Chapter 15Advertising, Publicity, and Sales Promotion

McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.

At the end of this presentation, you should be able to:

1. Understand why a marketing manager sets specific objectives to guide the advertising effort.

2. Understand when the various kinds of advertising are needed.

3. Understand how to choose the “best” medium.

4. Understand the main ways that advertising on the Internet differs from advertising in other media.

5. Understand how to plan the "best" message—that is, the copy thrust.

15–2

At the end of this presentation, you should be able to:

6. Understand what advertising agencies do.

7. Understand how to advertise legally.

8. Understand the importance of and different types of publicity.

9. Understand the importance and nature of sales promotion.

10. Know the advantages and limitations of different types of sales promotion.

11. Understand important new terms.

15–3

Marketing Strategy Planning Process

15–4

Strategy Planning, Advertising, Publicity, and Sales Promotion (Exhibit 15-1)

CH 15: Advertising, Publicity & Sales

Promotion

Advertising spending

Advertising strategy

decisions

Advertising & the law

Sales promotion decisions

CH 14: Personal Selling and

Customer Service

CH 13: Promotion Intro. To Integrated

Marketing Communications

Publicity & communic-

ation

15–5

The Decision to Position a New Product

15–6

International Dimensions Are Important

15–7

Advertising Spending as Percent of Sales for Illustrative Product Categories (Exhibit 15-2a)

15–8

Retail Ad Spending (Exhibit 15-2b)

15–9

Setting Ad Objectives Is a Strategy Decision

Obtain OutletsObtain Outlets

Ongoing ContactOngoing Contact

Support Sales ForceSupport Sales Force

Get Immediate ActionGet Immediate Action

Introduce New ProductsIntroduce New Products

AdvertisingAdvertisingObjectivesObjectivesShould beShould beSpecificSpecific

Maintain RelationshipsMaintain Relationships

Position BrandsPosition Brands

15–10

What’s the Advertising Objective?

15–11

Objectives Guide Implementation (Exhibit 15-3)

• Teaser campaigns• Pioneering ads• Jingles/slogans• Viral advertising• Announcements

• Teaser campaigns• Pioneering ads• Jingles/slogans• Viral advertising• Announcements

AwarenessAwareness

• Informative or descriptive ads

• Image/celebrity ads• Search ads• E-mail ads• Demonstration

• Informative or descriptive ads

• Image/celebrity ads• Search ads• E-mail ads• Demonstration

InterestInterest

• Competitive ads• Persuasive copy• Comparative ads• Testimonials

• Competitive ads• Persuasive copy• Comparative ads• Testimonials

Evaluation and Trial

Evaluation and Trial

• Reminder ads• Informative “why”

ads

• Reminder ads• Informative “why”

ads

ConfirmationConfirmation

• Direct-action retail ads

• Point-of-purchase ads

• Price deal offers

• Direct-action retail ads

• Point-of-purchase ads

• Price deal offers

DecisionDecision

15–12

Coordinating advertising across the channel to achieve objectives

Cooperative Advertising

Cooperative Advertising

Advertising AllowancesAdvertising Allowances

KeyIssuesKey

Issues

Ethical ConcernsEthical Concerns

15–13

Objectives Determine the Kinds of Advertising (Exhibit 15-4)

Institutional AdvertisingInstitutional Advertising

Pioneering AdvertisingPioneering Advertising

Product Advertising

Product Advertising

Competitive AdvertisingCompetitive Advertising

Reminder AdvertisingReminder

Advertising

Types ofAdvertising

Types ofAdvertising

15–14

Competitive Advertising Emphasizes Selective Demand

15–15

A Competitive Ad That’s Comparative

15–16

Reminder Advertising Reinforces a Favorable Relationship

15–17

Institutional Advertising – Remember Our Name

Sheds Favorable Light

Sheds Favorable Light

Connects Divisions of a Company

Connects Divisions of a Company

Advocates Causes and Ideas

Advocates Causes and Ideas

15–18

Interactive Exercise: Types of Advertising

15–19

Checking Your Knowledge

A television ad for Target encourages consumers to go to their nearest Target store for a big end-of-season sale coming up in two weeks. This type of advertising is:

