Advertising and Promotions Exam 1 (Chp. 1-4) Flashcards
Marketing
is the activity, set of institutions, and processes for creating,
communicating, delivering and exchanging offerings that have
value for customers, clients, partners, and society at large”
Exchange
Core concept of marketing
Value
Customer perceptions of benefits vs costs
Marketing Mix
Product, promotion, price, place
Role of marketing
Inform, persuade, and build relationships
Growth of Advertising and Promotion
Carefully prepared messages delivered to carefully targeted
audiences
IMC (integrated marketing communications)
Coordination among/across promotional tools/customer contact
points
Centralized messaging (common theme and positioning) –
consistency and synergy
Multiple audiences
Strategic in nature
Outcomes measurement
Brand
That part of a brand that can be spoken, including letters,
words, and numbers
Role of IMC in Branding
Develop and sustain brand identity and equity
Aid company connections to consumer via trust,
transparency and authenticity
Link to sustainability
Promotional Mix
the coordination of all seller-initiated efforts to set up
channels of information and persuasion in order to sell
goods and services
IMC and Audience Contact
Know x and y chart
Paid vs owned vs earned media
paid-tv, in store media, paid search
owned- website, facebook, blogs
earned- word-of-mouth, shared vids, media coverage
IMC Management
Process of planning, executing, evaluating, and controlling
promo mix tools to communicate with target audience
IMC plan
Framework for developing, implementing, and controlling IMC
program
Stages of IMC planning process
IMC planning Process
- review marketing plan
- analysis of promotional program situation
- analysis of communication process
- budget determination
- develop IMC programs
- Integrate and implement marketing communication strategies
- monitor, evaluate, and control IMC program
The promotional mix
Advertising
Direct marketing
Interactive/internet marketing
sales promotion
publicity/public relations
personal selling
advertising
Paid forms of non-personal communication
– About an organization, product, service, or
idea by an identified sponsor
– No feedback from audience (one-way)
– Important for products and services aimed at
mass consumer markets
– Key tool to inform and influence perceptions
– Cost effective
Direct Marketing
Direct mail
Direct response advertising
Telemarketing
Catalogs
Shopping channels
Internet sales
Digital/internet marketing
Back-and-forth communication
Users participate in and modify the form and content of
information
Happens in real time
Interactive media
Internet
Social media
Kiosks
Interactive television
Mobile marketing
Using the internet as an IMC tool
Builds and maintains customer relationships
Obtains customer database information
Communicates and interacts with buyers
Provides customer service and support
Educates or informs customers
A persuasive advertising medium
A sales tool or an actual sales vehicle
Sales Promotion
Consumer oriented
Trade oriented
Consumer oriented
Coupons
Samples
Premiums
Contest/Sweepstake
Refunds/Rebates
Bonus Packs
Loyalty Programs
Events
Trade-oriented
Trade Allowances
POP Displays
Training Programs
Trade Shows
Coop Advertising
Sales promotion budget
Most of the promotional budget now goes to sales promotion
Declining brand loyalty
Increased consumer sensitivity to “deals”
Larger and more powerful retailers are demanding more trade
promotion support
Publicity vehicles
Feature articles
Interviews
Special Events
News Releases
Public Relations
Systematically planning and
distributing information in an attempt to control and manage
image and the nature of the publicity received.
