Part 7 : Communicating Value Chapter 18 – Managing Mass Communications: Advertising, Sales Promotion, Events & Public Relations

Developing and Managing an Advertising Program Advertising is any paid form of non personal presentation and promotions of ideas, goods, or services by identified sponsors Ads can be a cost-effective way to disseminate messages, whether to build a brand preference or to educate people Developing an advertising program is a five-step process Set advertising objectives can be classified: Informative advertising: aims to create brand awareness and knowledge of new products or new features of existing products Persuasive advertising: aims to create preference of a product Reminder advertising: aims to stimulate repeat purchase of products Reinforcement advertising: aims to convince current purchasers that they made the right choice

Advertising is any paid form of non personal presentation and promotions of ideas, goods, or services by identified sponsors

Ads can be a cost-effective way to disseminate messages, whether to build a brand preference or to educate people

Developing an advertising program is a five-step process

Set advertising objectives can be classified:

Informative advertising: aims to create brand awareness and knowledge of new products or new features of existing products

Persuasive advertising: aims to create preference of a product

Reminder advertising: aims to stimulate repeat purchase of products

Reinforcement advertising: aims to convince current purchasers that they made the right choice

Developing and Managing an Advertising Program Establish a budget (factors to be considered whether budget will be used more or less): Stage in the product life cycle: new products need more advertising budgets to build awareness and to gain consumer trial Market share and consumer base: less budgets to reach consumers of a widely used brand than to reach consumers of low-share brands Competition and clutter: In a market with a large number of competitors and high advertising spending, a brand must advertise more budgets to be heard Advertising frequency: the number of repetitions needed to put across the brand’s message to consumers has the impact on more advertising budget Product substitutability: brands in less-well-differentiated like product classes (soft drinks, banks) require more adv. budgets to establish differential image

Establish a budget (factors to be considered whether budget will be used more or less):

Stage in the product life cycle: new products need more advertising budgets to build awareness and to gain consumer trial

Market share and consumer base: less budgets to reach consumers of a widely used brand than to reach consumers of low-share brands

Competition and clutter: In a market with a large number of competitors and high advertising spending, a brand must advertise more budgets to be heard

Advertising frequency: the number of repetitions needed to put across the brand’s message to consumers has the impact on more advertising budget

Product substitutability: brands in less-well-differentiated like product classes (soft drinks, banks) require more adv. budgets to establish differential image

Developing and Managing an Advertising Program Developing message strategy: Message generation and evaluation: to generate fresh insights and avoid using the same appeals as others e.g. today’s automobile ads have a sameness-a car driving at high speed across a dessert. The result is a weak link is established between the brand and the message Creative development and execution: the ad’s impact depends not only on what is said, but on how it is said on particular media Television Ads can demonstrate product attribute and persuasively explaining the consumer benefits Print Ads e.g. newspaper can provide much detailed product information (infomercial) and usage imagery. Format elements such as size, color, and illustration can improve attention-getting power Radio Ads: can get the flexibility – stations are very targeted, inexpensive to produce and place Deciding on media selection (factors to be considered): The effect of exposures on audience awareness depends on the exposures’ reach, frequency & impact e.g. Dancow 5+ ad during kids film. Audience awareness will be greater, the higher the exposures’ reach, frequency & impact. Choosing among major media types by considering the following variables: target audience media habits, product characteristics, message characteristics, and cost e.g. TV Media for busy mothers

Developing message strategy:

Message generation and evaluation: to generate fresh insights and avoid using the same appeals as others e.g. today’s automobile ads have a sameness-a car driving at high speed across a dessert. The result is a weak link is established between the brand and the message

Creative development and execution: the ad’s impact depends not only on what is said, but on how it is said on particular media

Television Ads can demonstrate product attribute and persuasively explaining the consumer benefits

Print Ads e.g. newspaper can provide much detailed product information (infomercial) and usage imagery. Format elements such as size, color, and illustration can improve attention-getting power

Radio Ads: can get the flexibility – stations are very targeted, inexpensive to produce and place

Deciding on media selection (factors to be considered):

The effect of exposures on audience awareness depends on the exposures’ reach, frequency & impact e.g. Dancow 5+ ad during kids film. Audience awareness will be greater, the higher the exposures’ reach, frequency & impact.

Choosing among major media types by considering the following variables: target audience media habits, product characteristics, message characteristics, and cost e.g. TV Media for busy mothers

Developing and Managing an Advertising Program Deciding on Media Timing and Allocation: The timing pattern (the more or less continuous advertising) should consider: Buyer turnover (the rate at which new buyers enter the market): the higher this rate, the more continuous the advertising should be Purchase frequency: buyers seldom buy the brand, the continuous advertising should be Forgetting rate: the buyer forgets the brand, the more continuous the advertising In launching a new product, the advertiser has to choose: Continuity: advertisers use continuous advertising for expanding market Concentration: advertisers spend all the adv dollars for product season or holiday Flighting: advertising is irregular due to limited fund and infrequent purchase cycle Pulsing: advertising for periodically but with heavier activity so that the audience will learn the message more thoroughly Evaluating advertising effectiveness through Advertising research techniques: for Print Ads (recall and recognition test); in-home test (with video tape); trailer test (by coupon free and see the redemption rate); theater test (preference brand changes “before and after” viewing the commercial); on air test (asked question about commercial recall after respondents watching the program) They also measure the ad’s sales effect through experimental data (correlating past sales to past advertising expenditures)

