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Kotcha15
Advertising spending in the US exceeds $212 billion annually, with worldwide spending over $414 billion. Advertising is used by businesses, nonprofits, professionals, and social agencies to promote ideas, goods, and services through paid, nonpersonal presentations. Developing an advertising campaign involves setting objectives, budgets, messages, media selection, timing, and evaluation. Sales promotion uses short-term incentives to encourage purchases and offers reasons to buy now. Tools include coupons, premiums, and contests. Public relations involves building goodwill through favorable publicity, corporate image, and handling rumors to communicate with key audiences.
Kotcha15
- 1. Chapter 15 Advertising, SalesPromotion, and Public Relations 1
- 2. Advertising Advertising is centuriesold. U.S. advertisers spend in excess of $212 billion each year; worldwide spending exceeds $414 billion. Advertising is used by: Business firms, Nonprofit organizations, Professionals, and Social agencies. 2
- 3. What is Advertising? Advertising is Any Paid Form of Nonpersonal Presentation and Promotion of Ideas, Goods, or Services by an Identified Sponsor. 3
- 4. Major Advertising Decisions (Fig. 15.1) Message Decisions •Message Strategy •Message Execution Objectives Setting Budget •Communication Decisions Campaign Evaluation objectives •Affordable Approach •Communication Impact •Sales Objectives •Percent of sales •Sales Impact •Competitive parity •Objective and task Media Decisions •Reach, Frequency, Impact •Major Media Types •Specific Media Types •Media Timing 4
- 5. Setting Advertising Objectives InformativeAdvertising Persuasive Advertising Inform Consumers or Build Selective Demand Build Primary Demand i.e Sony CD Players i.e CD Players Advertising Objective Specific Communication Task Accomplished with a Specific Target Audience During a Specific Period of Time Comparison Advertising Reminder Advertising Compares One Brand to Keeps Consumers Thinking Another About a Product i.e. Avis vs. Hertz i.e. Coca-Cola 5
- 6. Setting the PromotionBudget After Determining Its Advertising Objectives, the Each Product and Market. (From Chapter 14) Marketer Must Set the Advertising Budget for 6 Affordable Percentage o Percentage o Based on What the Based on a Certain Based on a Certain Company Can Afford of Current or Forec of Current or Forec Objective-and-Task Objective-and-Task Competitive Competitive Based on Determining Based on Determining Based on the Co Based on the Com Objectives & Tasks, Then Objectives & Tasks, Then Promotion B Promotion Bu Estimating Costs Estimating Costs
- 7. Setting the Advertising Budget Factors to be considered when setting the advertising budget: Stage in the product life cycle, Market share, Competition and clutter, Product differentiation. 7
- 8. Developing Advertising Strategy Advertising Strategy Consists of Two Major Elements and Companies are Realizing the Benefits of Planning These Two Elements Jointly. Creating the Selecting the Advertising Advertising Media Messages 8
- 9. Developing Advertising Strategy: Creating Ad Messages Plan a Message Strategy General Message to Be Communicated to Customers Develop a Message Develop a Message Focus on Focus on Customer Benefits Customer Benefits Creative Concept Creative Concept “Big Idea” “Big Idea” Some phrases or Big Ideas become so effective that they spark trends in speaking, Visualization or Phrase Advertising Appeals Visualization or Phrase Advertising Appeals fashion, or even in other ads. Combination of Both Combination of Both Meaningful Meaningful Believable Believable Distinctive Distinctive 9
- 10. Mes sa ge E xec u t i on What type of message executi on do these two Developing Advertising ads employ? In both cases, what distingui shes the product from the rest of the ad? Strategy: Message Execution Click or p res s spacebar to retu rn. Turning the “Big Idea” Into an Actual Ad to Capture the This Colgate ad Target Market’s Attention and Interest. informs customers about the necessity of brushing after lunch. In addition to acquiring new customers, Colgate may increase toothpaste use by present customers. Testimonial Evidence Testimonial Evidence Slice of Life Slice of Life Scientific Evidence Scientific Evidence Typical Lifestyle Lifestyle Message Technical Expertise Execution Fantasy Technical Expertise Fantasy Styles Personality Symbol Personality Symbol Mood or Image Mood or Image What type of mood does this set ab o t the product? u Musical Musical 10 Which lifestyle does it appeal to?
