eighteen advertising, public relations, and sales promotions Chapter

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1 Chapter eighteen advertising, public relations, and sales promotions 1

2 Advertising, Public Relations, and Sales Promotions LO 18-1 Describe the steps in designing and executing an advertising campaign. LO 18-2 Identify three objectives of advertising. LO 18-3 Describe the different ways that advertisers appeal to consumers. LO 18-4 Identify the various types of media. LO 18-5 Identify agencies that regulate advertising. LO 18-6 Describe the elements of a public relations toolkit. LO 18-7 Identify the various types of sales promotions. 2

3 Chipotle Mexican Grill 3

4 Steps in Planning and Executing an Ad Campaign Identify target audience Set advertising objectives Determine the advertising budget Convey the message Evaluate and select media Create advertisements Assess impact Advertising Age 4

5 Identify Target Audience Conduct research Use the information to set the tone Select the media Getty Images/Comstock Images 5

6 Set Advertising Objectives Pull strategy Push strategy Comstock/PunchStock Brand X Pictures/PunchStock 6

7 Informative Advertising Create and build brand awareness Push the consumer through the buying cycle Inform customers about upcoming sales events or arrival of new merchandise TJX Companies, Inc. 7

8 Persuasive Advertising Generally occurs in the growth and early maturity stages of the PLC when competition is most intense May be used to reposition an established brand in the later stage of the PLC The Procter & Gamble Company Used by permission 8

9 Reminder Advertising Communication used to remind or prompt repurchases Occurs after the products have gained market acceptance Used by Permission of Deutsch Inc as Agent for National Fluid Milk Processor Promotion Board 9

10 2000 Image 100 Ltd Focus of Advertisements Institutional advertisements Product-focused advertisements 10

11 Social Marketing Public Service Advertising (PSA) Under Federal Communication Commission rules, broadcasters must devote a specific amount of free airtime to PSAs Courtesy of the National Crime Prevention Council, ww.ncpc.org 11

12 Determining Advertising Budget Considerations: Role that advertising plays in their attempt to meet their overall promotional objectives Expenditures vary over the course of the Product Life Cycle Nature of the market and the product influence the size of the budget 12

13 Convey the Message Unique selling proposition (USP) Red Bull... Gives You Wings United Negro College Fund... A mind is a terrible thing to waste. Nike... Just Do It. State Farm Insurance... Like a good neighbor, State Farm is there TNT... We know drama 13

14 Procter & Gamble Procter & Gamble The Appeal Informational appeal Emotional appeal 14

15 Emotional Appeals in Advertising Emotional Appeal Company Example Fear/Safety ADT Security Breaking into Your Apartment Is Easier than You Think Humor Best Buy Game On, Santa Happiness Tropicana Awake to Alive Love/sex Axe Body Spray Unleash the Chaos Comfort Kleenex Softness Worth Sharing Nostalgia Chevrolet Find New Roads 15

16 Evaluate and Select Media Media planning Media mix Photodisc/Getty Images The McGraw-Hill Companies, Inc/John Flournoy, photographer Media buy Ryan McVay/Getty Images Photodisc/Getty Images 16

17 Mass and Niche Media Mass media reach large anonymous audience Digital Vision/PunchStock Niche media reach a smaller more targeted audience Digital Vision/PunchStock 17

18 Choosing the Right Medium Medium Advantages Disadvantages Television Radio Magazines Wide reach; incorporates sound and video. Relatively inexpensive; can be selectively targeted; wide reach Very targeted; subscribers pass along to others. High cost; several channel and program options; may increase awareness of competitors products. No video, which limits presentation; consumers give less focused attention than TV. Exposure periods are short. Relatively inflexible; takes some time for the magazine to be available. Newspapers Flexible; timely; able to localize. Can be expensive in some markets; advertisements have short life span. Internet/mobile Outdoor/billboard Direct marketing Can be linked to detailed content; highly flexible and interactive; allows for specific targeting. Relatively inexpensive; offers opportunities for repeat exposure. Is highly targeted; allows for personalization. Becoming cluttered; the ad may be blocked by software on the computer. Is not easily targeted; has placement problems in some markets; exposure time is very short. Cost can vary depending on type of direct marketing used; traditional media, like mail, will be more expensive than newer media. 18

