Chapter 16Chapter 16

Advertising and Advertising and Public RelationsPublic Relations

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Chapter ObjectivesChapter Objectives1. Identify the three major advertising objectives and the

two basic categories of advertising.2. List the major advertising strategies.3. Describe the process of creating an advertisement.4. Identify the major types of advertising appeals and

discuss their uses.5. List and compare the major advertising media.6. Outline the organization of the advertising function and

the role of an advertising agency.7. Explain the roles of cross promotions, public relations,

publicity, and ethics in an organization’s promotional strategy.

8. Explain how marketers assess promotional effectiveness.

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AdvertisingAdvertising

Paid, nonpersonal communication through various media by business firms, not-for-profit organizations, and individuals who are identified in the advertising message and who hope to inform or persuade members of a particular audience

Types of AdvertisingProduct AdvertisingInstitutional Advertising

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Product advertisingProduct advertisingNonpersonal selling of a particular good or

serviceThe type of advertising the average person

normally thinks of when talking about most promotional activities

Institutional advertisingInstitutional advertisingInstitutional advertising promotes a

concept, an idea, a philosophy, or the good-will of an industry, company organization, person, geographic location, or government agency

Corporate advertising

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Pepsi: Product Advertising

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California Strawberries: Institutional Advertising

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Objectives of AdvertisingObjectives of AdvertisingInformative advertising seeks to develop

initial demandPersuasive advertising attempts to

increase demand for an existing productReminder advertising strives to reinforce

previous promotion by keeping the name of the product before the market

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Figure 16.2Figure 16.2Advertising objectives in relation to the

stage in the product life cycle

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HeinzHeinzA reminder

ad

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Advertising StrategiesAdvertising Strategies

ComparativeComparativeEmphasizes

messages with direct or indirect promotional comparisons between competing brands. Often used by less dominant firms

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Celebrity Celebrity TestimonialsTestimonialsThe use of

celebrity spokespeople to try to boost the effectiveness of an advertising message

Accounts for about 20% of all U.S. ads. Improves product recognition

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Retail AdvertisingRetail AdvertisingAll advertising by retail stores that sell

directly to the consuming publicVaries widely in effectivenessShould be assigned to one person whose

sole responsibility and authority is developing an effective retail advertising program

Cooperative AdvertisingCooperative AdvertisingWhen a retailer and a manufacturer or

wholesaler share advertising costs

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Figure 16.3Figure 16.3Cooperative

Advertising by Foot Locker and Sketchers Sport Shoes

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Interactive AdvertisingInteractive AdvertisingInteractive media are communication

channels that induce message recipients to participate actively in the promotional effort.

Creates a dialogue, providing more material as the user asks.

Although the term has become nearly synonymous with e-commerce and the web, it also includes shopping mall kiosks, and text messages on cell phones.

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Creating an AdvertisementCreating an Advertisement

Translating Advertising Objectives into Translating Advertising Objectives into Advertising PlansAdvertising PlansBest ads are those which are created by

pinpointing goals like:Educating consumers about product

featuresEnhancing brand loyaltyImproving consumer perception of the

brandSuch objectives should guide the ad’s

design

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Elements of the Advertising Planning Process

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Ads must be meaningful, believable, and distinctive

Creator must decide whether to focus onA practical appeal (i.e., price), orEmotional responses like fear, humor or

fantasy Advertising Campaign

Series of different but related ads that use a single theme and appear in different media within a specified time period

Advertising MessagesAdvertising Messages

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Every year Publishers Clearing HousePublishers Clearing House has the “Big Give Away.” Other than making some lucky person rich,

what do you think their real message is? What would you say are the objectives for

their promotional campaign?

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SubwaySubway has had success with a series of advertisements featuring a customer who lost weight eating their product. Here is an example of the campaign.

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Examples of commercials using advertising appealsHumorHumorFearFearSexSex

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Developing and Preparing AdsDeveloping and Preparing AdsShould flow logically from the promotional

theme selectedAdvertisement should emphasize features like

its creativity, its continuity with past advertisements, and possibly its association with other company products

Advertisement should:Gain attention and interestInform and/or persuadeLead to purchase or other desired action

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Elements of a typical advertisement

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Creating Interactive AdsCreating Interactive AdsBanner: Web advertisement that links to an

advertiser’s siteMissiles

Keyword Ad: Web advertisement that appears on the results page of a search function and that is specific to the term being searched

Advertorials: Large advertising squares, similar to ad in telephone Yellow Pages

Interstitials: Web advertisements that pop up between Web pages of related content

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Media SelectionMedia Selection

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TelevisionTelevisionHas grown to rival newspapers as the

dominant advertising mediumGreatest share of TV ad revenues come from

companies that advertise nationallyVirtual Ads that are superimposed onto

sporting events -- they seem to be part of the arena’s signage, but can’t be seen by those attending the event

Another trend: abbreviated spots – 15 and 30 second spots

Cable TV’s share of ad revenues has grown, while the network’s share is falling

Media SelectionMedia Selection

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RadioRadioPopular choice for up-to-the-minute

newscastsAlso popular for targeting advertising

messages to local audiencesRecently, has become one of the fastest-

growing media alternativePlaying an increasingly important role as a

national, an even the global, favorite

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NewspapersNewspapersContinue to dominate local markets Retail and classified advertisement are keyImportant advantages include flexibility and

community prestigeNewspapers facilitate coordination between

local and national advertisingNewspapers offer powerful merchandising

services like promotional and research support

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Circuit CityCircuit City Newspaper InsertA free

standing insert

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MagazinesMagazinesDivided into two broad categories of consumer

magazines and business magazinesThese categories are also subdivided into

monthly publications and weekly publications Top five in the U.S.

