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© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-1.

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Presentation on theme: "© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-1."— Presentation transcript:

1 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-1

2 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-2 ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS C HAPTER

3 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-3 AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: 1.Explain the differences between product advertising and institutional advertising and the variations within each type. 2.Describe the steps used to develop, execute, and evaluate an advertising program.

4 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-4 AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: 3.Explain the advantages and disadvantages to alternative advertising media. 4.Discuss the strengths and weaknesses of consumer-oriented and trade-oriented sales promotions. 5.Recognize public relations as an important form of communication.

5 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 19-6 TYPES OF ADVERTISEMENTS Advertising Product Advertisements Competitive (or Persuasive) Pioneering (or Informational) Comparative Reminder Reinforcement

6 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide TYPES OF ADVERTISEMENTS Institutional Advertisements Pioneering Institutional Advocacy Competitive Institutional Reminder Institutional

7 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. What is the difference between pioneering and competitive ads? A: Pioneering ads tell people what a product is, what it can do, and where it can be found. Competitive ads promote a specific brands features and benefits to persuade the target market to select the firms brand rather than that of a competitor.

8 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. What is the purpose of an institutional advertisement? A: To build goodwill or an image for an organization.

9 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Identifying the Target Audience Setting the Advertising Budget Specifying Advertising Objectives

10 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-1 FIGURE 19-1 Super Bowl, super dollars, super audience

11 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Designing the Advertisement Message Content Fear Appeals Sex Appeals Humorous Appeals Creating the Actual Message

12 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin ETHICS AND SOCIAL RESPONSIBILITY ALERT Who Decides What Is Appropriate Advertising? Slide 19-35

13 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-A FIGURE 19-A Top 15 advertising slogans of the century

14 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-B FIGURE 19-B Top 10 advertising icons of the century

15 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. What are characteristics of good advertising objectives? A: The same guidelines used for setting promotion objectives described in Chapter 18: They should (1) be designed for a well-defined target audience, (2) be measurable, and (3) cover a specified time period.

16 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. What is a potential shortcoming of using a celebrity spokesperson? A: The spokespersons image may change to be inconsistent with the image of the company or brand.

17 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Selecting the Right Media Advertising Media Maximizing Exposure Choosing a Medium and a Vehicle within That Medium Minimizing Costs

18 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-2 FIGURE 19-2 U.S. advertising expenditures, by category (in millions of dollars)

19 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Selecting the Right Media Basic Terms Frequency Frequency Gross Rating Points (GRPs) Gross Rating Points (GRPs) Reach Reach Rating Rating Cost per Thousand (CPM) Cost per Thousand (CPM)

20 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-3 FIGURE 19-3 The language of the media buyer

21 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives Television Wasted Coverage Digital Video Recorders (DVRs) Out-of-Home TV Spot Ads Infomercials Infomercials

22 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-4 FIGURE 19-4 Advantages and disadvantages of major advertising media

23 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Ronco Infomercials What are the advantages and disadvantages of this medium? Click on Icon

24 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives Radio Magazines Newspapers Yellow Pages

25 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives Internet Rich Media Online Advertising Options Permission-Based Advertising

26 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin MARKETING NEWSNET Does Internet Advertising Really Work? Slide 19-61

27 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives Outdoor Billboards Transit Advertising Place-Based Media Other Media Selection Criteria

28 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide DEVELOPING THE ADVERTISING PROGRAM Scheduling the Advertising Buyer Turnover Purchase Frequency Forgetting Rate Continuous (Steady) Schedule Flighting (Intermittent) Schedule Pulse (Burst) Schedule

29 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. You see the same ad in Time and Fortune magazines and on billboards and TV. Is this an example of reach or frequency? A: frequency

30 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. Why has the Internet become a popular advertising medium? A: The Internet offers a visual message, can use both audio and video, is interactive through rich media, and tends to reach younger consumers.

31 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 3. What factors must be considered when choosing among alternative media? A: The media habits of the target audience, the products attributes, and the reach and cost, as measured by CPM.