A. pioneering.B. reminder.C. indirect competitive.D. direct competitive.E. institutional.

15–20

Checking Your Knowledge

Community Bank sends an advertisement via direct mail to several thousand customers, quoting special low financing rates on new vehicles for a limited time only. The ad names some other financial institutions and shows their respective loan rates. Community Bank promises to beat any rate offered for a comparable term. This type of advertising is:

A. pioneering.B. indirect competitive.C. comparative.D. reminder.E. institutional.

15–21

Choosing the “Best” Medium – How To Deliver the Message

Promotion ObjectivesPromotion Objectives

Target Market CharacteristicsTarget Market Characteristics

Funds AvailableFunds Available

Nature of the MediaNature of the Media

15–22

Comparing Advertising Media (Exhibit 15-5)

MediaMedia2010 Ad

spending.(billions)

2010 Ad spending.(billions)

2010 % of Total Spend

2010 % of Total Spend

AdvantagesAdvantages DisadvantagesDisadvantages

Television & cableTelevision & cable

51.4751.47 25.225.2Demonstrations,

good attention, wide reach, cable targets

Demonstrations, good attention, wide reach, cable targets

Expensive in total, “clutter”

Expensive in total, “clutter”

Direct mail

Direct mail

48.0148.01 23.623.6Selected audience,

flexible, can personalize

Selected audience, flexible, can personalize

Relatively costly per contact, “junk mail,”

hard to retain attention

Relatively costly per contact, “junk mail,”

hard to retain attention

News-paper

News-paper

29.3429.34 14.414.4Flexible, timely, local

marketFlexible, timely, local

market

“Clutter” ads compete for attention, poor photo reproduction

“Clutter” ads compete for attention, poor photo reproduction

15–23

Comparing Advertising Media (Exhibit 15-5)

MediaMedia2010 Ad

spending.(billions)

2010 Ad spending.(billions)

2010 % of Total Spend

2010 % of Total Spend

AdvantagesAdvantages DisadvantagesDisadvantages

Yellow pagesYellow

pages11.4511.45 5.65.6

Reaches local customers ready to buy, inexpensive

Reaches local customers ready to buy, inexpensive

Many competitors listed in same place, hard to differentiate

Many competitors listed in same place, hard to differentiate

InternetInternet 23.4223.42 11.511.5

Ads link to more detailed site, some “pay for results,”

easy to track results

Ads link to more detailed site, some “pay for results,”

easy to track results

Hard to compare costs with other media

Hard to compare costs with other media

15–24

An Emphasis on Targeting

Specialized Media Are

Gaining

Specialized Media Are

Gaining

Traditional Media Are More

Targeted

Traditional Media Are More

TargetedDirect Mail Has

GrownDirect Mail Has

Grown

“Must Buys” May Use Up

Funds

“Must Buys” May Use Up

Funds

KeyIssuesKey

Issues

15–25

Interactive Exercise: Promotion Planning

15–26

Advertising on the Internet

Click FraudClick Fraud Pay per click advertising

Pay per click advertising

Behavioral Targeting

Behavioral Targeting

KeyIssuesKey

Issues

Direct Response Desired

Direct Response Desired

15–27

Planning the Best Message—What to Communicate

15–28

Planning the Best Message Example

15–29

AIDA – Attention, Interest, Desire, and Action

Obtain ActionObtain Action

Arouse DesireArouse Desire

Hold InterestHold Interest

Get AttentionGet Attention

Can Global Messages Work?15–30

A Unique Selling Proposition

15–31

Checking Your Knowledge

A famous athlete is featured in a commercial for a pain-relieving rub that can help soothe muscle aches and pains. He says, “If it works for me, it’ll surely work for you.” This testimonial is mainly aimed at the _________ stage of the AIDA model.