AARP The MagazineReader’s DigestTV GuideBetter Homes & GardensNational Geographic

Automotive, retail, and movies and media advertisers are the biggest spenders

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Targeting different consumer interests through magazine advertising

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Direct MailDirect MailAlmost half is immediately discarded as

junkDetailed information and personalizationUse of direct-mail accounts for 19% of

total advertising expenditures

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Example of Direct Mail pieceTypical Contents of

Direct Mail Envelope: Offer Letter, Promotional Brochures, Reply Card and Self Addressed, Stamped Reply Envelope

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Outdoor AdvertisingOutdoor AdvertisingIncludes billboards, painted bulletins or

displays (such as those appearing on walls of buildings), and electric spectaculars

The oldest and simplest media business Is particularly effective along metropolitan

streets and other high-traffic areasFaces public concern over aesthetics

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Outdoor Advertising

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Interactive MediaInteractive MediaContains characteristics of both print and

broadcast mediaEnhances two-way communication and

encourages audience participationAlthough E-mail is considered a form of

direct-mail, it has recently taken on the characteristics of interactive media

Companies use interactive media to supplement other media

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Other Advertising MediaOther Advertising MediaIncludes transit advertising placed both inside

and outside the buses, subway trains installations, and commuter trains

Also includes ads on the roof of taxicabs, long bus stop shelters in benches, telephone booths, and even parking meters

Supplementary advertising media include:Cinema advertising, Ads on T-shirts, Inlaid

ads in store flooring, Ads in printed programs of live-theater productions, Previews of movie videocassettes, Directory advertising (e.g., Yellow Pages), Messages on Hot-air balloon and blimps

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Media SchedulingMedia Scheduling

Timing and sequencing of advertisements Media scheduling is influenced by

Sales patternsRepurchase cyclesCompetitors’ Activities

Reach – number of people exposed to an ad Frequency – number of times a person is

exposed to an ad Gross Rating Point – Reach x Frequency

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Hypothetical Media Schedule for a New Car Introduction

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Organization of the Advertising FunctionOrganization of the Advertising Function

Organizational Arrangements vary among companies

Usually organized as a staff department reporting to the head of marketing

Major Advertisers hire advertising agenciesAdvertising agenciesAdvertising agencies: Firms of specialists

who assist advertisers in planning and preparing Advertisements

Japan’s Dentsu is the world’s largest agency followed by NYC based McCann-Erickson Worldwide

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Figure 16.7Figure 16.7Advertising Agency Organization Chart

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Public RelationsPublic Relations

Public relationsPublic relations: the firm’s communications and relationships with its various publics

Non-marketing public relationsNon-marketing public relations refer to a company’s messages about general management issues

Marketing public relationsMarketing public relations (MPR) are narrowly focused public relations activities that directly support marketing goals

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Anheuser-Busch Anheuser-Busch Adventure ParksAdventure ParksMarketing Public

Relations by Promoting the Firm’s Commitment to Conservation and Wildlife Preservation

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PublicityPublicity: non-personal stimulation of demand for a good, service, place, idea, person, or organization by unpaid placement of significant news regarding the product in a print or broadcast mediumPublicity is not entirely free of costsPublicity-related expenses include the cost

of employing marketing personnel assigned to create and submit publicity releases, printing and mailing costs, and related expenses

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Cross PromotionCross Promotion

Cross promotion: a campaign in which marketing partners share the cost of a promotional campaign that meets their mutual needs

Movie studios, for example, frequently partner with fast-food chains

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Measuring Promotional EffectivenessMeasuring Promotional Effectiveness

Determining whether a campaign accomplishes its appropriate promotional objectives

Companies must measure how promotional programs contribute to increased sales and profits

One of the most difficult undertakings in marketing

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Measuring Advertising EffectivenessMeasuring Advertising EffectivenessPre-testingPre-testing is the assessment of an

advertisement for its effectiveness before it is actually used

Methods used include:Focus groupsSales conviction testBlind product testsTests using mechanical devices

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Post-testingPost-testing is the assessment of an advertisement’s effectiveness after it has been used

Methods used include:Starch Readership Report

Recall seeing?Recall reading?Recall message?

[Get quantitative and qualitative reports] Unaided recall tests Inquiry tests Split runs

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Magazine Advertisements With Starch Scores

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Measuring Public Relations EffectivenessMeasuring Public Relations EffectivenessMeasuring public relations results based

on their achieving objectivesTypically involves determining

Whether the message was heard by the target audience

Whether it had the desired influence on public opinions

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Evaluating Interactive MediaEvaluating Interactive MediaMeasurements include

Hits (user requests for a file)Impressions (the number of times of

viewers sees an ad)Click-throughs (when the user clicks on

the ad to get new information)

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Ethics in Nonpersonal SellingEthics in Nonpersonal Selling

AdvertisingAdvertising: Some call for advertising to children be

curtailed Others would ban alcoholic beverage

advertisingMarketers must carefully draw the line between

advertising and entertainmentCookies in cyberspace adsPuffery and Deception

The Uniform Commercial Code

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Ethics in Public RelationsEthics in Public RelationsPR practitioners violate the Public Relations

Society of America’s Code of Professional Standards if they promote products or causes widely known to be harmful to others

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End of Chapter SixteenEnd of Chapter Sixteen