Chapter 18

Advertising

Sales Promotions

Events And Experiences

And Public Relations

Chapter Questions
p What steps are involved in developing an
advertising program?
p How should sales promotion decisions be made?
p What are the guidelines for effective brand-building
events and experiences?
p How can companies exploit the potential of public
relations and publicity?
Chapter Outline
• Developing • Deciding on • Sales • Events and
and managing Media and Promotions Experiences
an Advertising Measuring
Program Effectiveness

Section 1 Section 2 Section 3 Section 4

• Public • Summary • Debates &

Relations Discussions

Section 5 Section 6 Section 7

 GEICO Relies Heavily on TV
Advertising

•TV advertising: $600 million

•1998: $3 billion => 2006: $11 Billion.
•The fastest-growing car insurance company in the U.S
Section 1
DEVELOPING AND MANAGING
AN ADVERTISING PROGRAM
What is Advertising?
Advertising is any paid form of nonpersonal
presentation and promotion of ideas, goods,
or services by an identified sponsor.
Procter & Gamble’s
Advertising History
FF Figure 18.1 The Five M’s of
Advertising
Setting the advertising Objectives

p The advertising objectives must flow from

prior decisions on target market, brand
positioning, and the market program.
p An advertising goal (or objective) is a specific
communications task and achievement level to
be accomplished with a specific audience in a
specific period of time.
An Example of an advertising Goal

p To increase among 30 million homemakers

who own automatic washers the number who
identify brand X as a low-sudsing detergent,
and who are persuaded that it gets clothes
cleaner, from 10% to 40% in one year.
Classification of advertising
Objectives
Awareness
Informative
advertising
Knowledge

Persuasive
advertising Liking

Reminder Preference
Advertising
Conviction
Reinforcement
advertising Purchase
Deciding on the advertising
budget
Factors to Consider in Setting an Advertising Budget

Stage in the product life cycle

Market share & consumer base

Competition and clutter

Advertising frequency

Product substitutability
 Developing the Advertising
Campaign
p Message Strategy: what ad attempts to convey
about the brand (what to say)
p Creative strategy: how the ad expresses the brand
claims (how to say)

Message Creative
Legal and
generation development
social issues
and evaluation and execution
Message generation and
evaluation
p Conducting market research to determine which
appeal works best with its target audience.
p Preparing a creative brief: an elaboration of
positioning statement and includes:
n Key message
n Target audience
n Communications objects (to do, to know, to believe),
n Key brand benefits
n Supports for the brand promise
n Media
FF
User-generated ads
A case of success A case of failure
Creative development and
execution
p The ad’s impact depends not only on what it
says, but often more important, how it says it.
p Execution can be decisive.
p Every advertising medium has advantages
and disadvantages:
n TV commercials
n Print-ads
n Radio commercials
Television
p Advantages
n Reaches broad spectrum
of consumers
n Low cost per exposure
n Ability to demonstrate
product use
n Ability to portray image
and brand personality
p Disadvantages
n Brief
n Clutter
n High cost of production
n High cost of placement
n Lack of attention by
viewers
FF
Successful TV commercials

Macintosh 1984 Ipod

Print Ads
p Advantages
n Detailed product
information
n Ability to communicate
user imagery
n Flexibility
n Ability to segment
p Disadvantages
n Passive medium
n Clutter
n Unable to demonstrate
product use
Print Ad Components

Picture

Headline

Copy
Signature
FF
Print Ad Evaluation Criteria
p Is the message clear at a glance?
p Is the benefit in the headline?
p Does the illustration support the headline?
p Does the first line of the copy support or
explain the headline and illustration?
p Is the ad easy to read and follow?
p Is the product easily identified?
p Is the brand or sponsor clearly identified?
FF
Successful Print ads
Radio Ads
p Advantages p Disadvantages
n Stations are very n Lack of visual images
targeted n Relatively passive
n Relatively inexpensive nature of the consumer
to produce and place processing that results.
n Allowing for quick
response
Legal and social issues
Section 2
DECIDING ON MEDIA AND
MEASURING EFFECTIVENESS
Deciding On Media And Measuring
Effectiveness
Deciding on desired reach, frequency and impact

