Principles of Marketing

Lecture-34

Summaryof

Lecture-33

Advertising

The Five M’s of Advertising

Mission

Salesgoals

Adver-tisingobjectives

Message

Message generation

Message evaluationand selection

Message execution

Social-responsibilityreview

Money

Factors toconsider:

Stage in PLC

Market shareand con-sumer base

Competitionand clutter

Advertisingfrequency

Productsubstituta-bility

Measure-ment

Communi-cationimpact

Salesimpact

MediaReach, frequency,impactMajor media typesSpecific mediavehicles

Media timingGeographicalmedia allocation

Major Advertising Decisions

Objectives SettingObjectives Setting

Budget DecisionsBudget Decisions

Message DecisionsMessage Decisions

Campaign EvaluationCampaign Evaluation

Media DecisionsMedia Decisions

Choose the Media

Yellow Pages

Outdoor

Internet

Magazine

Television

Direct Mail

Radio

NewspaperMajor

Kinds of Media

Today’s Topics

Advertising (cont..)

Sales Promotion

Media Scheduling

Step 1. Decide on Reach, Frequency, and Impact

Step 1. Decide on Reach, Frequency, and Impact

Step 2. Choosing Among Major Media TypesStep 2. Choosing Among Major Media Types

Step 3. Selecting Specific Media VehiclesStep 3. Selecting Specific Media Vehicles

Step 4. Deciding on Media TimingStep 4. Deciding on Media Timing

Setting the timing and sequence of a series of advertisements.

Sales patterns (seasonal), repurchase cycles, and competitors’ activities are the most important variables.

Advertisers use the concepts of reach, frequency, and gross rating points to measure the effectiveness of media scheduling plans.

Reach: the number of different people or households exposed to an advertisement at least one during a certain time period.

Frequency: the number of times an individual person is exposed to an advertisement in a certain time.

Gross rating point: reach times frequency.

Evaluating Advertising Effectiveness

PretestingPretesting

PosttestingPosttesting

Sales EffectivenessEvaluations

Sales EffectivenessEvaluations

Tools:

•Focus Groups•Screening•Persuasion Scores

Tools:

•Unaided Recall Tests•Aided Recall Tests•Inquiry Evaluations

Tools:

•Monitor Sales•Brand-to-Sales Effects

Communication Effects

Is the Ad Communicating Well?

Communication Effects

Is the Ad Communicating Well?

Advertising Program EvaluationAdvertising Program Evaluation

Sales Effects

Is the Ad Increasing Sales?

Sales Effects

Is the Ad Increasing Sales?

What to communicate?

Get Attention

Hold Interest

Arouse Desire

Obtain Action

Ways to Handle Advertising

Sales Departments inSmall Companies

Sales Departments inSmall Companies

Advertising AgencyAdvertising Agency

Advertising Departments

in Larger Companies

Advertising Departments

in Larger Companies

Sales Promotion

Sales Promotion is a Mass Communication Technique

That Offers Short-Term Incentives to Encourage Purchase or Sales of a

Product or Service.

Offers Reasons to Buy Now.

Sales Promotion Objectives

Increase short-term sales or help build long-term market share.

Get retailers to:

–carry new items and more inventory,

–advertise products,

–give products more shelf space, and

–buy product ahead.

In general, sales promotion should

focus on consumer relationship building.

Reasons for Increase inSales Promotion

Growing Power of Retailers Declining Brand Loyalty Increased Promotional Sensitivity Fragmentation of Consumer Markets Short-Term Focus Pressure from inside organization Competition Clutter

Major Consumer Sales Promotion Tools

SampleSample

CouponsCoupons

Cash RefundsCash Refunds

Price PacksPrice Packs

PremiumsPremiums

Advertising Specialties

Advertising Specialties

Trial amount of a product

Trial amount of a product

Savings when purchasing specified

products

Savings when purchasing specified

productsRefund of part of the

purchase priceRefund of part of the

purchase priceReduced prices

marked on the label or package

Reduced prices marked on the label or

packageGoods offered free or low

cost as an incentive to buy a product

Goods offered free or low cost as an incentive to

buy a product

Articles imprinted with an advertiser’s name given

as gifts

Articles imprinted with an advertiser’s name given

as gifts

Consumer Sales Promotion Techniques

Price Deals

AdvertisingSpecialties Coupons

Sampling Rebates

Contests, Games,Sweepstakes

Premiums Cross-Promotions

Price Deals

Bargain!

Bargain!

Value!

Value!

Cents-Off DealsCents-Off Deals Price-Pack DealsPrice-Pack Deals

Sale!Sale!

Major Trade Sales Promotion Tools

Discount

Allowance

Objectives of Trade Promotions

Increase ResellerInventory

InfluencePrice Discount

Defend AgainstCompetitors

Avoid PriceReductions

InfluenceReseller Promotion

Gain/MaintainDistribution

Increase ResellerInventory

InfluencePrice Discount

Defend AgainstCompetitors

Avoid PriceReductions

InfluenceReseller Promotion

Gain/MaintainDistribution

Trade Sales Promotion Techniques

Trade AllowancesTrade Allowances

Dealer LoadersDealer Loaders

Trade ContestsTrade Contests

Point-of-Purchase DisplaysPoint-of-Purchase Displays

Trade ShowsTrade Shows

Training ProgramsTraining Programs

Push MoneyPush Money

Developing the Sales Promotion

Program

Decide on the Size of the IncentiveDecide on the Size of the Incentive

Set Conditions for ParticipationSet Conditions for Participation

Evaluate the ProgramEvaluate the Program

Determine How to Promote andDistribute the Promotion Program Determine How to Promote and

Distribute the Promotion Program

Determine the Length of the ProgramDetermine the Length of the Program

Sales Promotion Uses

Introduce new products

Get existing customers to buy more

Attract new customers

Combat competition

Maintain sales in off season

Increase retail inventories

Tie in advertising and personal selling

Enhance personal selling efforts

Limitations of Sales Promotion

Cannot Reverse Declining Sales Trend

Cannot Reverse Declining Sales Trend

Cannot Overcome Inferior Product

Cannot Overcome Inferior Product

May Encourage Competitive Retaliation

May Encourage Competitive Retaliation

May Hurt ProfitMay Hurt Profit

Enough for today. . .

Summary

Media Scheduling

Step 1. Decide on Reach, Frequency, and Impact

Step 1. Decide on Reach, Frequency, and Impact

Step 2. Choosing Among Major Media TypesStep 2. Choosing Among Major Media Types

Step 3. Selecting Specific Media VehiclesStep 3. Selecting Specific Media Vehicles

Step 4. Deciding on Media TimingStep 4. Deciding on Media Timing

Evaluating Advertising Effectiveness

Communication Effects

Is the Ad Communicating Well?

Communication Effects

Is the Ad Communicating Well?

Advertising Program EvaluationAdvertising Program Evaluation

Sales Effects

Is the Ad Increasing Sales?

Sales Effects

Is the Ad Increasing Sales?

Sales Promotion

Major Consumer Sales Promotion Tools

Major Trade Sales Promotion Tools

Developing the Sales Promotion

Program

Decide on the Size of the IncentiveDecide on the Size of the Incentive

Set Conditions for ParticipationSet Conditions for Participation

Evaluate the ProgramEvaluate the Program

Determine How to Promote andDistribute the Promotion Program Determine How to Promote and

Distribute the Promotion Program

Determine the Length of the ProgramDetermine the Length of the Program

Next….

Personal Selling

Principles of Marketing

Lecture-34