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The Promotional Mix

Advertising Direct

Mark

Sales

Promotion

Publicity/PR Personal

Selling

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Advertising:

Advertising is the non - personal communication of informationusually persuasive in nature about products, services or ideas by

identified sponsors through the various media

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Advertising: Advantages

Ability to control message

Cost effective way to reach a largetarget market

Ability to create images and differentiate

brands Can sometimes strike responsive

reaction from customers

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Advertising: Disadvantages

High costs of producing and placing ads

Difficult to determine effectiveness Credibility problems

Clutter

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Sales Promotion: Advantages

Provides extra incentive to purchase

product

Way to appeal to price sensitive consumer

Can generate extra interest in ads

Easier to measure efforts

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Sales Promotion: Disadvantages

Often only has short term impact

Often abused

Can lead to promotional wars

Often does not contribute to brandimage

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Publicity/PR

Advantages

-- Credibility-- Low cost way to communicate

Disadvantages

-- Lack of control-- Difficult to get media cooperation

-- Can be negative

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Personal Selling: Advantages

Communication flexibility

Can communicate complex information

Can target to specific markets and

customers

Direct Feedback

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Direct Marketing: Advantages

Changes in society have made

consumers receptive to direct-marketedproducts

Allows for more selectivity and target

marketing Can customize message

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Direct Marketing: Disadvantages Consumers and businesses receive too

much unsolicited direct mail and phone

calls

Image problems for direct-marketed

products

Clutter problems

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INTRODUCTION

In fact today advertising is every where, on radio, TV,newspapers, billboards, magazines and

even on the side of the town buses. The global markethas expanded tremendously, and manifolds. Advertising

serves three main purposes:

1. To get or win new customers.

2. To increase use of products or services amongexisting customers.

3. To help potential customers make a choice amongcompeting brands.

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Advertising has assumed important role in this very fast developing andcompetitive world. In order to understand it first we have to know what it meansor in other words to know its definition. But before we define we must know i.e.six segments of the definition of advertising:

Six Segments1. It is paid form of communication.2. The Sponsor is identified.3. Most advertising tries to persuade or influence consumer to do. Somethingthough in some cases it is merely to make consumers aware of product orcompany.

4. Message is conveyed through different types of media.5. Advertising makes message reach large audience of potential consumers.6. Advertising is a form of mass communication therefore it is nonpersonal.

Based on the above the most accepted standard definition universally acceptedis as described by Bovee in 1992. It said:

Advertising is the non - personal communicationofinformation usuallypersuasive in nature aboutproducts, services or ideas by identifiedsponsors through the various media

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Communication

Means through which one person can pass information, ideas or feelings toanother through speech or pictures. Though, communication uses all senseslike smell, touch, taste, sound & sight, only two areuseful in advertising i.e. Sound & SightSound: Radio, Television micro-sound chips in magazines.Sight: The most useful medium of communication like print, i.e. A picture isworth a thousand wordsInformation

Information is knowledge, fact or news. It comes in different forms:

Complete or Incomplete! Biased or deceptive!What it is? What it looks like? How it works?What are its benefits &drawbacks etc?Paid For

If an advertisement is created, placed in the media so the cost to create andtime or space in the media must be paid for.

This is the point, where advertising departs from Public Relations.Persuasive

Purpose of advertisement is to Identify & differentiate one product from anotherand to persuade the customer for preferring one to another.

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Products, Services or Ideas

Things advertiser wants consumers to buy. There are three basicdifferentiations in products1. Perceptible Obviously different from other-like color, size,shape etc.2. Imperceptible Those which exist but are not obvious.3. Induced. No obvious difference but inform people about the

difference

Identified Sponsors

Telling audience about the sponsors

Various MediaLike Newspapers, Magazines, Radio, TV, Billboards, hoardings,balloons So anythingwhich is used to communicate ideas from one person to another

in non personal-way.

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Advantages ofNon-Personal Selling:

Seller has time to discuss everything about the product.

Seller can see the person to whom he/she is selling the product. Seller can easily locate potential buyers.

Disadvantages:

It is expensive being labor intensive. Time consuming. So seems personal selling is better than advertising which isnon-personal yet advertising still remains most effective.

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What is Advertising?

Advertising is:

(1) Paid,

(2) Nonpersonal Communication,

(3) From An Identified Sponsor(4)Using Mass Media,

(5) To Persuade or Influence an Audience.

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Roles and Functions of Advertising

To identify and differentiate from otherofferings

To communicate information about the product

To induce consumers to try new products and to

suggest reuse

To stimulate the distribution ofa product

To increase product use

To build value, brand preference, and loyalty

To lower the overall cost ofsales

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Roles of Advertising (contd)

To associate feelings with brand

To link brand with peers and group norms

(And. More?)

To

To

To

To

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Role of advertising

Marketing

Communication

Economic

Societal

The process abusiness uses tosatisfy consumer

needs by providinggoods and services

Product category

Target market

Marketing mix

Brand

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Role of advertising

Marketing

Communication

Economic

Societal

Can reach a massaudience

Introduces products

Explains importantchanges

Reminds and

reinforces Persuades

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Role of advertising

Marketing

Communication

Economic

Societal

Moves from beinginformational tocreating demand

Advertising is anobjective means forproviding price-value information,thereby creating amore rationaleconomy

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Role of advertising

Marketing

Communication

Economic

Societal

Informs consumersabout innovations andissues

Mirrors fashion anddesign trends

Teaches consumersabout new products

Helps shape consumerself-image

Perpetuates self-expression

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Importance ofAdvertising

Creating awareness

Increase sale

Brand identity and brand image

Communicate a change

Increase the buzz value

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Objectives ofAdvertising

Informative

Persuasive

Reminder

Reinforcement

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INFORMATIVEAims to create brand awarness and

knowledge of new products or features of existingfeatures.

