Promotion Integrated Marketing Communication Elements of promotion ● Advertising Strategies ● Other Methods of Promotion

Learning Objectives Understanding the obstacles that advertising messages face Understanding the choices facing marketing managers regarding Promotional objectives Promotional message Media choice Advertising and promotion spending

Elements of the Promotion Mix Advertising Sales Promotion Sales Coupons Rebates Premiums Personal selling Public relations Direct marketing

Promotion by Decision Stage Pre-purchase Influence decision, preference Samples to induce trial Purchase Sales promotion Point-of-purchase (POP) displays Post-purchase Increase repurchase propensity

Developing the Advertising Program IDENTIFYING THE TARGET AUDIENCE SPECIFYING ADVERTISING OBJECTIVES SETTING THE ADVERTISING BUDGET DESIGNING THE ADVERTISEMENT(S)

Some Media Alternatives Television Conventional advertisements Infomercials Sponsorship programming “Placements” In programming “Superimposed” Radio Magazines Newspapers Outdoor Internet Point-of-purchase Other Movie theaters On other products

Reaching the Customer: Encoding, “Noise,” and “Decoding” Other ads News articles Other store displays SENDER ENCODING THE MESSAGE MESSAGE CHANNEL DECODING THE MESSAGE RECEIVER Media, Salesperson Retail store News program Mktg mgr Advertising mgr Advertising agency Advertisement Coupon Sales presentation Press release Store display Receiver interpretation of the message Customers Media audience News media Clients CHANNEL FEEDBACK Text, p. 211.

Some Promotional Objectives Brand awareness Knowledge of product category Existence Benefits Functions Technology Knowledge of brand differences Brand attitude Favorable beliefs about the brand Overall Relative to competitors Product category or brand trial Brand preference Willingness to pay a premium for the brand Resistance to competitor promotions (e.g., sales, coupons) Willingness to buy under less convenient circumstances Increase in product category or brand usage Quantity used Frequency used Scope of uses Increase in short term sales

Promotional Objectives Across the Product Life Cycle (PLC) Introduction Advertising and public relations  awareness Sales promotion  trial Personal selling  distribution Growth Advertising and PR  brand loyalty Less emphasis on sales promotion Maturity Advertising persuasion, reminder Sales promotion  market share Decline Reduction in advertising and PR More emphasis on sales promotions  temporary sales Text, p. 217

Increase in Product Category or Brand Usage—Product Category Potential Examples Scope of uses Orange juice: “It isn’t just for breakfast anymore” Baking soda ZipLock™ bags WD-40™ (lubrication and sticker removal) Quantity used Calcium supplements Milk Frequency used Cosmetics Deodorant Wine Greeting cards Phone calls Cell phone minutes Call to family/friends Hotels, airlines Conference calls Car engine oil Canned soup

Communications Objectives Informing Awareness Interest Benefits Other information Persuading Preference based on competitive advantages Brand switching or prevention of brand switching Reminding Trigger memories Maintain preference and buying habits

Some Advertising Strategies Comparative ads Illegal in most countries Generally very disliked by U.S. consumers but still relatively effective Humor appeal A way to get attention to the advertisement—but the consumer may remember the humor and not what the product featured was Adding beliefs Classical conditioning (association) Fear appeal To be effective: Feared stimulus must be of medium intensity—enough to motivate action but not so intense that the individual “tunes out” the ad A clear solution must be offered—e.g., use Listerine™ to avoid tooth loss due to gingivitis Repetition Celebrity endorsements

The Elaboration Likelihood Model and Likely Effectiveness of Celebrity Endorsements Is endorser congruent with product endorsed? Product important or expensive? Yes High elaboration No Yes Low elaboration No More likely to be effective Unlikely to be effective Celebrity endorsements more likely to be effective 7

Executing The Advertising Program Pre-testing Several “story boards” or actual ads are created Ads are tested on consumers Instant response technologies (consumers either rate approval or have physiological measures taken throughout an ad duration The best performing ad or ads are chosen subject to constraints imposed (e.g., need to specify a certain message or use certain types of models) Possible redesign Carrying out advertisement Full service agencies Limited service agencies In-house

Advertising Intensity and Return --A Typical Relationship The “S”-Shaped Curve 1 0.8 high effectiveness Relatively 0.6 Saturation Point Response (e.g., sales, recall) 0.4 0.2 Too little to do much good 5 10 15 20 25 Amount of Advertising Spending

Sample Exam Question

Measuring Advertising Effect Several possible criteria: Scanner data Individual TV exposure can be matched against actual purchases Available only for grocery products Increase in sales (but it may be impossible to separate effects of different simultaneous ads) Lab studies: Recall Attitude toward product Preference

Japanese Advertising—Use of animation and cartoon characters

Breaking Through the Clutter