1Chap. 13 Essentials of Marketing 4e Lamb Hair McDaniel ©2005 South-Western/Thomson Learning...

1Chap. 13 Essentials of Marketing 4e Lamb Hair McDaniel©2005 South-Western/Thomson Learning

Advertising, Public Relations, Advertising, Public Relations, and Sales Promotionand Sales Promotion

Prepared byPrepared byDeborah BakerDeborah Baker

Texas Christian UniversityTexas Christian University

Chapter 13


Learning ObjectivesLearning Objectives

1. Discuss the effect of advertising on market share and consumers.

2. Identify the major types of advertising.

3. Discuss the creative decisions in developing an advertising campaign.


Learning Objectives Learning Objectives (continued)(continued)

4. Describe media evaluation and selection techniques.

5. Discuss the role of public relations in the promotional mix.


Learning ObjectivesLearning Objectives

6. Define and state the objectives of sales promotion.

7. Discuss the most common forms of consumer sales promotion.

8. List the most common forms of trade sales promotion.


Learning Objective Learning Objective

Discuss the effect of advertising on market share and consumers.

11

On Linehttp://www.redbull.com

On Linehttp://www.redbull.com


AdvertisingAdvertising

U.S. advertising spending exceeds $240 billion per year

Industry employs only 284,000

Ad budgets of some firms exceed over $2 billion per year—over $6 million per day!

11


Top Ten Leaders by U.S. Top Ten Leaders by U.S. Advertising SpendingAdvertising Spending

11


Advertising and Market ShareAdvertising and Market Share

New brands spend proportionately more for advertising than old ones.

A certain level of exposure is needed to affect purchase habits.

Beyond a certain level, diminishing returns set in.

New brands spend proportionately more for advertising than old ones.

A certain level of exposure is needed to affect purchase habits.

Beyond a certain level, diminishing returns set in.

11


Advertising and the Advertising and the ConsumerConsumer

Average U.S. citizen is exposed to hundreds of ads each day.

Advertising may change a consumer’s attitude toward a product.

Advertising can affect consumer ranking of brand attributes.

Average U.S. citizen is exposed to hundreds of ads each day.

Advertising may change a consumer’s attitude toward a product.

Advertising can affect consumer ranking of brand attributes.

11



Identify the major types of advertising.

22


Major Types of AdvertisingMajor Types of Advertising

InstitutionalAdvertisingInstitutionalAdvertising

ProductAdvertising

ProductAdvertising

Designed to enhance a company’s image rather than promote a

particular product.

Designed to enhance a company’s image rather than promote a

particular product.

Designed to tout the benefits of a specific good or service.

Designed to tout the benefits of a specific good or service.

22


Major Types of AdvertisingMajor Types of Advertising

Enhance corporation’s identity

Enhance corporation’s identity

PioneeringPioneering

CompetitiveCompetitive

ComparativeComparative

ProductProductAdvertisingAdvertising

ProductProductAdvertisingAdvertising

InstitutionalInstitutionalAdvertisingAdvertisingInstitutionalInstitutionalAdvertisingAdvertising

Advocacy advertisingAdvocacy advertising

22


On Linehttp://www.pizzahut.comhttp://www.papajohns.com

On Linehttp://www.pizzahut.comhttp://www.papajohns.com

Product AdvertisingProduct Advertising

PioneeringPioneeringPioneeringPioneering• Stimulates primary demand for

new product or category.• Used in the PLC introductory stage.

CompetitiveCompetitiveCompetitiveCompetitive• Influence demand for brand in the

growth phase of the PLC. • Often uses emotional appeal.

ComparativeComparativeComparativeComparative• Compares two or more competing

brands’ product attributes. • Used if growth is sluggish, or if

competition is strong.

22



Discuss the creative decisions in developing an advertising campaign.

33


Advertising CampaignAdvertising Campaign

A series of related

advertisements focusing

on a common theme,

slogan, and set of

advertising appeals.

33


Steps in Creating an Steps in Creating an Advertising CampaignAdvertising Campaign

Determine the advertising objectives.

Make creative decisions. Make media decisions.

Evaluate the campaign.

33


Setting Objectives:Setting Objectives:The DAGMAR ApproachThe DAGMAR Approach

Define Target Audience

Define Target Audience

Define DesiredPercentage

Change

Define DesiredPercentage

Change

Define the Time Frame for Change Define the Time

Frame for Change

Goal ofGoal ofAdvertising Advertising ObjectivesObjectives

Goal ofGoal ofAdvertising Advertising ObjectivesObjectives

33


Creative DecisionsCreative Decisions

Componentsof

Creative Decisions

Componentsof

Creative Decisions

Develop and EvaluateAdvertising Appeals

Develop and EvaluateAdvertising Appeals

Execute the Message

Execute the Message

Evaluate theCampaign’s Effectiveness

Evaluate theCampaign’s Effectiveness

Identify Product Benefits

Identify Product Benefits

33


Identify Product BenefitsIdentify Product Benefits

“Sell the Sizzle, not the Steak”

Sell product’s benefits, not its attributes

A benefit should answer “What’s in it for me?”

