Exam 2 Flashcards
Purpose of advertising
To sell products/services To create awareness & familiarity To enhance brand image To build customer demand To advertise new p/s
Define advertising
is a message designed to promote a product, a service, or an idea.
advertising: buying decision process
Problem recognition Info search Alternative evaluation Purchase decision Post purchase behavior
7 advertising techniques
Basic appeals Attention getting headlines Slogans Testimonials Product characters Comparison of products Depiction
Basic appeals
Ad. Technique
Biological: consumer’s basic needs for health and security
Emotional: focus on consumer’s feelings( love, romance, pride)
Rational: focus on consumer’s reasoning abilities (cost, safety, convince)
Social: focus on the way that social pressures influence consumer behavior (odor, weight, acne, fashion)
Attention-getting headlines
Successful headline leads into reading the rest of ad
Attract attention by promising reader personal benefit (wanna save money?!)
Slogans
Short phrases, repetitive, easy to remember, and sticks to your mind
Testimonial
A person endorses product (ex: Proactive)
Product characters
Fictional people or cartoon( Taco Bell chihuahua)
Comparison of products
MOST FREQUENTLY USED
Mac v. PC
Depiction
Most basic to get message across
Familiarity = credibility/trust?
Builds and reinforces a company’s reputation (the more a person hears or sees the most likely it will be accepted)
Reaching best target audience
Geography ( nations, states, regions)
Demographic (gender, age, religion, education)
Psychographics ( lifestyle, social class, personality)
Positioning
Mgmts desired positioning of the product (brand) in the eyes and minds of targeted buyers
Positioning strategies
Entire company (Marriott brands) Mix of products ( Marriott only in oc) Specific line (luxury brands) Particular brand (ritz)
Strategic relationships
Suppliers, distribution channels, customers
strategic relationships objective
Gain access to markets Enhance p/s New product development Reduce financial risks Share skills, knowledge, info, techniques
Why is strategic relationships more important?
Environmental complexity
Risks of a global economy
Skill/resource limitations of a single organization
Strategic relations challenges
Is partnering a promising strategy? Are good candidates available? Do relationships fit our culture? Ex: Heinz and TGIF Lodging: airlines and hotel shuttles Happy meals and Disney toys
CRM
Customer relationship management
Goal: establish a profitable long term relationship with customers rather than just expanding customer base or market share
3 levels of CRM
Strategic CRM
Operational CRM
Analytical CRM
Front end customer service and relationships, the back end is analytical or infrastructure for decision support, which links to strategic level of CRM
Key words: Customer service " relationships Infrastructure Decision support
Strategic CRM
Competitive differentiation
Market segmentation
Strategic positioning
Operational CRM
Customer service, relationships, database
Analytical CRM
Customer knowledge
Targeted marketing communications
Benefits of CRM
Customer retention
Share of wallet
Cross-selling
Up-selling
Costs of CRM
IT infrastructure
Process change
80/20 rule CRM
80% of business comes from 20% of customers
RFM
Recency: last customer interaction
Frequency: how frequent customer interacts with business
Monetary value: value of interactions
RFM marketing problem
Evaluate customer behavior customer value
RFM: Recency Coding using example with emails to 30,000 customers, but only 458 responded.
- 30,000 customers are sorting in descending order w/ respect to their most recent purchases
- Data divided into 5 EQUAL GROUPS, each containing 6,000 people
- Recency codes are assigned: top group has code 5, bottom group has code 1
Results
Group with highest Recency have highest response rates
Most recent purchasers are more willing to buy new products
RFM: Frequency coding
Frequency metrics: average number of purchases made by customer in a time period ( sorted in descending order with respect to purchase frequency)
Assigned into 5 groups, top 20% in the first frequency group
Frequency codes, where top group assigned to group 5 and bottom is 1
Results: highest response rates come from customers with highest frequency (differences between groups are less that RECENCY)
Lowest frequency contains new customers
RFM: Monetary Value
Same process as Recency and frequency
Monetary value is average amount purchased in a time period
Coding M=1,….5 to groups according to their groups
Results
Highest response rate is from customers with highest monetary value (unlike Recency, there are NOT big differences between groups)
Trends in tourism
Ecotourism, sustainable tourism, and heritage tourism are growing importance.
Promotion and development of tourism are moving from public (govt) to private (fairmount hotel gm, oc tourism annual conferences)
Technology advancements
Managing tourist destination will be more challenging
Increased concern for health and safety
Airlines entice travelers to book trips via private websites rather than other distribution channels
Economic benefits of tourism
Important source of employment
Fastest-growing economic sector in terms of foreign exchange earnings
Leading producer of tax revenues
Stimulates investment infrastructure to improve living conditions
Economic Impact of Tourism
What are the direct effects?
Production changes associated with immediate effects of changes in tourism expenditures.
Economic Impact of Tourism
What are the indirect effects?
Production changes resulting from various rounds of re-spending of the tourism industries receipts in other backward-linked industries
Economic Impact of Tourism
What are the induced effects?
Changes in economic activity resulting from household spending of income earned directly or indirectly as a result of tourism spending
Economic Impact of Tourism
What are the direct effects examples?
Accommodation, transportation, entertainment attractions
Economic Impact of Tourism
What are the indirect effects examples?
Most money
T&T investment spending
Purchases from suppliers
Govt collective T&T spending
Economic Impact of Tourism
What are the induced effects examples?
Spending from employes for the following: F&B Recreation Clothing Housing Household goods
