imc_final
TRANSCRIPT
Promoting Products Using Promoting Products Using Interactive and Integrated Interactive and Integrated Marketing CommunicationsMarketing Communications
Promotion Mix/ Promotion Mix/ Marketing Marketing
Communication Communication MixMix
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Objectives• Know the tools of the marketing Know the tools of the marketing
communications mix.(Promotion Mix)communications mix.(Promotion Mix)
• Learn the steps in developing effective Learn the steps in developing effective marketing communications.marketing communications.
• Understand methods for setting Understand methods for setting promotional budgets and the factors that promotional budgets and the factors that affect the design of the promotion mix.affect the design of the promotion mix.
• Advertising Decisions.Advertising Decisions.
• Sales promotion tool.Sales promotion tool.
• Public Relations Tools.Public Relations Tools.
• Personal SellingPersonal Selling
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Akai TVsAkai TVs Airtel and Hutch (Now Vodafone)Airtel and Hutch (Now Vodafone)FevicolFevicol BingoBingoHaldiram’sHaldiram’sWhat types of promotion mix What types of promotion mix
have these companies used to have these companies used to promote their products?promote their products?
Case Study
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Definition• Marketing Communications Mix ( Promotion Marketing Communications Mix ( Promotion
Mix)Mix)
A company’s total marketing A company’s total marketing communication program is called communication program is called as “ as “ Promotion MixPromotion Mix””
Promotion MixPromotion Mix Consists of specific Consists of specific mix of advertising, personal selling, mix of advertising, personal selling, sales promotion, and public sales promotion, and public relations tools that the company relations tools that the company uses to pursue its advertising and uses to pursue its advertising and marketing objectives.marketing objectives.
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• Integrated Marketing Integrated Marketing CommunicationsCommunications The concept under which a company The concept under which a company
carefully integrates and coordinates carefully integrates and coordinates its many communications channels its many communications channels to deliver a clear, consistent, and to deliver a clear, consistent, and compelling message about the compelling message about the organization and its products.organization and its products.
IMC implementation often requires IMC implementation often requires the hiring of a the hiring of a MarCom manager.MarCom manager.
Integrated Marketing Communications (IMC)
Change & Promotion Mix
• Definition- Promotion• Promotion Mix• Integrated Marketing
Communication (IMC)• Change
Technology Build Relationships Interactivity
Factors That Affect
The Promotion MixType of Product
Stage in the Product Life CycleTarget Market CharacteristicsActions of CompetitorsAvailable Funds
Components of Integrated MarketingAdvertising
Corporate Communication
Crisis Communication
E-CommerceEvent MarketingInternal
Communication
Issues Management
MarketingMultimediaPublic RelationsSales PromotionStrategic PlanningWeb Design
Objectives of Integrated MarketingBuild Brand Equity
Provide InformationManage Demand &
Build SalesDifferentiate ProductsInfluence Perceptions,
Attitudes, & Buyer Behavior
Total Direct Advertising
Expenditures
$104.3
$142.1 $153.0$164.1
$213.3
$0.0
$50.0
$100.0
$150.0
$200.0
$250.0
1992 1996 1997 1998 2002*
In billionsIn billions
*Projected*ProjectedSource: Source: The Direct Marketing Association
Figure 16.3 Advertising Expenditure by Figure 16.3 Advertising Expenditure by MediaMedia
Advertising Today
• Persuasive Communication
• Infomercials
• Internet
• Global Advertising
Internet Advertising
Will reach $22 billion in the U.S. The rest of world will spend $10.8
billion. $27 billion (10% of all U.S. ad
spending) will be siphoned from traditional media
Hardest hit: newspapers and direct mail
Source: Source: CIO Web Business, 10/1/1999
Steps in Personal SellingProspect/QualifyProspect/QualifyProspect/QualifyProspect/Qualify
PreapproachPreapproachPreapproachPreapproach
ApproachApproachApproachApproach
PresentatioPresentationn
PresentatioPresentationn
ObjectionsObjectionsObjectionsObjections
CloseCloseCloseClose
Follow-upFollow-upFollow-upFollow-up
Public Relations
Steps
• Listen
• Change/Develop
• Inform
PublicityFreeMore Effective
Than AdBelievableNo ControlNo Repetition
Sales Promotion• Internal & External
• Sampling
• Word-Of-Mouth
• Viral Marketing/Swag
• Technology
• Testimonials
Tips on Issuing Coupons
Coupons can be used as a “Thank you for buying” or a “Stop and try us.”
The value must be enough to attract customers.
Use coupon promotions sparingly.
Get professional help to get maximum exposure.
Color-code your coupons for different groups that use them.
Top Celebrity Endorsers
Celebrity Product(s)
Top Sports Endorsers
Athlete
Endorsements
Source:Source: Fortune Magazine
Promotional Strategies
Push StrategyPush Strategy
Pull StrategyPull Strategy
PromotioPromotionn
DistributionDistribution
Retail Retail StoreStore
CustomerCustomer
PromotioPromotionn
Building IMC
IMCIMC
Gather Data & Gather Data & Maintain Maintain DatabaseDatabaseRespond Quickly To Respond Quickly To Adjust Policies & Adjust Policies & ProceduresProcedures
Provide Provide Accessible Accessible InformationInformation
Characteristics of Objectives
Concrete, Measurable Communication TasksConcrete, Measurable Communication Tasks
Well-Defined Target AudienceWell-Defined Target Audience
Have an Existing Benchmark MeasureHave an Existing Benchmark Measure
Specify Degree of Change SoughtSpecify Degree of Change Sought
Specific Time PeriodSpecific Time Period
Good Objectives Should Include:Good Objectives Should Include:
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• Communications efforts should be Communications efforts should be viewed from the perspective of viewed from the perspective of managing customer relationships over managing customer relationships over time.time.
