Chapter 19

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C H A P T E R

Advertising, Public Relations, and Sales Promotions

19

McGraw-Hill/Irwin Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved.

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L E A R N I N G O B J E C T I V E S

Describe the steps in designing and executing an advertising campaign.

Identify three objectives of advertising.

Describe the different ways that advertisers appeal to consumers.

Identify the various types of media.

Identify agencies that regulate advertising.

Describe the elements of a public relations toolkit.

Identify the various types of sales promotions.

Advertising, Public Relations, and Sales Promotions

LO1

LO2

LO3

LO4

LO5

LO6

LO7

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Tropicana

Courtesy Tropicana Products, Inc.

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Steps in Planning and Executing an Ad Campaign

Identify target audience

Set advertising objectives

Determine the advertising Budget

Convey the message

Evaluate and select media

Create advertisements

Assess impact

Advertising Age Website

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Identify Target Audience

Conduct research

Use the information to set the tone

Select the mediaGetty Images/Comstock Images

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Set Advertising Objectives

Push strategyPull strategy

©Brand X Pictures/PunchStock

©Comstock/PunchStock

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Advertising Objectives

Inform

Persuade

Remind

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Advertising Objectives

Designing an ad for a

delicate topic for

parents and kids

Courtesy The Procter & Gamble Company

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Iams Pet

How does this ad

inform, persuade, and

remind?

©Procter & Gamble.

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Informative Advertising

Create and build brand awareness

Push the consumer through the buying cycle

Inform customers about upcoming sales events or arrival of new merchandise

©TJX Companies, Inc.

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Persuasive Advertising

Generally occurs in the growth and early maturity stages of the PLC when competition is most intense

May be used to reposition an established brand in the later stage of the PLC

©The Procter & Gamble Company Used by permission

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Reminder Advertising

Communication used to remind or prompt repurchases

Occurs after the products have gained market acceptance

Used by Permission of Deutsch Inc as Agent for National Fluid Milk Processor Promotion Board

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Product-focused advertisements

Institutional advertisements

Focus of Advertisements

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Social Marketing

Public Service Advertising (PSA)

Under Federal Communication Commission

rules, broadcasters must devote a specific amount of

free airtime to PSAs

Courtesy of the National Crime Prevention Council, ww.ncpc.org

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The AdCouncil

Courtesy The Advertising Council, Inc. Courtesy The Advertising Council, Inc.

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The TRUTH Takes Hold

How to get young consumers to quit smoking?

Part of the tobacco settlement: “raising generation that would be smoke free”

TRUTH uses a hard-hitting media campaign

In your face adsCourtesy American Legacy Foundation

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Determining Advertising Budget

Super Bowl Ads

Considerations:

Role that advertising plays in their attempt to meet their overall promotional objectives

Expenditures vary over the course of the Product Life Cycle

Nature of the market and the product influence the size of the budget

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Convey the Message

Unique selling proposition (USP)

Red Bull . . . Gives You Wings

United Negro College Fund . . . A mind is a terrible thing to waste.

Nike . . . Just Do It.

State Farm Insurance . . . Like a good neighbor, State Farm is there

TNT . . . We know drama

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The Message

CLOROX® is a registered trademark of The Clorox Company. Used with permission.

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The Appeal

Emotional appeal

Informational appeal

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Emotional Appeals in Advertising

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Symbols Help to Convey Messages

Courtesy Con Agra Foods, Inc.

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Evaluate and Select Media

Media planning

Media mix

Media buy

©Photodisc/Getty Images The McGraw-Hill Companies, Inc/John Flournoy,

photographer

Ryan McVay/Getty Images Photodisc/Getty Images

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Mass and Niche Media

Mass media reach large anonymous audience

Niche media reach a smaller more targeted

audience

©Digital Vision/PunchStock

©Digital Vision/PunchStock

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Choosing the Right Medium

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Viral Marketing Campaign

Courtesy Office Max

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Determine the Advertising Schedule

Continuous

Pulsing

Flighting

©Procter & Gamble

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Create Advertisements

Ads

The type of medium

determines the execution style

Creativity plays a major role in the execution

stage

Creativity should not

overshadow the message

The execution style must match the

medium and objectives

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What appeal is being used in this advertisement?