Choosing among major media types

Selecting specific media vehicles

Deciding media timing

Geographical media allocation

Evaluating the results

Media Selection
• Reach
• Frequency
• Impact
• Exposure
Figure 18.2 Relationship Among Trial,
Awareness, and the Exposure Function
Relationship between reach,
Frequency, and Impact
p Total number of exposures (E): this is the reach
times (x) the average frequency; that is:
n E= R x F : also called the gross rating points (GRP)
n If a given media schedule reach 80% of homes with
an average exposure frequency of 3, the media has a
GRP of 240 (80% x 3).
p Weighted number of exposures (WE): this is the
reach times frequency times average impact,
that is:
n WE = R x F x I
FF
Choosing among Major Media Types
Table 18.1: profiles of Major Media Types

p Newspapers p Outdoor
p Television p Yellow Pages
p Direct mail p Newsletters
p Radio p Brochures
p Magazines p Telephone
p Internet
Choosing Among Major Media
Types - variables
p Target audience and media habits
p Product characteristics
p Message characteristics
p Cost
FF
Table 18.2 Marketing Communication Expenditures
(2007)

Media $ % of Total
TV 72.1 32

Radio 20.9 9

Internet 16.7 8

Magazines 23.7 11

Newspaper 45.8 20
Alternative advertising Options
p Place advertising
p Product placement
p Point-of-purchase
p Evaluating alternative media
Place Advertising – Billboards &
Public spaces
Billboards Public spaces
FF
Place Advertising – Product
placement & advertorials
Product Placement Advertorials
FF
Space advertising -Point-of-
purchase advertising
Evaluating alternative media
p The challenge with nontraditional media is
demonstrating its reach and effectiveness
through credible, independent research.
n Unique ad placements designed to break through
clutter may also be perceived as invasive and
obtrusive.
n Consumer backlash often results when ads are
placed in traditionally ad-free spaces such as in
schools, police cruisers, doctors’ waiting rooms.
Virtual Worlds as a Media Vehicle
Selecting specific Media vehicles
Measures of Audience Size
p Circulation
p Audience
p Effective audience
p Effective ad-exposed
audience
FF
Selecting specific Media vehicles
Measures of Audience Size
Adjustments of media planners
p Computing cost per thousands (CPM) for each
vehicle to select the cost-effective one.
p Adjustments to be made based on:
n Audience quality (baby lotion ads on women
magazines and on teenagers’ ones)
n Audience attention probability (ads on Vogue and on
Newsweek)
n Magazine’s editorial quality (new drug ads on normal
and medical magazines)
n Magazine’s ad placement policies and extra services.
Deciding on media timing and
Allocation-Macroscheduling
p Macroscheduling problem involves scheduling
the advertising in relationship to seasons and
the business cycle.
n Suppose 70% of a product sales occur between
June and September.
p The firm can vary its advertising expenditures
to follow the seasonal pattern, to oppose the
seasonal pattern, or to be constant throughout
the year.
Deciding on media timing and
Allocation-Microscheduling
Figure 18.3 Classification of Advertising Timing Patterns

Buyer
turnover

Purchase
frequency

forgetting
rate
Factors Affecting Timing Patterns

p Buyer turnover
p Purchase frequency
p Forgetting rate
FF
Deciding on media timing and
Allocation – space allocation
p “National buys”
p “Spots buys”
p “Local buys”
FF
Media Schedule Patterns on a
new product launch
p Continuity
p Concentration
p Flighting
p Pulsing
Evaluating Advertising Effectiveness
– Communication-effect research
p To determine whether an ad is
communicating effectively.
p To perform this test both before an ad is put
into media and after it is printed or
broadcast.
p Three major methods of pretesting:
n Consumer feedback method
n Portfolio tests
n Laboratory tests
 Evaluating Advertising Effectiveness
– Sales-effect research
Figure 18.4 Formula for Measuring Sales Impact of Advertising

Share of
expenditures

Share of voice

Share of mind
and heart

Share of
market
Section 3
SALES PROMOTIONS
What is Sales Promotion?
Sales promotions consist of a collection of
incentive tools, mostly short term, designed to
stimulate quicker or greater purchase of
particular products or services by consumers
or the trade.
Sales Promotion Tactics
p Consumer-directed p Trade-directed
n Samples n Price offs
n Coupons n Allowances
n Cash refund offers n Free goods
n Price offs n Sales contests
n Premiums n Spiffs
n Prizes n Trade shows
n Patronage rewards n Specialty advertising
n Free trials
n Tie-in promotions
Using Sales Promotions