• The communication process begins The communication process begins with an audit of all potential contacts.with an audit of all potential contacts.
• Effective communication requires Effective communication requires knowledge of how communication knowledge of how communication works.works.
The Communication Process
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MediaMedia
SenderSender
EncodingEncoding
MessageMessage
DecodingDecoding
ReceiverReceiver
ResponseResponse
FeedbackFeedback
The Communication ProcessThe Communication Process
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Steps in Developing Effective Communications
Step 1. Identifying the Target Audience
Step 2. Determining the Communication Objectives
Step 3. Designing a Message
Step 4. Choosing Media
Step 5. Selecting the Message Source
Step 6: Collecting Feedback
Steps in Developing EffectiveCommunicationSteps in Developing EffectiveCommunication
Step 1. Identifying the Target AudienceStep 1. Identifying the Target Audience
Step 2. Determining the Communication ObjectivesBuyer Readiness Stages
Step 2. Determining the Communication ObjectivesBuyer Readiness Stages
PurchasePurchase
Conviction
Preference
Liking
Knowledge
Awareness
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• Step 1:Step 1: Identifying the Target Audience Identifying the Target Audience Affects decisions related to what, how, Affects decisions related to what, how,
when, and where message will be said, when, and where message will be said, as well as who will say itas well as who will say it
• Step 2:Step 2: Determining Communication Determining Communication ObjectivesObjectives Six buyer readiness stagesSix buyer readiness stages
Developing Effective Communication
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• Step 3:Step 3: Designing a Message Designing a Message AIDA framework guides message designAIDA framework guides message design Message content Message content contains contains appeals or themes appeals or themes
designed to produce desired results these are designed to produce desired results these are ::
Rational AppealsRational Appeals: Audience’s self interest. : Audience’s self interest. Economy (Price), Quality, Value, Features Economy (Price), Quality, Value, Features and Benefits of the productsand Benefits of the products
Emotional Appeals: Emotional Appeals: attempts to stir up attempts to stir up either positive or negative emotions to that either positive or negative emotions to that can motivate purchase.can motivate purchase.
– Love, pride, joy, humor, fear, guilt, shame E.g. Love, pride, joy, humor, fear, guilt, shame E.g. Crack creame.Crack creame.
Moral Appeals: Moral Appeals: are directed to audience’s are directed to audience’s sense of what is “Right” and “Proper” . E.g. sense of what is “Right” and “Proper” . E.g. For some social cause: clean envt. EtcFor some social cause: clean envt. Etc..
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LO3
Advertising AppealsProfit
Health
Love or romance
Fear
Admiration
Convenience
Fun and pleasure
Vanity and egotism
Environmental Consciousness
Product saves, makes, or protects money
Appeals to body-conscious or health seekers
Used in selling cosmetics and perfumes
Social embarrassment, old age, losing health
Reason for use of celebrity spokespeople
Used for fast foods and microwave foods
Key to advertising vacations, beer, parks
Used for expensive or conspicuous items
Centers around environmental protection
Step 3. Designing a MessageStep 3. Designing a Message
Steps in Developing EffectiveCommunication
Steps in Developing EffectiveCommunication
AttentionAttention InterestInterest DesireDesire
Message ContentRational Appeals
Emotional AppealsMoral Appeals
Message StructureDraw Conclusions
Argument TypeArgument Order
Message FormatHeadline, Copy, Color,
Words, & Sounds,Body Language
ActionAction
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• Step 3:Step 3: Designing a Message Designing a Message Message Structure: Key decisions are Message Structure: Key decisions are
required with respect to three message required with respect to three message structure issues:structure issues:
Whether or not to draw a conclusionWhether or not to draw a conclusion One-sided vs. two-sided argumentOne-sided vs. two-sided argument Order of argument presentationOrder of argument presentation
Message Format: Design, layout, copy, color, Message Format: Design, layout, copy, color, shape, movement, words, sounds, voice, shape, movement, words, sounds, voice, body language, dress, etc.body language, dress, etc.
Developing Effective Communication
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• Step 4: Step 4: Choosing MediaChoosing Media Personal communication channelsPersonal communication channels
Includes face-to-face, phone, mail, and Includes face-to-face, phone, mail, and Internet chat communicationsInternet chat communications
Word-of-mouth influence is often criticalWord-of-mouth influence is often critical Buzz marketing cultivates opinion leadersBuzz marketing cultivates opinion leaders
Nonpersonal communication channelsNonpersonal communication channels Includes media, atmosphere, and eventsIncludes media, atmosphere, and events
Developing Effective Communication
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• Step 5: Step 5: Selecting the Message SourceSelecting the Message Source Highly credible sources are more persuasiveHighly credible sources are more persuasive A poor spokesperson can tarnish a brandA poor spokesperson can tarnish a brand
• Step 6:Step 6: Collecting Feedback Collecting Feedback Recognition, recall, and behavioral measures Recognition, recall, and behavioral measures
are assessedare assessed May suggest changes in product/promotionMay suggest changes in product/promotion
Developing Effective Communication
Budgeting Decisions
Two major decisionsTwo major decisions
• Establishing the size of the Establishing the size of the budgetbudget
• Allocating the budgetAllocating the budget
Budgeting decisions involve determining how much money will be spent on advertising and promotion each year and how the monies will be allocated
Top Management Sets the Spending Limit
The Promotion Budget Is Set to Stay Within the Spending Limit
Top-Down Budgeting
Top-Down Approaches
The Affordable MethodThe Affordable Method What we have to spare. What's left to spend.What we have to spare. What's left to spend.
