Advertising, Sales Promotion, and Public Relations

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 Explain what sales promotion is and describe the different types of trade and consumer sales promotion activities Explain the role of public relations Describe the steps in developing a public relations campaign

Real People, Real Choices BzzAgent, Inc. (Joe Chernov) Negative articles questioned “disclosure” in word-of-mouth marketing campaigns What public relations strategy to use to respond to the criticism? Option 1: take charge of the discussion. Option 2: defend without being defensive. Option 3: go quiet.

Advertising: The Image of Marketing Advertising: nonpersonal communication paid for by an identified sponsor using mass media to persuade or inform an audience

Types of Advertising Product advertising: focuses on a specific good/service

Types of Advertising (cont’d) Institutional advertising: promotes the activities, personality, or point of view of an organization or company Advocacy advertising Public service announcement (PSA)

Types of Advertising (cont’d) Retail and local advertising: encourages customers to shop at a specific store or use a local service Do-it-yourself advertising “Generation C” phenomenon: consumer-generated ad content on the Web

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

Who Creates Advertising? (cont’d) Limited-service agency Full-service agency Account management Creative services Research and marketing services Media planning

Steps in Developing an Advertising Campaign Step 1: Identify the target audiences Step 2: Establish message and budget objectives Step 3: Design the Ads Creative strategy: process that turns a concept into an advertisement

Advertising Appeal: Central Idea of the Ad Reasons why: the Unique Selling Proposition (USP) Comparative advertising Demonstration Slice of life Lifestyle

Advertising Appeal: Central Idea of the Ad (cont’d) Testimonial Fear appeals Sex appeals Humorous appeals Slogans and jingles

Step 4: Pretest What the Ads Will Say Pretesting: seeks to minimize mistakes by getting consumer reactions to ad messages before they appear in the media Copy testing: measures effectiveness of ads

Step 5: Choose the Media Type(s) and Media Schedule Media planning: develops media objectives, strategies and tactics Aperture: is the best place and time to reach the target market

Where to Say It: Traditional Media Television Radio Newspapers Magazines Directories Out-of-home media Place-based media

Where to Say It: Internet Advertising Banners Buttons Search engine and directory listings Pop-up ads Email Spamming Permission marketing

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 advertising message in specific vehicles Impressions: measures number of people exposed to a message in one or more vehicles

Media Scheduling: When to Say It (cont’d) 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

Media Scheduling: When To Say It (cont’d) Gross rating points (GRPs) = reach X frequency Cost per thousand (CPM): the cost to deliver a message to 1,000 people

Media Scheduling: How Often To Say It Continuous schedule: puts out steady stream of advertising Pulsing schedule: varies the amount of advertising Flighting schedule: puts ads out in short, intense bursts

Step 6: Evaluate the Advertising Posttesting: research on consumers’ responses to advertising they have seen or heard Unaided recall Aided recall

Sales Promotion 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

Sales Promotion Directed Toward the Trade: Trade Promotions Discounts and deals Merchandising allowances Case allowances Increasing industry visibility Trade shows Promotional products Incentive programs (push money)

Sales Promotion Directed Toward Consumers Price-Based Consumer Sales Promotion Coupons Price deals, refunds, and rebates Frequency (loyalty/continuity) programs Special/bonus packs

Sales Promotion Directed Toward Consumers (cont’d) Attention-getting consumer promotion Contests and sweepstakes Premiums Sampling Point-of-purchase promotion Product/brand placements Cross-promotion

Public Relations PR: 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.

Public Relations (cont’d) Proactive PR activities stem from firm’s marketing objectives. Publicity: unpaid communication about an organization that gets media exposure. PR is even more important when firm’s image is at risk due to negative publicity. PR is responsible for preparing a crisis management plan.

Objectives of Public Relations Introducing new products to manufacturers Introducing new products to consumers Influencing government legislation Enhancing image of a firm Enhancing image of a city, region, or country Calling attention to a firm’s involvement with the community

Planning a Public Relations Campaign A statement of objectives Situation analysis Specification of publics, communicated messages, and specific program elements Timetable and budget Discussion of program evaluation plan

Public Relations Activities Press releases (timely topics, research project stories, and consumer information releases) Internal PR Investor relations Lobbying Speech writing Corporate identity

Public Relations Activities (cont’d) Media relations Sponsorships Special events Buzz-building: word-of-mouth/blogging Advice and counsel

Real People, Real Choices BzzAgent, Inc. (Joe Chernov) Joe chose option 1: take charge of the discussion. BzzAgent issued a press release announcing it had enhanced its disclosure policy, becoming the first company to enforce compliance with disclosure policies.

Marketing Plan Exercise (cont’d) --Outline an advertising campaign for the product and discuss the following: The type of appeal The main message The media (include at least one print and one broadcast medium) How you’ll develop the ads to share the same look and feel

Marketing in Action Case: You Make the Call What is the decision facing Amazon? What factors are important in understanding this decision situation? What are the alternatives? What decision(s) do you recommend? What are some ways to implement your recommendation?

Keeping It Real: Fast-Forward to Next Class, Decision Time at IBM Meet Esther Ferre, a General Manager at IBM. IBM sales teams are responsible for IBM relationships with clients and are evaluated on maximizing revenue and profits. The decision: How to allocate resources across a broad customer base?