©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-0 Chapter 15 Advertising, Direct Marketing, and M-Commerce

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-1 Chapter Objectives  Tell what advertising is and describe the major types of advertising  Describe the process of developing an advertising campaign  Explain how marketers evaluate advertising  Understand direct marketing  Explain the future of m-commerce

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-2 It’s an Ad Ad Ad Ad World  Advertising is nonpersonal communication paid for by an identified sponsor using mass media to persuade, inform, and remind an audience.

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-3 Types of Advertising  Product advertising - message focuses on a specific product  Institutional advertising - message focuses on activities, personality, or point of view of a company –advocacy advertising –public service advertisements (PSAs)

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-4 Who Does Advertising?  An advertising campaign is a coordinated, comprehensive plan that carries out promotion objectives and results in a series of advertisements placed in media over a period of time  Agencies –limited-service –full-service

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-5 The Body of Campaign Creation  Account management (soul)  Creative services (heart)  Research and marketing services (brains)  Media planning (legs)

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-6 Developing the Advertising Campaign  Identify the Target Market  Establish Objectives, Message, and Budget  Design Ad Campaign  Pretest Campaign  Choose Media and Schedule

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-7 Establish Objectives  Message goals  Budget

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-8 Design the Ad  Creative strategy is the process that turns a concept into an advertisement  Creatives try to develop a “big idea”  Creatives: –art directors –copywriters –photographers

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-9 Advertising Appeals  Reasons Why (USP)  Comparative Advertising  Demonstration  Testimonial  Slice-of-Life  Lifestyle  Fear  Sex  Humor  Slogans/Jingles

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-10 Name that Brand!  Double your pleasure, double your fun  Good to the last drop  My bologna has a first name….  I’d like to buy the world a _____

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-11 Pretest What Will Be Said  Copy testing measures ad effectiveness –Concept testing –Test commercials (with animatics or storyboards) –Finished testing

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-12 Choose the Media  Media planning is a problem- solving process for getting a message to a target audience in the most effective fashion –Where to say it –When to say it

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-13 Television  Pros –Creative and flexible –Prestigious –High impact messages –Network TV is cost effective for reaching mass audience –Cable TV is good for reaching targeted group  Cons –Quickly forgotten –Requires frequent repetition –Increasingly fragmented audiences –High costs on an absolute basis –Shorter ads result in increased clutter

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-14 Radio  Pros –Good for selective targeting –Heard out of home –Relatively low cost –Can be modified fast –Uses listener imagination  Cons –Listeners may not pay full attention –Small audiences mean ads must be repeated frequently –Not appropriate for products requiring demonstration

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-15 Newspapers  Pros –Wide exposure and coverage –Flexible format –Useful for comparison shopping –Local retailers can tie in with national  Cons –Most don’t spend much time reading newspapers –Low readership among teens and young adults –Short life span –Very cluttered

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-16 Magazines  Pros –Target audiences –High credibility and interest level –Long life span and pass along rate –Excellent visual quality  Cons –With exception of direct mail, the most expensive form –Long deadlines –Must use several magazines to reach target

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-17 Outdoor  Pros –Very high reach –Low cost –Good for supplementing other media  Cons –Hard to communicate complex messages –Cannot demonstrate product effectiveness –Controversial and disliked

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-18 Direct Response  Pros –Ads can target extremely narrow audiences –Messages can be timed –Easy to measure effectiveness  Cons –High cost per exposure –Target lists must be constantly updated –Ads lack credibility among many consumers

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-19 Innovative Media  Place-based media - transmit messages in public places  Guerilla marketing - use unconventional locations and intensive word-of-mouth campaigns to push products

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-20 Internet Advertising  Banners  Buttons  Sponsorships  Search engine and directory listings  Pop-up ads  –permission marketing –spamming  Web site design

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-21 Media Scheduling  Specifies the exact media to use for the campaign, when and how often the message should appear  Outlines the planner’s best estimate of which media and vehicles will be most effective in attaining campaign objectives

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-22 Factors Affecting Media Scheduling  Target market profile  People reached by different vehicles  Advertising patterns of competitors  Capability of medium to convey desired information  Compatibility of product with editorial content

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-23 Media Scheduling Terms_1  Impressions - the number of people who will be exposed to a message placed in one or more media vehicles  Reach - the percentage of the target market exposed to the media vehicle  Frequency - the average number of times a person in the target group will be exposed to the vehicle

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-24 Media Scheduling Terms_2  Gross Rating Points (GRPs) - reach * frequency  Cost per Thousand (CPM) - compares the relative cost effectiveness of different media vehicles that have different exposure rates; it reflects the cost to deliver a message to 1,000 people

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-25 Media Scheduling: How Often?  Continuous - steady stream throughout year  Pulsing - varies amount of advertising based on when product is in demand (e.g., suntan lotion)  Flighting - advertising appears in short, intense bursts alternative with period of little to no activity

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-26 Evaluating Advertising  Posttesting means conducting research on consumers’ responses to advertising messages they have seen or heard –unaided recall –aided recall –attitudinal measures

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-27 Direct Marketing  Any direct communication to a consumer or business recipient that is designed to generate a response in the form of an order, a request for further information, and/or a visit to a store or other place of business for purchase of a product

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-28 Forms of Direct Marketing  Mail order –Catalogs –Direct mail  Telemarketing  Direct response television –Infomercials –Home shopping networks

©2003 Prentice Hall, IncMarketing: Real People, Real Choices 3rd edition15-29 M-Commerce  Promotional activities transmitted over mobile phones and other mobile devices such as personal digital assistants (PDAs) –Prevalent in Europe and Asia