Ask “So?” to determine if it is a benefit

33


Advertising AppealAdvertising Appeal

Reason for a person

to buy a product.

33


Common Advertising AppealsCommon Advertising Appeals

Profit Profit

HealthHealth

Love or romanceLove or romance

FearFear

AdmirationAdmiration

ConvenienceConvenience

Fun and pleasureFun and pleasure

Vanity and egotism Vanity and egotism

Environmental ConsciousnessEnvironmental Consciousness

Product saves, makes, or protects money Product saves, makes, or protects money

Appeals to body-conscious or health seekersAppeals to body-conscious or health seekers

Used in selling cosmetics and perfumesUsed in selling cosmetics and perfumes

Social embarrassment, old age, losing health Social embarrassment, old age, losing health

Reason for use of celebrity spokespeopleReason for use of celebrity spokespeople

Used for fast foods and microwave foodsUsed for fast foods and microwave foods

Key to advertising vacations, beer, parksKey to advertising vacations, beer, parks

Used for expensive or conspicuous items Used for expensive or conspicuous items

Centers around environmental protectionCenters around environmental protection

33


Unique Selling PropositionUnique Selling Proposition

Desirable, exclusive, and

believable advertising

appeal selected as the

theme for a campaign.

33


Executing the MessageExecuting the Message

Mood or Image

Mood or Image

MusicalMusical

Demon-stration

Demon-stration

ScientificScientific

Real/AnimatedProductSymbols

Real/AnimatedProductSymbols

FantasyFantasy

LifestyleLifestyleSlice-of-LifeSlice-of-Life

HumorousHumorous

CommonCommonExecutionalExecutional

StylesStyles

CommonCommonExecutionalExecutional

StylesStyles

Spokes-person/

Testimonial

33



Describe media evaluation and selection techniques.

44


Major Types of Advertising Major Types of Advertising MediaMedia

NewspapersNewspapers

MagazinesMagazines

RadioRadio

TelevisionTelevision

Outdoor MediaOutdoor Media

InternetInternet

Alternative MediaAlternative Media

44


Advertising Spending for Advertising Spending for 2000 2000

44


NewspapersNewspapers

AdvantagesAdvantagesAdvantagesAdvantages

Year-round readership

Geographic selectivity

Immediacy

High individual market coverage

Short lead time

DisadvantagesDisadvantagesDisadvantagesDisadvantages

Limited demographic selectivity

Little color

May be expensive

Low pass-along rate

Clutter

Mass market medium

44


Cooperative AdvertisingCooperative Advertising

An arrangement in which

the manufacturer and the

retailer split the costs

of advertising the

manufacturer’s brand.

44


MagazinesMagazines

Good reproduction

Demographic selectivity

Regional/local selectivity

Long advertising life

High pass-along rate


Higher cost per contact

Long-term advertiser commitments

Slow audience build-up

Limited demonstration capabilities

Lack of urgency

Long lead time


44


On Linehttp://www.radioindustry.about.com

On Linehttp://www.radioindustry.about.com RadioRadio


Selectivity and audience segmentation

Immediate and portable

Geographic flexibility

Entertainment carryover

Short-term ad commitments


No visual treatment

Short advertising life

High frequency to generate retention

Commercial clutter

Background distractions

44


On Linehttp://www.fox.comhttp://www.abc.com

On Linehttp://www.fox.comhttp://www.abc.com TelevisionTelevision


Wide, diverse audience Low cost per thousand Creative and

demonstrative Immediacy of messages Entertainment carryover Demographic selectivity

with cable


Short life of message Expensive with high

campaign cost Little demographic

selectivity with network Long-term advertiser

commitments Long lead times Clutter

44


Outdoor MediaOutdoor Media


High exposure frequency

Moderate cost

Flexibility

Geographic selectivity

Broad, diverse market


Short message

Lack of demographic selectivity

High “noise” level

44


InternetInternet

Fast growing

Ability to reach narrow target audience

Short lead time

Moderate cost


Difficult to measure ad effectiveness and ROI

Ad exposure relies on “click through”

