketing events for customers, and fine-tuning the experience at every point of contact.


Tasks Aided by Public Relations

• Launching new products

• Repositioning a mature product

• Building interest in a product category

• Influencing specific target groups

• Defending products that have encountered public problems

• Building the corporate image in a way that reflects favorable on products


Public Relations Functions• Press relations—presenting news and information

about the organization in the most positive light • Product publicity—sponsoring efforts to publicize

specific products• Corporate communications—promoting

understanding of the organization through internal and external communications

• Lobbying—dealing with legislators and government officials to promote or defeat legislation and regulation

• Counseling—advising management about public issues, and company positions and image during good times and bad.


Major Tools in Marketing PR• Publications (e.g., annual reports, brochures,

articles, company newsletters and magazines)• Events (e.g., news conferences, seminars, trade

shows, contests)• Sponsorships (e.g., sports, cultural and causes)• News (e.g., press releases and press conferences)• Speeches (e.g., company executives field questions

from the media or give talks at trade associations or sales meetings)

• Public Service Activities (e.g., contributing money and time to good causes)

• Identity Media (e.g., company logos, stationery, signs, business forms, business cards, buildings, uniforms, and dress codes)


Decisions in Marketing PR

• Establish objectives (e.g., build awareness, build credibility, boost sales force and dealer enthusiasm)

• Choose message—what do you want to say

• Choose vehicles—how to deliver the message

• Implement—schedule

• Evaluate results—impact


Study Question 1• In developing an advertising program,

marketing managers can make five major decision known as the five Ms. Which of the following in NOT one of the five Ms?

A.Minimum

B.Money

C.Message

D.Mission

E.Media


Study Question 2• When setting the advertising budget,

marketers must consider the________

A.Stage in the product life cycle

B.Message details

C.Cost of television time

D.Buyer’s reaction to the camaign


Study Question 3• The obvious disadvantages of radio

include_____________

A.The relative passive nature of the consumer processing

B.Consumers’ ability to fast forward through advertisements

C.Excessive visual stimulus

D.Consumers’ typical commitment to a single radio station

E.All of the above


Study Question 4• _________is finding the most cost-

effective media to deliver the desired number and types of exposures to the target audience.

A.Frequency

B.Reach

C.Media buying

D.Media selection

E.Weight


Study Question 5• _________is most important when

launching new products, flanker brands, or extension of well-known brands.

A.Media selection

B.Frequency

C.Weighted exposures

D.Reach

E.Impact

Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public...

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