Public Relations tools
Cause-related marketing
Special Publications
Publicity vehicles
Community activities
public affairs activities
corporate advertising
special event sponsorship
personal selling
Person-to-person communication
A seller attempts to assist and/or persuade prospective buyers to
make a purchase or act on an idea
Marketing and promotions process
- Marketing Strategy and Analysis
- Target marketing Process
- Marketing Planning Program development
Marketing Strategy and Analysis
Strategic marketing plan
Incorporates overall corporate strategy and
guides specific marketing programs and policies
and allocation of organization’s resources
Situational analysis
Market segment/target market
Situational analysis
Opportunity analysis
Analysis of marketplace such as demand trends, unfulfilled
needs, new populations
Competitive analysis
Analysis of competition on a wide range of variables
Market segments/ target market
Selection of one or more target markets to pursue
Target Marketing Process (4 steps)
Identify markets with unfulfilled needs
Id specific needs of groups of people
Determine market segmentation
Divide market into distinct groups
5 common basis for segmentation
Select a market(s) to target
How many segments to enter (Undifferentiated,
differentiated, concentrated)
Which segments have potential
Position through marketing strategies
Image of the product (brand) relative to competitors
7 positioning strategies plus repositioning
Market segmentation
Segmenting Markets
1. Behavioral/Usage
Usage (heavy, med, light, nonuser)
Loyalty (brand freaks)
Switchers/variety seekers
80-20 Rule
2. Demographics
3. Geographic
4. Psychographic
5. Benefit
Selecting a target market
Determine…
How many segments to enter
1. undifferentiated marketing
one product or service to entire market
2. differentiated marketing
separate marketing strategies for each segment
3. concentrated marketing
selection of one segment with goal to gain large share
of market
Which segments have the greatest
potential
◦ Sales potential, growth, competition, ability to
compete, ability to market to this group
Market Positioning
Fitting the product or service to one or more
segments of the broad market in such a
way as to set it apart from competition
Developing a positioning strategy
Attribute/benefit
Price/quality
Use or application
Product class
Product user
Competitor
Cultural symbol
Repositioning
Salient attributes
Important
to consumers and are the basis
for making a purchase decision
Marketing Planning Program Development
Product decisions
Product value (meeting customer needs)
Branding (identity, equity)
Packaging
Price decisions
◦ Variables to consider (costs, demand, competition,
perceived value, product quality, advertising)
Distribution
Branding (name, term, symbol, design)
differentiate a product from others
instill mythical feeling
Brand identity
Combination of the name, logo, symbols, design,
packaging, and image associations held by the
consumer
Brand equity
Added value or goodwill (intangible asset of added
value)
Price decisions
Variables to consider (costs, demand, competition,
perceived value, product quality, advertising)
Distribution
Channel partners – make product available to
customers
◦ Direct and indirect channels
◦ Promotional Push - through the stores push out
to consumers
◦ Promotional Pull - generate demand via
consumer promotions and pull product through
the distribution channel
Clients
Organize based on its size, number of
products/markets, budget, marketing mix, structure
Two client structural forms
Two Client Structural Forms
Centralized
Functional structure, single product /market typically
Decentralized
Product/brand manager role, multiple products and markets
In-House agencies
In-House agencies
In-house agency: an advertising agency that is set
up, owned, and operated by the advertiser
Reduces advertising and promotion costs
Allows companies to maintain tighter control
Critics of in-house agencies worry about experience and
objectivity
Advantages and disadvantages to each organizational system
see slides
Ad agencies (role, services, type)
Role – to assist clients in developing, preparing,
and executing promotional programs (highly skilled,