Establish objectives

Select tools

Develop program

Pretest the program

Implement and control

Evaluate results
Consumer franchise –building
promotion – Body By Milk
Section 4
EVENTS AND EXPERIENCES
Events
p Event marketing: creating a brand-marketing
event or serving as a sole or participating sponsor
of events created by others.
FF
Events objectives
p To identify with a particular target market or life
style
p To increase brand awareness
p To create or reinforce consumer perceptions of
key brand image associations
p To enhance corporate image
p To create experiences and evoke feelings
p To express commitment to community
p To entertain key clients or reward employees
p To permit merchandising or promotional
opportunities
Major Sponsorship Decisions

Establish objectives

Choose events

Design programs

Measure effectiveness
Choosing Events –ideal events
Audience closely matches
target market
generating media
attention

Unique with few sponsors

Lending itself to ancillary

activities

Enhancing brand image

 Experiences
p Experiential
marketing: is not only
communicates
features and benefits
but also connects a
product or service with
unique and interesting
experiences.
Customer Experience Management
(CEM) – Experience providers
p Communications
p Visual/verbal Identity
p Product presence
p Co-branding
p Environments
p Internet & Electronic
media
p People
FF
Customer Experience
Management (CEM) – Steps
Analyze the customer’s
experiential world

Build the experiential

platform

Design the brand

experience

Structure the customer

interface

Engage in continuous
innovation
Section 5
PUBLIC RELATIONS
Public relations (PR)
p A public is any group that has an actual or
potential interest in or impact on a company’s
ability to achieve its objectives.
p Public relations (PR) includes a variety of
programs to promote or protect a company’s
image or individual products.
Public Relations Functions
p Press relations
p Product publicity
p Corporate communications
p Lobbying
p Counseling
Marketing Public Relations
(MPR) – additional tasks to PR
p Launching new products
p Repositioning a mature product
p Building interest in a product category
p Influencing specific target groups
p Defending products that have encountered
public problems
p Building the corporate image in a way that
reflects favorable on products
Major Tools in Marketing PR
p Publications
p Events
p Sponsorships
p News
p Speeches
p Public Service Activities
p Identity Media
Decisions in Marketing PR

Establish objectives

Choose messages

Choose vehicles

Implement

Kate Moss & Sir Richard Branson celebrating Evaluate results

Virgin Atlantic’s 25th Anniversary
Section 6
SUMMARY
Advertising-Definition
p Advertising is any paid form of nonpersonal
presentation and promotion of ideas, goods,
or services by an identified sponsor.
p Advertising includes not only business firms
but also charitable, nonprofit, and
government agencies.
Advertising- Developing an
advertising program
3a. Choose
advertising
message
3b. Choose
creative 5. Evaluate
1. Set 2. Establish an
strategy communication
advertising advertising and sales
objectives budget effects
4. Decide on
the media
Sales Promotion
pSales promotions consist of a diverse
collection of incentive tools, mostly short
term, designed to stimulate quicker or greater
purchase of particular products or services by
consumers or the trade.
p Sales promotion includes tools for
consumer promotions, trade promotions, and
business and sales-force promotion (trade
shows and conventions, contest for sales
reps, and specialty advertising).
Sales Promotion-Definition
pSales promotions consist of a diverse
collection of incentive tools, mostly short
term, designed to stimulate quicker or greater
purchase of particular products or services by
consumers or the trade.
Sales Promotion- tools and steps
pSales promotion includes tools for consumer
promotions, trade promotions, and business
and sales-force promotion (trade shows and
conventions, contest for sales reps, and
specialty advertising).
pA Company must establish its objectives,
select the tools, develop the program, pretest
the program, implement and control it, and
evaluate the results.
Events and experiences
p Events and experiences are a means to
become part of special and more personally
relevant moments in consumers’ lives.
p Involvements with events can broaden and
deepen the relationship of the sponsor with
its target market, but only if managed
properly.
Public relations (PR)
p Public relations (PR) involves a variety of
programs designed to promote or protect a
company’s image or its individual products.
Marketing Public relations (MPR)
p Many companies today use marketing public
relations (MPR) to support the marketing
department in corporate or product promotion
and image making.
p MPR can affect public awareness at a fraction of
the cost of advertising and is often much more
credible.
p The main tools of (M)PR are publications, events,
news, speeches, public service activities, and
identity media.
Section 7
DEBATES & DISCUSSIONS
Marketing Debate
ü Should marketers test advertising?
Take a position:
1. Ad pretesting is an unnecessary waste
of marketing dollars.
or
2. Ad pretesting provides an important
diagnostic function for marketers as to the
likely success of an ad campaign.
Marketing Discussion
ü What are some of your favorite TV
ads? Why?
ü How effective are the message and
creative strategies?
ü How are they building brand equity?