Arbitrary Allocation MethodArbitrary Allocation Method No system. Seemed like a good idea at the No system. Seemed like a good idea at the
time.time.
Percentage of Sales MethodPercentage of Sales Method Set percentage of sales or amount per unit.Set percentage of sales or amount per unit.
Competitive Parity MethodCompetitive Parity Method Match competitor or industry average Match competitor or industry average
spending.spending.
Return on Investment MethodReturn on Investment Method Spending is treated as a capital investment.Spending is treated as a capital investment.
Percentage-of-SalesMethod
Affordable Method
Competitive-Parity
Method
Objective-and-TaskMethod
Setting the Total Promotion BudgetSetting the Total Promotion Budget
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• Setting the Total Promotional BudgetSetting the Total Promotional Budget Objective-and-Task MethodObjective-and-Task Method
Specific objectives are definedSpecific objectives are defined Tasks required to achieve Tasks required to achieve objectives are objectives are determined determined
Costs of performing tasks are Costs of performing tasks are estimated, then estimated, then summed to create the summed to create the promotional budgetpromotional budget
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Response Hierarchy Models
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• Setting the Overall Promotion Setting the Overall Promotion MixMix Determined by the Determined by the nature of nature of
each promotion tooleach promotion tool and the and the selected selected promotion mix strategypromotion mix strategy
Setting the Promotional Budget
and Mix
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Setting the Promotional Budget and Mix
• AdvertisingAdvertising• Personal SellingPersonal Selling
• Sales PromotionSales Promotion
• Public RelationsPublic Relations
• Direct MarketingDirect Marketing
• Reaches large, Reaches large, geographically dispersed geographically dispersed audiences, often with audiences, often with high frequencyhigh frequency
• Low cost per exposure, Low cost per exposure, though overall costs are though overall costs are highhigh
• Consumers perceive Consumers perceive advertised goods as more advertised goods as more legitimatelegitimate
• Dramatizes Dramatizes company/brandcompany/brand
• Builds brand image; may Builds brand image; may stimulate short-term salesstimulate short-term sales
• Impersonal; one-way Impersonal; one-way communicationcommunication
Promotion Promotion ToolsTools
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Setting the Promotional Budget and Mix
• AdvertisingAdvertising
•Personal Personal SellingSelling
• Sales PromotionSales Promotion
• Public RelationsPublic Relations
• Direct MarketingDirect Marketing
• Most effective tool for Most effective tool for building buyers’ building buyers’ preferences, preferences, convictions, and convictions, and actionsactions
• Personal interaction Personal interaction allows for feedback allows for feedback and adjustmentsand adjustments
• Relationship-orientedRelationship-oriented
• Buyers are more Buyers are more attentiveattentive
• Sales force represents Sales force represents a long-term a long-term commitmentcommitment
• Most expensive of the Most expensive of the promotional toolspromotional tools
Promotion Promotion ToolsTools
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Setting the Promotional Budget and Mix
• AdvertisingAdvertising
• Personal SellingPersonal Selling
•Sales Sales PromotionPromotion
• Public RelationsPublic Relations
• Direct MarketingDirect Marketing
• May be targeted at the May be targeted at the trade or ultimate trade or ultimate consumerconsumer
• Makes use of a variety of Makes use of a variety of formats: premiums, formats: premiums, coupons, contests, etc.coupons, contests, etc.
• Attracts attention, offers Attracts attention, offers strong purchase strong purchase incentives, dramatizes incentives, dramatizes offers, boosts sagging offers, boosts sagging salessales
• Stimulates quick Stimulates quick responseresponse
• Short-livedShort-lived• Not effective at building Not effective at building
long-term brand long-term brand preferencespreferences
Promotion Promotion ToolsTools
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Setting the Promotional Budget and Mix
• AdvertisingAdvertising
• Personal Personal SellingSelling
• Sales Sales PromotionPromotion
• Public Public RelationsRelations
• Direct Direct MarketingMarketing
• Highly credibleHighly credible
• Many forms: news Many forms: news stories, news stories, news features, events and features, events and sponsorships, etc.sponsorships, etc.
• Reaches many Reaches many prospects missed via prospects missed via other forms of other forms of promotionpromotion
• Dramatizes company Dramatizes company or benefitsor benefits
• Often the most Often the most underused element underused element in the promotional in the promotional mixmix
Promotion Promotion ToolsTools
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Setting the Promotional Budget and Mix
• AdvertisingAdvertising
• Personal SellingPersonal Selling
• Sales PromotionSales Promotion
• Public RelationsPublic Relations
• Direct Direct MarketingMarketing
( If IMC is referred)( If IMC is referred)
• Many forms: Many forms: Telephone Telephone marketing, direct marketing, direct mail, online mail, online marketing, etc.marketing, etc.
• Four distinctive Four distinctive characteristics:characteristics: NonpublicNonpublic ImmediateImmediate CustomizedCustomized InteractiveInteractive
• Well-suited to Well-suited to highly targeted highly targeted marketing effortsmarketing efforts
Promotion Promotion ToolsTools
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• Promotion Mix StrategiesPromotion Mix Strategies Push strategyPush strategy:: trade promotions trade promotions
and personal selling efforts push the and personal selling efforts push the product through the distribution product through the distribution channels.channels.
