1. Advertising, Sales Promotion, and Public Relations

2. 2 Chapter Objectives Tell what advertising is and describe the major types of advertising Describe the process of developing an advertising campaign Explain how marketers evaluate advertising Explain what sales promotion is and describe the different types of trade and consumer sales promotion activities Explain the role of public relations Describe the steps in developing a public relations campaign

3. 3 Real People, Real Choices BzzAgent, Inc. (Joe Chernov) Negative articles questioned “disclosure” in word-of-mouth marketing campaigns What public relations strategy to use to respond to the criticism?  Option 1: take charge of the discussion.  Option 2: defend without being defensive.  Option 3: go quiet. BZZAGENT.COM

4. 4 Advertising: The Image of Marketing Advertising: nonpersonal communication paid for by an identified sponsor using mass media to persuade or inform an audience EXTREME MAKEOVER: HOME EDITION

5. 5 Discussion Some people say advertising is obnoxious, insults their intelligence, and promotes claims that are untrue. Others argue it provides value for consumers. --What are some arguments on each side? --How do you feel about advertising?

6. 6 Types of Advertising Product advertising: focuses on a specific good/service

7. 7 Types of Advertising (cont’d) Institutional advertising: promotes the activities, personality, or point of view of an organization or company Advocacy advertising Public service announcement (PSA) ROCK THE VOTE

8. 8 Types of Advertising (cont’d) Retail and local advertising: encourages customers to shop at a specific store or use a local service Do-it-yourself advertising  “Generation C” phenomenon: consumer-generated ad content on the Web WWW.PRICELESS.COM

9. 9 Discussion Chevy found that DIY advertising programs can sometimes backfire when consumers created anti-SUV TV commercials.  --Should companies avoid DIY campaigns?  --What are the benefits of DIY advertising?

10. 10 Who Creates Advertising? Advertising campaign: a coordinated, comprehensive plan that carries out promotion objectives and results in a series of ads placed in media over a period of time LEO BURNETT WORLDWIDE

11. 11 Who Creates Advertising? (cont’d) Limited-service agency Full-service agency  Account management  Creative services  Research and marketing services  Media planning Motorola Video

12. 12 Figure 13.1: Steps in Developing an Advertising Campaign

13. 13 Steps in Developing an Advertising Campaign Step 1: Identify the target audiences Step 2: Establish message and budget objectives Step 3: Design the Ads  Creative strategy: process that turns a concept into an advertisement

14. 14 Advertising Appeal: Central Idea of the Ad Reasons why: the Unique Selling Proposition (USP) Comparative advertising Demonstration Slice of life Lifestyle

15. 15 Advertising Appeal: Central Idea of the Ad (cont’d) Testimonial Fear appeals Sex appeals Humorous appeals Slogans and jingles

16. 16 Group Activity As an account team for an advertising agency, your group has been assigned a new line of high- quality, high-priced makeup. Consider different types of appeals:  USPComparative advertising  Fear appealCelebrity endorsement  Slice-of-life adSex appeal  Humor Outline the strengths and weaknesses of each of these appeals for advertising the makeup.

17. 17 Step 4: Pretest What the Ads Will Say Pretesting: seeks to minimize mistakes by getting consumer reactions to ad messages before they appear in the media Copy testing: measures effectiveness of ads

18. 18 Step 5: Choose the Media Type(s) and Media Schedule Media planning: develops media objectives, strategies and tactics Aperture: is the best place and time to reach the target market

19. 19 Where to Say It: Traditional Media Television Radio Newspapers Magazines Directories Out-of-home media Place-based media

20. 20 Discussion When Internet travel company Hotels.nl began using blankets on sheep for advertising, one town fined the company for ignoring a ban on advertising along the highways.  --What are the positive and negative aspects for companies of using sheep, or even horses and cows, to advertise products? For consumers?

21. 21 Where to Say It: Internet advertising Banners Buttons Search engine and directory listings Pop-up ads Email  Spamming  Permission marketing

22. 22 Discussion Through TV remotes, DVDs, computers, and cable television, technology gives today’s consumers control over the advertising images they see.  --How has this affected the advertising industry so far?  --How do you think consumer control will affect advertising in the future?