Deciding on Media Timing and Allocation:

The timing pattern (the more or less continuous advertising) should consider:

Buyer turnover (the rate at which new buyers enter the market): the higher this rate, the more continuous the advertising should be

Purchase frequency: buyers seldom buy the brand, the continuous advertising should be

Forgetting rate: the buyer forgets the brand, the more continuous the advertising

In launching a new product, the advertiser has to choose:

Continuity: advertisers use continuous advertising for expanding market

Concentration: advertisers spend all the adv dollars for product season or holiday

Flighting: advertising is irregular due to limited fund and infrequent purchase cycle

Pulsing: advertising for periodically but with heavier activity so that the audience will learn the message more thoroughly

Evaluating advertising effectiveness through

Advertising research techniques: for Print Ads (recall and recognition test); in-home test (with video tape); trailer test (by coupon free and see the redemption rate); theater test (preference brand changes “before and after” viewing the commercial); on air test (asked question about commercial recall after respondents watching the program)

They also measure the ad’s sales effect through experimental data (correlating past sales to past advertising expenditures)

Sales Promotion Sales promotion consists of a diverse collection of incentive tools, mostly short term, design to stimulate quicker or greater purchase of particular products or services by consumers or the trade Sales promotion includes tools for: Consumer promotion such as samples, coupon, cash refund, free trial, warranties, and demonstration Trade promotion such as trade shows and conventions, sales contests, and specialty advertising In using sales promotion, a company must be: Establishing objectives: For consumers, encouraging purchase of larger units, building trial among non users, and attracting switchers away from competitors’ brand. For retailers, persuading retailers to carry new items and higher levels of inventory, offsetting competitive promotions, building brand loyalty, and gaining entry into new retail outlets Selecting the tools: consumer promotion tools (samples, coupon, rebates, premium, contest) or trade promotion tools (allowance, free goods, price off) Developing the program: by considering the size of incentives, conditions for participation either everyone or select group, and the total sales promotion budget Pre testing, Implementing (cover lead time and sell- in time), and Controlling and Evaluating the programs (by sales data, consumer survey, and experiment)

Sales promotion consists of a diverse collection of incentive tools, mostly short term, design to stimulate quicker or greater purchase of particular products or services by consumers or the trade

Sales promotion includes tools for:

Consumer promotion such as samples, coupon, cash refund, free trial, warranties, and demonstration

Trade promotion such as trade shows and conventions, sales contests, and specialty advertising

In using sales promotion, a company must be:

Establishing objectives: For consumers, encouraging purchase of larger units, building trial among non users, and attracting switchers away from competitors’ brand. For retailers, persuading retailers to carry new items and higher levels of inventory, offsetting competitive promotions, building brand loyalty, and gaining entry into new retail outlets

Selecting the tools: consumer promotion tools (samples, coupon, rebates, premium, contest) or trade promotion tools (allowance, free goods, price off)

Developing the program: by considering the size of incentives, conditions for participation either everyone or select group, and the total sales promotion budget

Pre testing, Implementing (cover lead time and sell- in time), and Controlling and Evaluating the programs (by sales data, consumer survey, and experiment)

Events and Public Relation Events and experiences are a means to become part of special and more personally relevant moments in consumers’ lives. Involvement with events can broaden and deepen the relationship of the sponsor with its target market, but only if managed properly e.g. Harley Davidson touring. Public relation (PR) involves a variety of programs designed to promote or protect a company’s image or its individual products Many companies today use marketing public relation (MPR) to support the marketing department in corporate or product promotion and image making MPR can affect public awareness at a fraction of the cost of advertising, and is often much more credible from editorial copy. (the company develops interesting story and could be picked up by the media thus company did not pay for the space or time obtained in the media) The main tools of Public Relations are: publications (articles), events (trade shows), news (attend press release and conference), speeches, public service activities (build goodwill by contributing money and time to good causes).

Events and experiences are a means to become part of special and more personally relevant moments in consumers’ lives. Involvement with events can broaden and deepen the relationship of the sponsor with its target market, but only if managed properly e.g. Harley Davidson touring.

Public relation (PR) involves a variety of programs designed to promote or protect a company’s image or its individual products

Many companies today use marketing public relation (MPR) to support the marketing department in corporate or product promotion and image making

MPR can affect public awareness at a fraction of the cost of advertising, and is often much more credible from editorial copy. (the company develops interesting story and could be picked up by the media thus company did not pay for the space or time obtained in the media)

The main tools of Public Relations are:

publications (articles), events (trade shows), news (attend press release and conference), speeches, public service activities (build goodwill by contributing money and time to good causes).