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BUAD 307 PROMOTION Lars Perner, Instructor 1 Promotion Integrated Marketing Communication Elements of promotion Advertising Strategies Other Methods of.

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Presentation on theme: "BUAD 307 PROMOTION Lars Perner, Instructor 1 Promotion Integrated Marketing Communication Elements of promotion Advertising Strategies Other Methods of."— Presentation transcript:

1 BUAD 307 PROMOTION Lars Perner, Instructor 1 Promotion Integrated Marketing Communication Elements of promotion Advertising Strategies Other Methods of Promotion

2 BUAD 307 PROMOTION Lars Perner, Instructor 2 Learning Objectives Understanding the obstacles that advertising messages face Understanding the choices facing marketing managers regarding –Promotional objectives –Promotional message –Media choice –Advertising and promotion spending

3 BUAD 307 PROMOTION Lars Perner, Instructor 3 Elements of the Promotion Mix Advertising Sales Promotion –Sales –Coupons –Rebates –Premiums Personal selling Public relations Direct marketing

4 BUAD 307 PROMOTION Lars Perner, Instructor 4 Promotion by Decision Stage Pre-purchase –Influence decision, preference –Samples to induce trial Purchase –Sales promotion –Point-of-purchase (POP) displays Post- purchase –Increase repurchase propensity

5 BUAD 307 PROMOTION Lars Perner, Instructor 5 Developing the Advertising Program IDENTIFYING THE TARGET AUDIENCE SPECIFYING ADVERTISING OBJECTIVES DESIGNING THE ADVERTISEMENT(S) SETTING THE ADVERTISING BUDGET

6 BUAD 307 PROMOTION Lars Perner, Instructor 6 Some Media Alternatives Television –Conventional advertisements –Infomercials –Sponsorship programming –Placements In programming Superimposed Radio Magazines Newspapers Outdoor Internet Point-of-purchase Other –Movie theaters –On other products

7 BUAD 307 PROMOTION Lars Perner, Instructor 7 Reaching the Customer: Encoding, Noise, and Decoding ENCODINGTHEMESSAGEMESSAGECHANNELDECODINGTHEMESSAGERECEIVER CHANNEL FEEDBACK NOISE SENDER. Text, p. 211. Mktg mgr Advertising mgr Advertising agency agencyAdvertisementCoupon Sales presentation Press release Store display Media, Salesperson Retail store News program Receiver interpretation of interpretation of the message the messageCustomers Media audience News media Clients Other ads News articles Other store displays

8 BUAD 307 PROMOTION Lars Perner, Instructor 8 Some Promotional Objectives Brand awareness –Knowledge of product category Existence Benefits Functions Technology –Knowledge of brand differences Brand attitude –Favorable beliefs about the brand Overall Relative to competitors Product category or brand trial Brand preference –Willingness to pay a premium for the brand –Resistance to competitor promotions (e.g., sales, coupons) –Willingness to buy under less convenient circumstances Increase in product category or brand usage –Quantity used –Frequency used –Scope of uses Increase in short term sales

9 BUAD 307 PROMOTION Lars Perner, Instructor 9 Promotional Objectives Across the Product Life Cycle (PLC) Introduction –Advertising and public relations awareness –Sales promotion trial –Personal selling distribution Growth –Advertising and PR brand loyalty –Less emphasis on sales promotion Maturity –Advertising persuasion, reminder –Sales promotion market share Decline –Reduction in advertising and PR –More emphasis on sales promotions temporary sales Text, p. 217

10 BUAD 307 PROMOTION Lars Perner, Instructor 10 Increase in Product Category or Brand UsageProduct Category Potential Examples Scope of uses –Orange juice: It isnt just for breakfast anymore –Baking soda –ZipLock bags –WD-40 (lubrication and sticker removal) Quantity used –Calcium supplements –Milk Frequency used –Cosmetics –Deodorant –Wine –Greeting cards –Phone calls Cell phone minutes Call to family/friends –Hotels, airlines –Conference calls –Car engine oil –Canned soup

11 BUAD 307 PROMOTION Lars Perner, Instructor 11 Communications Objectives Informing –Awareness –Interest –Benefits –Other information Persuading –Preference based on competitive advantages –Brand switching or prevention of brand switching Reminding –Trigger memories –Maintain preference and buying habits

12 BUAD 307 PROMOTION Lars Perner, Instructor 12 Some Advertising Strategies Comparative ads –Illegal in most countries –Generally very disliked by U.S. consumers but still relatively effective Humor appeal –A way to get attention to the advertisementbut the consumer may remember the humor and not what the product featured was Adding beliefs Classical conditioning (association) Fear appeal –To be effective: Feared stimulus must be of medium intensity enough to motivate action but not so intense that the individual tunes out the ad A clear solution must be offere de.g., use Listerine to avoid tooth loss due to gingivitis Repetition Celebrity endorsements

13 BUAD 307 PROMOTION Lars Perner, Instructor 13 The Elaboration Likelihood Model and Likely Effectiveness of Celebrity Endorsements Product important or expensive? Celebrityendorsements more likely to be effective No Is endorser congruent with productendorsed? Unlikely to be effective More likely to be effective No NoYes Yes Lowelaboration Highelaboration

14 BUAD 307 PROMOTION Lars Perner, Instructor 14 Executing The Advertising Program Pre-testing –Several story boards or actual ads are created –Ads are tested on consumers Instant response technologies (consumers either rate approval or have physiological measures taken throughout an ad duration –The best performing ad or ads are chosen subject to constraints imposed (e.g., need to specify a certain message or use certain types of models) Possible redesign Carrying out advertisement –Full service agencies –Limited service agencies –In-house

15 BUAD 307 PROMOTION Lars Perner, Instructor 15 Advertising Intensity and Return --A Typical Relationship 0 0.2 0.4 0.6 0.8 1 Response (e.g., sales, recall) 0510152025 Amount of Advertising Spending The S-Shaped Curve Saturation Point Relatively high effectiveness Too little to do much good

16 BUAD 307 PROMOTION Lars Perner, Instructor 16 Sample Exam Question

17 BUAD 307 PROMOTION Lars Perner, Instructor 17 Measuring Advertising Effect Several possible criteria: – Scanner data Individual TV exposure can be matched against actual purchases Available only for grocery products – Increase in sales (but it may be impossible to separate effects of different simultaneous ads) – Lab studies: Recall Attitude toward product Preference

18 BUAD 307 PROMOTION Lars Perner, Instructor 18 Japanese AdvertisingUse of animation and cartoon characters

19 BUAD 307 PROMOTION Lars Perner, Instructor 19 Breaking Through the Clutter


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