C HAPTER 12 Communicating Customer Value: Advertising, Sales Promotion, and Public Relations.

CCHAPTER HAPTER 1212

Communicating Communicating Customer Value: Customer Value: Advertising, Sales Advertising, Sales

Promotion, and Public Promotion, and Public RelationsRelations

Copyright 2007, Prentice-Hall Inc. 12-2

Discuss the process and advantages of integrated marketing communications.

Define the five promotion tools and discuss the factors that must be considered in shaping the overall promotion mix.

Describe and discuss the major decisions involved in developing an advertising program.

Explain how sales promotion campaigns are developed and implemented.

Explain how companies use public relations to communicate with their publics.

Roadmap: Previewing the Concepts


The Agency Has recently won both

multiple creative awards and several major advertising accounts.

Located in South Beach, FL, far removed from mainstay agencies on Madison Avenue in NYC.

Agency philosophy: “Anything and everything is an ad.”

The Tactics Heavy focus on guerilla

tactics, unconventional uses of media, and holistic marketing strategies while TV is used only sparingly.

Street-level research helps develop creative appeals.

Tries to start a consumer movement behind the brand, and campaigns go well beyond advertising.

CP + BCP + B – An Unusual Success Story – An Unusual Success Story


The Marketing Communications (Promotion) Mix

AdvertisingAdvertising

Public Public RelationRelation

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Sales Sales PromotionPromotion

Personal Personal SellingSelling

Direct Direct MarketinMarketin

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Mass markets have fragmented, leading to a shift away from mass marketing.

Improvements in information technology are speeding movement toward segmented marketing.

These factors have shifted the marketing communications model. – Less broadcasting & more narrow casting

Changing Communications Landscape


Using IMC, the company carefully integrates and coordinates its many communication channels to deliver a clear, consistent, and compelling message about the organization and its brands.– Several factors influence the choice of

promotional tools.

Integrated Marketing Communications


Figure 12-1Integrated Marketing Communications


Integrated Marketing Communications

Begins by recognizing all contact points where the customer may encounter the company or its brand.

Seeks to deliver a clear and positive message via each contact.

Ties together messages and images in consistent fashion.

Target audience(s) must be identified.

Creates an integrated communication program which focuses on encouraging behavioral responses.

Helps the firm to manage customer relationships over time.


Advertising

Can reach masses of geographically dispersed buyers.

Can repeat a message many times.

Is impersonal, one-way communication.

Can be very costly for some media types.


Personal Selling

Involves personal interaction between two or more people.

Allows relationship building.

Most effective way for preferences, convictions, and actions to be influenced.

Most expensive promotion tool; requires long-term commitment.


Sales Promotion

Wide assortment of tools.

Attracts consumer attention.

Offers strong incentives to buy.

Invites and rewards quick consumer response.

Effects are short-lived.


Public Relations

Very believable. Reaches people who avoid

salespeople and ads. Can dramatize a company

or product. Tends to be used as an

afterthought. Planned use can be effective and

economical.


Direct Marketing

Many forms that share four primary characteristics:– Nonpublic– Immediate– Customized– Interactive

Well suited to highly targeted marketing.

Direct mail is one form of direct marketing.


Figure 12-2Push Vs. Pull Promotion Strategy


Figure 12-3Major Decisions in Advertising


Setting Advertising Objectives

Advertising Objective:– Specific communication task to be

accomplished with a specific target audience during a specific period of time.

Classified by Purpose:– Inform– Persuade– Remind


Fulfilling Objectives

Outdoor advertising (billboard, transit, etc.) is often used for reminder purposes. Print ads can fulfill this objective as well.

Which of the ads above is/are attempting to remind consumers, versus inform or persuade?

Marketing in Action


Setting the Advertising Budget

Affordable method Percentage-of-sales

method

Competitive-parity method

Objective-and-task method


Consists of two major elements:– Creating advertising messages

Message strategy & message execution must break through the clutter.

– Selecting advertising media Set reach, frequency, and impact goals. Choose among major media types. Select specific media vehicles. Decide on media timing.

Developing Advertising Strategy


The Message Strategy

Identify customer benefits. Develop compelling creative concept—

the “Big Idea.” Advertising appeals

should be meaningful, believable, and distinctive.

Angela Talley of DDB Worldwide explains how advertising people learn to think like consumers when developing the message strategy.

Video Snippet


Message Execution

Technical Expertise

Scientific Evidence

Testimonial or Endorsement

Slice of Life Lifestyle Fantasy Mood or Image Musical Personality

Symbol


Celebrity Endorsements

Celebrity endorsements have been at the heart of the “ Got Milk?” milk mustache campaign for years.

Marketing in Action

www.whymilk.com


Humorous Advertising Appeals

Humorous advertising tones are being used in the marketing of many products, including dictionaries.

Marketing in Action


Message Execution Choose a tone. Use memorable,

attention-getting words. Choose correct format

elements.– Illustration– Headline– Copy

Absolut print ads attract attention through choice of illustration and headline.www.absolutad.com/


Setting Media Objectives

Reach– Percentage of people exposed to ad.

Frequency– Number of times a person is exposed to

advertisement.

Media Impact– The qualitative value of a message

exposure through a given medium.