23. 23 Media Scheduling: When To Say It Media schedule: specifies exact media to use and when to use it Advertising exposure: defines degree to which the target market will see an advertising message in specific vehicles Impressions: measures number of people exposed to a message in one or more vehicles

24. 24 Figure 13.3: Media Schedule for a Video Game

25. 25 Media Scheduling: When To Say It (cont’d) Reach: measures percentage of target market exposed to media vehicle Frequency: measures average number of times a person in the target group will be exposed to the message

26. 26 Media Scheduling: When To Say It (cont’d) Gross rating points (GRPs) = reach X frequency Cost per thousand (CPM): the cost to deliver a message to 1,000 people

27. 27 Media Scheduling: How Often To Say It Continuous schedule: puts out steady stream of advertising Pulsing schedule: varies the amount of advertising Flighting schedule: puts ads out in short, intense bursts

28. 28 Step 6: Evaluate the Advertising Posttesting: research on consumers’ responses to advertising they have seen or heard Unaided recall Aided recall

29. 29 Sales Promotion Programs designed to build interest in or encourage purchase of a product during a specified period of time  Deliver short-term sales results  Can target end consumers, channel partners, and/or employees

30. 30 Sales Promotion Directed Toward the Trade: Trade Promotions Discounts and deals  Merchandising allowances  Case allowances Increasing industry visibility  Trade shows  Promotional products  Incentive programs (push money)

31. 31 Sales Promotion Directed Toward Consumers Price-Based Consumer Sales Promotion  Coupons  Price deals, refunds, and rebates  Frequency (loyalty/continuity) programs  Special/bonus packs SMARTSOURCE.COM

32. 32 Discussion Companies sometimes teach consumers a “bad lesson” by overusing sales promotion. As a result, consumers expect the product always to be “on sale.”  --What are some products for which this bad lesson has occurred?  --How can companies prevent it?

33. 33 Sales Promotion Directed Toward Consumers (cont’d) Attention-getting consumer promotion  Contests and sweepstakes  Premiums  Sampling  Point-of-purchase promotion  Product/brand placements  Cross-promotion FREESAMPLES.COM

34. 34 Group Project Your group works for a firm producing several brands of household cleaning products.  --Develop recommendations for trade and consumer sales promotion activities for a new laundry detergent  --In a role-playing situation, present and defend your recommendations to your boss.

35. 35 Public Relations PR: communication function that seeks to build good relationships with an organization’s publics. Publics include consumers, stockholders, legislators, and other firm stakeholders. Basic rule of good PR: do something good, then talk about it.

36. 36 Public Relations (cont’d) Proactive PR activities stem from firm’s marketing objectives. Publicity: unpaid communication about an organization that gets media exposure. PR is even more important when firm’s image is at risk due to negative publicity. PR is responsible for preparing a crisis management plan.

37. 37 Discussion Some critics denounce PR specialists, calling them “flacks” or “spin doctors” whose job is to hide the truth about a company’s problems  What is the proper role of PR within an organization?  Should PR specialists try to put a good face on bad news?

38. 38 Objectives of Public Relations Introducing new products to manufacturers Introducing new products to consumers Influencing government legislation Enhancing image of a firm Enhancing image of a city, region, or country Calling attention to a firm’s involvement with the community

39. 39 Planning a Public Relations Campaign A statement of objectives Situation analysis Specification of publics, communicated messages, and specific program elements Timetable and budget Discussion of program evaluation plan

40. 40 Public Relations Activities Press releases (timely topics, research project stories, and consumer information releases) Internal PR Investor relations Lobbying Speech writing Corporate identity

41. 41 Public Relations Activities (cont’d) Media relations Sponsorships Special events Buzz-building: word-of- mouth/blogging Advice and counsel

42. 42 Group Activity As PR professionals employed by your university, your group must develop strategies for improving your school’s PR program. --Write a memo to your university president with your recommendations.

43. 43 Real People, Real Choices BzzAgent, Inc. (Joe Chernov) Joe chose option 1: take charge of the discussion.  BzzAgent issued a press release announcing it had enhanced its disclosure policy, becoming the first company to enforce compliance with disclosure policies.

44. 44 Marketing Plan Exercise Think about one of the following:  A new brand of toothpaste  Your local city or state  Your university Outline an advertising campaign for the product and discuss the following:  The type of appeal  The main message  The media (include at least one print and one broadcast medium)  How you’ll develop the ads to share the same look and feel

45. 45 Marketing in Action Case: You Make the Call What is the decision facing Amazon? What factors are important in understanding this decision situation? What are the alternatives? What decision(s) do you recommend? What are some ways to implement your recommendation?

46. 46 Keeping It Real: Fast-Forward to Next Class, Decision Time at IBM Meet Esther Ferre, a General Manager at IBM. IBM sales teams are responsible for IBM relationships with clients and are evaluated on maximizing revenue and profits. The decision: How to allocate resources across a broad customer base?