PersuasiveAims to create liking, preference, conviction

and purchase of a product or service

ReminderAims to stimulate repeat purchase ofproducts and services

Reinforcement Aims to convince current purchasersthat they have made the right choice.

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Attitude

A learned

predisposition to

behave in a

consistentlyfavorable or

unfavorable manner

with respect to a

given object.

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The Tricomponent Model

Cognitive Affective

Conative

The kn

owledge andperceptions that

are acquired by a

combination of

direct experiencewith the attitude

object and related

information from

various sources

Components

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Cognitive Affective

Conative

A consumersemotions or feelingsabout a particularproduct or brand

Components

Starbucks Coffee

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Cognitive Affective

Conative

The likelihood ortendency that anindividual willundertake a specific

action or behave in aparticular way withregard to the attitude

object

Components

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Advertising objectives

Cognitive

objectives

Affectiveobjectives

Conativeobjectives

Product categoryneed

Brand awarenessBrand knowledge

Feelings evoked bythe ad

Attitude towards

the adLiking of the brand

Attitude towardsthe brand

Brand conviction

Brand satisfactionPurchase intention

Purchase

Repeat-purchase

Brand loyalty

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Publicity

Publicity involves the generation of news about acompany, product, service, brand or person in variousmedia. It is a subset of the public relations effort.

Publicity is generally short-term focused

Publicity is not always under the control of the firm

Publicity can be negative as well as positive

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The Power of Publicity

Perceived as more credible

Often perceived as endorsed by the mediumin which it appears

Often has high news value

Often generates high frequency of exposure

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Publicity Vehicles

Feature Articles

Captioned Photos

SpecialEvents

NewsReleases

PressConferences

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Advertising Versus Publicity

Advertising Publicity

Tentative

Low

Low/Unspecified

Uncontrollable

Great

Lower

Measurable

Schedulable

High/Specific

High

Specifiable

Undetermined

Higher

Little

Factor

Control

Credibility

Reach

Frequency

Cost

Flexibility

Timing

2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

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Identify the majortypes ofadvertising

Major Types of AdvertisingMajor Types of Advertising

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Major Types of Advertising

LO2

Institutional

Advertising

Institutional

Advertising

Enhances a companys image

rather than promotes a

particular product.

Enhances a companys image

rather than promotes a

particular product.

Product

Advertising

Product

Advertising

Touts the benefits ofa

specific good or service.

Touts the benefits ofa

specific good or service.

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Major Types of Advertising

1.Institutional

Including Corporate

2. Product

a. Pioneering

b. Competitive

C.Comparative

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Corporate advertising

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Product Advertising

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Product Advertising

LO2

PioneeringPioneeringPioneeringPioneering Stimulates primary demand for new

product or category

Used in the PLC introductory stage

CompetitiveCompetitiveCompetitiveCompetitive

Influences demand

for brand in thegrowth phase of the PLC

Often uses emotional appeal

ComparativeComparativeComparativeComparative Compares twoor more competing

brands product attributes

Used ifgrowth is sluggish, or ifcompetition is strong

Online

http://www.pizzahut.com

http://www.papajohns.com

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Competitive Advertising

Pioneering Advertising, also called Informative

tries to develop primary demand tries to develop primary demand

Done in the early stage of the Product Life Cycle.Done in the early stage of the Product Life Cycle.

Direct Indirect

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Competitive Advertising

Tries to get you to take action nowTries to get you to take action now -- buy the productbuy the productnow. Immediate Buyingnow. Immediate Buying

Direct

Indirect

Tries to point out the advantages so ifyou thinkTries to point out the advantages so ifyou think

about this product later, you will buy their brandabout this product later, you will buy their brand

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Advertising that makes direct comparisonsAdvertising that makes direct comparisons

with competitive brands.with competitive brands.

Companies used to hesitate to do this, but now theyCompanies used to hesitate to do this, but now they

do it freely.do it freely.

Sometimes it can backfire and cause the viewer toSometimes it can backfire and cause the viewer toNOT want to buy the productNOT want to buy the product -- if the comparison isif the comparison is

too harsh eg. Political advertising that is too nastytoo harsh eg. Political advertising that is too nasty

Comparative Advertising

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Some countries do not allow ComparativeSome countries do not allow Comparative

Advertising.Advertising.

Other countries allow it,,, but,, you have toOther countries allow it,,, but,, you have to

prove any statements you makeprove any statements you make

Comparative Advertising

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REVIEW LEARNING

OUTCOME

LO2

The Major Types of Advertising

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CLASSIFICATION OF ADVERTISEMENTSAdvertisements have various objectives, sometimes other than just sellingproducts. However, before designing and classifying ads answers to followingquestions are essential:

What do I want my advertising to accomplish? i.e. specifying goals.Whom should my advertising address?

Target audience.Demographics e.g. gender, age, location or business etc. Behaviors e.g.current awareness about your business.Needs & desires e.g. benefit which consumers look for in a product.What should my advertising say?

To sum up the message should speak to your audience and you should be ableto decide where to place the advertisement? Selection of media to placeadvertisement is essential but before advertising we must determine thepurpose of doing so and identify, is it a product or a non- product.

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Communication Phases in Advertising

Awareness:

If most of the target audience is unaware of the object, the communicators task is to build awareness, perhapsjust name recognition, with simple messages repeating the product name. Consumers must become aware of thebrand. This isnt as straightforward as it seems. Capturing someones attention doesnt mean they will notice thebrand name. Thus, the brand name needs to be made focal to get consumers to become aware. Magazines arefull of ads that will capture your attention, but youll have trouble easily seeing the brand name.