32 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide EXECUTING THE ADVERTISING PROGRAM Pretesting the AdvertisingPretesting the Advertising Portfolio Tests Jury Tests Theater Tests

33 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide EXECUTING THE ADVERTISING PROGRAM Carrying Out the Advertising Program Full-Service Agency Full-Service Agency Limited-Service Agencies Limited-Service Agencies In-House Agencies In-House Agencies

34 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-5 FIGURE 19-5 Alternative structures of advertising agencies used to carry out the advertising program

35 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide EVALUATING THE ADVERTISING PROGRAM Posttesting the AdvertisingPosttesting the Advertising Aided Recall (Recognition-Readership) Unaided Recall Attitude Tests Inquiry Tests Sales Tests Making Needed Changes

36 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. Explain the difference between pretesting and posttesting advertising copy. A: Pretests are conducted before ads are placed in any medium to determine whether the ads communicate the intended message or select among alternative versions. Posttests are shown to the target audience to determine whether it accomplished its intended purpose.

37 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. What is the difference between aided and unaided recall posttests? A: Aided recall involves showing an ad to respondents who then are asked if their previous exposure to it was through reading, viewing, or listening. Unaided recall involves asking respondents if they remember an ad without any prompting to determine if they saw or heard its message.

38 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide SALES PROMOTION Consumer-Oriented Sales Promotion Coupons Deals Premiums Self-Liquidating Contests Sweepstakes

39 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FIGURE 19-6 FIGURE 19-6 Sales promotion alternatives

40 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide SALES PROMOTION Consumer-Oriented Sales Promotion Samples Loyalty Programs Point-of-Purchase Displays Rebates Product Placement Product Placement

41 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide SALES PROMOTION Trade-Oriented Sales Promotion Allowances and Discounts Cooperative Advertising Cooperative Advertising Merchandise Allowance Case Allowance Finance Allowance Training of Distributors Salesforces

42 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. Which sales promotional tool is most common for new products? A: sales promotion

43 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. Whats the difference between a coupon and a deal? A: A coupon provides a reduced price for an item based on redemption. A deal is a short-term price reduction.

44 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 3. Which trade promotion is used on an ongoing basis? A: trade allowance

45 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide PUBLIC RELATIONS Publicity Tools News Release News Conference Public Service Announcements (PSAs) Personal Appearance/Visibility

46 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide INCREASING THE VALUE OF PROMOTION Building Long-Term Relationships with Promotion Self-Regulation

47 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 1. What is a news release? A: An announcement regarding changes in the company or the product line.

48 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Concept Check 2. What is the difference between government regulation and self- regulation? A: Government regulation involves laws or other controls set by an agency of local, state, or federal government, whereas self-regulation involves ethical guidelines for business practices set by advertising agencies, trade associations, and marketing organizations.

49 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide ADVERTISING ON THE INTERNET GOING ONLINE

50 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Visit the Interactive Advertising Bureau website and review the Standards and Guidelines section to determine what type of online ad you would recommend. How many types of (a) rectangles and pop-ups, (b) banners and buttons, and (c) skyscrapers does the IAB specify? Going Online

51 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Describe the profile of the audience for each of the websites. Going Online

52 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide What does the IAB suggest you include in your online advertising privacy policy? Going Online

53 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide A HISTORICAL LOOK AT ADVERTISING SUPPLEMENTAL LECTURE NOTE 19-1

54 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide SHOULD ADVERTISERS BELIEVE TV RATINGS? SUPPLEMENTAL LECTURE NOTE 19-2

55 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide ONLINE ADVERTISING TAKES OFF! SUPPLEMENTAL LECTURE NOTE 19-3

56 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide A HISTORICAL LOOK AT THE OBJECTIVES OF SALES PROMOTIONS SUPPLEMENTAL LECTURE NOTE 19-4

57 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide ARE YOU A LOYAL CUSTOMER? SUPPLEMENTAL LECTURE NOTE 19-5

58 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide FALLON WORLDWIDE: IN THE CREATIVITY BUSINESS VIDEO CASE 19

59 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Fallon Worldwide stresses its creativity, as shown by comments from the Fallon people in the case. In what ways do the Citi and BMW campaigns reflect their creativity? Compare the sources of the ideas in the two campaigns. VIDEO CASE 19 Fallon Worldwide

