Clint Giwer, Adam Gray, Cassidy Hill Final media Project JB 3013 Clint Giwer, Adam Gray, Cassidy Hill

Lowe’s Media Plan Pages Item 1-2 Cover Sheet and table of contents 3-8 Situational Analysis 9 Marketing Goals 10-15 Media Objectives 16-21 Media Strategies 22-23 Media Tactics and pie chart 24-25 Media Scheduling and Cost 26-27 Plan Performance and summary 28-32 Appendix

Situational Analysis Product Evaluation Consumer Evaluation From its founding in 1946, the number one goal of Lowe’s is helping customers improve the places they call home. Now, in 2010, they are making it even easier for customers to do so. There are over 1,700 stores located in the U.S. and Canada. Whether it’s a new refrigerator, floor or maybe a new lawnmower for the summer, Lowe’s has it. Consumer Evaluation Lowes consumers are generally older males and females with an above average income.

Situational Analysis Target Market Demographics: Age: 25-49 years old Sex: Almost even with 49% males and 51% females Income: average income of 60-100k Race: Caucasian Marital Status: Married Education: College or more

Situational Analysis Sales History In the 2007 fiscal year, Lowe’s net sales were $48,283 million dollars with a gross margin of 34.64%. In the 2008 fiscal year, Lowe’s dropped to $48,230 million dollars in net sales and the gross margin fell to 34.21%. In December of 2009 Lowe’s hit their year high with 9.1 million

Situational Analysis S.W.O.T. Strengths Has brands exclusive to Lowe’s Good brand recognition. Located in all 50 states, and becoming globalized. Competitive prices. Weaknesses Harder to reach lower income target market. Less trust in housing market. Opportunities Room for expansion. Threats Home Depot is still the leader in Home improvement.

Situational Analysis Competitive Analysis Home Depot is Lowe’s biggest competitor. They operate primarily in The United Sates, but also have stores in Canada, Mexico and China. As of Feb 3, 2008 Home Depot has a total of 2,234 stores. 1,950 are Home Depots in the United States. They also own and operate other home improvement stores like 34 EXPO design center stores, 5 Yard Bird stores and 2 THD Design Center stores. Ace Hardware is another major competitor. They have 4400 stores in the U.S. and are growing at a rate of about 100 stores per year.

Situational Analysis Advertising History Lowe’s is currently being advertised as the best place to get good prices with name brand appliances and anything for home improvement. They own and exclusively sell certain brands customers can only find at Lowe’s. Lowe’s is the second largest home improvement retailer worldwide, and boasts it will beat any competitor’s price by 10%. Since 2006 Lowe’s slogan has been “Let’s build something together.” Lowe’s is also associated with racing. It is the associated sponsor of the Atlanta motor speedway and Bristol motor speedway and sponsor of the number 48 car driven by Jimmie Johnson.

Marketing Goals The main marketing goal is to increase Lowe’s sales to men and women ages 25-49 by 10 percent within one year.

Media Objectives Media Target The primary audience is both males and females ages 25- 49 with a college level education. They are married, have children and have an above average income. They are looking to use some of their disposable income to improve their home by painting, tiling and flooring, getting new appliances etc. Our advertising will be mainly focused on this demographic and the common problem of the need for home repairs and improvement.

Media Objectives Geographic Coverage National media will be used because Lowes is located in all 50 states with 1,616 stores nation wide.

Media Objectives Seasonality Lowe’s will be advertising mostly during the second and third quarter in spring and summer because during these months people are more inclined to undergo home improvement projects.

Media Objectives Reach and Frequency Optimum reach is 85% with a frequency of four. Our reach will increase during the third quarter during the summer months, which will encourage more people to shop at Lowe’s to get materials and ideas for their summer projects while our frequency will remain the same.

Media Objectives Creative Implications Our team will focus on visual advertisements, which include television, magazine and Internet ads. We will heavy up on internet ads because this is where we have the most room for growth and it is not as costly as television, that’s because Lowe’s has an extensive array of products, being able to see the products through visualization will benefit us. Internet advertising: Focus on using Internet ads to drawn people to Lowe’s website. Our target audience seeks knowledge and is web friendly; therefore reaching them on the Internet will be most beneficial. Our target audience will want to compare prices online before making purchases, as well as preview the merchandise before being committed to making purchases.

Media Objectives Promotional Support The seasonality of Lowe’s advertisements as well as their placement will encourage shopping and buying materials for summer projects in stores and online.

Media Strategies Target Audience We will reach our target audience mainly through use of television ads, but also advertise in magazines, the internet and the radio to increase the number of people exposed to the message. Rationale: Television will be the most effective medium for a national advertising campaign because it will reach the highest percentage of the target audience. Using the internet, magazines and the radio will increase combined reach.