A. attentionB. interestC. desireD. actionE. confirmation

15–32

Advertising Agencies Often Do the Work (Exhibit 15-6)

Organi-zation

Organi-zation

Largest agency networks

Largest agency networks

HQ location

HQ location

2009revenue

billion

2009revenue

billionSelect clientsSelect clients

15–33

Advertising Agencies Often Do the Work (Exhibit 15-6)

Organi-zation

Organi-zation

Largest agenciesLargest

agenciesHQ

locationHQ

location

2009 revenuebillions

2009 revenuebillions

Select clientsSelect clients

15–34

Measuring Advertising Effectiveness is Not Easy

Research and Testing May Improve Odds

Research and Testing May Improve Odds

Consider the Total Mix

Consider the Total Mix

Hindsight May Lead to Foresight

Hindsight May Lead to Foresight

15–35

How to Avoid Unfair Advertising

StandardsAre Changing

StandardsAre Changing

Government May Say

What’s Fair

Government May Say

What’s Fair

Support for Claims Is Fuzzy

Support for Claims Is Fuzzy

FTC Controls Unfair PracticesFTC Controls

Unfair Practices

15–36

Types of Publicity (Exhibit 15-7)

How does the customer obtain the communication?

How does the customer obtain the communication?

Through popular and trade press

Through popular and trade press

"Found" through search,pass-along, or experience"Found" through search,

pass-along, or experience

Targeting commercial press• Press kits• Online media room• Posting press releases

Targeting commercial press• Press kits• Online media room• Posting press releases

15–37

How does the customer obtain the communication?

How does the customer obtain the communication?

Through popular and trade press

Through popular and trade press

"Found" through search,pass-along, or experience"Found" through search,

pass-along, or experience

Targeting consumers• Useful web site content• Video or podcasts• Games

Targeting consumers• Useful web site content• Video or podcasts• Games

One-way communicationOne-way communication Interactive communicationInteractive communication

Targeting organizations• Commercial white papers• Case studies• Webinars

Targeting organizations• Commercial white papers• Case studies• Webinars

Types of Publicity (Exhibit 15-7)

15–38

How does the customer obtain the communication?

How does the customer obtain the communication?

Through popular and trade press

Through popular and trade press

"Found" through search,pass-along, or experience"Found" through search,

pass-along, or experience

Targeting consumers•Blogs & social media•Customer reviews & online communities

Targeting consumers•Blogs & social media•Customer reviews & online communities

One-way communicationOne-way communication Interactive communicationInteractive communication

Targeting organizations• Social media• Blogs• Online communities

Targeting organizations• Social media• Blogs• Online communities

Types of Publicity (Exhibit 15-7)

15–39

Examples of Different Types of Publicity and Different Promotion Objectives (Exhibit 15-8)

Getting attention & holding interest• Viral videos•Direct-to-consumer press releases• Articles in the press

Getting attention & holding interest• Viral videos•Direct-to-consumer press releases• Articles in the press

Managing ongoing customerrelationships• Social media like Facebook• Blogs• Online communities• Podcasts, webcasts, webinars

Managing ongoing customerrelationships• Social media like Facebook• Blogs• Online communities• Podcasts, webcasts, webinars

Arousing desire & obtaining action• Customer reviews• Case studies• Webinars

Arousing desire & obtaining action• Customer reviews• Case studies• Webinars

Developing a desired positioning• Viral videos• Games• Branded services• Commercial white papers

Developing a desired positioning• Viral videos• Games• Branded services• Commercial white papers

15–40

Sales Promotion: Do Something Different to Stimulate Change (Exhibit 15-9)

15–41

Problems in Managing Sales Promotion

Hard toManage

Need For

Alternatives

Erodes Brand

Loyalty

NotFor

Amateurs

KeyProblems

15–42

Different Types of Sales Promotion for Different Targets

15–43

You should now be able to:

1. Understand why a marketing manager sets specific objectives to guide the advertising effort.

2. Understand when the various kinds of advertising are needed.

3. Understand how to choose the “best” medium.

4. Understand the main ways that advertising on the Internet differs from advertising in other media.

5. Understand how to plan the "best" message—that is, the copy thrust.

15–44

You should now be able to:

6. Understand what advertising agencies do.

7. Understand how to advertise legally.

8. Understand the importance and nature of sales promotion.

9. Understand the importance of and different types of publicity.

10. Know the advantages and limitations of different types of sales promotion.

11. Understand important new terms.

15–45

Key Terms

Advertising allowances

Cooperative advertising

Product advertising

Institutional advertising

Pioneering advertising

Competitive advertising

Direct type advertising

Indirect type advertising

Comparative advertising Reminder advertising Advertising allowances Copy thrust Advertising agencies Corrective advertising

15–46