On October 23rd, 2014, we updated our
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Informative Advertising Build Primary Demand Persuasive Advertising Build Selective Demand Comparison Advertising Compares One Brand to Another Reminder Advertising Keeps Consumers Thinking About a Product.
The Five Ms of Advertising Mission Sales goals Adver- tising objectives Money Factors to consider: Stage in PLC Market share and con- sumer base Competition and clutter Advertising frequency Product substituta- bility Message Message generation Message evaluation and selection Message execution Social-responsibility review Media Reach, frequency, impact Major media types Specific media vehicles Media timing Geographical media allocation Measure- ment Communi- cation impact Sales impact
Advertising Budget Factors Stage in the Product Life Cycle Market Share & Consumer Base Competition & Clutter Advertising Frequency Product Substitutability
Profiles of Major Media Types Newspapers Advantages: Flexibility, timeliness; good local market coverage; broad acceptance, high believability Limitations: Short life; poor reproduction quality; small pass-along audience Television Advantages: Combines sight, sound, motion; high attention; high reach; appealing to senses Limitations: High absolute costs; high clutter; fleeting exposure; less audience selectivity Direct Mail Advantages: Audience selectivity; flexibility, no ad compe- tition within same medium; allows personalization Limitations: Relative high cost; “junk mail” image
Radio Advantages: Mass use; high geographic and demographic selectivity; low cost Limitations: Audio only; fleeting exposure; lower attention; nonstandardized rates; fragmented audiences Magazines Advantages: High geographic and demographic selectivity; credibility and prestige; high-quality reproduction; long life; good pass-along readership Limitations: Long ad purchase lead time; waste circulation; no guarantee of position Outdoor Advantages: Flexibility; high repeat exposure; low cost; low message competition Limitations: Little audience selectivity; creative limitations Profiles of Major Media Types
Classification of Advertising Timing Patterns Month Number of messages per month Concen- trated (1) (2) (3) Level Rising Falling Alternating (4) Continuous (8) (7) (6) (5) (9) Inter- mittent (10) (11) (12) (9)
Simplified Rating Sheet for Ads __Total (Attention) How well does the ad catch the reader’s attention? __ 20 (Read-through) How well does the ad lead the reader to read further? __ 20 (Cognitive) How clear is the central message or benefit? __ 20 (Affective) How effective is the particular appeal? __ 20 (Behavior) How well does the ad suggest follow-through action? __ 20 Poor ad Mediocre ad Average ad Good ad Great ad 0 20 40 60 80 100
Advertising Strategy Message Execution Testimonial Evidence Slice of Life Scientific Evidence Lifestyle Technical Expertise Fantasy Musical Personality Symbol Mood or Image Turning the “Big Idea” Into an Actual Ad to Capture the Target Market’s Attention and Interest. Typical Message Execution Styles
Advertising Evaluation Advertising Program Evaluation Communication Effects Is the Ad Communicating Well? Sales Effects Is the Ad Increasing Sales?
Why the increase in Sales Promotion?
Growing retailer power
Declining brand loyalty
Increased promotional sensitivity
Fragmentation of consumer market
Increased managerial accountability
Long-Term Promotional Allocation Cox Direct 19th Annual Survey of Promotional Practices 0 10 20 30 40 50 60 1986 88 90 92 94 1996 Year %t of total - 3 yr.MA Trade Promo Media Adv Cons. Promo
Consumer Promotion Consumer-Promotion Objectives Consumer-Promotion Tools Entice Consumers to Try a New Product Lure Customers Away From Competitors’ Products Get Consumers to “Load Up’ on a Mature Product Hold & Reward Loyal Customers Consumer Relationship Building Point-of-Purchase Displays Premiums Price Packs Cash Refunds Coupons Samples Patronage Rewards Games Sweepstakes Contests Advertising Specialties Patronage Rewards
Cluster analysis yielded two interpretable results:
49% are “deal prone,” 51% not
24% High “Deal prone,” 50% intermediate, 26% deal insensitive
“Deal-proneness” a generalized construct - (crosses type of promotion)
Younger & Less educated more likely to be deal prone
Trade Promotions Trade-Promotion Objectives Trade-Promotion Tools Persuade Retailers or Wholesalers to Carry a Brand Give a Brand Shelf Space Promote a Brand in Advertising Push a Brand to Consumers Specialty Advertising Items Contests Free Goods Buy-Back Guarantees Allowances Price-Offs Patronage Rewards Push Money Discounts Premiums Displays