1. www.mhhe.com/fourps For use only with Perreault/Cannon/McCarthy or Perreault/McCarthy texts. © 2008 McGraw-Hill Companies, Inc. McGraw-Hill/Irwin Advertising and Sales Promotion Advertising and Sales Promotion CHAPTER FIFTEEN

2. CH 15: Advertising & Sales Promotion CH 14: Personal Selling and Customer Service CH 13: Promotion Intro. To Integrated Marketing Communications Advertising spending Advertising strategy decisions Advertising and the law Sales promotion decisions Strategy Planning, Advertising, and Sales Promotion (Exhibit 15-1)

3. Advertising Spending as Percent of Sales for Illustrative Product Categories (Exhibit 15-2a)

4. Retail Ad Spending (Exhibit 15-2b)

5. Obtain Outlets Ongoing Contact Support Sales Force Maintain Relationships Get Immediate Action Obtain Outlets Introduce New Products Position Brands Introduce New Products Position Brands Ongoing Contact Support Sales Force AdvertisingObjectives Should be Specific Setting Ad Objectives Is a Strategy Decision

6. Objectives Guide Implementation (Exhibit 15-3)

7. Institutional Advertising Pioneering Advertising Product Advertising Competitive Advertising Reminder Advertising Direct Indirect Comparative Types of Advertising Types of Advertising Objectives Determine the Kinds of Advertising (Exhibit 15-4)

8. Cooperative Advertising Cooperative Advertising Integrated Communications Integrated Communications Integrated Communications Integrated Communications Cooperative Advertising Cooperative Advertising Allowances Advertising Allowances Advertising Allowances Advertising Allowances Key Issues Key Issues Vertical Cooperation Vertical Cooperation Vertical Cooperation Vertical Cooperation Ethical Concerns Coordinating Advertising Efforts with Cooperative Relationships

9. Media 2004 spend. (billions) 2004 spend. (billions) 2-year % growth Advantages Disadvantages Television & cable $67.8 25.3% Demonstrates well, good attention, wide reach Expensive in total, “clutter,” and less selective audience Direct mail $52.2 16.8 Selected audience, flexible, can personalize Relatively costly per contact, “junk mail,” hard to retain attention News- paper $46.6 5.9 Flexible, timely, local market May be expensive, short life, no “pass along” Radio $19.6 9.5 Wide reach, low cost segmented audience Wide reach, low cost segmented audience Weak attention, many different rates, short exposure Comparing Advertising Media (Exhibit 15-5)

10. Media 2004 spend. (billions) 2004 spend. (billions) 2-year % growth Advantages Disadvantages Yellow pages $14.0 1.4% Reaches local customers seeking purchase info. Many competitors listed in same place, hard to differentiate Magazine $12.3 11.8 Very targeted, good detail, good “pass along” Inflexible, long lead times Internet $6.9 40.8 Ads link to more detailed site, some “pay for results,” easy to track results Hard to compare costs with other media Outdoor $5.8 11.5 Flexible, repeat exposure, inexpensive “Mass market,” very short exposure Comparing Advertising Media (Exhibit 15-5)

11. Obtain Action Arouse Desire Hold Interest Get Attention Can Global Messages Work? AIDA – Attention, Interest, Desire and Action

12. Organi- zation Organi- zation Largest agencies HQ location 2005 revenue billions 2005 revenue billions Select clients Omnicon Group BBDO Worldwide, DDB Worldwide, TBWA Worldwide New York $10.48 DaimlerChrysler, IKEA, Exxon Mobil, Bud Light, McDonalds, Apple WPP Group J. W. Thompson, Oglivy & Mather, Grey Worldwide London $9.24 Bayer, Ford, HSBC, Mattel, Diamond Trading Company, 3M Inter- public Group McCann Erickson Worldwide, Foote Cone & Belding Worldwide, Lowe Worldwide New York $6.27 John Deere, Cadbury Schweppes, Quiznos, AOL, Black & Decker, General Motors Europe Advertising Agencies Often Do the Work

13. Organi- zation Organi- zation Largest agencies HQ location 2005 revenue billions 2005 revenue billions Select clients Dentsu Dentsu, Colby & Partners, DCA Advertising Tokyo $2.97* Kao, Toshiba, Canon, Matsushita, Hitachi, Shiseido Publicis Group Publicis Worldwide, Leo Burnett Worldwide, Saatchi & Saatchi Paris $4.95 Coca-Cola, British Airways, Hewlett- Packard, Kellogg’s, Visa, Hallmark Havas Euro RSCG Worldwide, MPG, Arnold Worldwide Suresnes France $1.75 Sony, Hershey’s, Verizon, Peugeot, Lee Jeans, eBay in China * 2004 revenues Advertising Agencies Often Do the Work

14. Sales Promotion: Do Something Different to Stimulate Change (Exhibit 15-6)