60 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide In the Citi and BMW campaigns how were (a) the target markets and (b) each brands positioning changed from the situation prior to the campaign? VIDEO CASE 19 Fallon Worldwide

61 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Compare the media used for the Citi and BMW campaigns. Why were these media chosen? Do you expect the use of these or other media to change in the future? VIDEO CASE 19 Fallon Worldwide

62 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide How might Fallon and its clients measure the success of (a) the Citi and (b) the BMW campaigns? VIDEO CASE 19 Fallon Worldwide

63 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide VOLKSWAGEN: THE DRIVERS WANTED CAMPAIGN APPENDIX D CASE D-19

64 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide What were the primary promotional objectives for Volkswagen at the beginning of the Drivers Wanted campaign? What are Volkswagens current promotional objectives? How do you expect the promotional objectives for the overall Volkswagen brand and for specific car models, such as the Jetta or Touareg, to change over time? APPENDIX D CASE D-19 Volkswagen

65 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide What do you feel are the most valid measures for assessing the success of the Volkswagen advertising campaign? Explain why you feel that these are the best means of determining effectiveness. APPENDIX D CASE D-19 Volkswagen

66 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Volkswagens promotional program has heavily emphasized a pull promotional strategy versus a push promotional strategy. Why? Is this emphasis likely to change over time? APPENDIX D CASE D-19 Volkswagen

67 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Advertising Advertising is any paid form of nonpersonal communication about an organization, good, service, or idea by an identified sponsor.

68 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Product Advertisements Product advertisements are advertisements that focus on selling a good or service and which take three forms: (1) pioneering (or informational), (2) competitive (or persuasive), and (3) reminder.

69 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Institutional Advertisements Institutional advertisements are advertisements designed to build goodwill or an image for an organization rather than promote a specific good or service.

70 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Reach Reach is the number of different people or households exposed to an advertisement.

71 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Rating A rating is the percentage of households in a market that are tuned to a particular TV show or radio station.

72 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Frequency Frequency is the average number of times a person in the target audience is exposed to a message or an advertisement.

73 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Gross Rating Points Gross rating points (GRPs) is a reference number used by advertisers that is obtained by multiplying reach (expressed as a percentage of the total market) by frequency.

74 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Cost per Thousand Cost per thousand (CPM) is the cost of reaching 1,000 individuals or households with the advertising message in a given medium (M is the Roman numeral for 1,000).

75 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Infomercials Infomercials are program-length (30-minute) advertisements that take an educational approach to communication with potential customers.

76 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Pretests Pretests are tests conducted before the advertisements are placed in any medium to determine whether it communicates the intended message or to select among alternative versions of the advertisement.

77 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Full-Service Agency A full-service agency is an advertising agency that provides the most complete range of services, including market research, media selection, copy development, artwork, and production.

78 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Limited-Service Agencies Limited-service agencies are advertising agencies that specialize in one aspect of the advertising process such as providing creative services to develop the advertising copy or buying previously unpurchased media space.

79 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide In-House Agencies In-house agencies consists of the companys own advertising staff, which may provide full services or a limited range of services.

80 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Posttests Posttests are tests conducted after an advertisement has been shown to the target audience to determine whether it accomplished its intended purpose.

81 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Consumer-Oriented Sales Promotions Consumer-oriented sales promotions are sales tools used to support a companys advertising and personal selling directed to ultimate consumers.

82 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Product Placement Product placement is a sales promotion tool that uses a brand-name product in a movie, television show, video, or a commercial for another product.

83 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Trade-oriented sales promotions are a Sales tools used to support a companys advertising and personal selling directed to wholesalers, distributors, or retailers. Also called trade promotions. Trade-Oriented Sales Promotions

84 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Cooperative Advertising Cooperative advertising consists of advertising programs by which a manufacturer pays a percentage of the retailers local advertising expense for advertising the manufacturers products.

85 © 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide Publicity Tools Publicity tools consist of methods of obtaining nonpersonal presentation of an organization, good, or service without direct cost. Examples include news releases, news conferences, and public service announcements.


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