Chapter 15

Advertising, Sales Promotion, and Public Relations

Advertising

• Advertising is centuries old.• U.S. advertisers spend in excess of $212 billion

each year; worldwide spending exceeds $414 billion.

• Advertising is used by:– Business firms,– Nonprofit organizations,– Professionals, and– Social agencies.

What is Advertising?

Advertising is Any Paid Form of Nonpersonal

Presentation and Promotion of Ideas, Goods, or Services by an Identified

Sponsor.

Provide Product &Brand Information

Provide Product &Brand Information

Provide IncentivesTo Take Action

Provide IncentivesTo Take Action

Provide Reminders andReinforcement

Provide Reminders andReinforcement

Advertising Performs 3 Basic

Functions

Advertising Performs 3 Basic

Functions

Functions of Advertising

Roles of Advertising

Marketing RoleMarketing Role

Communication RoleCommunication Role

Economic RoleEconomic Role

•Marketing is the process a business uses to satisfy consumer needs and wants through goods and services.

Societal RoleSocietal Role

•Advertising is a form of mass communication.

•Two main views about advertising, either the market power model or the economics of information theory.

•Informs us about new and improved products, teaches us how to use these innovations, etc.

InteractiveAdvertising

InteractiveAdvertising

Public ServiceAdvertising

Public ServiceAdvertising

InstitutionalAdvertising

InstitutionalAdvertising

Business-to-Business

Advertising

Business-to-Business

Advertising

Brand Advertising

Brand Advertising

Retail or LocalAdvertising

Retail or LocalAdvertising

PoliticalAdvertising

PoliticalAdvertising

Direct-ResponseAdvertising

Direct-ResponseAdvertising

DirectoryAdvertising

DirectoryAdvertising

Types of Advertising

The Five Ms of Advertising

MissionMission

MoneyMoney

MessageMessage MediaMedia

MeasurementMeasurement

Developing anAdvertising Plan

Developingthemes

Developingthemes

Settingobjectives

Settingobjectives

Evaluatingsuccess/

failure

Evaluatingsuccess/

failure

Consideringcooperative

efforts

Consideringcooperative

effortsTiming

adsTiming

ads

Creatingads

Creatingads

Selectingmedia

Selectingmedia

Assigningrespon-sibility

Assigningrespon-sibility

FigureFigure 19-119-1

FeedbackFeedback

1. 1.

Establishinga budget

Establishinga budget

4. 4.

5. 5.

6. 6.

7. 7. 8. 8.

9.9.

2. 2. 3. 3.

Plan a Message StrategyGeneral Message to Be Communicated to Customers

Develop a Message Focus on

Customer Benefits

Develop a Message Focus on

Customer Benefits Creative Concept“Big Idea”

Visualization or PhraseCombination of Both

Creative Concept“Big Idea”

Visualization or PhraseCombination of Both

Advertising AppealsMeaningfulBelievableDistinctive

Advertising AppealsMeaningfulBelievableDistinctive

Developing Advertising Strategy: Creating Ad Messages

Some phrases or Big Ideas become so effective that they spark trends in speaking, fashion, or even in other ads.

TypicalMessage

ExecutionStyles

Testimonial EvidenceTestimonial Evidence Slice of LifeSlice of Life

Scientific EvidenceScientific Evidence LifestyleLifestyle

Technical ExpertiseTechnical Expertise FantasyFantasy

MusicalMusical

Personality SymbolPersonality Symbol Mood or ImageMood or Image

Turning the “Big Idea” Into an Actual Ad to Capture the Target Market’s Attention and

Interest.

Developing Advertising Strategy: Message Execution

What type of message execution do these two ads employ?

Message Executi on

In both cases, what dis tinguishes the product from theres t of the ad?

Click or p ress spacebar to retu rn.

What type of mood does this set about the product?

Which lifestyle does it appeal to?Click or press spacebar to return

This Colgate adinforms customersabout the necessity of brushing afterlunch.

In addition to acquiring new customers, Colgate may increasetoothpaste use bypresent customers.

Step 1. Decide on Reach, Frequency, and Impact

Step 2. Choosing Among Major Media TypesMedia Habits of Target Consumers,

Nature of the Product, Types of Message, Cost

Step 3. Selecting Specific Media VehiclesSpecific Media Within a Given Type, i.e. Magazines.

Must Balance Media Cost Against Media Factors:Audience Quality & Attention, Editorial Quality

Step 4. Deciding on Media TimingScheduling of Advertising Over the Course of a Year

Pattern of Ads: Continuity or Pulsing

Advertising Strategy:Selecting Advertising Media

Types of Advertising MediaBroadcast MediaTelevision Network, spot, and cable tv Radio

Broadcast MediaTelevision Network, spot, and cable tv Radio

Out-of-homeMedia Outdoor media Place-based media

Out-of-homeMedia Outdoor media Place-based media

Print Media Newspapers Magazines Directories

Print Media Newspapers Magazines Directories

Interactive Media TV shopping Computers FAX ads E-mail

Interactive Media TV shopping Computers FAX ads E-mail

Advertising Agencies

• Large agencies divide their staffs to specialize in creative,media,research, or business (account planning).

