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  • 1. The Field of Advertising Management
  • 2. Market / Consumer Behavior Government Competition Ad Agency Media Research Agency Advertiser Control Inst . Facilitating Inst. Institutions Involved in the Field of Advertising
  • 3. Research Suppliers Advertiser Ad agency Media Role of the Facilitating Institutions
  • 4. Advertising Management
  • 5. Management is about : - Planning - Decision Making - Control
  • 6. Framework of Advertising Planning & Decision Making Situation Analysis Marketing Programme Integrated Mar. Com. Plan Advertising Plan Implementation
  • 7. Process starts with an analysis of the Brand’s external & internal environment Situation Analysis (external and internal) Marketing Programme Market analysis Competitor analysis Brand Analysis- SWOT Advertising Plan Implementation
  • 8. The Role of Advertising emerges from the Marketing Programme Situation Analysis Marketing Programme Determines the role of each elements of the marketing mix including Marketing Communications Indicates how all elements will be coordinated to support and synergise with each other IMC & Advertising plan Implementation
  • 9. The Advertising Plan Includes… Situation Analysis Marketing Programme IMC & Advertising Plan Setting Objectives - (Segmentation-positioning) Media – strategy & tactics Message – strategy & tactics Implementation Implementation and Coordination (synergy with other IMC tools)
  • 10. Framework of Advertising & Decision Making Situation Analysis Marketing Programme IMC /Advertising Plan Implementation Facilitating Agencies Social, legal & other constraints
  • 11. The Role of Advertising….
    • The role the Advertising plan can only be in the context of the Marketing Plan
      • The Advertising Plan must support and synergise with:
        • the elements of the Marketing Mix
        • and other elements of the Communication Mix
    • Need to understand ‘How Advertising Works’
    • to appreciate the role it plays
  • 12. How does Advertising work ? Advertising is ‘ persuasive communication’
  • 13. The Communication Process Message Source Receiver Destination Media WOM Perception Process Message
  • 14. The Persuasion Process of Advertising is through a variety of advertising effects Awareness/familiarity Brand Benefit / Information Creating image / personality Associating feelings with Brand Linkage of Brand with peers/experts/group norms /culture Reminder / Brand trial inducement Brand Attitude Purchase Behavior The Persuasion Process of Advertising
  • 15. Setting Advertising Objectives
  • 16. These must be Operational Objectives
      • Meaningful Advertising Objectives
        • Provide criteria for decision making
        • Serve as a communication and coordination tool
        • Provide criteria for evaluate performance
    • Can ‘Sales’ be meaningful Objectives?
  • 17. ‘ Sales’- A Meaningful Advertising Objective??
        • Difficult to identify the impact of Advtg.on ‘Sales’
          • ‘ Advtg. impact is felt over time
          • Isolating ad impact from other elements of the marketing mix is difficult
      • New customers
      • Advertising Immediate Sales Future sales
      • Change attitude / improve image
  • 18. Developing Advertising Objectives Involves 3 considerations -
        • Behavioral decisions (behavioral objectives) that Advertising must influence
        • The Target Segment
        • The decision making process that communication must precede to influence behavior
  • 19. ‘Sales Strategy’ the basis for Advertising Objectives
      • Sales growth comes from -
        • New customers buying
        • Old customers staying loyal
        • Old customers consuming more
  • 20. Demand Generation - Offensive Strategy
      • Market dynamics:
      • - Sales grow because of new customers buying
        • ‘ Offensive Marketing Strategies’
        • Primary demand generation
        • Secondary demand generation
    Those not the buying product Existing customers Those buying Other brands
  • 21. Demand Generation - Defensive Strategy
      • Market dynamics:
      • Sale grow with old customers staying loyal
      • ‘ Defensive Marketing Strategy’
        • Recall the important brand features
        • Reinforce use experience
        • Consumer promotions
  • 22. Demand Generation through Increased Consumption
      • Market dynamics:
      • Sales grow with ‘Product form expansion’
        • More frequent usage / share of requirement (SOR)
        • New use applications
  • 23. Secondary Demand -New customers using other brands Primary Demand - Customers trying the category for the first time Existing customers Loyalty More consumption news uses and more usage Behavioral Responses that drive Purchase Marketing / Sales Strategies & Behavioral Objectives Trial Purchase Trial Purchase Loyalty Increased usage / SOR
  • 24. The Influence of Advertising on Desired Behavior
      • Advertising is not as effective in directly evoking desired action -‘Purchase’
      • Advertising causal intervening response
      • desired behavioral response Sales
      • Sales Promotions, DM & Retail Advertising should be used in conjunction with Advertising to drive sales
  • 25. The Persuasion Process of Advertising is through a variety of effects Awareness/familiarity Brand Benefit Information Creating image / personality Associating feelings with Brand Linkage of Brand with peers/experts/group norms Reminder / Brand trial inducement Brand Attitude Purchase Behavior These Intervening Variables between Advertising & Action are more effective Operational Advertising Objectives than Sales
  • 26.
