chapter 15 Flashcards
advertising
a cost-effective way to disseminate messages, whether to build a brand preference or to educate people.
the five M’s
marketers can make five major decisions in developing an advertising program:
1. mission
2. money
3. message
4. media
5. measurement
informative advertising
aims to create brand awareness and knowledge of new products or new features of existing products.
persuasive advertising
aims to create liking, preference, conviction, and purchase of a product or service.
reminder advertising
aims to stimulate repeat purchase of products and services.
reinforcement advertising
aims to convince current purchasers they made the right choice.
factors to consider when setting the advertising budget
- stage in the product life cycle
- market share and consumer base
- competition and clutter
- advertising frequency
- product substitutability
creative strategy steps
- message generation and evaluation
- creative development and execution
- legal and social issues
open sourcing/crowdsourcing
using consumers as a creative team for message generation and evaluation. this strategy can cut costs dramatically.
television ads
reach a broad spectrum of consumers at a low cost per exposure, but the high volume of nonprogramming material on TV makes it easy for consumers to ignore the ad.
print ads
because consumers consume them at their own pace, magazines and newspapers can provide detailed information and effectively communicate their user and usage imagery, but the static nature of the visual images in print media makes the presentations or demonstrations difficult.
radio ads
main advantage is flexibility. also, is relatively inexpensive, but lacks visual images are therefore relatively passive in nature.
media selection
finding the most cost-effective media to deliver the desired number and types of exposures to the target audience.
effects of exposures on audience awareness
- reach (R): the number of people exposed to a particular media schedule at least once during a time period. most important when (a) launching new products (b) flanker brands (c) extensions of well-known brands, and (d) infrequently purchased brands or (e) when going after an undefined target market.
- frequency (F): number of times within the time period that an average person is exposed to the message. most important where there are (a) strong competitors (b) a complex story to tell (c) high consumer resistance or (d) a frequent-purchase cycle.
- impact (I): qualitative value of an exposure through a given medium.
place advertising/out-of-home advertising
a broad category including many creative and unexpected forms to grab consumers’ attention where they
work, play, and shop. eg. billboards, public spaces, product placement, and point of purchase (P-O-P).
point of purchase (P-O-P)
reaching consumers where buying decisions are made through ads on shopping carts, in-store demonstrations, and live sampling.
macroscheduling decision
in choosing media, an advertiser makes a macroscheduling and a microscheduling decision. the macroscheduling decision relates to seasons and the business cycle.
microscheduling decision
calls for allocating advertising expenditures within a short period to obtain maximum impact.
“burst” advertising
concentrated advertising instead of dispersed advertising.
choices when launching a new product
- continuity: even exposures throughout a period
- concentration: means spending the budget in one period
- flighting: advertising during a period, followed by no advertising, followed by a second period of advertising
- pulsing: continuous advertising at low levels, reinforced periodically by waves of heavier activity.
communication-effect research/copy testing
seeks to determine whether an ad is communicating effectively. should be performed before an ad is launched and after. a company’s share of advertising expenditures produces a share of voice that earns a share of consumers’ minds and hearts and ultimately a share of market.
sales impact can be measured using (1) the historical approach or (2) experimental data.
share of voice
proportion of company advertising of that product to all advertising of that product.
historical approach
using advanced statisitcal techniques to correlate past sales to past advertising expenditures.
consumer franchise-building promotions
a sales promotion tool that builds brand equity while moving product. it imparts a selling message along with a deal, such as free samples, frequency awards, coupons, and premiums.
stockpiling
purchasing earlier than usual (purchase acceleration).
when using sales promotion a company must
- establish its objectives
- select consumer promotion tools
- select trade promotion tools
- select business and sales force promotion tools
sales promotions objectives
- for consumers include (a) encouraging more frequent purchases of larger-size units (b) build trial among nonusers (c) attracting switchers.
- for retailers include (a) persuading retailers to carry new items and more inventory (b) encourage off-season buying (c) stocking of related items (d) offsetting competitive promotions (e) building brand loyalty (f) gaining entry to new retail outlets.