Knowledge/ Comprehension:

The target audience might have product awareness but not know much more; hence this stage involves creatingbrand knowledge. This is where comprehension of the brand name and what it stands for become important. Whatare the brands specific appeals, its benefits? In what way is it different than competitors brands? Who is thetarget market? These are the types of questions that must be answered if consumers are to achieve the step ofbrand knowledge.

Acceptance:Prospective customer must decide whether your product can meet their needs .acceptance thought in the mindsof customer may be created or may not be even if yours product is according to need because they may docamparison of it with other options.

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Preference:

The target audience might like the product but not prefer it to others. In this case, thecommunicator must try to build consumer preference by promoting quality, value, performance andother features. The communicator can check the campaigns success by measuring audiencepreference before and after the campaign.

Ownership:

Owner ship is final purchase action. Finally, some members of the target audience might have

conviction but not quite get around to making the purchase. They may wait for more information orplan to act later. The communicator must need these consumers to take the final step, perhaps byoffering the product at a low price, offering a premium, or letting consumers tried out. This is whereconsumers make a move to actually search out information or purchase.Thus advertising is thought to work and follow a certain sequence whereby the prospect is movedthrough a series of stages in succession from unawareness to the purchase of the product.

Reinforcement:Use advertising to bolster yours customer sense of satisfaction about action/purchase.This phasestart new cycle because it sends another message to the audience to again purchase and if theyhave already purchased than giving feeling of satisfaction.

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Advertising agency

Definition: -

Advertising agency is an independent

organization of creative people and businesspeople, who specialize in

Developing and preparing advertising plans

Advertisements and other promotional tools

Purchase advertising space and time in variousmedia

On behalf of its client , various advertisers orsellers

To find:------ customers for the clients goods andservices

Advertising Agency

an outside firm that specializesin the creation, production,and/or placement of thecommunications message andthat may provide other services

to facilitate the marketing andpromotions process.

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Organization Structure

The activities within an ad agency aredivided into 4 broad groups:

1. Account management

2. The creative department

3. Media buying

4. Research

Recently added: public relations, directmarketing, and promotional services

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Organization ChartBoard ofDirectors

Managing Director

Client Services

Director

Creative

Director

Servicing Group

Media

Research

Creative Groups

Audio Visual

Language

Studio

Production

Finance /

Accounts

Secretarial /

Legal Personnel

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Types of advertising agencies

1. Full service agenciesA full service agency is capable of providing all services asdevelopment, create, and execute for the client

Provides a range of marketing services.

Services directly related to advertising such as copywriting,artwork, production of ads, media planning etc.

2. Specialized service agencies

A Function of Full service Agency or How Ad agency works:

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A. Function of Full service Agency or How Ad.agency works:1.Account Department:The account management function is the main link between the agency and the client. The account executive isthe key person in account department also known as AE. Account Manager serve as a liaison between the clientand the various departments of an advertising agency.

Account Managers coordinate all activities provided by each of the departments in order to offer the client the bestservice possible. AE works for the agency but on the behalf of the client thus respresent the client in the industry.

2.Creative ServicesWork as umbrella for the creative services.1.Creative departement: Creative director control all the creative activities.a.Copy dapartment: The copy deprtment is run by the copy writer under the supervission of the Creative director.A Copywriter is responsible for supplying the copy of an ad. For example, in a commercial the copy needed is a script. In a

magazine, the copy is a headline plus the main body. The copywriter is expected to come up with catchy phrases. Copy

writer function is to write the words as message.

b. Art Department:The Art Director supervise the art , including such visuals elements as the design , illustrations, photos, and typethat appear in print ads and commercials.Production department:After client approves the agency creative concepts the production deptt, supervised bythe creative director , translates the art and copy into finished Ads.Within this department , the print production managerworks with outside suppliers such as printers andphotographers to make the copywriters words and art departments design and illustrations into newspaper ormagzine ads. Similaraly the broadcast production maangerhires the suppliers such as directors and musciansto work the words created by the copy writeres and art ideas developed by the art department into the finishedcommercials for the radio or telivision.

2.Traffic department : Holding together all the creative department activites togather is traffic department. TheTraffic Coordinator is responsible forcoordinating, developing timetables, meeting deadlines, obtaining approvals at each

stage of the ad development process and overseeing all aspects of the production of an ad.

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AccountDepartment

Creative Services

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Copy Approval Process

Senior Executives

Product Manager, Brand

Manager, Marketing Staff

Client

Account Management TeamLegal Department

Agency

Senior WriterCreative Director

Copywriter

Account Planning

3 Marketing services:

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3. Marketing services:Function is which audience will be target, what strategies will influence more and

which media will best reach to audience.

Under the Media director is media department the Media plannerplans which

media to be used, when to use and at what cost use. Media Planners are Responsible forthe evaluation and selection of media as well as the development of the media plan.

The Media planner will suggest a plan of action for the client. In many agencies the

Media Planner purchases the media. The media buyerbooks time and space in media

for the ad. Media researcher supports media planner and media buyer in analyzing the

number and type of people each medium reaches.

4.Agency Management/Administration.

Function is runing agency managemnt, activities.