Is this ad effective in delivering the selling message?

©Procter & Gamble

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Assess Impact Using Marketing Metrics

Pretesting

Tracking

Protesting

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1. What are the steps involved in planning an ad campaign?

2. What are the differences between informational, persuasive, and reminder advertising?

3. What are the pros and cons of the different media types?

4. How can the effectiveness of advertising be evaluated?

CHECK YOURSELF

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Regulatory and Ethical Issues in Advertising

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Puffery

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Public Relations

TOMS Shoes Website

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1. Why do companies utilize public relations as part of their IMC strategy?

2. What are the elements of a public relations toolkit?

CHECK YOURSELF

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Sales Promotions

Can be targeted at either the end user consumers or channel members

Can be used in either push or pull strategies

Courtesy Payless Shoe Source, Inc.

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Types of Sales PromotionPromotion Advantages Disadvantages

Coupons • Stimulates demand. • Allows for direct tracing of sales.

• Has low redemption rates.• Has high cost.

Deals • Encourages trial. • Reduces consumer risk. • May reduce perception of value.

Premiums • Builds goodwill. • Increases perception of value.

• Consumers buy for premium, not product.• Has to be carefully managed.

Contests • Increases consumer involvement. • Generates excitement.

• Requires creativity.• Must be monitored.

Sweepstakes • Increases involvement with the product. • Sales often decline after the sweepstakes is over.

Samples • Encourages trial. • Offers direct involvement. • Has high cost to the firm.

Loyalty Programs • Creates loyalty. • Encourages repurchase. • Has high cost to the firm.

POP Displays • Provides high visibility. • Encourages brand trial.

• Is difficult to get a good location in the store.• Can be costly to the firm.

Rebates • Stimulates demand. • Increases value perception.

• Is easily copied by competitors.• May just advance future sales.

Product Placement • Displays products nontraditionally. • Demonstrates product uses.

• Firm often has little control over display.• Product can be overshadowed.

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Sales Promotion

What form of sales promotion is represented in this ad?

Do you feel it is an effective promotion?

Courtesy Nestlé SA

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Using Sales Promotion Tools

Cross-promoting

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The McGraw-Hill Companies, Inc./ Ken Karp, photographer

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Cross Promotion

Courtesy PetSmart, Inc

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Evaluated Sales Promotions using Marketing Metrics

Realized margin

Cost of additional inventory

Potential increase in sales

Long-term impact

Potential loss from switches from more profitable items

Additional sales by customers

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1. What are various forms of sales promotions?

2. What factors should a firm consider when evaluating a sales promotion?

CHECK YOURSELF

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An advertising plan is a subsection of the firm’s overall marketing plan that explicitly analyzes the marketing and advertising situation, identifies the objectives of the advertising campaign, clarifies a specific strategy for accomplishing those objectives, and indicates how the firm can determine whether the campaign was successful.

Glossary

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A continuous advertising schedule runs steadily throughout the year and therefore is suited to products and services that are consumed continually at relatively steady rates and that require a steady level of persuasive and/or reminder advertising.

Glossary

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Return to slide

A flighting advertising schedule is implemented in spurts, with periods of heavy advertising followed by periods of no advertising.

Glossary

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Institutional advertisements inform, persuade, and remind consumers about issues related to places, politics, an industry, or a particular corporation.

Glossary

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Media buy is the actual purchase of airtime or print pages.

Glossary

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The media mix is the combination of the media used and the frequency of advertising in each medium.

Glossary

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Media planning is the process of evaluating and selecting the media mix that will deliver a clear, consistent, compelling message to the intended audience.

Glossary

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Product-focused advertisements focus on informing, persuading, or reminding customers about a specific product or service.

Glossary

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Public service advertising (PSA) focuses on public welfare and generally is sponsored by nonprofit institutions, civic groups, religious organizations, trade associations, or political groups.

Glossary

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A pull strategy is a strategy in which the goal is to get consumers to pull the product into the supply chain by demanding it.

Glossary

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A pulsing advertising schedule combines the continuous and flighting schedules by maintaining a base level of advertising but increasing advertising intensity during certain periods.

Glossary

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A push strategy is designed to increase demand by focusing on wholesalers, distributors, or sales people.

Glossary