- 11. Advertising Strategy: Selecting AdvertisingMedia Step 1. Decide on Reach, Frequency, and Impact Step 2. Choosing Among Major Media Types Media Habits of Target Consumers, Nature of the Product, Types of Message, Cost Step 3. Selecting Specific Media Vehicles Specific Media Within a Given Type, i.e. Magazines. Must Balance Media Cost Against Media Factors: Audience Quality & Attention, Editorial Quality Step 4. Deciding on Media Timing Scheduling of Advertising Over the Course of a Year Pattern of Ads: Continuity or Pulsing 11
- 12. Jon Steel, of Goodby, Silverstein, and Partners: Evaluating Advertising Advertising Program Evaluation Communication Effects Communication Effects Sales Effects Sales Effects Is the Ad Communicating Well? Is the Ad Communicating Well? Is the Ad Increasing Sales? Is the Ad Increasing Sales? 12
- 13. Discussion Connections Advertising objectivescan be classified by primary purpose: to inform, persuade, or remind. Using your local newspaper, find examples of ads pursuing each of the above. Apply Table 15.1 to explain your answers. 13
- 14. Other Advertising Considerations Sales Departmentsin Advertising Departments Small Companies in Larger Companies Advertising Agency Firm that Assists Companies in the Planning, Creation, & Implementation of Their Advertising Programs 14
- 15. Advertising Agencies Large agenciesdivide their staffs to specialize in creative,media,research, or business (account planning). Ad agencies are moving away from the commission system because it no long accurately reflects the services performed. Most ad agency clients still want just a few of the services that can be provided by the agency, so diversification efforts have been limited. 15
- 16. International Advertising Decisions Adaptation of Global Advertising Advertising Media Differ Considerably in Availability and Cost Regulation in Advertising Practices Comparison Ads Not Acceptable in All Countries Programs Must be Matched to Local Cultures and Customs 16
- 17. What is SalesPromotion ? 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. 17
- 18. Rapid Growth ofSales Promotion Sales promotion can take the form of consumer promotions, business promotions, trade promotions or sales force promotions. Rapid growth in the industry has been achieved because: Product managers are facing more pressure to increase their current sales, Companies face more competition, Advertising efficiency has declined, Consumers have become more deal oriented. 18
- 19. Sales Promotion Objectives Increaseshort-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. 19
- 20. Major Consumer Sales Promotion Tools Sample Sample Trial amount of a product Trial amount of a product Savings when purchasing specified Savings when purchasing specified Coupons Coupons products products Cash Refunds Cash Refunds Refund of part of the purchase price Refund of part of the purchase price Reduced prices marked on the label or Reduced prices marked on the label or Price Packs Price Packs package package Goods offered free or low cost as an Goods offered free or low cost as an Premiums Premiums incentive to buy a product incentive to buy a product Advertising Advertising Articles imprinted with an advertiser’s Articles imprinted with an advertiser’s Specialties Specialties name given as gifts name given as gifts 20
- 21. Major Consumer Sales Promotion Tools Cash or other rewards for the use of a Cash or other rewards for the use of a Patronage Rewards Patronage Rewards certain product certain product Displays and demonstrations that take Displays and demonstrations that take Point-of-Purchase Point-of-Purchase place at the point of sale place at the point of sale Contests Contests Consumers submit an entry to be judged Consumers submit an entry to be judged Consumers submit their names for a Consumers submit their names for a Sweepstakes Sweepstakes drawing drawing Presents consumers with something every Presents consumers with something every Game Game time they buy time they buy 21
- 22. Major Trade Sales Promotion Tools Trade-Promotion Trade-Promotion Objectives Tools Persuade Retailers or Persuade Retailers or Wholesalers to Carry a Brand Wholesalers to Carry a Brand Discounts Discounts Give a Brand Shelf Space Give a Brand Shelf Space Promote a Brand in Allowances Allowances Promote a Brand in Advertising Advertising Push a Brand to Consumers Push a Brand to Consumers Sales Promotion T his K ibble s ‘n Bit s promotion off ered pet owner s a chance to see their dogs in a commer cial. Which of the fou r obj ectives does this type of promoti on 22 fulfill?
- 23. Major Business Sales Promotion Tools Business-Promotion Business-Promotion Objectives Tools Generate Business Leads Generate Business Leads Conventions Conventions Stimulate Purchases Stimulate Purchases Trade Shows Trade Shows Reward Customers Reward Customers Sales Contests Sales Contests Motivate Salespeople Motivate Salespeople 23
- 24. Developing the Sales PromotionProgram Decide on the Size of the Incentive Decide on the Size of the Incentive Set Conditions for Participation Set Conditions for Participation Determine How to Promote and Determine How to Promote and Distribute the Promotion Program Distribute the Promotion Program Determine the Length of the Program Determine the Length of the Program Evaluate the Program Evaluate the Program 24
- 25. What is PublicRelations? Public Relations Involves Building Good Relations With the Company’s Various Publics by Obtaining Favorable Publicity, Building Up a Good Corporate Image, and Handling or Heading Off Unfavorable Rumors, Stories, and Events. 25
- 26. Perform Any ofAll Departments May Public Relations of the Following Functions: 26 Major Public Relations Press Relations or Agentry Press Relations or Agentry Product Publicity Product Publicity Public Affairs Public Affairs Lobbying Lobbying Functions Investor Relations Investor Relations Developm Developme
- 27. Major Public RelationsTools News Web Site Speeches Public Special Service Events Activities Corporate Written Identity Audiovisual Materials Materials Materials 27
- 28. 28 Major Public Relations Setting Public Relations Objectives Setting Public Relations Objectives Choosing the Public Relations Message Choosing the Public Relations Messages and Vehicles and Vehicles Implementing the Public Relations Plan Implementing the Public Relations Plan Decisions Evaluating Public Relations Results Evaluating Public Relations Results
- 29. Review of Concept Connections Define the roles of advertising, sales promotion, and public relations in the promotion mix. Describe the major decisions involved in developing an advertising program. Explain how sales promotion campaigns are developed and implemented. Explain how companies use public relations to communicate with their publics. 29