Not all consumers have access to internet


44On Linehttp://www.bannerite.comhttp://www.flash-banner-design.com

On Linehttp://www.bannerite.comhttp://www.flash-banner-design.com


Examples of Alternative Examples of Alternative MediaMedia

Ads in Movies and Videos

Ads in Movies and Videos

Interactive KiosksInteractive Kiosks

Computer Screen Savers

Computer Screen Savers

Video Shopping CartsVideo Shopping Carts

Fax MachinesFax Machines

44On Linehttp://www.looksmart.comhttp://www.yahoo.com

On Linehttp://www.looksmart.comhttp://www.yahoo.com


Media Selection Media Selection ConsiderationsConsiderations

Cost perCost perContactContact

Cost perCost perContactContact

ReachReachReachReach

FrequencyFrequencyFrequencyFrequency

AudienceAudienceSelectivitySelectivityAudienceAudienceSelectivitySelectivity

The cost of reaching one member of the target market.

The cost of reaching one member of the target market.

The number of target consumers exposed to a commercial at least

once during a time period.

The number of target consumers exposed to a commercial at least

once during a time period.

The number of times an individual is exposed to a message during a

time period.

The number of times an individual is exposed to a message during a

time period.

The ability of an advertising medium to reach a precisely

defined market.

The ability of an advertising medium to reach a precisely

defined market.

44


Cable TV Network Viewer Cable TV Network Viewer ProfilesProfiles

44


Media SchedulingMedia Scheduling

ContinuousContinuousMedia ScheduleMedia Schedule

ContinuousContinuousMedia ScheduleMedia Schedule

Flighted Flighted Media ScheduleMedia Schedule

Flighted Flighted Media ScheduleMedia Schedule

PulsingPulsingMedia ScheduleMedia Schedule

PulsingPulsingMedia ScheduleMedia Schedule

SeasonalSeasonalMedia ScheduleMedia Schedule

SeasonalSeasonalMedia ScheduleMedia Schedule

Advertising is run steadily throughout the period.

Advertising is run steadily throughout the period.

Advertising is run heavily every other month or every two weeks.Advertising is run heavily every other month or every two weeks.

Advertising combines continuous scheduling with flighting.

Advertising combines continuous scheduling with flighting.

Advertising is run only when the product is likely to be used.

Advertising is run only when the product is likely to be used.

44



Discuss the role of public relations in the promotional mix.

55


Public RelationsPublic Relations

Evaluates public attitudes

Evaluates public attitudes

Identifies issues of public concernIdentifies issues of public concern

Executes programs to gain

public acceptance

Executes programs to gain

public acceptance

The Role of The Role of Public RelationsPublic Relations

The Role of The Role of Public RelationsPublic Relations

55


Functions of Public RelationsFunctions of Public Relations

Press Relations Press Relations Press Relations Press Relations

Product PublicityProduct PublicityProduct PublicityProduct Publicity

Corporate CommunicationCorporate CommunicationCorporate CommunicationCorporate Communication

Public AffairsPublic AffairsPublic AffairsPublic Affairs

LobbyingLobbyingLobbyingLobbying

Employee and Investor RelationsEmployee and Investor RelationsEmployee and Investor RelationsEmployee and Investor Relations

Crisis ManagementCrisis ManagementCrisis ManagementCrisis Management

55


On Linehttp://www.bmwfilms.com

On Linehttp://www.bmwfilms.com

Public Relations ToolsPublic Relations Tools

Product PlacementProduct Placement

Consumer EducationConsumer Education

Event SponsorshipEvent Sponsorship

Issue SponsorshipIssue Sponsorship

Internet Web SitesInternet Web Sites

New Product PublicityNew Product Publicity

55


Crisis ManagementCrisis Management

A coordinated effort to

handle the effects of

unfavorable publicity or of

an unfavorable event.

55



Define and state the objectives of sales promotion.

66

On Linehttp://www.nba.com/maverickshttp://www.mavs.com

On Linehttp://www.nba.com/maverickshttp://www.mavs.com


Sales PromotionSales Promotion

Marketing communication

activities, other than

advertising, personal

selling, and public

relations, in which a

short-term incentive

motivates a purchase.

66On Linehttp://www.onlineclothingstores.comhttp://www1.coolsavings.com

On Linehttp://www.onlineclothingstores.comhttp://www1.coolsavings.com


Sales Promotion TargetsSales Promotion Targets

ConsumerSales Promotion

ConsumerSales Promotion

Trade Sales Promotion

Trade Sales Promotion

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Uses of Sales PromotionUses of Sales Promotion