Media Strategies Geographic Coverage Lowe’s will use national television, internet, magazines and radio advertisements. Rationale: Because our target audience is so large Lowe’s must use a national advertising campaign to each the largest number of people.

Media Strategies Pattern of Scheduling Pattern of scheduling will be during warm seasons, during April – September Lowe’s will heavy up on ads on television, and the radio starting in July. Rationale: Because advertising is expensive Lowe’s will only advertise in it’s peak season when people are working on summer projects. People are not as likely to work on outdoor projects during the winter. The reach for television will increase in July – September.

Media Strategies Reach / Frequency Because Lowe’s is using a national advertising campaign, the frequency will be lower at 4 in order to compensate for budget. Rationale: Because Lowe’s brand is already well known the strategy will exercise a higher reach and a lower frequency in order to expose the maximum number of people to the message. The television and radio advertising will have a low frequency. This will ensure the highest number of people are exposed to the message.

Media Strategies Creative Implications Lowe’s will focus on visual advertisements, because Lowe’s has an extensive array of products, being able to see the products through visualization be beneficial. Rationale: Focus on using Internet ads to drawn people to Lowe’s website. Our target audience seeks knowledge and is web friendly; therefore reaching them on the Internet will be most beneficial. Our target audience will want to compare prices online before making purchases, as well as preview the merchandise before being committed to making purchases.

Media Strategies Promotional Support Heavying up in television will be promotional support. Rationale: Having advertisements in every medium will allow Lowe’s to have a large reach ensuring that the target market is exposed to the message.

Media Tactics Television: Lowe’s will will have a 30 second spot on Home an Garden Television, during primetime. Internet: Low’s will have a run on site ad on the NASCAR website. Magazine: Lowe’s will have six half page ads in Better Homes and Gardens. Radio: Lowe’s will use national radio advertisements in early morning drivetime during July – September.

Pie Chart

Media Flowchart

Budget Worksheet

Plan Performance Medium Weeks of advertising GRPs Net Reach Avg. frequency Esimated Cost TV 22 2,220 92 4 $23,250,060 Magazine 6 133 22.2 $1,830,600 Radio 10 525 62 $2,100,000 Internet 26 560 70 $7,735,700 TOTAL 3438 98 $ 34,916,360

Summary This Media Plan will allow Lowe’s to reach more than 100 million people in it’s target market with TV, internet, magazine and radio ads. With these reach and frequency goals 99% of the target market will be exposed to Lowe’s advertisements an average of four times a month.

Appendix TV calculations Home and Garden Television Reach 92 Frequency 4 GRP 2,220 Combined GRP: 900 + 1320 = [ 2,220 ] Combined Reach: (impr.) 101,669,200 / (Universe) 110,510,000 = .92 [92%] Combined Frequency: (combined GRP) 2220 / (combined reach) 92 = [ 24 ] Gross Impressions: (universe) 110,510,000 x (GRP) 2220 = [ 245,332,200,000 ]

Appendix Internet Calculations NASCAR website Reach 70 Frequency 4 GRP 280 Combined GRP: (R) 70 x (F) 4 = [ 280 GRP ] Combined Reach: (impr.) 77,357,000 / (Universe) 110,510,000 = .7 [ 70% ] Combined Frequency: 280 / 70 = 4 Gross Impressions: (univ) 110,510,000 x (comb. GRP) 280 = [ 30,942,800,000 ]

Appendix Magazine Calculations Better Homes and Gardens Reach 22.2 Frequency 6 GRP 133 Combined GRP: (R) 22.2 x (F) 6 = [ 133.2 GRP ] Combined Reach: (impr.) 24,533,220 / (Universe) 110,510,000 = .222 = 22% Combined Frequency: 33 / 22.2 = [ 1.5 ] Gross Impressions: (univ) 110,510,000 x (comb. GRP) 133.2 = [ 14,719,932,000 ]

Appendix Radio National Radio Reach 52.5 Frequency 10 GRP 525 Combined GRP: (R) 52.5 x (F) 10 = [ 525 GRP ] Combined Reach: (impr.) 58,017,750 / (Universe) 110,510,000 = .525, [ 52%] Combined Frequency: 33 / 22.2 = [ 1.5 ] Gross Impressions: (univ) 110,510,000 x (comb. GRP) 133.2 = [ 14,719,932,000 ]

Appendix Combined Reach TV 92% Magazine 22.2% Internet 70% Radio 52% TOTAL 0.92+0.222=1.142, .92 x .222 = 0.2, 1.142-.2 =.942 94% .94 + .7 =1.64, .94 x .7 = .658, 1.64 - .658 = .982, 98% .982 + .52 = 1.502, .982 x .52 = .509, 1.502 - .501 = .993, 99% [ 99.3% ] of total market is reached. That’s 109,736,430 people!