Pull strategy:Pull strategy: producers use producers use advertising and consumer sales advertising and consumer sales promotions to generate strong promotions to generate strong consumer demand for products.consumer demand for products.
Setting the Promotional Budget and Mix
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• Checklist:Checklist: Integrating the Promotion Integrating the Promotion MixMix Analyze trends (internal and external)Analyze trends (internal and external) Audit communications spendingAudit communications spending Identify all points of contactIdentify all points of contact Team up in communications planningTeam up in communications planning Make all communication elements Make all communication elements
compatiblecompatible Create performance measuresCreate performance measures Appoint an IMC managerAppoint an IMC manager
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• Advertising and Sales PromotionAdvertising and Sales Promotion Avoid false and deceptive Avoid false and deceptive
advertisingadvertising
Trade promotions can not favor Trade promotions can not favor certain customers over otherscertain customers over others
Use advertising to promote socially Use advertising to promote socially responsible programs and actionsresponsible programs and actions
Socially Responsible Communications
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• Personal SellingPersonal Selling Salespeople must follow the rules of Salespeople must follow the rules of
“fair competition”“fair competition” Three day cooling-off rule protects Three day cooling-off rule protects
ultimate consumers from high ultimate consumers from high pressure tacticspressure tactics
Business-to-business sellingBusiness-to-business selling Bribery, industrial espionage, and Bribery, industrial espionage, and
making false and disparaging making false and disparaging statements about a competitor are statements about a competitor are forbiddenforbidden
Advertising Decisions
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Advertising Decisions
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What is Advertising?• Any form of Nonpersonal presentation Any form of Nonpersonal presentation
and promotion of ideas, goods, or and promotion of ideas, goods, or services by an identified sponsor.services by an identified sponsor.
• U.S. advertisers spend in excess of U.S. advertisers spend in excess of $175 billion each year.$175 billion each year.
• Advertising is used by:Advertising is used by: Business firms,Business firms, Nonprofit organizations,Nonprofit organizations, Professionals,Professionals, Social Agencies. Social Agencies.
Inverted Pyramid of Communications Effects
90% Awareness
70% Knowledge
40% Liking
25% Preference
20% Trial
5% UseC
onative
Cognitive
Affective
Advertising and Movement Toward Action
ConativeRealm of motives.Ads stimulate or direct desires.
AffectiveRealm of emotions.Ads change attitudes and feelings
CognitiveRealm of thoughts.Ads provide information and facts.
Purchase
Conviction
Preference
Liking
Knowledge
Awareness
Point of purchaseRetail store ads, Deals“Last-chance” offersPrice appeals, Testimonials
Competitive adsArgumentative copy
“Image” copyStatus, glamour appeals
AnnouncementsDescriptive copyClassified adsSlogans, jingles, skywritingTeaser campaigns
Related behavioral Dimensions
Movement toward purchase
Types of promotions and advertising at each step
Major Decisions in Advertising
Objectives SettingObjectives Setting
Budget DecisionsBudget Decisions
Message DecisionsMessage Decisions
Campaign EvaluationCampaign Evaluation
Media DecisionsMedia Decisions
Informative AdvertisingBuild Primary Demand
Informative AdvertisingBuild Primary Demand
Setting Objectives
Persuasive AdvertisingBuild Selective Demand
Persuasive AdvertisingBuild Selective Demand
Comparison Advertising
Compares One Brand to Another
Comparison Advertising
Compares One Brand to Another
Advertising Objectives• Specific Communication Task
• Accomplished with a Specific Target Audience • During a Specific Period of Time
Reminder AdvertisingKeeps Consumers Thinking
About a Product.
Reminder AdvertisingKeeps Consumers Thinking
About a Product.
The DAGMAR ApproachRecognition that communication effects are the logical basis for
advertising goals and objectives against which success or failure
should be measured.DDefineefine
AAdvertisingdvertising
GGoals foroals for
MMeasuringeasuring
AAdvertisingdvertising
RResultsesults
The DAGMAR Approach• An advertising goal is a An advertising goal is a
communication task that is communication task that is specific and measurable.specific and measurable.
• The communication task has four The communication task has four stages:stages: AwarenessAwareness ComprehensionComprehension ConvictionConviction ActionAction
Setting the Advertising Budget
Stage in the Product Life Cycle
Stage in the Product Life Cycle
Competition and Clutter
Competition and Clutter
Market Share
Market Share
Advertising Frequency
Advertising Frequency
ProductDifferentiation
ProductDifferentiation
Factors in Setting the Advertising
Budget
Advertising Budget Methods
Affordable, Percentage of Sales, Competitive-Parity and Objective-and-Task
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LOI
Top Ten Leaders by U.S.Advertising Spending
Top Ten Leaders by U.S.Advertising Spending
Plan a Message StrategyGeneral Message to Be Communicated to Customers
Plan a Message StrategyGeneral Message to Be Communicated to Customers
Advertising StrategyCreating Advertising Messages
Advertising StrategyCreating Advertising Messages
Develop a Message Focus on
Customer Benefits
Develop a Message Focus on
Customer Benefits Creative Concept“Big Idea”
Visualization or PhraseCombination of Both
Creative Concept“Big Idea”
Visualization or PhraseCombination of Both Advertising Appeals
MeaningfulBelievableDistinctive
Advertising AppealsMeaningfulBelievableDistinctive
Message Execution
TypicalMessage
ExecutionStyles
TypicalMessage
ExecutionStyles
TestimonialEvidence
TestimonialEvidence Slice of LifeSlice of Life
ScientificEvidence
ScientificEvidence LifestyleLifestyle
TechnicalExpertise
TechnicalExpertise FantasyFantasy
MusicalMusical
PersonalitySymbol
PersonalitySymbol
Mood orImage
Mood orImage
Turning the “Big Idea” Into an Actual Ad to Capture the Target Market’s Attention and Interest.