objective, experience)
Services
research, creative, media, production
Account, marketing, creative, management, finance
Positions/jobs
Department or group organization
Types
Full service to specialty agencies (creative,
media)
Superagencies
Creative boutiques
Only creative services
Media specialist firms
Specialize in buying media, especially broadcast time
Compensation
Commission, fee, cost, incentive-based
Evaluation
Financial audit – costs, expenses, charges
Qualitative audit – efforts in planning, developing, and
implementing a campaign
how agencies are compensated
Commissions
From 3 to 15% on total media amount billed
As high as 16% for outdoor media
Fixed-Fee Method
Monthly basic fee charged of all services
Cost-Plus Agreement
* Cost of agency work + Fixed %
Percentage charges (mark-up)
* charges for services provided by outside suppliers
* 17.65 to 20% mark-up to charges
Incentive-based Compensation
* Fee based on the achievement of agreed-on results, tightly-
specified objectives
Ad agencies (more info)
Evaluating Agencies
Financial, qualitative audits
Gaining and Losing Clients
Relationship business
Performance driven
Pages 96-99
Specialized Services
Direct-Marketing, Sales Promotions, PR, Digital firms
Collateral Services – single job hires
IMC Services – all under one roof
Pros and cons, responsibility, foundation characteristics
Consumer behavior
PROCESS AND ACTIVITIES PEOPLE
ENGAGE IN WITH RELATION TO PRODUCTS AND SERVICES TO
SATISFY THEIR NEEDS AND DESIRES
* SEARCHING AND SELECTING
* PURCHASING AND USING
* EVALUATING
* DISPOSING
Basic Model of Consumer Decision Making
Problem Recognition –> Motivation
Information search–> Perception
Alternative evaluation–>attitude formation
purchase decision–>integration
post purchase evaluation–>learning
Problem recognition (1)
CONSUMER PERCEIVES A NEED AND GETS MOTIVATED TO SOLVE THE PROBLEM
* CAUSED BY A DIFFERENCE BETWEEN CONSUMER’S IDEAL STATE AND ACTUAL
STATE
SOURCES
* OUT OF STOCK
* DISSATISFACTION, NEW NEEDS OR WANTS
* NEW PRODUCTS, RELATED PRODUCTS OR PURCHASES
* MARKETER-INDUCED PROBLEM RECOGNITION
Consumer motivations (1)
HELPS IN UNDERSTANDING THE REASONS UNDERLYING CONSUMER PURCHASES
* MOTIVES: FACTORS THAT COMPEL A CONSUMER TO TAKE A PARTICULAR ACTION
* RESEARCH METHODS: INTERVIEWS, PROJECTIVE TECHNIQUES, ASSOCIATION
TESTS, FOCUS GROUPS
Maslows hierarchy of needs
Information search (2)
INTERNAL SEARCH – PERSONAL EXPERIENCE/PRIOR KNOWLEDGE
* EXTERNAL SEARCH – INFORMATION BEYOND THE PERSON
Perception (2)
PROCESS BY WHICH AN INDIVIDUAL RECEIVES, SELECTS,
ORGANIZES AND INTERPRETS INFORMATION TO CREATE A
MEANINGFUL PICTURE
* DEPENDS ON
* INTERNAL FACTORS
* CHARACTERISTICS OF A STIMULUS
Processes involved in perception
SENSATION – IMMEDIATE, DIRECT RESPONSE TO SENSES TO
STIMULUS
* 5 SENSES
* ADS, PACKAGING, BRAND NAME POINT OF PURCHASE
* SELECTING INFORMATION – INTERNAL PSYCHOLOGICAL
FACTORS DETERMINE WHAT ONE FOCUSES ON AND/OR
IGNORES
* RELEVANCE TO NEEDS
* INTERPRETING INFORMATION- ORGANIZING AND
CATEGORIZING INFORMATION INFLUENCED BY …
* INTERNAL PSYCHOLOGICAL FACTORS
* THE NATURE OF THE STIMULUS
Selective perception
1.EXPOSURE
2.ATTENTION
3.COMPREHENSION
4.RETENTION - MNEMONICS
Subliminal perception-subconcious
Alternative evaluation (3)
COMPARISON OF BRAND PRODUCTS AND SERVICES IDENTIFIED
AS CAPABLE OF SOLVING THE PROBLEM
* EVOKED SET - 2 TO 5 BRANDS THAT COME TO MIND
* EVALUATIVE CRITERIA (FUNCTIONAL AND PSYCHOSOCIAL)
Attitude formation (3)
ATTITUDES ARE LEARNED PREDISPOSITIONS
* SALIENT BELIEFS
* MULTIATTRIBUTE MODEL
Purchase decision (4)
OUTCOME OF THE ALTERNATIVE EVALUATION STAGE -
DEVELOPED PURCHASE INTENTION, BRAND LOYALTY
Integration (4)
EVALUATION OF ALTERNATIVES BASED ON KNOWLEDGE,
BELIEFS, AND MEANINGS
* HEURISTICS
* AFFECT REFERRAL DECISION RULE
Post Purchase evaluation (5)
COMPARE PERFORMANCE TO EXPECTATION
* COGNITIVE DISSONANCE (DOUBT)
Learning (5)
BEHAVIORAL LEARNING – CLASSICAL AND OPERANT
* COGNITIVE LEARNING
Classical conditioning
unconditioned stimulus to conditioned response
operant conditioning
random rewarding
Environmental influences
CULTURE
* SUBCULTURE
* SOCIAL CLASS
* REFERENCE GROUP
* SITUATIONAL DETERMINANTS
