Ch 15 - Advertising, Sales Promotion, and Public Relations

Question 1

Explain the differences between product advertising and institutional advertising and the variations within each type.

Answer 1

Product advertisements focus on selling a good or service and take three forms: Pioneering advertisements tell people what a product is, what it can do, and where it can be found; competitive advertisements persuade the target market to select the firm’s brand rather than a competitor’s; and reminder advertisements reinforce previous knowledge of a product. Institutional advertisements are used to build goodwill or an image for an organization. They include advocacy advertisements, which state the position of a company on an issue, and pioneering, competitive, and reminder advertisements, which are similar to the product ads but focused on the institution.

Question 2

Describe the steps used to develop, execute, and evaluate an advertising program.

Answer 2

The promotion decision process can be applied to each of the promotional elements. The steps to develop an advertising program include the following: identify the target audience, specify the advertising objectives, set the advertising budget, design the advertisement, create the message, select the media, and schedule the advertising. Executing the program requires pretesting, and evaluating the program requires posttesting.

Question 3

Explain the advantages and disadvantages of alternative advertising media.

Answer 3

Television advertising reaches large audiences and uses pictures, print, sound, and motion; its disadvantages, however, are that it is expensive and perishable. Radio advertising is inexpensive and can be placed quickly, but it has no visual element and is perishable. Magazine advertising can target specific audiences and can convey complex information, but it takes a long time to place the ad and is relatively expensive. Newspapers provide excellent coverage of local markets and can be changed quickly, but they have a short life span and poor color. Yellow pages advertising has a long use period and is available 24 hours per day; its disadvantages, however, are that there is a proliferation of directories and they cannot be updated frequently. Internet advertising can be interactive, but its effectiveness is difficult to measure. Outdoor advertising provides repeat exposures, but its message must be very short and simple. Direct mail can be targeted at very selective audiences, but its cost per contact is high.

Question 4

Discuss the strengths and weaknesses of consumer-oriented and trade-oriented sales promotions.

Answer 4

Coupons encourage retailer support but may delay consumer purchases. Deals reduce consumer risk but reduce perceived value. Premiums offer consumers additional merchandise they want, but they may be purchasing only for the premium. Contests create involvement but require creative thinking. Sweepstakes encourage repeat purchases, but sales drop after the sweepstakes. Samples encourage product trial but are expensive. Loyalty programs help create loyalty but are expensive to run. Displays provide visibility but are difficult to place in retail space. Rebates stimulate demand but are easily copied. Product placements provide a positive message in a noncommercial setting that is difficult to control. Trade-oriented sales promotions include (a) allowances and discounts, which increase purchases but may change retailer ordering patterns, (b) cooperative advertising, which encourages local advertising, and (c) salesforce training, which helps increase sales by providing the salespeople with product information and selling skills.

Question 5

Recognize public relations as an important form of communication.

Answer 5

Public relations activities usually focus on communicating positive aspects of the business. A frequently used public relations tool is publicity. Publicity tools include news releases and news conferences. Nonprofit organizations often use public service announcements.

Question 6

advertising

Answer 6

Any paid form of nonpersonal communication about an organization, product, service, or idea by an identified sponsor.

Question 7

consumer-oriented sales promotion

Answer 7

Sales tools used to support a company’s advertising and personal selling directed to ultimate consumers. Also called consumer promotions.

Question 8

cooperative advertising

Answer 8

Advertising programs by which a manufacturer pays a percentage of the retailer’s local advertising expense for advertising the manufacturer’s products.

Question 9

infomercials

Answer 9

Program-length (30-minute) advertisements that take an educational approach to communication with potential customers.

Question 10

institutional advertisements

Answer 10

Advertisements designed to build goodwill or an image for an organization rather than promote a specific product or service.

Question 11

posttests

Answer 11

Tests conducted after an advertisement has been shown to the target audience to determine whether it accomplished its intended purpose.