Selecting Advertising Media
Step 1. Decide on Reach, Frequency, and Impact
Step 1. Decide on Reach, Frequency, and Impact
Step 2. Choosing Among Major Media TypesMedia Habits of Target Consumers
Nature of the ProductType of Message
Cost
Step 2. Choosing Among Major Media TypesMedia Habits of Target Consumers
Nature of the ProductType of Message
Cost
Step 3. Selecting Specific Media VehiclesSpecific Media Within a Given Type, i.e. Magazines.Must Balance Media Cost Against Media Factors:
Audience Quality & Attention, Editorial Quality
Step 3. Selecting Specific Media VehiclesSpecific 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 TimingScheduling of Advertising Over the Course of a Year
Pattern of Ads: Continuity or Pulsing
Step 4. Deciding on Media TimingScheduling of Advertising Over the Course of a Year
Pattern of Ads: Continuity or Pulsing
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Learning
Media Selection Considerations
Cost perCost perContactContact
Cost perCost perContactContact
ReachReachReachReach
FrequencyFrequencyFrequencyFrequency
AudienceAudienceSelectivitySelectivityAudienceAudienceSelectivitySelectivity
The cost of reaching one member of the target market.
The cost of reaching one member of the target market.
The number of target consumers exposed to a commercial at least
once during a time period.
The number of target consumers exposed to a commercial at least
once during a time period.
The number of times an individual is exposed to a message during a time
period.
The number of times an individual is exposed to a message during a time
period.
The ability of an advertising medium to reach a precisely defined market.
The ability of an advertising medium to reach a precisely defined market.
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Alternative Media
Ads in MoviesAds in Movies
Interactive KiosksInteractive Kiosks
Computer Screen SaversComputer
Screen Savers
Shopping CartsShopping Carts
DVDsDVDs
AdvertainmentsAdvertainments
Cell Phone AdsCell Phone Ads
Subway Tunnel AdsSubway Tunnel Ads
Floor AdsFloor Ads
Video Game AdsVideo Game Ads
Advertising EvaluationAdvertising Evaluation
Communication Effects
Is the Ad Communicating Well?
Communication Effects
Is the Ad Communicating Well?
Advertising Program EvaluationAdvertising Program Evaluation
Sales Effects
Is the Ad Increasing Sales?
Sales Effects
Is the Ad Increasing Sales?
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Advertising Evaluation: It should evaluate both the 1)Communication Effect: It includes Copy Testing- tells whether the ad is communicating well. It can be Pretesting (Direct Rating, Portfolio Test & Laboratory Test) and Post Testing ( Recall Test and recognition Test).2)Measuring the Sales Effect: What sales are caused by an ad that increases brand awareness by 20% and brand preference by 10%?. Difficult but can know the sales effect by comparing past sales with past ad Expenditure.
Ways to Handle AdvertisingWays to Handle Advertising
Sales Departments inSmall Companies
Sales Departments inSmall Companies
Advertising Agency
Firm that Assists Companiesin Planning, Preparing,
Implementing and Evaluating Their
AdvertisingPrograms.
Advertising Agency
Firm that Assists Companiesin Planning, Preparing,
Implementing and Evaluating Their
AdvertisingPrograms.
Advertising Departments in Larger Companies
Advertising Departments in Larger Companies
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Lamb Hair McDaniel
©2004 South-Western/Thomson
Learning
Major Types of Advertising
InstitutionalAdvertisingInstitutionalAdvertising
ProductAdvertising
ProductAdvertising
Designed to enhance a company’s image rather than promote a
particular product.
Designed to enhance a company’s image rather than promote a
particular product.
Designed to tout the benefits of a specific good or service.
Designed to tout the benefits of a specific good or service.
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Lamb Hair McDaniel
©2004 South-Western/Thomson
Learning
Major Types of AdvertisingEnhance
corporation’s identityEnhance
corporation’s identity
PioneeringPioneering
CompetitiveCompetitive
ComparativeComparative
ProductProductAdvertisingAdvertising
ProductProductAdvertisingAdvertising
InstitutionalInstitutionalAdvertisingAdvertisingInstitutionalInstitutionalAdvertisingAdvertising
Advocacy advertisingAdvocacy advertising
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©2004 South-Western/Thomson
Learning
Product Advertising
PioneeringPioneeringPioneeringPioneering• Stimulates primary demand for
new product or category.• Used in the PLC introductory stage.
CompetitiveCompetitiveCompetitiveCompetitive• Influence demand for brand in the
growth phase of the PLC. • Often uses emotional appeal.
ComparativeComparativeComparativeComparative• Compares two or more competing
brands’ product attributes. • Used if growth is sluggish, or if
competition is strong.
International Advertising DecisionsInternational Advertising Decisions
Adaptation of Global Advertising
Adaptation of Global Advertising
Advertising Media Costs & Availability
Advertising Media Costs & Availability
Regulation of Advertising Practices
Regulation of Advertising Practices
© 2005 McGraw-Hill Ryerson Limited
Setting Objectives Using the Communications Effects Pyramid
Figure 4-5Figure 4-5
Sales Promotion
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What is Sales Promotion?What is Sales Promotion?• Mass communication technique that offers Mass communication technique that offers
short-term incentives to encourage purchase or short-term incentives to encourage purchase or sales of a goods or service.sales of a goods or service.