5. Groups Team Work

Some advertisers to become Integrated Marketing Communication Agencies (IMC)

they expand into other servicesDirect marketing

Public relations

Sales promotion

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Full-service advertising agency

Advantages

In-depth knowledge andskills

Obtaining negotiatingmuscle with the media

Coordinating advertisingand marketing efforts

Disadvantages

Some control is lost

Larger clients are favored

over small clients Occasionally inefficient in

media buying

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Specialised Service Agencies:1. Limited Service agency:

Focused on selected advertising services.e.gCreative boutiques (limited service, staff advertising agency).Concentrate on --creative execution of client communication

Focus on----idea and the creative product.

Provide only creative functions and not full-service.

Copy writing, artwork and production of ads

Merge with other agencies to provide a wide range of services

Although they dont always offer media planning and research but than too its

very widely wanted by the clients.

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In House agencies

Owned completely by the advertiser

Can undertake to serve several other clients, if the owner so desires

Freelancers

Independent creative people who are self employed andtake on assignments from an agency or a marketeron a project-by-project basis.

Media Buying Services: are independent companies thatspecialize in the buying of media, particularly radioand television time.

O i ti l St t f Ad ti i

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Organizational Structure of Advertising Central system

One group plans ,control and coordinates alladvertising efforts.

Decentralized system Separate marketing, sales, advertising and promotion

departments for various product lines or businesses ofthe company. Often use product or brand managementsystem

Selection ofsystem depends upon Size of the orgz.

# of products

Role of ads in the whole process

budget

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Advantages Facilitated

communications

Fewer personnel required

Continuity in staff

Involvement of top

management/ experienceis more

Disadvantage Some times lower level

staffcant understand the

over all mkting plan as the

responsibility rests on top

Longer response time

Inability to handle multipleproduct line.

The Centralized System

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Decentralized system

Advantages More flexible in term of

promotional programs Rapid response to the

problems.

Disadvantage Sometimes brand

mangers are at juniorlevel lack ofexperience

Brand manger mayhave less authorityover the execution ofplan which they havecreated.

Misallocation offunds.

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Revenue of Advertising

AgenciesCommissions from Media The traditional method of compensating

agencies is through a commission system,

where the agency receives a specifiedcommission (usually 15 percent) from the mediaon any advertising time or space it purchases forits client. encourages agencies to recommend high media

expenditures to increase their commission level

tempts the agency to avoid noncommissionablemedia such as direct mail, sales promotions, oradvertising specialties, unless they are requested by

the client

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Commissions from Media

Negotiated commission: reducedpercentage rates, variable commissionrates, and commissions with minimum and

maximum profit rates.

F C t d I ti B d

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Fee, Cost and Incentive-BasedSystems

Fee Arrangement

Straight or fixed-fee: agency charges a basic monthlyfee for all of its services and credits to the client anymedia commissions earned. Agency and client agreeon the specific work to be done and the amount theagency will be paid for it.

Fee-commission combination: media commissionsreceived by the agency are credited against the fee. If

the commissions are less than the agreed-on fee, theclient must make up the difference.

F C t d I ti B d

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Cost-plus Agreement: client agrees to paythe agency a fee based on the costs of itswork plus some agreed-on profit margin

(often a percentage of total costs). Directcosts (personnel time and out-of-pocketexpenses) plus an allocation for overhead

and a markup for profits determine theamount the agency bills the client.

F C t d I ti B d

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Incentive-Based Compensation: the agencysultimate compensation level will depend on howwell it meets predetermined performance goals.goals often include objective measures such assales or market share as well as more subjectivemeasures such as evaluations of the quality ofthe agencys creative work. Companies usingincentive-based systems determine agency

compensation through media commissions,fees, bonuses, or some combination of thesemethods.

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Five Players of Advertising

Advertiser

(Client)

Advertising

Agency

Media

Organization

Suppliers

Target

Audience

Marketing strategy and final approval

Creative and media plan

Audience delivery

Marketing communication specialists,collateral services

Receivers of marketing communications

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The Key Players

Advertiser(client)

Agency Media

Supplier Audience

Uses advertising to sendout a message about itsproducts

Initiates the advertisingeffort by identifying amarketing problem

Approves audience, planand budget

Hires the advertisingagency

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The Key Players

Advertiser(client)

Agency Media

Supplier Audience

Has strategic andcreative expertise,media knowledge,workforce talent, andnegotiating abilities Advertising

department

In-house agency

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The Key Players

Advertiser(client)

Agency Media

Supplier

Audience

The channels ofcommunication that carrythe message to theaudience

Are also companies orhuge conglomerates

Mass media advertisingcan be cost effectivebecause the costs are

spread over the largenumber of people the adreaches

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The Key Players

Advertiser(client)

Agency Media

Supplier Audience

Assist advertisers,agencies, and themedia in creating andplacing the ads

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The Key Players

Advertiser(client)

Agency Media Supplier

Audience

The desired audience forthe advertising message

Data-gatheringtechnology improvesaccuracy of information

about customers Advertisers must

recognize the varioustarget audiences they aretalking to and know as

much about them aspossible

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Participants in the IMC Process

Advertisers or Clients

firms that have products, services or causesto be marketed

Advertising Agency

an outside firm that specializes in thecreation, production, and/or placement of the

communications message and that mayprovide other services to facilitate themarketing and promotions process.

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Participants in the IMC Process

Media Organizations

provide information or entertainment to theirsubscribers, viewers, or readers

purpose of media is to provide anenvironment for the firms marketingcommunications message.

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Media Planning

I know half the money I spendOn advertising is wasted, but ICan never find out which half.

What is media planning?

--The process of designing a course of action that shows how advertising time andspace will be used to contribute to the achievement of marketing objectives.

Media planning: The process of directing the advertising message to thetarget audience at the appropriate time and place

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Background andSituation AnalysisBackground andSituation Analysis

Discusses Media Options, Opportunities

and Target Audience.

