1. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University Lamb, Hair, McDaniel 2007-2008 14 CHAPTER Integrated Marketing Communications

2. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 2 Learning Outcomes Discuss the role of promotion in the marketing mix Discuss the elements of the promotional mix Describe the communication process Explain the goal and tasks of promotion LO 1 LO 2 LO 3 LO 4

3. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 3 Learning Outcomes Discuss the AIDA concept and its relationship to the promotional mix Describe the factors that affect the promotional mix Discuss the concept of integrated marketing communications LO 5 LO 6 LO 7

4. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 4 Discuss the role of promotion in the marketing mix The Role of Promotion in the Marketing Mix LO 1

5. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 5 LO 1 The Role of Promotion Communication by marketers that informs, persuades, and reminds potential buyers of a product in order to influence an opinion or elicit a response. Promotion

6. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 6 LO 1 The Role of Promotion A plan for the optimal use of the elements of promotion:  Advertising  Public Relations  Sales Promotion  Personal Selling Promotional Strategy Promotional Strategy Competitive Advantage

7. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 7 LO 1 The Role of Promotion in the Marketing Mix Overall Marketing Objectives Marketing Mix Product Place Promotion Price Marketing Mix Product Place Promotion Price Target Market Promotional Mix Advertising Public Relations Sales Promotion Personal Selling Promotion Plan Promotional Mix Advertising Public Relations Sales Promotion Personal Selling Promotion Plan

8. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 8 LO 1 Competitive Advantage Unique features Excellent service Low prices Rapid delivery High product quality

9. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 9 REVIEW LEARNING OUTCOME LO 1 The Role of Promotion in the Marketing Mix

10. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 10 Discuss the elements of the promotional mix The Promotional Mix LO 2

11. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 11 The Promotional Mix LO 2 Combination of promotion tools used to reach the target market and fulfill the organization’s overall goals.  Advertising  Public Relations  Sales Promotion  Personal Selling Promotional Mix Promotional Mix

12. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 12 The Promotional Mix LO 2 Impersonal, one-way mass communication about a product or organization that is paid for by a marketer. Advertising

13. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 13 Advertising Media LO 2 Traditional Advertising Media New Advertising Media  Television  Radio  Newspapers  Magazines  Books  Direct mail  Billboards  Transit cards  Internet  Banner ads  Viral marketing  E- mail  Interactive video

14. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 14 Advertising LO 2 Advantages Disadvantages  Reach large number of people  Low cost per contact  Can be micro- targeted  Total cost is high  National reach is expensive for small companies

15. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 15 Public Relations LO 2 The marketing function that evaluates public attitudes, identifies areas within the organization that the public may be interested in, and executes a program of action to earn public understanding and acceptance. Public Relations Public Relations

16. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 16 LO 2 Beyond the Book Reality-Based Product Advertising  Jaguar is giving an $80,000 Jaguar XK to a select group of “beautiful people”—just to be seen in it  It is reality-based product placement—where real life blurs seamlessly into advertising  The success of the campaign is “how many people touch and see the car” SOURCE: Gina Chon, “Jaguar Tries a Living Product Placement,” Wall Street Journal, June 29, 2006, B1.

17. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 17 The Function of Public Relations LO 2  Maintain a positive image  Educate the public about the company’s objectives  Introduce new products  Support the sales effort  Generate favorable publicity

18. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 18 Sales Promotion LO 2 Marketing activities— other than personal selling, advertising, and public relations—that stimulate consumer buying and dealer effectiveness. Sales Promotion Online http://www.nabiscoworld.com

19. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 19 Sales Promotion LO 2 End Consumers End Consumers Trade Customers Company Employees Company Employees Free samples Contests Premiums Trade Shows Vacation Giveaways Coupons

20. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 20 Personal Selling LO 2 Planned presentation to one or more prospective buyers for the purpose of making a sale. Personal Selling Personal Selling

21. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 21 Personal Selling LO 2 Traditional Selling Traditional Selling Relationship Selling Relationship Selling

22. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 22 REVIEW LEARNING OUTCOME LO 2 Elements of the Promotional Mix

23. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 23 Describe the communication process Marketing Communication LO 3

24. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 24 LO 3 The process by which we exchange or share meanings through a common set of symbols. Online http://www.mcdonalds.com Communication

25. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 25 LO 3 Categories of Communication Categories of Communication Interpersonal Communication Interpersonal Communication Mass Communication Mass Communication Marketing Communication

26. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 26 LO 3 As SendersAs Receivers  Develop messages  Adapt messages  Spot new communication opportunities  Inform  Persuade  Remind Marketing Communication

27. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 27 LO 3 Noise Sender Encoding Message Feedback Channel Feedback Channel Message Channel Message Channel Decoding Message Decoding Message Receiver The Communication Process

28. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 28 LO 3 Characteristics of the Elements in the Promotional Mix

29. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 29 LO 3 Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Message Content Control Sponsor Identification Reaching Large Audience Message Flexibility Advertising Indirect and impersonal Low Little Delayed One-way Yes Fast Same message to all audiences Characteristics of the Elements in the Promotional Mix

30. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 30 LO 3 Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Message Content Control Sponsor Identification Reaching Large Audience Message Flexibility Public Relations Usually indirect, impersonal Moderate to low Little Delayed One-way No Usually fast Usually no direct control Characteristics of the Elements in the Promotional Mix

31. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 31 LO 3 Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Message Content Control Sponsor Identification Reaching Large Audience Message Flexibility Sales Promotion Usually indirect and impersonal Moderate to low Little to moderate Varies Mostly one-way Yes Fast Same message to varied target Characteristics of the Elements in the Promotional Mix

32. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 32 LO 3 Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Message Content Control Sponsor Identification Reaching Large Audience Message Flexibility Personal Selling Direct and face-to-face High Much Immediate Two-way Yes Slow Tailored to prospect Characteristics of the Elements in the Promotional Mix

33. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 33 The Impact of Blogging LO 3 Sponsored by a company or one of its brands and maintained by one or more of the company’s employees. Noncorporate Blogs Corporate Blogs Corporate Blogs Independent and not associated with the marketing efforts of any particular company or brand.

34. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 34 REVIEW LEARNING OUTCOME LO 3 The Communication Process

35. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 35 Explain the goals and tasks of promotion The Goals and Tasks of Promotion LO 4

36. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 36 Goals and Tasks of Promotion LO 4 Online http://www.tide.com Informing Reminding Persuading Target Audience Target Audience

37. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 37 Goals and Tasks of Promotion LO 4 Informing Reminding Persuading Target Audience Target Audience PLC Stages PLC Stages: Introduction Early Growth PLC Stages: Growth Maturity PLC Stages: Maturity

38. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 38 Goals and Tasks of Promotion LO 4  Increase awareness  Explain how product works  Suggest new uses  Build company image Informative Promotion

39. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 39 Goals and Tasks of Promotion LO 4  Encourage brand switching  Change customers’ perceptions of product attributes  Influence immediate buying decision  Persuade customers to call Persuasive Promotion

40. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 40 Goals and Tasks of Promotion LO 4  Remind customers that product may be needed  Remind customers where to buy product  Maintain customer awareness Reminder Promotion

41. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 41 Discuss the AIDA concept and its relationship to the promotional mix Promotional Goals and the AIDA Concept LO 5

42. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 42 The AIDA Concept LO 5 Model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message. A ttention I nterest D esire A ction A ttention I nterest D esire A ction AIDA Concept AIDA Concept

43. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 43 The AIDA Concept LO 5 http://www.nascar.com http://www.kelloggs.com Online Action Desire Interest Attention Cognitive (thinking) Affective (feeling) Conative (doing)

44. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 44 Biz Flix LO 5 About a Boy

45. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 45 REVIEW LEARNING OUTCOME LO 5 The AIDA Concept

46. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 46 Describe the factors that affect the promotional mix Factors Affecting the Promotional Mix LO 6

47. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 47 LO 6 Factors Affecting the Choice of Promotional Mix Nature of the product Stage in PLC Target market factors Type of buying decision Promotion funds Push or pull strategy

48. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 48 LO 6 Stage in the Product Life Cycle Light Advertising; pre- introduction publicity Heavy use of Advertising; PR for awareness; sales promotion for trial AD/PR decrease; limited sales promotion; personal selling for distribution Ads decrease; sales promotion; personal selling; reminder & persuasive Advertising, PR, brand loyalty; personal selling for distribution Introduction Growth Maturity Decline Sales ($) Time

49. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 49 LO 6 Target Market Characteristics For…  Widely scattered market  Informed buyers  Brand-loyal repeat purchasers Advertising Sales Promotion Less Personal Selling

50. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 50 LO 6 Type of Buying Decision Advertising Sales Promotion Routine Personal Selling Neither Routine nor Complex Neither Routine nor Complex Advertising Public Relations Print Advertising Complex

51. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 51 LO 6 Available Funds  Trade-offs with funds available  Number of people in target market  Quality of communication needed  Relative costs of promotional elements

52. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 52 LO 6 Push and Pull Strategies Manufacturer promotes to wholesaler Manufacturer promotes to wholesaler Wholesaler promotes to retailer Wholesaler promotes to retailer Retailer promotes to consumer Retailer promotes to consumer Consumer buys from retailer Consumer buys from retailer PUSH STRATEGY Orders to manufacturer Manufacturer promotes to consumer Manufacturer promotes to consumer Consumer demands product from retailer Consumer demands product from retailer Retailer demands product from wholesaler Retailer demands product from wholesaler Wholesaler demands product from manufacturer Wholesaler demands product from manufacturer Orders to manufacturer PULL STRATEGY

53. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 53 REVIEW LEARNING OUTCOME LO 6 Factors Affecting Promotional Mix

54. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 54 Discuss the concept of integrated marketing communications Integrated Marketing Communications LO 7

55. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 55 Integrated Marketing Communications LO 7 Integrated Marketing Communications Integrated Marketing Communications The careful coordination of all promotional messages to assure the consistency of messages at every contact point where a company meets the consumer.

56. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 56 IMC Popularity Growth LO 7  Proliferation of thousands of media choices  Fragmentation of the mass market  Slash of advertising spending in favor of promotional techniques that generate immediate response

57. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 57 REVIEW LEARNING OUTCOME LO 7 Integrated Marketing Communications

58. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 58 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by Deborah Baker, Texas Christian University Lamb, Hair, McDaniel 2007-2008 15 CHAPTER Advertising and Public Relations

59. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 59 Learning Outcomes Discuss the effects of advertising on market share and consumers Identify the major types of advertising Discuss the creative decisions in developing an advertising campaign LO 1 LO 2 LO 3

60. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 60 Learning Outcomes Describe media evaluation and selection techniques Discuss the role of public relations in the promotional mix LO 4 LO 5

61. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 61 Discuss the effects of advertising on market share and consumers The Effects of Advertising LO 1

62. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 62 LO 1 The Effects of Advertising  U.S. advertising was almost $300 billion in 2006  In 2005, 32 companies spent over $1 billion each  The advertising industry is small— only 155,000 employed by the 12,000 advertising agencies  Ad budgets of some firms are almost $4 billion annually

63. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 63 LO 1 The Effects of Advertising Top Ten Leaders by U.S. Advertising Spending Top Ten Leaders by U.S. Advertising Spending

64. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 64 LO 1 Advertising and Market Share New brands with a small market share spend proportionally more for advertising and sales promotion than those with a large market share.  Beyond a certain level of spending, diminishing returns set in.  New brands require higher spending to reach a minimum level of exposure needed to affect purchase habits.

65. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 65 LO 1 The Effects of Advertising on Consumers  The average U.S. citizen is exposed to hundreds of ads each day.  Advertising may change a consumer’s negative attitude toward a product, or reinforce a positive attitude.  Advertising can affect consumer ranking of a brand’s attributes.

66. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 66 REVIEW LEARNING OUTCOME LO 1 Effects of Advertising

67. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 67 Identify the major types of advertising Major Types of Advertising Major Types of Advertising LO 2

68. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 68 Major Types of Advertising LO 2 Institutional Advertising Institutional Advertising Enhances a company’s image rather than promotes a particular product. Product Advertising Product Advertising Touts the benefits of a specific good or service.

69. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 69 Major Types of Advertising LO 2 Corporate identity Pioneering Competitive Comparative Product Advertising Product Advertising Institutional Advertising Institutional Advertising Advocacy advertising

70. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 70 Product Advertising LO 2 PioneeringPioneering  Stimulates primary demand for new product or category  Used in the PLC introductory stageCompetitiveCompetitive  Influences demand for brand in the growth phase of the PLC  Often uses emotional appeal ComparativeComparative  Compares two or more competing brands’ product attributes  Used if growth is sluggish, or if competition is strong Online http://www.pizzahut.com http://www.papajohns.com

71. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 71 REVIEW LEARNING OUTCOME LO 2 The Major Types of Advertising

72. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 72 Discuss the creative decisions in developing an advertising campaign Creative Decisions in Advertising LO 3

73. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 73 Creative Decisions in Advertising LO 3 A series of related advertisements focusing on a common theme, slogan, and set of advertising appeals. Advertising Campaign

74. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 74 Creative Decisions in Advertising LO 3 Determine the advertising objectives Make creative decisions Make media decisions Evaluate the campaign

75. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 75 Setting Objectives: The DAGMAR Approach LO 3 Define target audience Define desired percentage change Define the time frame for change

76. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 76 Creative Decisions LO 3 Develop and evaluate advertising appeals Execute the message Evaluate the campaign’s effectiveness Identify product benefits

77. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 77 Identify Product Benefits LO 3  “Sell the Sizzle, not the Steak”  Sell product’s benefits, not its attributes  A benefit should answer “What’s in it for me?”  Ask “So?” to determine if it is a benefit

78. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 78 Identify Product Benefits LO 3 Attribute Benefit “Powerade’s new line has been reformulated to combine the scientific benefits of sports drinks with B vitamins and to speed up energy metabolism.” “So, you’ll satisfy your thirst with a great-tasting drink that will power you throughout the day.” - So?

79. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 79 Advertising Appeals LO 3 Profit Health Love or romance Fear Admiration Convenience Fun and pleasure Vanity and egotism Environmental Consciousness Product saves, makes, or protects money Appeals to body-conscious or health seekers Used in selling cosmetics and perfumes Social embarrassment, old age, losing health Reason for use of celebrity spokespeople Used for fast foods and microwave foods Key to advertising vacations, beer, parks Used for expensive or conspicuous items Centers around environmental protection

80. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 80 Unique Selling Proposition LO 3 A desirable, exclusive, and believable advertising appeal selected as the theme for a campaign. Unique Selling Proposition

81. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 81 Executing the Message LO 3 Mood or Image Musical Demon- stration Demon- stration Scientific Real/ Animated Product Symbols Real/ Animated Product Symbols Fantasy Lifestyle Slice-of-Life Humorous Spokes- person/ Testimonial Spokes- person/ Testimonial

82. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 82 REVIEW LEARNING OUTCOME LO 3 Creative Decisions for Ad Campaign Set advertising objectives Identify benefits Develop appeal Evaluate campaign results Evaluating results helps marketers adjust objectives for future campaigns Execute message

83. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 83 Describe media evaluation and selection techniques Media Decisions in Advertising Media Decisions in Advertising LO 4

84. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 84 Media Decisions in Advertising LO 4 Newspapers Magazines Yellow Pages Internet Radio Television Outdoor Media Direct Mail Trade Exhibits Cooperative Advertising Brochures Coupons Catalogs Special Events Monitored Media Unmonitored Media

85. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 85 Major Advertising Media LO 4 Newspapers Magazines Radio Television Outdoor Media Yellow Pages Internet

86. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 86 Newspapers LO 4 Advantages  Geographic selectivity  Short-term advertiser commitments  News value and immediacy  Year-round readership  High individual market coverage  Co-op and local tie-in availability  Short lead time Disadvantages  Limited demographic selectivity  Limited color  Low pass-along rate  May be expensive

87. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 87 LO 4 Beyond the Book Free Newspapers?  The new Baltimore Examiner is delivering 250,000 newspapers—at no charge and unsolicited!  Advertising brings in the revenue for this niche publication targeting households with income of $73,000 or more.  The ads are $2,900 for a full page, compared with $17,000 for its competition, the Baltimore Sun.  The Examiner is betting that low ad rates and the target market will be a valuable proposition to advertisers. SOURCE: Joseph T. Hallinan, “Do New Free Dailies Mean Sun is Setting for Paid Newspapers?,” Wall Street Journal, April 5, 2006, B1.

88. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 88 An arrangement in which the manufacturer and the retailer split the costs of advertising the manufacturer’s brand. Cooperative Advertising LO 4 Cooperative Advertising

89. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 89 Magazines LO 4 Advantages  Good reproduction  Demographic selectivity  Regional/local selectivity  Long advertising life  High pass-along rate Disadvantages  Long-term advertiser commitments  Slow audience build-up  Limited demonstration capabilities  Lack of urgency  Long lead time

90. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 90 Radio LO 4 Advantages  Low cost  Immediacy of message  Short notice scheduling  No seasonal audience change  Highly portable  Short-term advertiser commitments  Entertainment carryover Disadvantages  No visual treatment  Short advertising life  High frequency to generate comprehension and retention  Background distractions  Commercial clutter

91. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 91 Television LO 4 Advantages  Wide, diverse audience  Low cost per thousand  Creative opportunities for demonstration  Immediacy of messages  Entertainment carryover  Demographic selectivity with cable Disadvantages  Short life of message  Consumer skepticism  High campaign cost  Little demographic selectivity with stations  Long-term advertiser commitments  Long lead times for production  Commercial clutter

92. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 92 LO 4 Beyond the Book TV Advertising: Is Less More?  The number of ads in TV shows is a longstanding complaint of viewers and advertisers.  The media is cluttered and consumers change channels or speed through commercials on a DVR.  Tests are being conducted to feature shorter commercial pods. SOURCE: Suzanne Vranica, “TV-Ad Test to Show if Less is More,” Wall Street Journal, April 5,2006, B3. Year Commercial Minutes per Hour

93. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 93 Outdoor Media LO 4 Advantages  Repetition  Moderate cost  Flexibility  Geographic selectivity Disadvantages  Short message  Lack of demographic selectivity  High “noise” level

94. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 94 Internet LO 4 Advantages  Fast growing  Ability to reach narrow target audience  Short lead time  Moderate cost Disadvantages  Difficult to measure ad effectiveness and ROI  Ad exposure relies on “click through” from banner ads  Not all consumers have access to Internet Online http://www.fox.com http://www.abc.com

95. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 95 Alternative Media LO 4 Ads in Movies Interactive Kiosks Computer Screen Savers Computer Screen Savers Shopping Carts DVDs Advertainments Cell Phone Ads Subway Tunnel Ads Subway Tunnel Ads Floor Ads Video Game Ads

96. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 96 LO 4 Beyond the Book Videogame Advertising  Microsoft plans to acquire Massive inc., a start-up that places ads in video games.  Ads are inserted into the game environment.  Video games could become a large new medium for advertising. SOURCE: Robert A. Guth and Nick Wingfield, “Microsoft’s ‘Massive’ Move into Game Ads,” Wall Street Journal, April 26,2006, B1.

97. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 97 LO 4 Beyond the Book Directory Assistance Advertising  Companies are offering free telephone directory assistance—but there’s an advertisement first.  The audio ads are narrowly targeted, and are 10 to 12 seconds.  The growth of such free services could represent another change in the telecom industry.  Dial 1-800-FREE411 or 1-800-411-METRO SOURCE: Rebecca Buckman, “Your Listing, and a Word From Our Sponsor,” Wall Street Journal, April 20,2006, B1.

98. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 98 Qualitative Factors in Media Selection LO 4  Attention to the commercial and the program  Program liking  Lack of distractions  Other audience behaviors

99. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 99 Media Scheduling LO 4 Continuous Media Schedule Flighted Media Schedule Pulsing Media Schedule Seasonal Media Schedule Advertising is run steadily throughout the period. Advertising is run heavily every other month or every two weeks. Advertising combines continuous scheduling with flighting. Advertising is run only when the product is likely to be used.

100. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 100 LO 4 Beyond the Book Media Scheduling on the Web  Competition for Web advertising spots is driving up prices.  Some Web advertisers now run campaigns based on time of day. Examples: ● McDonald’s: breakfast meals during morning hours ● Xerox: copier ads during the workday ● Budweiser: beer ads on Friday afternoons  Scheduling Web ads during prime times is a more efficient use of ad dollars and more targeted. SOURCE: David Kesmodel, “More Marketers Place Web Ads by Time of Day,” Wall Street Journal, June 23, 2006, B1.

101. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 101 REVIEW LEARNING OUTCOME LO 4 Media Evaluation and Selection Scheduling: continuous flighted pulsing seasonal WinterSpringSummer Fall Type:Newspaper Magazine Radio Television Outdoor Internet Alternative Considerations: MixHow much of each? Cost per contactHow much per person? ReachHow many people? FrequencyHow often? Audience How targeted is selectivity audience?

102. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 102 Discuss the role of public relations in the promotional mix Public Relations LO 5

103. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 103 Public Relations LO 5 The element in the promotional mix that: Public Relations Public Relations  evaluates public attitudes  identifies issues of public concern  executes programs to gain public acceptance

104. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 104 Functions of Public Relations LO 5 Press relations Product publicity Corporate communication Public affairs Lobbying Employee and investor relations Crisis management

105. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 105 Public Relations Tools LO 5 Product placement Consumer education Event sponsorship Issue sponsorship Internet Web sites New product publicity Online http://www.vw.com http://www.chevrolet.com

106. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 106 LO 5 Beyond the Book Example of Consumer Education  Corporations are teaching public school students about personal finance.  People under age 25 are a fast- growing group for credit card debt increases and bankruptcy.  Is it appropriate to use educational materials with a corporate identity?  How should financial literacy be taught? SOURCE: Diya Gullapalli, “Your Kid’s Teacher: The Bank,” Wall Street Journal, April 8-9, 2006, B1.

107. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 107 Managing Unfavorable Publicity LO 5 A coordinated effort to handle the effects of unfavorable publicity or of an unfavorable event. Crisis Management Crisis Management

108. Chapter 1Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 108 Biz Flix LO 5 EdTV

109. Chapter 14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 109 REVIEW LEARNING OUTCOME LO 5 The Role of Public Relations