1) Consumer Promotion, 2)Trade Promotion and 1) Consumer Promotion, 2)Trade Promotion and 3)Sales force Promotion ( Three Target groups)3)Sales force Promotion ( Three Target groups)
• Rapid growth in the industry has been achieved Rapid growth in the industry has been achieved because:because: Product managers are facing more pressure Product managers are facing more pressure
to increase their current sales,to increase their current sales, Companies face more competition,Companies face more competition, Advertising efficiency has declined,Advertising efficiency has declined, Consumers have become more deal oriented.Consumers have become more deal oriented.
Point-of-PurchaseDisplays
Point-of-PurchaseDisplays
Consumer - Promotion Tools
PremiumsPremiums
Price PacksPrice Packs
Cash RefundsCash Refunds
CouponsCoupons
SamplesSamples
Short-Term Incentives to Encourage Purchase or Sales of a Product or Service.
Consumer-Promotion Objectives
Consumer-Promotion Tools
Patronage Rewards
Patronage Rewards
GamesGames
SweepstakesSweepstakes
ContestsContests
AdvertisingSpecialties
AdvertisingSpecialtiesPatronage Rewards
Entice Consumers to Try a New Product
Entice Consumers to Try a New Product
Lure Customers AwayFrom Competitors’ Products
Lure Customers AwayFrom Competitors’ Products
Get Consumers to “Load Up’on a Mature Product
Get Consumers to “Load Up’on a Mature Product
Hold & Reward Loyal Customers
Hold & Reward Loyal Customers
Consumer Relationship Building
Consumer Relationship Building
Specialty Advertising
Items
Specialty Advertising
Items
Trade - Promotion ToolsTrade - Promotion Tools
ContestsContests
Free GoodsFree Goods
Buy-BackGuarantees
Buy-BackGuarantees
AllowancesAllowances
Price-OffsPrice-Offs
Short-Term Incentives That are Directed to Retailers and Wholesalers.
Trade-Promotion Objectives
Trade-Promotion Tools
Patronage Rewards
Patronage Rewards
Push MoneyPush Money
DiscountsDiscounts
PremiumsPremiums
Displays
Persuade Retailers or Wholesalers to Carry a Brand
Persuade Retailers or Wholesalers to Carry a Brand
Give a Brand Shelf SpaceGive a Brand Shelf Space
Promote a Brand in Advertising
Promote a Brand in Advertising
Push a Brand to ConsumersPush a Brand to Consumers
Business - Promotion ToolsBusiness - Promotion Tools
Short-Term Incentives That are Directed to Industrial Customers.
Business-Promotion Objectives
Business-Promotion Tools
Generate Business LeadsGenerate Business Leads
Stimulate PurchasesStimulate Purchases
Reward CustomersReward Customers
Motivate SalespeopleMotivate Salespeople
ConventionsConventions
Trade ShowsTrade Shows
Sales ContestsSales Contests
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Sales-force Promotion :
Bonuses, Contest and Rallies.“ Best salesman of the Year Award” “ Trip to Europe or US for best performers”.
Decide on the Size of the IncentiveDecide on the Size of the Incentive
Set Conditions for ParticipationSet Conditions for Participation
Evaluate the ProgramEvaluate the Program
Determine How to Promote andDistribute the Promotion Program Determine How to Promote and
Distribute the Promotion Program
Determine the Length of the ProgramDetermine the Length of the Program
Developing the Sales Promotion Program Developing the Sales Promotion Program
Public Relations
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What is Public Relations?• Building good relations with the company’s Building good relations with the company’s
various publics by obtaining favorable various publics by obtaining favorable publicity, building up a good “corporate publicity, building up a good “corporate image” and handling or heading off image” and handling or heading off unfavorable rumors, stories and events.unfavorable rumors, stories and events.
• Major functions are:Major functions are: Press Relations Press Relations Product PublicityProduct Publicity Public AffairsPublic Affairs LobbyingLobbying Investor RelationsInvestor Relations DevelopmentDevelopment
PUBLIC RELATIONS
DefinitionDefinition““Public Relations in the management Public Relations in the management
function which evaluates public attitudes, function which evaluates public attitudes, identifies the policies and procedures of an identifies the policies and procedures of an
individual or an organization to with the individual or an organization to with the public Definition cont.public Definition cont.
interest, and executes a program of action interest, and executes a program of action to earn public understanding and to earn public understanding and acceptance.”acceptance.”
American Association of Advertising American Association of Advertising AgenciesAgencies
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Company’s Various Publics
•Financial Publics: Banks, Investment houses..•Government Publics: Govt. Laws.•Media Publics: Newspapers, Magazines ..•Citizen-action Publics: Envt. Groups etc.•Local Publics: Neighborhood, Community organizations.•General Publics: Public Image of co.•Internal Publics: employees and others.