Discusses Media Options, Opportunities

and Target Audience.

Staging a Media Plan

A Media Plan is a Written Document that Summarizes theRecommended Objectives, Strategies, and Tactics Pertinent to the

Placement of a Companys Advertising Messages.

Strategy:Selection of Media

Strategy:Selection of Media

Explains Why a Single Medium or Set of

Media is Appropriate.

Explains Why a Single Medium or Set of

Media is Appropriate.

Flow Chart Scheduling& Budgeting

Flow Chart Scheduling& Budgeting

Media Buyers Convert Objectives andSelect, Negotiate, & Contract for Media

Space.

Media Buyers Convert Objectives andSelect, Negotiate, & Contract for Media

Space.

Media Objectives &Aperture Opportunities

Media Objectives &Aperture Opportunities

Goal orTask that Media Can AccomplishBased on Aperture Opportunities.

Goal orTask that Media Can AccomplishBased on Aperture Opportunities.

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Media strategyconsists of four sets of interrelated activities1. Selecting the target audience2. specifying media objectives3. selecting media and vehicles4. buying mediaSelecting the target audience: Consumer segments considered the best prospects for a product or service arecalled target groups People with common characteristics tend to act in similar way Break down population into consumer segments Groups of potential buyers with key similarities

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Whom to Advertise To

Which Geographic Areas toCover

When to Advertise

What the Duration of the Campaign Should Be

What the Size or Length of the Ad Should Be

Setting Media Objectives

The Basic Goals That Direct Media Strategy Typically Focus on:

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Specifying Media Objectives

1. What proportion of the target audienceshould be exposed to our message

Reach 2. How often should the target audience beexposed to our message?

Frequency

-- Motivational frequency-- Effective reach and frequency

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(contd) 3. How much total advertising is

necessary to achieve the reach andfrequency objective?

Weight (GRPs/TRPs, Gross Impressions)

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4. How to schedule the advertising campaign?

Scheduling or Continuity

- Continuous scheduling- Pulsing- Fighting

Three Methods ofMedia Scheduling

Continuous

Media Schedule

FlightedMedia Schedule

Pulsing

Media Schedule

Advertising is run steadilythroughout the period.

Advertising is run heavily everyother month or every two weeks.

Advertising combines continuous

scheduling with flighting.


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Specifying Media Objectives(contd)

5. What is the least expensive way toaccomplish media objectives?

Cost: Absolute and relative costs- CPM or CPP: Measures cost efficiency

6. Other considerations

-- Geographic coverage

-- Qualitative media environment

-- Recall research

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Major Advertising Media

NewspapersNewspapers

MagazinesMagazines

RadioRadio

TelevisionTelevision

Outdoor MediaOutdoor Media

Yellow PagesYellow Pages

InternetInternet

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Newspapers

AdvantagesAdvantages

Geographic selectivity

Short-term advertiser

co

mmitments News value and immediacy

Year-round readership

High individual marketcoverage

Co-op and local tie-in

availability Short lead time

DisadvantagesDisadvantages

Limited demographicselectivity

Limited c

olo

r Low pass-along rate

May be expensive

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Magazines


Good reproduction

Demographic selectivity

Regional/local selectivity Long advertising life

High pass-along rate


Long-term advertisercommitments

Sl

ow audience build-up

Limited demonstrationcapabilities

Lack ofurgency

Long lead time

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Radio


Low cost

Immediacy ofmessage

Short notice scheduling No seasonal audience

change

Highly portable

Short-term advertisercommitments

Entertainment carryover


No visual treatment

Short advertising life

High

frequency t

ogenerate comprehension

and retention

Background distractions

Commercial clutter

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Television


Wide, diverse audience

Low cost per thousand

Creative opportunities fordemonstration

Immediacy ofmessages

Entertainment carryover

Demographic selectivitywith cable


Short life ofmessage

Consumer skepticism

High campaign cost Little demographic

selectivity with stations

Long-term advertisercommitments

Long lead times for

production Commercial clutter

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Out-of-Home Advertising

Includes everything from billboards, hot-airballoons, painted buses & walls, telephonekiosks, to airport terminal displays.

Out-of-home advertisers target specific peoplewith specific messages at a time when they aremost susceptible to their impact. i.e. sign attelephone reminds you to make dinner

reservations. Estimates are that $1.8 billion is spent on this

media form.

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Outdoor Media


Repetition

Moderate cost

Flexibility Geographic selectivity


Short message

Lack ofdemographic

selectivity High noise level

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Internet


Fast growing

Ability to reach narrow

target audience Short lead time

Moderate cost


Difficult to measure adeffectiveness and ROI

Ad exp

osure relies

onclick through from

banner ads

Not all consumers haveaccess to Internet

Media Decisions in

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Media Decisions in

Advertising

NewspapersNewspapers

MagazinesMagazines

Yellow PagesYellow Pages

InternetInternet

RadioRadio

TelevisionTelevision

Outdoor MediaOutdoor Media

Direct MailDirect Mail

Trade ExhibitsTrade Exhibits

Cooperative AdvertisingCooperative Advertising

BrochuresBrochures

CouponsCoupons

CatalogsCatalogs

Special EventsSpecial Events

MonitoredMediaMonitoredMedia Unmonitored MediaUnmonitoredMedia

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Alternative Media

Ads in MoviesAds in Movies

Interactive KiosksInteractive Kiosks

ComputerScreen SaversComputer

Screen Savers

Shopping CartsShopping Carts

DVDsDVDs

AdvertainmentsAdvertainments

Cell Phone AdsCell Phone Ads

SubwayTunnel Ads

SubwayTunnel Ads

Floor AdsFloor Ads

Video Game AdsVideo Game Ads

Some basic terms used in media

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Some basic terms used in mediaplanning (contd)

GRPs: the sum of the total exposure potential of a series of mediavehicles as a % of the audience population-- GRPs = %Reach x Average frequency

Gross rating point(GRP) is a term used in advertising to

measure the size of an audience reached by a specific media vehicle orschedule. It is the product of the percentage of the target audiencereached by an advertisement, times the frequency they see it in agiven campaign.

