Chapter 13 Advertising, Sales Promotion, and Public Relations

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-2 Chapter Objectives  Understand advertising, the major types of advertising, and the criticisms of advertising  Describe the process of developing an advertising campaign and how marketers evaluate advertising  Explain sales promotion, and describe the different types of trade and consumer sales promotions activities  Explain the role of public relations (PR) and the steps in developing a PR campaign

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-3 Real People, Real Choices: Decision Time at BzzAgent  How should the firm respond to the negative articles which questioned “disclosure” in word-of-mouth marketing campaigns? –Option 1: Take charge of the discussion –Option 2: Defend without being defensive –Option 3: Go quiet

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-4 Advertising: The Image of Marketing  Marketers spent $285 billion on advertising in the U.S. in 2006  Marketers are increasingly diverting more money into alternative media –Product and brand placements are growing  Advertising: –Nonpersonal communication an identified sponsor pays for that uses mass media to persuade or inform an audience

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-5 Types of Advertising  Product advertising: Focuses on a specific good or service  Institutional advertising: Promotes the activities, personality, or point of view of an organization or company –Public service announcements (PSA) –Advocacy advertising

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-6 Types of Advertising  Retail and local advertising: Encourages customers to shop at a specific store or use a local service –Ad copy discusses store hours, locations, sales, and featured products  Do-it-yourself advertising –“Generation C” phenomenon: consumer- generated ad content on the Web

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-7 Who Creates Advertising?  Advertising campaign: A coordinated, comprehensive plan that carries out promotion objectives and results in a series of ads placed in media over a period of time –Limited-service agency –Full-service agency Account management Creative services Research and marketing services Media planning

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-8 Ethical Issues in Advertising  Ethical criticisms of advertising: –Advertising is manipulative –Advertising is deceptive and untruthful –Advertising is offensive and in bad taste –Advertising creates and perpetuates stereotypes –Advertising causes people to buy things that they don’t really need

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-9 Steps in Developing an Advertising Campaign  Step 1: Identify the target audiences  Step 2: Establish message and budget objectives  Step 3: Create the ads –Creative strategy: The process that turns a concept into an advertisement –Advertising appeal: The central idea of the ad

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-10 Types of Advertising Appeals  Reasons why—the unique selling proposition (USP)  Comparative advertising  Demonstration  Testimonial  Slice of life  Lifestyle  Fear appeals  Sex appeals  Humorous appeals  Slogans, jingles, and music

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-11 Steps in Developing an Advertising Campaign  Step 4: Pretest what the ads will say –Pretesting: Research method that seeks to minimize mistakes by getting consumer reactions to ad messages before they appear in the media

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-12 Steps in Developing an Advertising Campaign  Step 5: Choose the media type(s) and media schedule –Media planning: The process of developing media objectives, strategies, and tactics –Aperture: The best place and time to reach the target market

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-13 Where To Say It: Traditional Media  Television  Radio  Newspapers  Magazines  Directories

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-14 Where To Say It: Internet Advertising  Banners  Buttons  Pop-up ads  Search engine and directory listings  –Spamming –Permission marketing

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-15 Where To Say It: Indirect Forms of Advertising  Directories  Out-of-home media  Place-based media  Branded entertainment  Advergaming

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-16 Media Scheduling: When To Say It  Media schedule: –Specifies exact media to use and when to use it  Advertising exposure: –Defines degree to which the target market will see an ad message in specific vehicles  Impressions: –Measures number of people exposed to a message in one or more vehicles

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-17 Media Scheduling: When To Say It  Reach: –Measures percentage of target market exposed to media vehicle  Frequency: –Measures average number of times a person in the target group will be exposed to the message  Gross rating points (GRPs) –Reach multiplied by frequency  Cost per thousand (CPM): –The cost to deliver a message to 1,000 people

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-18 Media Scheduling: How Often To Say It  Typical advertising patterns: –Continuous schedule: Steady stream of advertising throughout year –Pulsing schedule: Varies the amount of advertising based on when the product is likely to be demanded –Flighting schedule: Advertising in short, intense bursts, alternated with periods in which no advertising is done

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-19 Steps in Developing an Advertising Campaign  Step 6: Evaluate the advertising –Posttesting: Research on consumers’ responses to advertising they have seen or heard Unaided recall Aided recall Attitudinal measures

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-20 Sales Promotion  Sales promotions: Programs designed to build interest in or encourage purchase of a product during a specified period of time –Deliver short-term sales results –Can target end consumers, channel partners, and/or employees

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-21 Sales Promotion Directed Toward the Trade  Allowances, discounts, and deals –Merchandising allowances –Case allowances  Co-op advertising  Increasing industry visibility –Trade shows –Promotional products –Point-of-purchase (POP) –Incentive programs

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-22 Sales Promotion Directed Toward Consumers  Price-based consumer sales promotion –Coupons –Price deals, refunds, and rebates –Frequency (loyalty/continuity) programs –Special/bonus packs

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-23 Sales Promotion Directed Toward Consumers  Attention-getting consumer promotions –Contests and sweepstakes Contests are based on skill Sweepstakes are based on chance –Premiums –Sampling The premiere technique for generating new product trial

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-24 Public Relations  Public relations: Communication function that seeks to build good relationships with an organization’s publics –Publics include consumers, stockholders, legislators, and other firm stakeholders –Basic rule of good PR, “Do something good, then talk about it”

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-25 Public Relations  Proactive PR activities stem from a firm’s marketing objectives –Publicity Unpaid communication about an organization that gets media exposure  PR is critical when a firm’s image is at risk due to negative publicity –PR staff is responsible for preparing a crisis management plan

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-26 Objectives of Public Relations  Typical objectives include: –Introducing new products to manufacturers –Introducing new products to consumers –Influencing government legislation –Enhancing the image of a firm –Enhancing image of a city, region, or country –Calling attention to a firm’s involvement with the community

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-27 Planning a PR Campaign  Multistep process includes: –Situation analysis –A statement of objectives –Specification of publics, communicated messages, and specific program elements –Timetable and budget –Discussion of program evaluation plan

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-28 Public Relations Activities  Press releases (various forms)  Internal PR  Investor relations  Lobbying  Speech writing  Corporate identity  Media relations  Sponsorships  Special events  Advice and counsel

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-29 Real People, Real Choices: Decision Made at BzzAgent  Joe chose option 1 –Implementation: BzzAgent took charge of the discussion, refined their disclosure policy, enforced compliance, researched the relationship between disclosure and campaign performance, and issued press releases about revised policy –Measuring success: The disclosure debate did not interfere with the company’s financing or client relationships

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-30 Keeping It Real: Fast-Forward to Next Class Decision Time at Woodtronics  Meet Jeffrey Brechman, a principal of the Woodtronics firm  Woodtronics designs and builds trading room furniture, command centers, and network control centers  The decision to be made: Should Jeffrey sell the new or original product to the Jersey City client?

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall13-31 Copyright © 2009 Pearson Education, Inc. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.