• Ad agencies are moving away from the commission system because it no long accurately reflects the services performed.

• Most ad agency clients still want just a few of the services that can be provided by the agency, so diversification efforts have been limited.

Full-Service – 4 Major Staff FunctionsFull-Service – 4 Major Staff Functions

Specialized – Functions, Audiences, IndustriesSpecialized – Functions, Audiences, Industries

Industry-Focused – Certain Fields, IndustriesIndustry-Focused – Certain Fields, Industries

Minority – Focus on Ethnic GroupMinority – Focus on Ethnic Group

Creative – Focus on Creative ExecutiveCreative – Focus on Creative Executive

Media Buying Services – Purchase of Media for Clients

Media Buying Services – Purchase of Media for Clients

Virtual – Uses Technology to OperateVirtual – Uses Technology to Operate

Types of Agencies

5 Areas of Importance

5 Areas of Importance

Account Management

InternalServices

Account Planning

& Research

Creative Development & Production

Media Planning & Buying

How Agencies are Organized

What is Sales Promotion ?

Sales Promotion is a Mass Communication Technique

That Offers Short-Term Incentives to Encourage

Purchase or Sales of a Product or Service.

Offers Reasons to Buy Now.

Sales Promotion Objectives

• Increase short-term sales or help build long-term market share.

• Get retailers to:– carry new items and more inventory,– advertise products, – give products more shelf space, and– buy product ahead.

• In general, sales promotion should focus on consumer relationship building.

Sales PromotionsSales PromotionsSales PromotionsSales Promotions

AdvantagesAdvantagesAdvantagesAdvantages DisadvantagesDisadvantages DisadvantagesDisadvantages

Build interestBuild interest

Bring quick sales burstsBring quick sales bursts

Build relationships with intermediaries

Build relationships with intermediaries

Influence laggardsInfluence laggards

Keep traffic highKeep traffic highDilute future salesDilute future sales

Seem temporarySeem temporary

“Poison the well”“Poison the well”

Dilute brand equityDilute brand equity

Gather information for databases

Gather information for databases

SampleSample

CouponsCoupons

Cash RefundsCash Refunds

Price PacksPrice Packs

PremiumsPremiums

Advertising Specialties

Advertising Specialties

Trial amount of a productTrial amount of a product

Savings when purchasing specified products

Savings when purchasing specified products

Refund of part of the purchase priceRefund of part of the purchase price

Reduced prices marked on the label or package

Reduced prices marked on the label or package

Goods offered free or low cost as an incentive to buy a product

Goods offered free or low cost as an incentive to buy a product

Articles imprinted with an advertiser’s name given as gifts

Articles imprinted with an advertiser’s name given as gifts

Major Consumer Sales Promotion Tools

Patronage RewardsPatronage Rewards

Point-of-PurchasePoint-of-Purchase

ContestsContests

SweepstakesSweepstakes

GameGame

Cash or other rewards for the use of a certain product

Cash or other rewards for the use of a certain product

Displays and demonstrations that take place at the point of sale

Displays and demonstrations that take place at the point of sale

Consumers submit an entry to be judged

Consumers submit an entry to be judged

Consumers submit their names for a drawing

Consumers submit their names for a drawing

Presents consumers with something every time they buy

Presents consumers with something every time they buy

Major Consumer Sales Promotion Tools

What is Public Relations?

Public Relations Involves Building Good Relations With the

Company’s Various Publics by Obtaining Favorable Publicity, Building Up a Good Corporate

Image, and Handling or Heading Off Unfavorable Rumors, Stories,

and Events.

The Practice of Public Relations• Public relations is a management function that is

practiced by a wide range of organizations such as: – companies, – governments, – trade and professional associations, – non-profit organizations, – travel and tourism industry, – educational systems, – labor unions, – politicians, – organized sports, and the media.

Press Relations or AgentryPress Relations or Agentry

Product PublicityProduct Publicity

Public AffairsPublic Affairs

LobbyingLobbying

Investor RelationsInvestor Relations

DevelopmentDevelopment

Public Relations Departments May

Perform Any of All of the Following

Functions:

Major Public Relations Functions

News

Speeches

Special Events

Written MaterialsAudiovisual

Materials

Corporate Identity

Materials

Public Service

Activities

Web Site

Major Public Relations Tools

Media Use

Advertising PaysPR

Persuades

Media Use

Advertising PaysPR

Persuades

Control

Advertising – More

PR – Less

Control

Advertising – More

PR – Less

Public Relations Differs From Advertising in ThreeImportant Ways:

Public Relations Differs From Advertising in ThreeImportant Ways:

Credibility

Advertising-Some

PR – MuchMore

Credibility

Advertising-Some

PR – MuchMore

Comparing Public Relations and Advertising