Chapter 13 Flashcards
Advertising
Advertising. Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor.
Ex) broadcast, print, online, mobile, outdoor
PROS
Advertising can reach masses of geographically dispersed buyers at a low cost per exposure, and it enables the seller to repeat a message many times. Television advertising can reach huge audiences.
Beyond its reach, large-scale advertising says something positive about the seller’s size, popularity, and success. Because of advertising’s public nature, consumers tend to view advertised products as more legitimate. Advertising is also very expressive; it allows the company to dramatize its products through the artful use of visuals, print, sound, and color.
CONS
mass-media advertising is impersonal and lacks the direct persuasiveness of company salespeople
audience does not feel that it has to pay attention or respond.
Costly
Sales Promotion
Sales promotion. Short-term incentives to encourage the purchase or sale of a product or service.
Ex) discounts, coupons, displays, and demonstrations
Sales promotions invite and reward quick response
Not as effective as advertising or personal selling in building long-run brand preference and customer relationships.
Personal Selling
Personal selling. Personal customer interactions by the firm’s sales force for the purpose of engaging customers, making sales, and building customer relationships.
Ex) sales presentations, trade shows, and incentive programs.
PROS
most effective tool at certain stages of the buying process, particularly in building up buyers’ preferences, convictions, and actions
allows all kinds of customer relationships to spring up, ranging from matter-of-fact selling relationships to personal friendships. An effective salesperson keeps the customer’s interests at heart to build a long-term relationship by solving a customer’s problems. Finally, with personal selling, the buyer usually feels a greater need to listen and respond, even if the response is a polite “No, thank you.”
CONS
Costs 3 times more than advertising
Hard to adjust sales force
Public Relations
Public relations (PR). Building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events.
EX) press releases, sponsorships, events, and Web pages
Public relations is very believable—news stories, features, sponsorships, and events seem more real and believable to readers than ads do. PR can also reach many prospects who avoid salespeople and advertisements—the message gets to buyers as “news and events” rather than as a sales-directed communication
Direct or Digital Marketing
Direct and digital marketing. Engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships
digital marketing are well suited to highly targeted marketing efforts, creating customer engagement, and building one-to-one customer relationships.
four major types of media (poes)
Paid
Owned
Earned
Shared
Paid Media
promotional channels paid for by the marketer, including traditional media (such as TV, radio, print, or outdoor) and online and digital media (paid search ads, mobile ads, email marketing, or Web and social media display ads and sponsored content).
Owned Media
promotional channels owned and controlled by the company, including company Web sites, corporate blogs, owned social media sites, proprietary brand communities, sales forces, and events.
Earned Media
PR media channels, such as television, newspapers, blogs, online video sites, and other media not directly paid for or controlled by the marketer but that incorporate the content because of viewer, reader, or user interest.
Ex) a blog about a car review
Shared media
media shared by consumers with other consumers, such as social media, blogs, mobile media, and viral channels as well as traditional word of mouth.
integrated marketing communications (IMC).
company carefully integrates and coordinates its many communication channels to deliver a clear, consistent, and compelling message about the organization and its brands.
The concept of integrated marketing communications suggests that the company must blend the promotion tools carefully into a coordinated promotion mix.
Two basic promotional mix
Push + pull
Push Strategy
push strategy involves “pushing” the product through marketing channels to final consumers. The producer directs its marketing activities (primarily personal selling and trade promotion) toward channel members to induce them to carry the product and promote it to final consumers.
Pull strategy
pull strategy, the producer directs its marketing activities (primarily advertising, consumer promotion, and direct and digital media) toward final consumers to induce them to buy the product. For example, Unilever promotes its Axe grooming products directly to its young male target market using TV and print ads, Web and social media brand sites, and other channels. If the pull strategy is effective, consumers will then demand the brand from retailers such as CVS, Walgreens, or Walmart, which will in turn demand it from Unilever. Thus, under a pull strategy, consumer demand “pulls” the product through the channels.
4 important question while designing an advertising program
setting advertising objectives,
setting the advertising budget,
developing advertising strategy (message decisions and media decisions)
and evaluating advertising effectiveness.
Advertising objective
advertising objective is a specific communication task to be accomplished with a specific target audience during a specific period of time. Advertising objectives can be classified by their primary purpose—to inform, persuade, or remind
Affordable Method of Advertising
They set the promotion budget at the level they think the company can afford.
Unfortunately, this method of setting budgets completely ignores the effects of promotion on sales. It tends to place promotion last among spending priorities, even in situations in which advertising is critical to the firm’s success. It leads to an uncertain annual promotion budget, which makes long-range market planning difficult. Although the affordable method can result in overspending on advertising, it more often results in underspending.
Percentage of sales
Setting their promotion budget at a certain percentage of current or forecasted sales. Or they budget a percentage of the unit sales price. The percentage-of-sales method has advantages. It is simple to use and helps management think about the relationships between promotion spending, selling price, and profit per unit.
Comparative- Parity Method
competitive-parity method, setting their promotion budgets to match competitors’ outlays.
First, competitors’ budgets represent the collective wisdom of the industry. Second, spending what competitors spend helps prevent promotion wars. Unfortunately, neither argument is valid. There are no grounds for believing that the competition has a better idea of what a company should be spending on promotion than does the company itself.
Objective and Task Method
objective-and-task method, whereby the company sets its promotion budget based on what it wants to accomplish with promotion. This budgeting method entails (1) defining specific promotion objectives, (2) determining the tasks needed to achieve these objectives, and (3) estimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget.
advantage of the objective-and-task method is that it forces management to spell out its assumptions about the relationship between dollars spent and promotion results. But it is also the most difficult method to use. Often, it is hard to figure out which specific tasks will achieve stated objectives
Advertising Strategy
two major elements: creating advertising messages and selecting advertising media
message strategy
plain, straightforward outlines of benefits and positioning points that the advertiser wants to stress.
begins with identifying customer benefits that can be used as advertising appeals. Ideally, the message strategy will follow directly from the company’s broader positioning and customer value-creation strategies.
Creative Strategy
begins with identifying customer benefits that can be used as advertising appeals. Ideally, the message strategy will follow directly from the company’s broader positioning and customer value-creation strategies.
Advertising appeals
Advertising appeals should have three characteristics. First, they should be meaningful, pointing out benefits that make the product more desirable or interesting to consumers. Second, appeals must be believable. Consumers must believe that the product or service will deliver the promised benefits.
However, the most meaningful and believable benefits may not be the best ones to feature. Appeals should also be distinctive. They should tell how the product is better than competing brands.
