Communicating Customer Value: Communicating Customer Value: Advertising and Public Relations Chapter 12

1

Communicating Communicating Customer Value:Customer Value:

Advertising and Public Relations

Chapter 12

Copyright 2011, Pearson Education Inc., Publishing as Prentice-Hall 12 - 2

1. Define the five promotion mix tools for communicating customer value.

2. Discuss the changing communications landscape and the need for integrated marketing communications.

3. Describe and discuss the major decisions involved in developing an advertising program.

4. Explain how companies use public relations to communicate with their publics.

Rest Stop:Rest Stop: Previewing the ConceptsPreviewing the Concepts


Unilever Integrates Digital & Traditional Media

First StopFirst Stop

Background About Unilever: World’s # 2

advertiser spends $5.3 billion on global advertising and promotion. Less is being spent on traditional media; more is being invested in online and digital.

Recognition: Unilever was named digital marketer of the year by Advertising Age. However, Unilever does not run digital campaigns in isolation of other media; rather, digital is integrated with traditional media.

Implementation How They Do It: Innovative

websites, viral videos, and “webisodes” represent key digital content. Real, funny TV ads pull viewers to websites to build consumer involvement with brand. Public relations gets clips aired on talk shows.

Results: The key benefit of all integrated efforts is termed “superdistribution”, which means digital clips are picked up and shown by other media for free. “Evolution” created $200 million in free media coverage.


Promotion MixPromotion Mix

Specific blend of promotion Specific blend of promotion tools that the company uses to tools that the company uses to persuasively communicatepersuasively communicate

customer value and build customer value and build customer relationships.customer relationships.

Also referred to as “marketing communications mix”.


Figure 12.1:Figure 12.1:

Integrated Marketing Integrated Marketing CommunicationsCommunications



Several factors are changing the face of marketing communications:– Consumers.– Marketing strategies.– Communication technology.

These factors have shifted the marketing communications model so that firms are doing less broadcasting and more narrowcasting.


Integrated Marketing Integrated Marketing Communications (IMC)Communications (IMC)

Carefully integrating and Carefully integrating and coordinating the company’s many coordinating the company’s many communication channels to communication channels to deliver a clear, consistent, and deliver a clear, consistent, and compelling message about the compelling message about the organization and its products.organization and its products.



A strong need for integrated marketing communications exists.– Conflicting messages from different

sources can create confusion or blur brand perceptions.

Marketers must understand each promotion tool when shaping the marketing communications mix. – Each brand contact delivers a message.


Marketing in ActionMarketing in Action

Burger King’s integrated, multipronged Whopper Freakout campaign employed a carefully coordinated mix of TV, radio, rich media banner ads, and a Freakout web site. Successful? You bet! Sales grew by 29%!

http://www.bk.com/en/us/campaigns/whopper-freakout.html

http://www.bk.com/en/us/campaigns/whopper-freakout.html


Shaping the Overall Promotion MixShaping the Overall Promotion Mix

Nature of advertising:– Can reach masses of geographically

dispersed buyers at a low cost per exposure.

– Can repeat a message many times.– Consumers view advertised products as

more legitimate.– Is impersonal, one-way communication.– Can be very costly for some media types.



Nature of personal selling:– Involves personal interaction between two or

more people.– Most effective tool at building preferences,

convictions, and actions.– Allows relationship building and two-way

communication.– Requires long-term commitment to sales force.– Most expensive promotion tool.



With personal selling, customers feel a greater need to listen and respond. Two-way communication is a key strength of selling compared to other forms of marketing communications.


Nature of sales promotion:– Includes a wide assortment of tools.– Attracts consumer attention.– Can be used to dramatize product offers.– Offers strong incentives to buy.– Invites and rewards quick consumer

response.– Effects are short-lived.



Nature of public relations:– Very believable.– Reaches people who avoid salespeople

and ads.– Can dramatize a company or product.– Tends to be used as an afterthought.– Planned use can be effective and

economical.



Nature of direct marketing:– Many forms of direct marketing exist.– Direct marketing forms share four primary

characteristics:• Less public.• Immediate.• Customized.• Interactive.

– Well suited to highly targeted marketing.




Push vs. Pull Promotion StrategyPush vs. Pull Promotion Strategy


AdvertisingAdvertising

Advertising has been used for centuries.

U.S. advertisers spend more than $290 billion each year; worldwide spending exceeds $604 billion.


AdvertisingAdvertising

Advertising is used by:– Business firms.– Not-for-profit

organizations.– Professionals.– Social agencies.– Government.



Major Advertising DecisionsMajor Advertising Decisions



Advertising objective:– A specific communication task to be

accomplished with a specific target audience during a specific period of time.

Overall advertising goal is to help build customer relationships by communicating customer value.



Advertising objectives can be classified by purpose:– Informative

advertising.– Persuasive advertising.– Comparative

advertising (a special type of persuasive advertising).

– Reminder advertising.


Fuel For Fuel For ThoughtThought

What is the objective of this ad for De Beers diamonds?



Setting the advertising budget:– Affordable method.– Percentage-of-sales

method.– Competitive-parity

method.– Objective-and-task

method.$



Audi gained a competitive advantage by spending heavily on advertising and promotion at a time when rivals were retrenching.


Developing advertising strategy:– Creating advertising

messages.• Message strategy and

message execution must break through the clutter.

• Advertising is being merged with entertainment.



““Madison & Vine”Madison & Vine”

A term that has come to represent A term that has come to represent the merging of advertising the merging of advertising entertainment in an effort to break entertainment in an effort to break through the clutter and create new through the clutter and create new avenues for reaching consumers avenues for reaching consumers with more engaging messages.with more engaging messages.