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©2004 South-Western/Thomson
Learning
Public Relations
Evaluates public attitudes
Evaluates public attitudes
Identifies issues of public concern
Identifies issues of public concern
Executes programs to gain public acceptance
Executes programs to gain public acceptance
The Role of The Role of Public RelationsPublic Relations
The Role of The Role of Public RelationsPublic Relations
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©2004 South-Western/Thomson
Learning
Functions of Public Relations
Press Relations Press Relations Press Relations Press Relations
Product PublicityProduct PublicityProduct PublicityProduct Publicity
Corporate CommunicationCorporate CommunicationCorporate CommunicationCorporate Communication
Public AffairsPublic AffairsPublic AffairsPublic Affairs
LobbyingLobbyingLobbyingLobbying
Employee and Investor RelationsEmployee and Investor RelationsEmployee and Investor RelationsEmployee and Investor Relations
Crisis ManagementCrisis ManagementCrisis ManagementCrisis Management
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SpecialEvents
SpecialEvents
Written MaterialsWritten
Materials
Corporate Identity Materials
Corporate Identity Materials SpeechesSpeeches
NewsNews
AudiovisualMaterials
AudiovisualMaterials
Major Public Relations ToolsMajor Public Relations Tools
Public Service
Activities
Public Service
Activities
Web SiteWeb Site
Click to add titleClick to add title
Setting Public Relations ObjectivesSetting Public Relations Objectives
Choosing the Public Relations Messages and Vehicles
Choosing the Public Relations Messages and Vehicles
Implementing the Public Relations PlanImplementing the Public Relations Plan
Evaluating Public Relations ResultsEvaluating Public Relations Results
Major Public Relations DecisionsMajor Public Relations Decisions
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Marketing Debate What is the biggest obstacle to marketing communications program?Take a position:1. The biggest obstacle to effective promotionmix is a lack of agency coordinationacross communication units.1. 2. The biggest obstacle to effective promotionmix is a lack of understanding as to how to optimally design and evaluate suchprograms.
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Marketing Discussion
Pick a Brand and go to the Web site.Locate as many forms of
communication as you can find. Conduct an informal communications
audit. What do you notice? Howconsistent are the different
communications?
Personal Selling
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The Nature of Personal Selling• Most salespeople are well-Most salespeople are well-
educated, well-trained professionals educated, well-trained professionals who work to build and maintain who work to build and maintain long-term customer relationships.long-term customer relationships.
• The term salesperson covers a wide The term salesperson covers a wide range of positions:range of positions: Order takerOrder taker: Department store clerk: Department store clerk Order getterOrder getter: Creative selling in : Creative selling in
different environmentsdifferent environments
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The Role of the Sales Force
• Personal selling is a paid, personal form of Personal selling is a paid, personal form of promotion.promotion.
• Involves two-way personal communication Involves two-way personal communication between salespeople and individual between salespeople and individual customers.customers.
• Salespeople:Salespeople: Probe customers to learn about problemsProbe customers to learn about problems Adjust marketing offers to fit special needsAdjust marketing offers to fit special needs Negotiate terms of salesNegotiate terms of sales Build long-term personal relationshipsBuild long-term personal relationships
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The Role of the Sales Force
Sales Force serves as critical link between company and its customers
They represent the company to the customers
They represent the customers to the company
Goal =Customer Satisfaction and Company Profit
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Major Steps in Sales Force Management
Figure 13.1
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Step 1: Sales Force Structure
Territorial: Salesperson assigned to exclusive area and sells full line of
products
Product: Sales force sells only certain product lines
Customer: Sales force organizes along customer or industry lines
Complex: Combination of several types of structures
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Inside Sales Force
• Conduct business from their Conduct business from their offices via telephone or visits offices via telephone or visits from perspective buyers.from perspective buyers.
• Includes:Includes: Technical support peopleTechnical support people Sales assistantsSales assistants TelemarketersTelemarketers
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Step 2: Recruiting and Selecting Salespeople
• Key talents of salespeople:Key talents of salespeople: Intrinsic motivationIntrinsic motivation Disciplined work styleDisciplined work style Ability to close a saleAbility to close a sale Ability to build relationships with Ability to build relationships with
customerscustomers
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Recruiting Salespeople• RecommendationRecommendation
s from current s from current sales forcesales force
• Employment Employment agenciesagencies
• Classified adsClassified ads
• Web searches
• University and college students
• Recruit from other companies
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Step3: Sales Force Training Goals
Learn about and identify with the company.
Learn about the company’s products.
Learn customers’ and competitors’ characteristics.
Learn how to make effective presentations.
Learn field procedures and responsibilities.
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Step4 : Compensating Salespeople
• Fixed amount: Fixed amount: Salary Salary
• Variable amount:Variable amount: Commissions or bonusesCommissions or bonuses
• Expenses:Expenses: Repays for job-related expendituresRepays for job-related expenditures
• Fringe benefits:Fringe benefits: Vacations, sick leave, pension, etc.Vacations, sick leave, pension, etc.
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Step 5: Supervising Salespeople
• DirectingDirecting Salespeople Salespeople Help them identify customers and Help them identify customers and
set call norms.set call norms. Specify time to be spent Specify time to be spent
prospectingprospectingAnnual call planAnnual call planTime-and-duty analysisTime-and-duty analysisSales force automation systemsSales force automation systems
How Salespeople Spend Their Time
Supervising Salespeople
• MotivatingMotivating Salespeople Salespeople Organizational climateOrganizational climate Sales quotasSales quotas Positive incentives:Positive incentives:
Sales meetingsSales meetingsSales contestsSales contestsRecognition and honorsRecognition and honorsCash awards, trips, profit sharingCash awards, trips, profit sharing
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Sales Force IncentivesMany companies offer cash, trips, or merchandise as incentives.
Marriott suggests that companies reward outstanding sales performers by letting them “spread their wings and reenergize” at fabulous Marriott resorts worldwide.