      • Advertising Objectives (the Intervening Response Variables that are persuasive in its context) are determined by t he type of Sales Strategy and Behavioral Objectives
  • 27. The Persuasion Process of Advertising is through a variety of effects Awareness / Familiarity Brand Benefit Information Creating image -personality / users Associating feelings with Brand use Linkage with peers / experts/group norms Reminder / Brand trial inducement Purchase These Intervening Variables have a causal relationship between Advertising & Sales Trial Purchase & Loyalty Trial Purchase & Increased usage Loyalty Loyalty Loyalty
  • 28. Advertising Objectives Reflect the Target Segment
      • The segment and sub-segment can be defined by –
        • Behavioral measures – non-users, other brand users, heavy / light / loyal users etc.
        • Advertising response measures – unaware, not convinced of key benefit, diffused / sharp image, etc
        • Lifestyle - attitude & opinions, interests
        • Benefits sought
        • Demographic, psychographics, geographic basis - more relevant for media decisions
  • 29. ‘ Hierarchy of Effects’ Model - DAGMAR Unaware Aware Comprehension & image Attitude Action Cognitive Affective Behavioral DAGMAR Approach – A communication task to be accomplished amongst a defined audience, in a specified period of time
  • 30. DAGMAR in Practice
      • Objectives in Black & White to ensure the sated goals contain the crucial aspects of DAGMAR
        • A specific task indicated clearly – to be measurable
        • A starting point set – Benchmark against which goal achievement can be measured
        • A Target Segment specified precisely
        • The Time Period for achieving the desired response indicated
  • 31. DAGMAR in Practice
      • Challenges to DAGMAR
        • Does not measure Sales
        • Broad outline does not give enough details (which hierarchical level)
        • Measurement is a problem
        • System noise – other factors affecting goal
        • Model may not hold good in every situation
  • 32. Other Persuasion Models IADA Hierarchy Innovation of Effects Adoption Attention Awareness Knowledge Awareness Interest Desire Liking Preference Conviction Interest Evaluation Cognitive Stage Affective Stage Action Stage Action Purchase Trial Adoption
  • 33. Segmentation and Positioning
  • 34. Segmentation is about deciding which consumers the Advertising should be targeted at
  • 35. The Target Marketing Process Identify markets with unfulfilled needs Determining market segmentation Selecting market to target Positioning through marketing strategies
  • 36. Five-Step Segmentation Process
    • 1. Finding ways to group consumers according to their needs.
    • 2. Finding ways to group marketing actions , usually the products offered, available to the organization.
    • 3. Developing a market/product grid to relate the market segments to the firm’s products and actions .
    • 4. Selecting the product segments toward which the firm directs its marketing actions.
    • 5. Taking marketing actions to reach target segments .
  • 37. Bases for Segmentation
    • Geographic Segmentation
      • State - region - country - climate
    • Demographic Segmentation
      • Age, sex, income, education, occupation, social class
    • Psychographic Segmentation
      • AIOs, (Activities, Interests, Opinions)
      • VALS (Values and Lifestyles)
      • Personality traits
    • Behavioristic Segmentation
      • Usage, loyalties, use occasions
    • Benefit Segmentation
      • Types of specific needs or wants to be satisfied .
  • 38. Segmentation Approaches
      • A Priori basis : the market is segmented before any data on the market place is examined
        • Age
        • Income
        • Usage
        • Loyalty
        • Geo-location
      • Empirical Segmentation : created on the basis of differences in
        • Attitude and benefits sought
        • life-style - AIO
        • culture
  • 39. Approach Implementation
      • Both are used together but in different order
        • A priori segmentation starts with variables such as income etc and then examines attitudes and benefits
        • Empirical segmentation starts with benefit segmentation and then see how these clusters are different in terms of demographics
  • 40. Selecting a Target Market Segmentation Strategies
    • D etermining how many segments to enter
    • Undifferentiated Marketing – offering one product or service to the entire market
    • Differentiated marketing – competing in a number of segments with separate marketing strategies for each
    • Concentrated Marketing – focusing on one market segment
  • 41. Determining Which Market Segments Offer the Most Potential
    • Identify the group that is most likely to respond to the brand offering
    • Determine sales potential of the segment
    • Determine opportunities for growth of the market segment.
    • Analyze the competition in the segment (segments not being served well by competition)
    • Analyze the company’s ability to compete in the market segment
    • Decide how to compete in the market segment
  • 42. Segmentation Decision Check List
    • Can the size of the market segment be measured?
    • Is the market segment large and profitable enough to serve? (large and growing in size)
    • Is the segment identified accessible? Can it be reached effectively and efficiently?
    • Can effective marketing programs be developed to attract and serve the segment identified?