Immediate purchasesImmediate purchases

Increase trialIncrease trial

Boost consumer inventoryBoost consumer inventory

Encourage repurchaseEncourage repurchase

Increase ad effectivenessIncrease ad effectiveness

Encourage brand switchingEncourage brand switching

Encourage brand loyaltyEncourage brand loyalty

66


Objectives of Sales PromotionObjectives of Sales Promotion

Type of BuyerType of Buyer Type of BuyerType of Buyer

Loyal CustomersLoyal Customers

Competitor’sCustomersCompetitor’sCustomers

Brand SwitchersBrand Switchers

Price BuyersPrice Buyers

Desired ResultsDesired Results Desired ResultsDesired Results

•Reinforce behavior• Increase consumption•Change timing

•Reinforce behavior• Increase consumption•Change timing

•Break loyalty•Persuade to switch•Break loyalty•Persuade to switch

•Persuade to buy your brand more often•Persuade to buy your brand more often

•Appeal with low prices•Supply added value

•Appeal with low prices•Supply added value

Sales PromotionSales PromotionExamples Examples

Sales PromotionSales PromotionExamples Examples

•Loyalty marketing•Bonus packs•Loyalty marketing•Bonus packs

•Sampling•Sweepstakes, contests, premiums

•Sampling•Sweepstakes, contests, premiums

•Price-lowering promotion•Trade deals

•Price-lowering promotion•Trade deals

•Coupons, price-offpackages, refunds•Trade deals

•Coupons, price-offpackages, refunds•Trade deals

66



Discuss the most common forms of consumer sales promotion.

77


Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

Coupons and RebatesCoupons and Rebates

PremiumsPremiums

Loyalty Marketing ProgramsLoyalty Marketing Programs

Contests & SweepstakesContests & Sweepstakes

SamplingSampling

Point-of-Purchase PromotionPoint-of-Purchase Promotion

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CouponCoupon

RebateRebate

PremiumPremium

A certificate that entitles consumers to an immediate

price reduction.

A certificate that entitles consumers to an immediate

price reduction.

A cash refund given for the purchase of a product during

a specific product.

A cash refund given for the purchase of a product during

a specific product.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.


77


LoyaltyMarketingProgram

LoyaltyMarketingProgram

FrequentBuyer

Program

FrequentBuyer

Program

A promotional program designed to build long-term, mutually

beneficial relationships between a company and key customers.

A promotional program designed to build long-term, mutually

beneficial relationships between a company and key customers.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.


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ContestContest

SweepstakesSweepstakes

Promotions that require skill or ability to compete for prizes.

Promotions that require skill or ability to compete for prizes.

Promotions that depend on chance or luck, with

free participation.

Promotions that depend on chance or luck, with

free participation.


77

On Linehttp://www.sweepstakesonline.com

On Linehttp://www.sweepstakesonline.com


SamplingSampling A promotional program that allows the consumer the opportunity to try a

product or service for free.

A promotional program that allows the consumer the opportunity to try a

product or service for free.


77


SamplingSampling

Methodsof

Sampling

Methodsof

Sampling

Direct mailDirect mail

Door-to-door delivery

Door-to-door delivery

Packaging with another productPackaging with another product

Retail store demonstrationRetail store

demonstration

77



Goals ofGoals of Point-of-PurchasePoint-of-Purchase

DisplaysDisplays

Goals ofGoals of Point-of-PurchasePoint-of-Purchase

DisplaysDisplays

Build traffic Build traffic

Advertise the productAdvertise the product

Induce impulse buyingInduce impulse buying

77


On Linehttp://www.burgerking.comhttp://www.philipmorris.comhttp://www.upromote.com

On Linehttp://www.burgerking.comhttp://www.philipmorris.comhttp://www.upromote.com


Free merchandiseFree merchandise

SweepstakesSweepstakes

Free shippingFree shipping

CouponsCoupons

EffectiveTypes ofOn-LineSales

Promotion

EffectiveTypes ofOn-LineSales

Promotion

77



List the most common forms of trade sales promotion.

88


Tools for Trade Sales Tools for Trade Sales PromotionPromotion

Trade AllowancesTrade Allowances

Push MoneyPush Money

TrainingTraining

Free MerchandiseFree Merchandise

Store DemonstrationStore Demonstration

Conventions & Trade ShowsConventions & Trade Shows

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Trade AllowanceTrade Allowance

A price reduction offered

by manufacturers to

intermediaries, such as

wholesalers and retailers.

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Push MoneyPush Money

Money offered to channel

intermediaries to encourage

them to “push” products--

that is, to encourage other

members of the channel to

sell the products.

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The Role of The Role of Trade Sales PromotionTrade Sales Promotion

Improve trade relations

Gain new distributors

Build or reducedealer inventories

Obtain support forconsumer sales promotions

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1Chap. 13 Essentials of Marketing 4e Lamb Hair McDaniel ©2005 South-Western/Thomson Learning...

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Transcript of 1Chap. 13 Essentials of Marketing 4e Lamb Hair McDaniel ©2005 South-Western/Thomson Learning...