For example, a TV advertisement that is aired 5 times reaching 50% ofthe target audience, it would have 250 (GRP = 5 50%) i.e.,

GRPs = % reach frequency

CDI and BDI

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The Brand Development Index (BDI) helps marketers factor the rate ofproduct usage by geographic area into the decision process.

BDI= % of sale of brand/product in area/city *(multiply) 100

% of total population in area/ city

The Category Development Index (CDI) is computed in the samemanner as the BDI, except it uses information regarding the product category (asopposed to the brand) in the numerator.

CDI= % of sale of total category in area/city *(multiply) 100

% of total population in area/ city

100=marketinpopulationU.S.totalofPercentage

marketinsalestotalcategoryproductofPercentageCDI

100=marketinpopulationU.S.totalofPercentage

markettheinsalesU.S.totaltobrandofpercentageBDI

Using BDI and CDI Indexes

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g

High BDI Low BDI

High CDI High market shareGood market potential

Low market share

Good market potential

Low CDI High market shareMonitor for sales decline

Low market share

Poor market potential

High BDI and high CDI This market usually represents good salespotential for both the product category and the brand.

High BDI and low CDI The category is not selling well, but the brand is;probably a good market to advertise in but should bemonitored for declining sales.

Low BDI and high CDI The product category shows high potential but thebrand is not doing well; the reasons should bedetermined.

Low BDI and low CDI Both the product category and the brand are doingpoorly; not likely to be a good place for advertising.

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A series of related

advertisements focusing on a

common theme, slogan, and set

of advertising appeals.

Advertising

Campaign

Advertising

Campaign

St

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Steps:

1. Analyzing the market

2. Determining advertising objectives

3. Establishing budgetary and control system

4. Developing advertising strategy for:1. Selecting media

2. Creating messages

5. Coordinating advertising with other

promotional and marketing methods6. Evaluating results

7. Execution of advertising campaign

St 1 A l th k t

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Step 1: Analyze the market

1. Determining the demand factors.

2. Identifying the target group.

3. Assess the competition

4. Legal and regulatory environment

Step 2: Determining advertising

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p g gobjectives

Defining the Marketing Objectives: Decidewhat the marketing objectives is out toachieve in terms of:

Increase sales of brand x

Increase market share

Distributors network awareness and

increasing distribution Much more depending on organization

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..

Defining the communication objectives:Decide what the communication objectivesis out to achieve in terms of:

Increasing brand awareness Positioning the service as the friendliest on

the market

Repositioning Guinness

Maintaining brand x as the preferred brand

Step 3: Establishing the budgetary

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p g g yand control system

Advertising budget is a plan for financingcertain future advertising operations

Mostly a fund will be allocated to this

purpose to marketing department Within this fund they try to do media

selection and other advertising expenses

An advertising budget must be flexible tochange according to changing marketingconditions

Step 4: Developing advertising strategy

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Step 4: Developing advertising strategy

Developing advertising strategy for:

Selecting media(on basis of target market and evalutuion of target market is done on basisof GRP, which is Gross rating point(GRP) is a term used in advertising to measure thesize of an audience reached by a specific media vehicle or schedule. It is the product of thepercentage of the target audience reached by an advertisement, times the frequency theysee it in a given campaign. For example, a TV advertisement that is aired 5 times reaching50% of the target audience, it would have 250 (GRP = 5 50%) i.e., GRPs = frequency %reach andCPM is the CPM (CostPerMille) orCPT (CostPerThousand Impressions)is when advertisers pay for exposure of their message to a specific audience. "Per mille"means per thousand impressions, or loads of an advertisement. ) and other technical tacts.

Creating messages How we get there- how the objectives are achieved. Strategy drives the tacticsin the same direction

Adverting strategy must encompass the totality ofwhat a product or serviceis and how it is sold to the consumer

The strategy summarizes the tactics, by helping to harmonize and integrate alltactical communication tools.

The strategy should also include selection of target markets, positioning,

selection ofcommunication tools, sequence ofcommunication tools (aredifferent tools used at different stages?), time scales media selection andcreating messages

Step 5: Coordinating advertising with

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other promotional and marketing

methods For an advertising program to be

successful, elements as production,

delivery and inventory must be integratedwith the advertisement plan

An advertising planning must consider to

get the maximum cooperation fromdistributors, dealers and salespeople

Step 6: Evaluating advertising

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p g gresults

Pretesting: It is a research technique

which determines the reaction to

advertising by a representative sample ofthe target market before . The goal of

pretesting is to eliminate errors or

weaknesses in program design beforeconsiderable sums of money are invested

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Posttesting:

This is done only after a full commitment to a creative

approach and a schedule of media has been made . The

objective is to ensure that future campaigns will be more

effective .

Campaigns success is measured and feedback of the

campaigns is tested.

Step 7: Execution of the advertising

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p gprogram

Planning of the advertising program is thejoint responsibility of advertiser andadvertising agency

Execution part is the responsibility of theagency

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Advertising Research

Marketing research

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Marketing research

Marketing research is the systematic gathering,recording and analysing of data about problemsrelating to the marketing of goods and services

It plays a significant part n product formulation,packaging, new product introductions andadvertising copy.