  • 43. TM and Media Reach Approaches
      • Controlled Coverage – using niche media to reach only the desired segment e.g. trade magazines
      • Customer Selection – using mass media to Reach is directed at mass audiences
  • 44. Positioning It gives the consumer a clear idea of what the Brand stands for
  • 45. The Positioning Process Positioning Concept The desired perception or association management wants target customers to have for a firm and/or its products Positioning Effectiveness The extent to which management’s positioning objectives are achieved in the market target Positioning Strategy The combination of marketing actions used to portray the positioning concept to targeted buyers Positioning of the brand The positioning of the brand by the buyers in the market target Market Target
  • 46. Positioning Strategy Development Process - Background Analysis 1. Identify the competitors 2. Assess perceptions of competitors 3. Determine their positions 4. Analyze consumer preferences 6. Monitor the position 5. Make the positioning decision
  • 47. Product/Service and Brand Positioning
    • 1. What position, (if any) do we currently hold in the mind of customers?
    • 2. What position do we want to hold?
    • 3. Whom do we have to compete against to establish this position?
    • 4. Do we have the resources to occupy and hold the position?
    • 5. Can we stay with one consistent positioning strategy?
    • 6. Does our marketing and advertising match our positioning strategy?
  • 48. Positioning Strategy Approaches
    • Product/Service or Brands can be positioned by single or multiple approaches:
      • Product attributes or consumer benefit
      • Price-quality
      • Use or application
      • Users
      • Product class
      • Cultural symbols
      • Competitors
  • 49. Positioning Decision – Check Points
    • Select and Evaluate the position
    • An economic analysis
      • Appeals to a large and growing segment
      • Penetration possibilities – competitive edge to attack competition
    • Don’t be what you are not
    • Monitor the position
  • 50. Positioning Decision -Imperatives
      • Segmentation commitment
      • Stick with the Advertising that works
      • Consider using symbols
  • 51. Positioning Strategy Execution
      • A relative concept that must indicate the position of the brand vis-a-vis other brands - differentiation
      • It determines the nature of the elements of the marketing mix
      • Best communicated through Advertising
  • 52. Product Decisions
      • A product is a bundle of benefits or values that satisfies the needs of consumers
      • Product symbolism refers to what a product or brand means to customers
      • Product quality, branding, packaging, and company name contribute to product image
      • Branding:
        • Brand name communicates attributes and meaning
        • Advertising creates and maintains brand equity which results from the image and/or impression of a brand
  • 53. The Value of Strong Corporate and /or Brand Identity
    • Strong corporate/brand equity :
    • Creates more options for competing (particularly against lower-priced competitors)
    • Can facilitate brand and line extensions
    • Allows companies to sell products/services at a premium price and maintain larger profit margins
    • Builds customer loyalty
    • Makes it easier to withstand economic fluctuations and marketing crises
    • Makes customer response more inelastic to price increases and elastic to price decreases
  • 54. Packaging
      • Traditional functions of packaging:
        • economy, protection, storage
      • Packaging has become increasingly important because:
        • self service emphasis of many stores
        • buying decisions made at point-of-purchase
        • often customers first exposure to product
      • Packaging is a way to communicate to consumers
  • 55. Pricing Decisions
    • Price must be consistent with perceptions of the product
    • Higher prices communicate higher product quality
    • Lower prices often reflect bargain or “value” perceptions
    • A product positioned as high quality while carrying a lower price than competitors may confuse customers
    • Price, advertising and distribution must be unified to create the position for the product or service.
  • 56. Distribution Channel Decisions
    • Channel decisions involve:
    • Determining the type of channel system:
      • Direct channels
      • Indirect channels
    • Selecting, managing and motivating marketing intermediaries such as
      • Wholesalers
      • Distributors
      • Brokers
      • Retailers
  • 57. Push Versus Pull Push Policy Pull Policy Information Flow Producer Retailer Consumer Wholesaler Producer Wholesaler Retailer Consumer
  • 58. "Push" Techniques
    • Point of sale displays, racks, stands
    • Trade deals, special displays
    • Dealer premiums, prizes, gifts
    • Cooperative advertising deals
    • Advertising materials, mats, inserts
    • Push money or "spiffs"
    • Collaterals, catalogs, manuals
    • Trade shows, conventions, meetings
  • 59. "Pull" Techniques
    • Sampling, free trial
    • Coupons
    • Premiums or gifts
    • Contests, sweepstakes
    • Price-off deals
    • Refunds/rebates
    • Frequency/loyalty programs
    • Point-of-purchase advertising
  • 60. Marketing and Promotions Process Model Competitive analysis Target marketing Identifying markets Market segmentation Selecting a target market Positioning through marketing strategies Product decisions Pricing decisions Channel of distribution decisions
    • Promotional
    • decisions
    • advertising
    • direct
    • marketing
    • internet/
    • interactive
    • marketing
    • sales
    • promotion
    • publicity
    • and public
    • relations
    • personal
    • selling
    • Ultimate
    • customer
    • Consumers
    • Businesses
    Marketing Strategy and Analysis Target Marketing Process Marketing Planning Program Development Promotion to final buyer Target Market Purchase Promotion to trade