19 Viral Marketing Campaign Courtesy Office Max 19

20 Determine the Advertising Schedule Continuous Pulsing Flighting Procter & Gamble 20

21 Create Advertisements Creativity plays a major role in the execution stage Creativity should not overshadow the message The type of medium determines the execution style Ads The execution style must match the medium and objectives 21

22 Assess Impact Using Marketing Metrics Pretesting Tracking Protesting 22

23 check yourself 1. What are the steps involved in planning an ad campaign? 2. What are the differences between informational, persuasive, and reminder advertising? 3. What are the pros and cons of the different media types? 4. How can the effectiveness of advertising be evaluated? 23

24 Regulatory and Ethical Issues in Advertising Federal Agency General Purpose Specific Jurisdiction Federal Trade Commission (FTC) (1914) Enforces federal consumer protection laws. Enforces truth in advertising laws; defines deceptive and unfair advertising practices. Federal Communications Commission (FCC) (1934) Food and Drug Administration (1930) Regulates interstate and international communications by radio, television, wire, satellite, and cable. Regulates food, dietary supplements, drugs, cosmetics, medical devices (including radiation-emitting devices such as cell phones), biologics (biological issues), and blood products. Enforces restrictions on broadcasting material that promotes lotteries (with some exceptions); cigarettes, little cigars, or smokeless tobacco products; or that perpetuates a fraud. Also enforces laws that prohibit or limit obscene, indecent, or profane language. Regulates package labeling and inserts, definition of terms such as light and organic, and required disclosure statements (warning labels, dosage requirements, etc.). 24

25 Public Relations PR Element Publications: Brochures, special-purpose single-issue publications such as books Video and audio: Programs, public service announcements Annual reports Media relations: Press kits, news releases, speeches, event sponsorships Electronic media: Websites, campaigns Function Inform various constituencies about the activities of the organization and highlight specific areas of expertise. Highlight the organization or support cause-related marketing efforts. Give required financial performance data and inform investors and others about the unique activities of the organization. Generate news coverage of the organization s activities or products/services. Websites can contain all the previously mentioned toolbox elements while directs PR efforts to specific target groups. TOMS Shoes 25

26 check yourself 1.Why do companies utilize public relations as part of their IMC strategy? 2.What are the elements of a public relations toolkit? 26

27 Sales Promotions Can be targeted at either the end user consumers or channel members Can be used in either push or pull strategies Courtesy Payless Shoe Source, Inc. 27

28 Types of Sales Promotion Promotion Advantages Disadvantages Coupons Deals Premiums Contests Sweepstakes Samples Loyalty Programs POP Displays Rebates Product Placement Stimulates demand. Allows for direct tracing of sales. Encourages trial. Reduces consumer risk. Builds goodwill. Increases perception of value. Increases consumer involvement. Generates excitement. Increases involvement with the product. Encourages trial. Offers direct involvement. Creates loyalty. Encourages repurchase. Provides high visibility. Encourages brand trial. Stimulates demand. Increases value perception. Displays products nontraditionally. Demonstrates product uses. Has low redemption rates. Has high cost. May reduce perception of value. Consumers buy for premium, not product. Has to be carefully managed. Requires creativity. Must be monitored. Sales often decline after the sweepstakes is over. Has high cost to the firm. Has high cost to the firm. Is difficult to get a good location in the store. Can be costly to the firm. Is easily copied by competitors. May just advance future sales. Firm often has little control over display. Product can be overshadowed. 28

29 The McGraw-Hill Companies, Inc./ John Flournoy, photographer Using Sales Promotion Tools Cross-promoting The McGraw-Hill Companies, Inc./ Ken Karp, photographer 29

30 check yourself 1.What are various forms of sales promotions? 2.What factors should a firm consider when evaluating a sales promotion? 30