2. Enterprise Marketing Edward Gallagher MBA fasteddieg2001@yahoo.co.uk

3. Advertising, Promotion and Public Relations Definition: Advertising  Any paid form on non-personal communication about an organization, good or service or idea by an identified sponsor.  Advertising is expensive. $ 263 billion spent in advertising in the US per year. Two types of advertisements:  Product advertisement  Institutional advertisement

4. Product Advertising Definition:  Advertisement that focuses on selling a good or a service. Types:  Pioneering:  Competitive:  Reminder:

5. Types of Product Advertisement  Pioneering – introduces a new product, informative, usually at the beginning of the product cycle.  Competitive – promotes a specific brands benefits and value, usually to gain market share.  Reminder – re-enforces previous knowledge of a product, usually in the middle of the product cycle

6. Types of Institutional Advertisement  Advocacy – states the company’s position on an issue.  Pioneering – introduces new information about a company.  Competitive – promotes advantages of doing business with a company over its competitors  Reminder – re-enforces previous knowledge of a company

7. Developing the Advertising Program  Identify the Target Audience  Specify the Advertising Objectives  Set the Advertising budget  Design the Advertisements  Execute the Advertising Program  Evaluate the Advertising Program

8. Identify the Target Audience  The target audience is the market segment or groups that advertisers intend to reach  Advertisers must have some understanding of the lifestyles, attitudes, demographics and buying habits of the audience and how to reach them.  Example: Hummer SUV’s spent $3 million to place ads in Wired, Spin, BusinessWeek, Skiing and Cigar Aficionado magazines.

9. Specify Advertising Objectives  Clearly define Advertising Objectives  Objectives should be specific, example, 10% increase in market share or $ 1 million in additional sales.  Objectives should be realistic and attainable.  Objectives should be measurable.

10. Setting Advertising Budget  Advertising is expensive. Advertising is worth it if it is executed properly.  Expected profits allocate advertising resources.  Examples: a 30 second commercial during Super Bowl XXXIX cost $2.4 million.  BMW 7 series has 5% of the luxury car market. They spend $39 million advertising the 7 series.

11. Largest Advertisers in the US CompanyAdvertising budget (US dollars) Sales (US dollars) Advertising as percentage of sales General Motors$3.9 billion$136 billion2.9 % Phillip Morris$2.6 billion$44 billion5.9 % Procter & Gamble$2.3 billion$20 billion11.6 % Ford$2.3 billion$118 billion2 % Pfizer$2.2 billion$18 billion12.6 % Pepsi Co.$2.1 billion$13 billion15.9 % DaimlerChrysler$1.9 billion$78 billion2.5 % AOL Time Warner$1.8 billion$36 billion4.9 % Walt Disney$1.7 billion$21 billion8.4 % Verizon$1.6 billion$62 billion2.6 %

12. Designing the Advertisement  The advertising message usually focuses on key benefits to the customer.  Advertisements consist of both informational and persuasional elements  The informational and persuasional content combine to in the form of an “appeal” to the customer.  The advertisement provides a compelling reason for the viewer to act.

13. Persuasional Elements  Fear appeals – fear of a negative consequence of not using the product. Risk: If the fear message is too strong, it may turn the viewer off the product. If it is not strong enough, the viewer may fail to act.  Sex appeals – a suggestion that using the product will make the user more attractive. Using “sexy” people in the advertisement to associate the product with sexiness. Risk: Can turn the opposite sex off of the product. The company may develop a negative public image is sex is used too often.  Humour appeal – suggesting that the product is fun through the use of humour. Risk: Humour wears off quickly. Viewers may find the message offensive or not funny. If ad is too funny, the message may be lost.

14. Selecting the Right Media MediumAdvantagesDisadvantages TelevisionLarge audience, rich content, can target specific audience Expensive, difficult to convey complex message RadioLow cost, can target specific local audiences No visual content, difficult to convey complex message MagazinesTarget specific audience, high quality, long life span Long lead time, high cost, NewspapersLocal coverage, short lead time, ads can be clipped and saved Short life span, poor color InternetVideo, audio, animation, interactive with viewer Effectiveness had not been proven OutdoorLow cost, local market, high visibility Message must be short Direct mailHigh selectivity, complex information, high quality Junk mail image

15. Executing the Advertising Program - Pretest  Portfolio Tests – Many potential ads are evaluated by a panel of subjects to determine which one gives the best impression  Jury Tests – same as Portfolio Testing except specific ads are evaluated  Theatre Tests – Consumers are invited to view televisions shows where test commercials are shown.

16. Evaluating the Advertising Program - posttest  Aided Recall test – subjects are shown the ad and asked if they have seen it  Un-aided Recall test – subjects are asked if they have seen the ad, without showing ad  Attitude tests – subjects are asked about any change in attitude after viewing ad  Inquiry tests – ad asks for response from viewer, the best response is the most successful  Sales tests – sales activity is monitored in a controlled manner

17. Sales Promotion  Extra buying incentive.  Using sales tools such as coupons, contests, samples, loyalty programs, point of purchase displays, rebates and product placements.  Used to increase market share.

18. Sales Promotional tools  Coupons – the bearer of the coupon gets a discount that the time of purchase.  Contests – a lucky consumer can win a prize.  Samples – give away a small quantity of product for a consumer evaluation.  Loyalty programs – used to encourage repeat business.

19. Sales Promotional tools  Rebates – consumer gets money back if they purchase a product and send proof of purchase to the manufacturer.  Product Placement – arranging to have a brand appear in movie or television show. Example: James Bond movies show Sony televisions, Aston Martin and BMW cars.  Point-of-Purchase displays – place a store display at the point of purchase or where purchase decision is made.

20. Enterprise oriented Promotions  Allowances and discounts – encourage higher volume purchases  Cooperative advertising – offer to share advertising costs with wholesaler or reseller.  Training of distributors’ sales force – train the resellers on how best to represent the products.

21. Public Relations  Definition: Communications efforts used to create and maintain favourable relations between an organization and its stakeholders.  Research shows that the public’s attitude towards an organization can dramatically affect its sales.

22. Public Relations tools  News Release – also called press release, a single page describing a product or company event.  Publicity – A news story type of communication transmitted through a mass medium at no charge  News Conference – a meeting with the press to announce major news events. Also used by companies to respond to news events that affect the company.

23. Dealing with unfavourable Public Relations  One bad event can destroy that image in a matter of moments that took years to build.  Bad news travels faster than good news.  In today’s information age, bad news can travel faster than ever before.  Companies need to try their best to prevent these events.  Companies need to have plans in place to deal with these events when they occur.