Marketing research when directed at the

advertising copy decision is referred asadvertising research

Advertising research

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Advertising research

It is a subsystem of marketing researchprocess

Information gathered via market research

is used up the advertiser and advertisingagency for campaign planning.

Research procedure

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Research procedure

Defining the problem

Collecting secondary or available data

Collecting primary or orginal data

Compiling and collating data

Interpreting the findings

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Advertising Copy Testing and

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Diagnosis

Copy Testing Decisions

Whether you should copy-test

When you should copy-test Measures used in copy testing

Advertising objective based measures

Communication effects models

The Components of Advertising

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The Components of Advertising

Research (Fig. 5.1)

Strategic Vs Evaluative

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Strategic Vs. Evaluative

Research & Marketing Research Strategic research is an extension of the

marketing strategy and is used to help develop

creative designs and media plans. Evaluative research measures how well the

advertiser has reached its goals.

Marketing research is used to identify consumer

needs, develop new products, evaluate pricinglevels, assess distribution methods, and test theeffectiveness of various promotional strategies.


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g

Strategy research Product concept research Product features or positioning

Target audience research

Identification, characteristics, appropriateappeals

Media audience research Appropriate media selection (e.g., Nielsen)

Message element research Consumer reactions to various messageelements

Strategic Research

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PrimaryResearch Suppliers

Simmons Market

Research Bureau

MediamarkResearch, Inc.

Go

vernmentOrganizations

Trade

Associations

SecondaryResearch Suppliers

Strategic Research

Information-Gathering Process that Enhances theDesign of a Creative Strategy

SecondaryResearch PrimaryResearch

Secondary Info.

on the Internet

The Strategy Document(C ti B i f)

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The Marketing Objective

The Product

The Target Audience

The Promise

The Brand Personality

(Creative Brief)

The Outcome of Strategic Research is Called a Strategy Document or CreativeBrief, which is finally reached to advertising agency

Diagnostic Research

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Diagnostic Research

Contact Methods

i.e. in person

Survey Research

i.e. population or sample

Observation Research

i.e. people-watching

Use ofMetaphors

i.e. images, not words

Content Analysis

i.e. audits of competitors'advertisements

In-Depth Interviews

i.e. one-on-one

Focus Groups

i.e. group in-depth

interviews

Early FeedbackMethods

Evaluative Research

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Evaluative Research

Evaluative research is used to make final go/no godecisions about finished or nearly finished ads.

Advertisers hope it will provide a valid measure ofeffectiveness, however: There are many truths in numbers,

Advertising is only one part of the overall marketingcampaign,

Advertising has many purposes,

Evaluative research methods change all the time.

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Advertising Copy Testing and Diagnosis

The Advertising Used

Frequency of Exposure

How its Shown

Where the Exposure Occurs How Respondents are Obtained

Geographic Scope

Alternative Measures of Persuasion Bases of Comparison and Evaluation

Evaluation Research Methods

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Direct-ResponseCounts

Brand Tracking Memory Tests

Persuasion Tests

CommunicationTests

Frame-by-Frame

Tests

In-Market Tests

Evaluation Research Methods

Memory Tests

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Ask Questio

nsAfter Ad Has Run Unaidedo

rAided Recall

Recall Tests (e.g., DAR)

May be aR

eliable,But Not Valid Test

Show Ad & Ask IfPeople

Remember Having Seen It Before

Recognition Tests (e.g., Bruzzone, Starch)

Memory Tests

Persuasion Tests

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Persuasion TestAttitude Change Test

Audience Composition Environment Brand Familiarity

Step 1Consumers Are

Asked IfTheyd

Buy a Brand

Step 2Consumers AreExposed to an

Ad forThat Brand

Step 3Consumers Are

Asked Again

about Purchase

Intentions

Cost

Persuasion Tests

Assessing Persuasion Tests

Step 4Results Are

Analyzed

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Did ad deliver the message it wasIntended to deliver?

Did ad deliver any messages it wasnot intended to deliver?

How did representatives of thetarget audience react to the

message, etc.?

Direct-Response CountsDirect-Response Counts Communication TestsCommunication Tests

Request a Direct Response

Via a:

Toll-Free Number,

Coupon,

Web site,

Offer embedded in the

body copy

Count NumberofSales or

Requests.

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Frame-by-Frame

Viewers Watch &

Respond to a TVCommercial by

1) Turning a Dial,2) Pressing

Numbers on aKeypad, or 3)

WearingElectrodes.

In-Market Tests

EvaluateAdvertisementsby MeasuringTheir Influence

on Sales.

Seldom UsedWith

Individual Ads.

May Use SimulatedTest Markets

Brand Tracking

Following Brands

From RejectionThrough LevelsOfAcceptance

For Every BrandIn a Market.

Tracking theBrand is More

Important thanTracking the Ad.

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Sales Promotions

Sales Promotion

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Sales Promotion

Sales Promotion is a MarketingDiscipline that Utilizes a Variety of

Incentive Techniques to StructureSales-Related Programs Targeted toConsumers, Trade, and/or SalesLevels that Generate a Specific,

Measurable Action or Response for a

Product or Service.