Question 12

pretests

Answer 12

Tests conducted before an advertisement is placed in any medium to determine whether it communicates the intended message or to select among alternative versions of the advertisement.

Question 13

product advertisements

Answer 13

Advertisements that focus on selling a product or service and which take three forms: (1) pioneering (or informational), (2) competitive (or persuasive), and (3) reminder.

Question 14

product placement

Answer 14

A consumer sales promotion tool that uses a brand-name product in a movie, television show, video game, or a commercial for another product.

Question 15

publicity tools

Answer 15

Methods of obtaining nonpersonal presentation of an organization, product, or service without direct cost, such as news releases, news conferences, and public service announcements.

Question 16

trade-oriented sales promotions

Answer 16

Sales tools used to support a company’s advertising and personal selling directed to wholesalers, distributors, or retailers. Also called trade promotions.

Question 17

What is the difference between pioneering and competitive ads?

Answer 17

Pioneering ads, used in the introductory stage of the product life cycle, tell people what a product is, what it can do, and where it can be found. Competitive ads promote a specific brand’s features and benefits to persuade the target market to select the firm’s brand rather than that of a competitor.

Question 18

What is the purpose of an institutional advertisement?

Answer 18

The purpose of an institutional advertisement is to build goodwill or an image for an organization.

Question 19

The Federal Communications Commission suggests that advertising program decisions be based on .

Answer 19

market research about the target audience

Question 20

Describe three common forms of advertising appeals.

Answer 20

The three common forms of advertising appeals are: (1) fear appeals, which suggest to the consumer that he or she can avoid some negative experience through the purchase and use of a product or service, a change in behavior, or a reduction in the use of a product; (2) sex appeals, which suggest to the audience that the product will increase the attractiveness of the user; and (3) humorous appeals, which imply either directly or subtly that the product is more fun or exciting than competitors’ offerings.

Question 21

You see the same ad in Time and Fortune magazines and on billboards and TV. Is this an example of reach or frequency?

Answer 21

Reach—using more of the same media type (magazines) as well as using more of different types of media (magazines, billboards, and TV)—is an attempt to maximize the number of individuals in a target market that are exposed to the advertisement. Frequency uses the same medium/media more than once to present the advertising message.

Question 22

Why has the Internet become a popular advertising medium?

Answer 22

The Internet offers a visual message, can use both audio and video, is interactive through rich media, and tends to reach younger consumers.

Question 23

Describe three approaches to scheduling advertising.

Answer 23

The three approaches to scheduling advertising are: (1) a continuous (steady) schedule, which is when advertising is run at a continuous or steady schedule throughout the year because seasonal factors are unimportant; (2) a flighting (intermittent) schedule, which is when periods of advertising are scheduled between periods of no advertising to reflect seasonal demand; and (3) a pulse (burst) schedule, which is when a flighting schedule is combined with a continuous schedule because of increases in demand, heavy periods of promotion, or introduction of a new product.

Question 24

Explain the difference between pretesting and posttesting advertising copy.

Answer 24

Pretests are conducted before ads are placed in any medium to determine whether they communicate the intended message or to select among alternative versions of the ad. Posttests are shown to the target audience to determine whether it accomplished its intended purpose.

Question 25

What is the difference between aided and unaided recall posttests?

Answer 25

Aided recall involves showing an ad to respondents who then are asked if their previous exposure to it was through reading, viewing, or listening. Unaided recall involves specifically asking respondents if they remember an ad without any prompting to determine if they saw or heard its message.

Question 26

Which sales promotional tool is most common for new products?

Answer 26

samples

Question 27

Which trade promotion is used to encourage the local advertising efforts of resellers?

Answer 27

cooperative advertising

Question 28

What is a news release?

Answer 28

A news release is an announcement regarding changes in the company or the product line.

Question 29

What type of publicity tool is used most often by nonprofit organizations?

Answer 29

public service announcements (PSAs)