- for the sales force include (a) encouraging support of a new product/service (b) encouraging more prospecting (c) stimulating off-season sales.
major consumer promotion tools
- samples
- coupons
- cash refund offers (rebates)
- price packs (cents-off deals)
- premiums (gifts)
- frequency programs
- prizes (contests, sweepstakes, and games)
- patronage awards
- free trials
- product warranties
- tie-in promotions
- cross-promotions
- point-of-purchase (P-O-P) displays and demonstrations
cash refund offers/rebates
providing a price reduction after sales. the consumer sends “proof of purchase” to the manufacturer.
premiums
merchandise offered at a relatively low cost or free as an incentive to purchase a particular product.
with-pack premium
accompanies the product inside or on the package.
free-in-the-mail premium
is mailed to consumers who send in a proof of purchase.
self-liquidating premium
sold below its normal retail price to consumers who request it.
sweepstakes
asks consumers to submit their names in a drawing.
patronage awards
value in cash or in other forms that are proportional to patronage of a certain vendor.
tie-in promotions
two or more brands or companies team up on coupons, refunds, and contests to increase pulling power.
cross-promotions
using one brand to advertise another noncompeting brand.
trade promotion tool reasons
- persuade the retailer or wholesaler to carry the brand
- persuade the retailer or wholesaler to carry more units than the normal amount
- induce retailers to promote brand by featuring, display, and price reductions
- stimulate retailers and their salesclerks to push the product
major trade promotion tools
- price-off (off-invoice or off-list)
- allowance
- free goods
allowance
an amount offered in return for the retailer’s agreeing to feature the manufacturer’s products in some way.
advertising allowance
compensates retailers for advertising the manufacturer’s products.
display allowance
compensates retailers for carrying a special product display.
major business and sales force promotion tools
- trade shows and conventions (important for B-to-B, but also the most expensive)
- sales contests
- specialty advertising
specialty advertising
consists of useful, low-cost items bearing the company’s name and address, and sometimes and advertising message, that salespeople give to prospects and customers. eg. pens.
cost of a particular promotion
administrative cost + incentive cost * expected number of units sold
deciding to use a particular incentive
marketers have to (1) determine the size of the incentive (2) the conditions for participation (3) duration of the promotion (4) distribution vehicle (5) timing (6) total sales promotion budget.
sales promotion steps
- establish objectives
- select consumer promotion tools
- select trade promotion tools
- select business and sales force promotion tools
- develop the program
- implement and evaluate the program
atmospheres
“packaged environments” that create or reinforce leanings toward product purchase.
reasons to sponsor events
- identify with a particular target market or lifestyle
- increase salience of company or product name
- create or reinforce perceptions of key brand image associations
- enhance corporate image
- create experiences and evoke feelings
- express commitment to community or social issues
- entertain key clients or reward key employees
- permit merchandising or promotional opportunities
major sponsorship decisions
- choosing event opportunities
- designing sponsorship programs
- measuring sponsorship activities
supply-side method
assesses media coverage to measure an event’s success. eg. number of seconds the brand is visible on television.
demand-side method
identifies the sponsorship’s effects on consumers’ brand knowledge.
experiential marketing
does not only communicate features and benefits, but also connects a product or service with unique and interesting experiences. it is part of grassroots marketing.
public
any group that has an actual or potential interest or impact on a company’s ability to achieve its objectives.
public relations (PR)
include a variety of programs to promote or protect a company’s image or individual products. they perform five functions
PR functions
- press relations
- product publicity
- corporate communications
- lobbying
- counselling
press relations
presenting news and information about the organisation in the most positive light.
product publicity
sponsoring efforts to publicise specific products.
corporate communications
promoting the understanding of the organisation through internal and external communications.
lobbying
dealing with legislators and government officials to promote or defeat legislation and regulation.
counselling
advising management about public issues as well as company positions and image during good times and bad.
marketing public relations (MPR)
support corporate or product promotion and image making. it goes beyond simple publicity.
MPR roles
- launch new products
- resposition mature products
- build interest in a product category
- influence specific target groups
- defending products that have encountered public problems
- building the corporate image in a way that reflects favourably on its products
major tools in marketing PR
- publications (eg. annual reports, brochures, articles)
- events
- sponsorships
- news
- speeches
- public service activities
- identity media
public service activities
companies can build goodwill by contributing money and time to good causes.
identity media
companies need a visual identity that the public immediately recognises. the visual identity is carried by company logos, stationery, brochures, etc.
