1. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 1 chapter 17 Prepared by Angela Zigras, Seneca College Deborah Baker, Texas Christian University ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS

2. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 2 You Will Learn To... 1.Discuss the role of advertising in the IMC program. 2. Identify the major types of advertising. 3. Discuss the creative planning process for advertising. 4. Describe the media planning process for advertising.

3. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 3 You Will Learn To... 5. Discuss the role of sales promotion in the IMC program. 6. Describe the most common forms of consumer sales promotion. 7. Identity the most common forms of trade sales promotion.

4. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 4 You Will Learn To... 8.Discuss the role of public relations in the IMC program. 9. Describe the major types of public relations activity.

5. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 5 Advertising  Canadian advertising reached an estimated $5.3 Billion in 2000.  Spending depends on the stage in the life cycle of the company, product, or service.  The effects of advertising are not directly measured to sales.

6. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 6 Advertising  New brands spend proportionately more for advertising than old ones.  A certain level of exposure is needed to affect purchase habits.  Beyond a certain level, diminishing returns set in.

7. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 7 Major Types of Advertising Institutional Advertising Institutional Advertising Designed to enhance a company’s image rather than promote a particular product. Product Advertising Product Advertising Designed to tout the benefits of a specific good or service.

8. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 8 Major Types of Advertising Enhance corporation’s identify Pioneering Competitive Comparative ProductAdvertisingProductAdvertising InstitutionalAdvertising Advocacy advertising

9. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 9 Product Advertising PioneeringPioneering Stimulates primary demand for new product or category CompetitiveCompetitive Influence demand for brand in the growth phase of the PLC. Often uses emotional appeal. Influence demand for brand in the growth phase of the PLC. Often uses emotional appeal. ComparativeComparative Compares two or more competing brands’ product attributes. Used if growth is sluggish, or if competition is strong. Compares two or more competing brands’ product attributes. Used if growth is sluggish, or if competition is strong.

10. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 10 Advertising Objective The specific communication task to be accomplished for a specified target audience during a specified period.

11. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 11 Steps in Creating an Advertising Campaign Determine the Advertising Objectives. Make creative decisions. Make media decisions. Evaluate the campaign.

12. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 12 Creative Objectives Communicate Creative Objectives Increase Frequency of Use Increase Frequency of Use Attract New Targets Product Improvements Promotion Incentives Positive Corporate Image Product Improvements Promotion Incentives Positive Corporate Image Unique Product Benefits and Attributes Unique Product Benefits and Attributes

13. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 13 Creative Decisions Components of Creative Decisions Components of Creative Decisions Develop and Evaluate Advertising Appeals Develop and Evaluate Advertising Appeals Execute the Message Evaluate the Campaign’s Effectiveness Evaluate the Campaign’s Effectiveness Identify Product Benefits

14. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 14 Identify Product Benefits  “Sell the Sizzle, not the Steak”  Sell product’s benefits, not its attributes  A benefit should answer “What’s in it for me?”  Ask “So?” to determine if it is a benefit

15. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 15 Advertising Appeal Reason for a person to buy a product.

16. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 16 Common Advertising Appeals

17. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 17 Executing the Message

18. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 18 Media Types Newspapers Magazines Radio Television Outdoor Internet Alternative Media Major Types ofAdvertisingMedia ofAdvertisingMedia

19. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 19 NewspapersAdvantagesAdvantages  Year-round readership  Geographic selectivity  Immediacy  High individual market coverage  Short lead timeDisadvantagesDisadvantages  Limited demographic selectivity  Little colour  May be expensive  Low pass-along rate  Clutter  Mass market medium

20. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 20 Cooperative Advertising An arrangement in which the manufacturer and the retailer split the costs of advertising the manufacturer’s brand.

21. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 21 Magazines  Good reproduction  Demographic selectivity  Regional/local selectivity  Long advertising life  High pass-along rateAdvantagesAdvantages  Higher cost per contact  Long-term advertiser commitments  Slow audience build-up  Limited demonstration capabilities  Lack of urgency  Long lead timeDisadvantagesDisadvantages

22. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 22 RadioAdvantagesAdvantages  Selectivity and audience segmentation  Immediate and portable  Geographic flexibility  Entertainment carryover  Short-term ad commitmentsDisadvantagesDisadvantages  No visual treatment  Short advertising life  High frequency to generate retention  Commercial clutter  Background distractions

23. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 23 TelevisionAdvantagesAdvantages  Wide diverse audience  Low cost per thousand  Creative and demonstrative  Immediacy of messages  Entertainment carryover  Demographic selectivity with cableDisadvantagesDisadvantages  Short life of message  Expensive with high campaign cost  Little demographic selectivity with network  Long-term advertiser commitments  Long lead times  Clutter

24. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 24 Outdoor Media AdvantagesAdvantages  High exposure frequency  Moderate cost  Flexibility  Geographic selectivity  Broad, diverse marketDisadvantagesDisadvantages  Short message  Lack of demographic selectivity  High “noise” level

25. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 25 Internet and World Wide Web  Fast growing  Ability to reach narrow target audience  Short lead time  Moderate costAdvantagesAdvantages  Difficult to measure ad effectiveness and ROI  Ad exposure relies on “click through”  Not all consumers have access to internetDisadvantagesDisadvantages

26. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 26 Alternative Media Ads in Movies and Videos Ads in Movies and Videos Interactive Kiosks Computer Screen Savers Computer Screen Savers Video Shopping Carts Fax Machines Examples of Alternative Media Examples of Alternative Media

27. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 27 Media Selection Considerations Cost per Contact Factors Influencing Media Mix Decisions Factors Influencing Media Mix Decisions Reach Frequency Audience Selectivity

28. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 28 Media Selection Considerations Cost per Contact ContactReachReach FrequencyFrequency AudienceSelectivityAudienceSelectivity The cost of reaching one member of the target market. The number of target consumers exposed to a commercial at least once during a time period. The number of times an individual is exposed to a message during a time period. The ability of an advertising medium to reach a precisely defined market.

29. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 29 Media Scheduling Types of Media Schedules Types of Media Schedules Continuous Media Schedule Flighted Media Schedule Pulsing Media Schedule Seasonal Media Schedule

30. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 30 Media Scheduling Continuous Media Schedule Continuous Flighted Media Schedule Pulsing Media Schedule Pulsing Seasonal Seasonal Advertising is run steadily throughout the period. Advertising is run heavily every other month or every two weeks. Advertising combines continuous scheduling with flighting. Advertising is run only when the product is likely to be used.

31. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 31 Evaluating the Ad Campaign Advertising Research  Can be tested before –Pretest Determine best appeal, layout & media vehicle.  Can be tested after –Post-test To assess how the advertising could have been more efficient.

32. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 32 Sales Promotion Consumer Sales Promotion Trade Sales Promotion Trade Sales Promotion Incentive to buyIncentive to buy Reason to buyReason to buy Sales Promotion Incentive to buyIncentive to buy Reason to buyReason to buy

33. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 33 Objectives of Sales Promotion Type of Buyer Loyal Customers Competitor’s Customers Brand Switchers Price Buyers Desired Results Reinforce behaviour Increase consumption Change timing Break loyalty Persuade to switch Persuade to buy your brand more often Appeal with low prices Supply added value Sales Promotion Examples Loyalty marketing Bonus packs Sampling Sweepstakes, contests, premiums Price-lowering promotion Trade deals Coupons, price-off packages, refunds Trade deals

34. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 34 Tools for Consumer Sales Promotion Coupons and Rebates Premiums Loyalty Marketing Programs Contests & Sweepstakes Sampling Point-of-Purchase Promotion Popular Tools for Consumer Sales Promotion Popular Tools for Consumer Sales Promotion

35. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 35 Coupon Rebate Premium A certificate that entitles consumers to an immediate price reduction. A cash refund given for the purchase of a product during a specific product. A cash refund given for the purchase of a product during a specific product. An extra item offered to the consumer, usually in exchange for some proof of purchase. Tools for Consumer Sales Promotion

36. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 36 Loyalty Marketing Program Loyalty Marketing Program Frequent Buyer Program Frequent Buyer Program A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers. A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers. A loyalty program in which loyal consumers are rewarded for making multiple purchases. A loyalty program in which loyal consumers are rewarded for making multiple purchases. Tools for Consumer Sales Promotion

37. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 37 Contest Sweepstakes Promotions that require skill or ability to compete for prizes. Promotions that depend on chance or luck, with free participation. Tools for Consumer Sales Promotion

38. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 38 Sampling A promotional program that allow the consumer the opportunity to try a product or service for free. Tools for Consumer Sales Promotion

39. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 39 Sampling Methods of Sampling Methods of Sampling Direct mail Door-to-door delivery Packaging with another product Retail store demonstration

40. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 40 Tools for Consumer Sales Promotion Goals of Goals of Point-of-Purchase Point-of-Purchase Displays Displays Goals of Goals of Point-of-Purchase Point-of-Purchase Displays Displays Build traffic Advertise the product Induce impulse buying

41. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 41 Tools for Trade Sales Promotion Trade Allowances Push Money Training Free Merchandise Store Demonstration Conventions & Trade Shows Unique Tools for Trade Sales Promotion Unique Tools for Trade Sales Promotion

42. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 42 Trade Allowance A price reduction offered by manufacturers to intermediaries, such as wholesalers and retailers.

43. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 43 Push Money Money offered to channel intermediaries to encourage them to “push” products-- that is, to encourage other members of the channel to sell the products.

44. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 44 The Role of Trade Sales Promotion Improve trade relations Gain new distributors Build or reduce dealer inventories Obtain support for consumer sales promotions

45. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 45 Public Relations Evaluates public attitudes Identifies issues of public concern Executes programs to gain public acceptance The Role of Public Relations The Role of Public Relations

46. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 46 Functions of Public Relations Press Relations Product Publicity Corporate Communication Public Affairs LobbyingLobbying Employee and Investor Relations Crisis Management

47. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 47 Public Relations Tools Tools Used By PRProfessionalsTools PRProfessionals Product Placement Consumer Education Event Sponsorship Issue Sponsorship Company Web Sites New Product Publicity

48. Copyright © 2002 by Nelson, a division of Thomson Canada Limited. Chapter 1717- 48 Managing Unfavourable Publicity A coordinated effort to handle the effects of unfavourable publicity or of an unfavourable event.CrisisManagement