Visit the Adverblog’s archive on Advertainment for current examples.

http://www.adverblog.com/archives/cat_advertainment.htm

http://www.adverblog.com/archives/cat_advertainment.htm



Ad agency JWT attempted to promote its “Madison & Vine” philosophy to potential business partners with this ad.



Planning the message strategy:– Identify customer benefits that can be

used as advertising appeals.– Develop compelling creative concept—

the “big idea”.– Choose an ad advertising appeal that is:

• Meaningful.• Believable.• Distinctive.



Technical expertise

Scientific evidence

Testimonial evidence or endorsement

Slice of Life Lifestyle Fantasy Mood or image Musical Personality

symbol

Message Execution Styles:



Message execution process:– Choose the execution style.– Choose a tone.

• Use memorable, attention-getting words.– Choose format elements:

• Illustration.• Headline.• Copy.


Fuel For ThoughtFuel For Thought

What is the message execution style?What is the tone of the ad?Are the words used attention-getting and memorable?How does the illustration work with the rest of the ad?



Consumer-generated messages:– Tapping consumers for message ideas or

actual ads can involve:• Searching existing Web video sites.• Holding contests or inviting consumers to submit

ad message ideas and videos.– Benefits of consumer-generated messages:

• Collects new ideas and fresh brand perspectives at relatively little expense.

• Boosts consumer involvement and gets consumers talking and thinking about the brand.



The Doritos “Crash the Super Bowl” ads are among the top-rated ads on USA Today’s Super Bowl Ad Meter.

Visit the “Crash” web site to learn how you can submit your ad and to view the ads created by the most recent winners.

http://www.crashthesuperbowl.com/#/winners


Developing advertising strategy:– Selecting advertising media.

• Set reach, frequency, and impact goals.• Choose among major media types.• Select specific media vehicles.• Decide on media timing.




Deciding on reach, frequency, impact:– Reach: Percentage of people exposed to

ad campaign in a given time period.– Frequency: Number of times a person is

exposed to advertisement.– Media Impact: The qualitative value of a

message exposure through a given medium.



Each media type has specific advantages and disadvantages.

Choosing among media types requires consideration of the:– Medium’s impact– Message effectiveness– Cost

The media mix should be regularly reexamined.



Media vehicles:– Specific media within each general media type,

such as Newsweek. Factors to consider when choosing

vehicles:– Cost.– Audience quality.– Audience engagement.– Editorial quality.


Marketers must also decide on media timing, or how to schedule the advertising over the course of a year.– Follow seasonal pattern.– Oppose seasonal pattern.– Same coverage all year.

Choose the pattern of the ads:– Continuity.– Pulsing.




Many products, services, and retailers advertise more heavily before special holidays, new seasons, or even particular times of the year, such as “Back to School”.


Return on advertising investment:– The net return on advertising investment

divided by the costs of the advertising investment.

Evaluating advertising involves:– Measuring the communication effects of an ad

or campaign.– Measuring the sales and profit effects of the

ad campaign.

Evaluating Advertising and Return Evaluating Advertising and Return on Advertising Investmenton Advertising Investment



The 2010 Super Bowl drew the single largest TV audience ever in the US (105 million), with ad prices ranging from $ 2.8 to $3 million for a 30 second spot. Was it worth it?? Learn how Nielsen measures ROI for Super Bowl ads.

http://blog.nielsen.com/nielsenwire/consumer/maximizing-super-bowl-advertising-roi-in-a-paid-vs-earned-media-environment/


Organization of ad function:– Small companies—one person in firm.– Large companies—ad department that may

also work with an ad agency.– Advertising agencies employ specialists who

perform ad tasks better then the company’s own staff can.

• Bring outside viewpoints to problem-solving.• Wide range of experience.

Other Advertising ConsiderationsOther Advertising Considerations


International advertising issues:– To what degree should global

advertising be adapted to various countries?

• Greater need for standardization of global brand advertising strategies.

• Specific advertising programs must usually be adapted to local cultures and other factors.

Other Advertising ConsiderationsOther Advertising Considerations


Public RelationsPublic Relations

Building good relations with Building good relations with the firm’s various publics by the firm’s various publics by obtaining favorable publicity, obtaining favorable publicity, building up a good corporate building up a good corporate image, and handling or image, and handling or heading off unfavorable heading off unfavorable rumors, stories, and events.rumors, stories, and events.


Public RelationsPublic Relations

Public relations departments perform the following functions:– Press relations or press agency.– Product publicity.– Public affairs.– Lobbying.– Investor relations.– Development.


Public Relations Role and Public Relations Role and ImpactImpact

Public relations:– May strongly impact public awareness at

a lower cost than advertising.– Can yield spectacular results.– Is beginning to play an increasingly

important brand-building role.

Advertising and PR can work together in unintended ways. Watch this clip to see more! Click on filmstrip icon at left to play video



Starting with preview events like the one shown above, Nintendo’s award-winning PR campaign for its new Wii game produced nonstep stock-outs for more than two years.


Major Public Relations ToolsMajor Public Relations Tools

Corporate identity materials

Public service activities

Buzz marketing & social networking

Company Web site

News Speeches Special events Written

materials Audiovisual

materials


1. Define the five promotion mix tools for communicating customer value.

2. Discuss the changing communications landscape and the need for integrated marketing communications.

3. Describe and discuss the major decisions involved in developing an advertising program.

4. Explain how companies use public relations to communicate with their publics.

Rest Stop:Rest Stop: Reviewing the ConceptsReviewing the Concepts


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Copyright © 2011 Pearson Education, Inc. Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall

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Communicating Customer Value: Communicating Customer Value: Advertising and Public Relations Chapter 12