Sales Promotion Strategies

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ObjectivesObjectives

Intended to

ChangeConsumerBehavior

Building BrandsBuilding Brands

Can be Used to Build

Brand Images, ButMay be Long-Term

IntroducingIntroducingNew ProductsNew Products

Advertising and PromotionWork Well Together

Here UsingPush & PullStrategies

Sales Promotion Strategies

Consumer-Oriented Promotions

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Consumer Oriented Promotions

Consumer-OrientedPromotion

Samples

Coupons

Premiums

Contests/sweepstakes

Refunds/rebates

Bonus packs

Price-offs

Event sponsorship

Objectives of Consumer-Oriented

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Obtaining trial and repurchase

Increasing consumption of anestablished brand

Defending current customers

Targeting a specific market Enhancing advertising and marketing

efforts

Objectives of Consumer Oriented

Sales Promotion

Advantages of Coupons

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g p

Offers price reduction only toconsumers who are price sensitive

Does not rely on retailers cooperation

Generates trial of a new brand

Encourages non-users to try an

established brand or users to repeatuse

Disadvantages of Coupons

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g p

It can be difficult to estimate how many consumers willredeem a coupon and when they will do so.

Coupons targeted to attract new users of established

brands are often redeemed by previous loyal users.

Couponing programs can be expensive.

Problems of coupon misredemption and fraud exist.

Premiums

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PremiumsTangible Reward for Performing a Particular Act.

Direct Received

At Time ofPurchase

Mail Proofof

Purchase & Payment

Be Mailed In

Contests and Sweepstakes

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Contests

Compete for a Prize BasedOn Some Skill or Ability

GeneratesHigh DegreeOfConsumerInvolvement

Can HelpRevive

LaggingSales

p

Sweepstakes

Participants Submit NamesTo Be Included in Drawing

Game Type of Sweepstakes;Time Frame Much

Longer

Advantages of Sweepstakes and

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Effective way of getting the consumer tobecome involved with the brand by

making the promotion product relevant Generate interest in or excitement over

a brand and attracting attention toadvertising

Effective way of dealing with specificmarketing problems

d a ages o S eeps a es a d

Contests

Disadvantages of Contests andSweepstakes

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Sweepstakes

May overshadow the ad or brand

May detract from brand franchise or

image

Presence of professionals or hobbyistswho may submit entries and detract

from effectiveness

Refunds, Rebates, and

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PremiumsRefunds and Rebates

A Marketers Offer toReturn a Certain

Amount OfMoney to the ConsumerWho Purchases the

Product. i.e cash rebate + low-value

coupon

Sampling

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Allowing the Customer to Experience the

Product or Service.

Very Effective Strategy for Introducing

A New or Modified Product.

Most Common Method ofDistributing

Samples is Through the Mail.

9 Out of10Customers Prefer a Sample

To a Cents-OffCoupon to Introduce

Product.

p g

Trade Promotions

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Trade advertising is directed atwholesalers and retailers.

Four goals of a trade promotion are:

Stimulate in-store merchandising or other tradesupport,

Manipulate levels of inventory held bywholesalers and retailers,

Expand product distribution to new areas of thecountry or new classes of trade,

Create a high level of excitement about theproduct among those responsible for its sale.

Types of Trade Promotions

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Point-of-

PurchaseRetailer

Kits

Contests

Sweepstakes

Trade Shows

Types of Trade Promotions

Exhibits

Trade

Incentives

Trade

Deals

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Point-of-Purchase Displays

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So

meof

the Mo

st Po

pular PO

PToo

ls &Techniques

Mechanical Product

Dispensers

Price Cards

Signs

Banners

Special Racks

Carton Displays

Point-of-Purchase Displays

Display Distributed toRetailers Used toCall

Customers Attention to Product Promotions.

Trade Promotions

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Trade Shows& Exhibits

Allow ProductDemonstrations,

Provide Information,& Answer

Questions.

Retailer (Dealer)Kits

MaterialsT

hatHelp Reps MakeSales Calls AreOften Designed

as Kits.Contain Detailed

Product Specs,How-to-Do itDisplay, etc.

Contests &

Sweepstakes

AdvertisersC

anDevelop

Contests &

Sweepstakes to

Motivate

Resellers.

Occasional Use

Only is Effective.

Trade Incentives and Deals

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i Incentive Programsi.e. Used When IntroducingA New Product.

Types Include Bonuses &Dealer Loadings

Trade DealsMost Important ResellerSales PromoTechnique.

Types Include Buying &Advertising Allowances

Sponsorships and EventMarketing

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Marketing

Sponsorships include a number of activitiesincluding: sports sponsorships,

entertainment tours and attractions, festivals,

fairs, and annual events,

cause marketing associating with an event thatsupports a social cause, and

arts.

Sponsorships and EventMarketing

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Marketing

Event marketing describes the marketingpractice in which a brand is linked to an event tocreate experiences for customers and associatethe brand personality with a certain lifestyle.

A sponsorship occurs when a companysponsors a sports event or concert, or supports acharity with its resources.

It is attempting to increase the perceived value ofthe sponsors brand in the consumer's mind.

Blimps, balloons, and inflatables are used atmany events.

Specialty Advertising

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Build Brands; Creating

Both Awareness and

Reminders

Includes Everything

From Hats With Logos to

T-shirts, & Mousepads

Normally Have a

Promotional Message

Printed Somewhere

Third LargestCategory ofPromotional

Spending

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Structure of an Advertising AgencyAccount Executive: Organizes the resources of the agency to solve the problems of theclient

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client.

The Creative Team: Basically comprises of a writer and a designer.

Account Planner or Researcher: Responsible for the data and market intelligence on theaccount

Media Planner: This team actually makes the campaign come live.

Account Director: Overall responsible of providing service to clientele of the agency.

Creative Director: Overall incharge for the creative and the artwork of agency s clients.

Media Director: Responsible for media planning of the buying activities of the agency

Production House: This is the department which brings alive the creative art work ofcreative team

Documents

mail of ad