Choosing Media Type & Vehicles

Media Type: – consider the medium’s impact, message

effectiveness, and cost.

Media Vehicles:– Specific media within

each general media type

Factors to Consider:– Cost– Audience quality– Audience attention– Editorial quality


Alternative Media

Marketing in Action

Can you think of any other examples?


The Summit Combo unit offers the convenience of a refrigerator, freezer, and microwave combined into a single, compact, energy-efficient unit. The product is targeted towards people in college residence halls, assisted-living facilities, government offices, and business offices.

What media categories and vehicles would you use to reach these targets? Can you think of some alternative media that might be useful as well?

Let’s Talk!


Must decide how to schedule the advertising over the course of a year.– Follow seasonal pattern– Oppose seasonal pattern– Same coverage all year

Choose the pattern of the ads– Continuity– Pulsing

Deciding on Media Timing


Evaluating Advertising

Advertising accountability is becoming increasingly important to firms.

Evaluating advertising effectiveness involves:– Measuring the communication effects of an ad

—“Copy Testing” Is the proper message being communicated?

– Measuring the sales and profit effects of an ad. Is the ad increasing sales?


Other Advertising Considerations

Organization of Ad Function– Small companies– Large companies– Advertising agency

International Advertising Issues– Standardization vs.

adaptation. – Costs and media

availability vary by country.

– Advertising practices are regulated differently in each country.

An example of standardized advertising


Sales Promotion

Sales promotion consists of Sales promotion consists of short-term incentives to short-term incentives to

encourage the purchase of sales encourage the purchase of sales of a product or service.of a product or service.

The idea behind sales promotion is to generate immediate sales.


Pull-Oriented Sales Promotions

Pull-oriented sales promotions are those that target the ultimate consumer and encourage consumers to prefer a particular brand to competitive offerings. Contests and coupons are two examples of pull-oriented sales promotions.

Marketing in Action


Sales promotion can take the form of consumer, business, trade, or sales force promotions.

Rapid growth in the industry has been achieved because:– Product managers are facing more pressure to

increase their current sales– Companies face more competition– Advertising efficiency has declined– Consumers have become more deal oriented

Rapid Growth of Sales Promotion


Consumer Promotion Objectives

Objectives for Consumer Sales Promotions:– Increase short-term sales. – Help build long-term

customer relationships.

Many tools exist that can help in accomplishing these objectives.


Consumer Sales Promotion Tools

Coupons: provide a discount off the purchase price of the product when redeemed.

Cash Refunds: offer a refund of part of the purchase price after the item has been bought.

Price Packs: offer savings off the regular price of the product; marked on the package.

Samples: offer a trial amount of the product.

Premiums: goods offered for free or at a low price as an incentive to buy.

Advertising Specialties: useful items imprinted with the name or logo of the advertiser which are given as gifts to consumers.


Consumer Sales Promotion Tools

Patronage Rewards: cash or other awards offered for regular use of a brand.

POP Displays: include signs and displays that exist at the point-of-sale.

Demonstrations: food or product in-store sampling.

Contests: entries are judged by a panel who selects the winner.

Sweepstakes: names are submitted for a random drawing.

Games: game pieces are given for each purchase. Some win instantly; others must fit a game pattern.


Point-of-purchase displays can draw attention to the brand and stimulate impulse buys.

Why do you think many retailers resist using POP displays?

Let’s Talk!


Objectives:– Persuade resellers to carry a brand.– Give a brand shelf space.– Promote brand in advertising.– Push brand to customers.

Tools:– Discounts, allowances, free goods, push

money, specialty advertising items.

Trade Promotion


Objectives:– Generate business leads.– Stimulate purchases.– Reward customers.– Motivate salespeople.

Tools:– Conventions, trade shows, sales contests,

and many of the same tools used for consumer or trade promotions.

Business Promotion


Decide on the size of the incentive Set conditions for participation Decide how to promote and distribute

the promotion program Decide the length of the program Evaluate the program

Developing the Sales Promotion Program


Trade Shows

The International Consumer Electronics trade show attracts over 20,000 exhibitors and over 130,000 visitors.

Marketing in Action


Public Relations

Public Relations: – Building good relations with the firm’s

various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events.

Public Relations Functions:– Includes press relations or press agency,

product publicity, public affairs, lobbying, investor relations and development.


Audiovisual materials

Corporate identity materials

Public service activities

Company Web site

News Speeches Special events Buzz marketing Mobile marketing Written materials

Public Relations Tools


Public Relations

Scholastic sponsored low-cost sleepovers, games, and costume contests which effectively promoted the release of

the sixth Harry Potter book.

Marketing in Action


Define the three steps of target marketing: market segmentation, market targeting, and market positioning.

List and discuss the major bases for segmenting consumer and business markets.

Explain how companies identify attractive market segments and choose a target marketing strategy.

Discuss how companies position their products for maximum competitive advantage in the marketplace.

Rest Area: Reviewing the Concepts

C HAPTER 12 Communicating Customer Value: Advertising, Sales Promotion, and Public Relations.

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Transcript of C HAPTER 12 Communicating Customer Value: Advertising, Sales Promotion, and Public Relations.