Steps in Effective Selling
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13-109
Major Steps in Effective Selling
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The Personal Selling Process
ProspectingThe salesperson identifies qualified
potential customers
Pre-approachThe salesperson learns as much as possible about a
prospective customer before making a sales call
ApproachThe salesperson meets the customer for
the first timePresentation
The salesperson tells the “product story” to the buyer, highlighting customer
benefits
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The Personal Selling Process
Handling ObjectionsThe salesperson seeks out, clarifies, and overcomes customer objections to buying
ClosingThe salesperson asks the customer for an
order
Follow-upThe salesperson follows up after the sale
to ensure customer satisfaction and repeat business
Ambush Marketing
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What is Ambush Marketing?
• Generally defined as:Generally defined as:• marketing and promotional marketing and promotional
activities that:activities that: seek an association with a seek an association with a
sponsored eventsponsored eventwithout the authorization or consent without the authorization or consent
of the organizer of the event or of the organizer of the event or sponsor, andsponsor, and
without paying the requisite feewithout paying the requisite fee
ambush marketing?• Goal:Goal:
to misappropriate or capitalize on the to misappropriate or capitalize on the
goodwill and popularity of the sponsored goodwill and popularity of the sponsored
eventevent
intentionally confuse the public into intentionally confuse the public into
thinking that the ambush marketer is the thinking that the ambush marketer is the
official sponsor of the eventofficial sponsor of the event
to deflect some attention away from the to deflect some attention away from the
competing sponsorscompeting sponsors
to reduce the effectiveness of their to reduce the effectiveness of their
communication while also undermining the communication while also undermining the
value and the quality of the sponsorship value and the quality of the sponsorship
opportunity that was soldopportunity that was sold
Ambush Marketing?• The result:The result:
consumers may be confused as to who is consumers may be confused as to who is the official sponsor of the eventthe official sponsor of the event
ambush marketing may impact negatively ambush marketing may impact negatively on sponsorship rightson sponsorship rights
• Therefore:Therefore: sponsors seek some guarantee from the sponsors seek some guarantee from the
organizer of the event that offenders will be organizer of the event that offenders will be pursued (in the sponsorship agreement)pursued (in the sponsorship agreement)
Forms ambush marketing
• Simultaneous promotions (for example: Simultaneous promotions (for example: sample/free product distribution at sample/free product distribution at sponsored event, billboard advertising sponsored event, billboard advertising or flying blimp with advertiser’s mark or flying blimp with advertiser’s mark over venue)over venue)
• Purchase of sub-category rights (for Purchase of sub-category rights (for example: broadcast rights purchased example: broadcast rights purchased from a TV network from marketers who from a TV network from marketers who are not official sponsors of the event for are not official sponsors of the event for the duration of the sponsored event)the duration of the sponsored event)
Direct Marketing
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Direct Marketing• Direct marketing consists of Direct marketing consists of
direct connections with carefully direct connections with carefully targeted individual consumers to targeted individual consumers to both obtain an immediate both obtain an immediate response and cultivate lasting response and cultivate lasting customer relationships. customer relationships.
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The New Direct-Marketing Model
• Some firms use direct marketing as Some firms use direct marketing as a a supplementalsupplemental medium. medium.
• For many companies, direct For many companies, direct marketing constitutes a marketing constitutes a new and new and complete modelcomplete model for doing business. for doing business.
• Some firms employ the direct model Some firms employ the direct model as their as their onlyonly approach. approach.
• Some see this as the new marketing Some see this as the new marketing model of the next millennium.model of the next millennium.
Benefits of Direct Marketing
• Benefits to Benefits to BuyersBuyers:: ConvenientConvenient Easy to useEasy to use PrivatePrivate Ready access to products Ready access to products
and informationand information Immediate and interactiveImmediate and interactive
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Benefits of Direct Marketing• Benefits to Benefits to SellersSellers::
Powerful tool for building Powerful tool for building customer relationshipscustomer relationships
Can target small groups or Can target small groups or individualsindividuals
Can tailor offers to individual Can tailor offers to individual needsneeds
Can be timed to reach prospects at Can be timed to reach prospects at just the right momentjust the right moment
Gives access to buyers they could Gives access to buyers they could not reach through other channelsnot reach through other channels
Offers a low-cost, efficient way to Offers a low-cost, efficient way to reach marketsreach markets
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Customer Databases
• An organized collection of comprehensive An organized collection of comprehensive data about individual customers or data about individual customers or prospects, including geographic, prospects, including geographic, demographic, psychographic, and behavioral demographic, psychographic, and behavioral data. data.
• Databases can be used to identify prospects, Databases can be used to identify prospects, tailor products, and maintain customer tailor products, and maintain customer relationshipsrelationships
• Database marketing requires substantial Database marketing requires substantial investment in hardware, software, personnelinvestment in hardware, software, personnel
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Forms of Direct Marketing
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Direct-Mail Marketing
• Involves sending an offer, Involves sending an offer, announcement, reminder, or other announcement, reminder, or other item to a person at a particular item to a person at a particular address.address.
• Accounts for a high proportion of Accounts for a high proportion of direct-marketing sales.direct-marketing sales.
• Permits high Permits high target-market selectivity.target-market selectivity.
• Personal and flexible.Personal and flexible.
• Easy to measure results.Easy to measure results.
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Catalog Marketing
• With the Internet, more and more With the Internet, more and more catalogs going electronic.catalogs going electronic.
• Print catalogs still the primary Print catalogs still the primary medium.medium.
• Harder to attract new customers Harder to attract new customers with Internet catalogs.with Internet catalogs.
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Direct-Response TV Marketing
Direct-Response Advertising
Infomercials
Home Shopping Channels
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Integrated Direct-Marketing
The use of carefully coordinated multiple-media, multiple-stage campaigns.