Management of Advertising, Sales Promotion and Public Relations

8/3/2019 Management of Advertising, Sales Promotion and Public Relations

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ManagementManagement of Advertising, Salesof Advertising, Sales

Promotion and Public RelationsPromotion and Public Relations

Prof. Rushen ChahalProf. Rushen Chahal


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AdvertisingAdvertising

y Includes all activities involved in presenting anon-personal, sponsor-identified, paid-formessage about a product or organization.

y Can classify it by: The target audience: consumers or businesses

Product/service vs. organization/company

Objective: Primary or selective demand

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The Nature of AdvertisingThe Nature of Advertising

y advertising is distinguished from other forms ofpromotion as follows

y it has a verbal and/or visual message

y

the sponsor of the message is identifiedy delivery is through recognizable media

y there is payment by the advertiser to the mediafor carrying the message

y advertisers are increasingly being able to reachspecific audiences with tailor-made messages

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Advertising toAdvertising to

Target AudiencesTarget Audiences

y advertising can be classified by the targetaudience to which it is directed

y consumeradvertising generally appears in

mass media and is directed to endconsumers: may beproduct orinstitutional in nature

y business-to-business advertising is oftencalled trade advertising and is directed to abusiness market

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What is Being Advertised?What is Being Advertised?

yy product advertisingproduct advertising is designed to promotethe sale of a specific product or service:

may be directdirect--actionaction, quick-response

may be indirectindirect--actionaction over a longer timeyy institutional advertisinginstitutional advertising promotes the firm or

tries to create a positive image:

may promote customer service

or send a public service message

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What are the Objectives?What are the Objectives?

yy primaryprimary--demanddemand advertising is intended to

stimulate use of a category of products

yy

selectiveselective--demanddemand advertising is intended toencourage purchase of a particular brand

or the products and services of a specific

firm

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Comparative AdvertisingComparative Advertising

yy SelectiveSelective--demanddemand advertising

y Involves comparing a product to itscompeting brand

y May be: Direct, naming competitors outright

Less direct, alluding to competitors (e.g.,leading brand, Brand X) but not namingthem

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CoCo--operative Advertisingoperative Advertising

yy coco--operativeoperative advertising involves the

sharing of the cost of advertising by two

or more sponsors:

a manufacturer and retailers (verticalvertical), or

a group of retailers (horizontal(horizontal)

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AnAdvertising CampaignAnAdvertising Campaign

(Steps 1 and 2)(Steps 1 and 2)1. Transforming a theme into a coordinated

advertising program to accomplish a specificgoal.

2. Objectives of the campaign determined byfirms overall marketing strategy. Typicalobjectives are:

Support personal selling

Improve dealer relations

Introduce a new product Counteract substitution

Expand use of a product category

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The Advertising CampaignThe Advertising Campaign

(Steps 3 and 4)(Steps 3 and 4)

y Creating a message that:

Gets and holds the attention of the intendedaudience.

Influences the audience in the desired way.y Selecting media involves:

The choice of a medium such as television, radio,newspaper, or magazine.

The specific category of the selected medium to beused, such as special interest (Chatelaine) vs. generalinterest magazines (Macleans).

The specific media vehicles.

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The Campaign BudgetThe Campaign Budget

y A budget must be allocated among the

various activities comprising the overallpromotional program.

y Promotional budgets can be extended

with co-operative advertising.

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Choosing MediaChoosing Media

y Objectives of the ad.

y Audience coverage.

y Requirements of the message.

y Time and location of the buying decision.

y Media cost (CPM)

y Media characteristics.

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Characteristics ofCharacteristics of

Key MediaKey Media

y Newspapers: flexible, local

y Television: versatile, powerful but costly,

fragmented

y Direct Mail: personal, selective, effective, but

tough

y Radio: strong locally, cheap but single

medium

y Magazines: top quality, little flexibility

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MoreMore

Key MediaKey Media

y out-of-home advertising

y specialty advertising

y emerging media:

WorldWideWeb

infomercials

place-based media

videos and CD-ROMs

yellow pages

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Evaluating the Major MediaEvaluating the Major Media

y newspapers are flexible and timely, have alocal orientation and wide coverage, lowcost

y television is versatile, but audience is nowfragmented, reaches mass audiences

y direct mail is efficient, targets certain

audience

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More MediaMore Media

EvaluationsEvaluations

y radio stations target specific segments, low

cost, local orientation, short message life

y

magazines deliver quality advertising tospecific segments, message stays around

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The Changing NatureThe Changing Nature

of Mediaof Media

y media are becoming less mass, more targeted

y cableTV offers many specialty channels

y direct-to-homeTV adds to fragmentation

y lots of new out-of-home media

y Yellow Pages and other directories on CD-ROM

y place-based media where they shop and live

y advertising on theWeb works as Yellow Pages does-- the customer seeks out the advertiser

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Evaluating AdvertisingEvaluating Advertising

y It is difficult to measure the sales

effectiveness of advertising because:

Ads have different objectives.

Ads can have an effect over time period.

Measurement problems.

y Effectiveness can be tested:

Before an ad is presented. While it is being presented.

After it has completed its run.

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Organizing for AdvertisingOrganizing for Advertising

y Develop an internal advertisingdepartment.

Many large retailers do this.

yUse an outside advertising agency. Specialized, skilled professionals.

Experienced, many services offered

y Do both.

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Sales PromotionSales Promotion

y Demand-stimulating devices designed tosupplement advertising and facilitate personalselling.

y Sales promotions include such things ascoupons, in-store displays, premiums, tradeshows, in-store demonstrations, andcontests.

y The target for these activities may bemiddlemen, end users, or the producers ownsalesforce.

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Types of Sales PromotionTypes of Sales Promotion

y Trade promotions, directed to membersof the distribution channel.

y Consumer promotions, aimed atconsumers.

y Consumers got 3.3 billion coupons for

packaged goods alone in1996

.

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Advantages ofAdvantages of

Sales PromotionSales Promotion

y It can produce short-term results.

y Competitors are using sales

promotions.y Sales promotions are attractive to

price-conscious consumers.

y Can enhance/facilitate retail

salesmanship which is often of lowquality.

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Key Reasons forKey Reasons for

Sales PromotionSales Promotiony Stimulating end-user demand.

Sampling program for new/improved product

y Improving the marketing performance

of middlemen and salespeople. Sell more, win a holiday trip.

y Supplementing advertising andfacilitating personal selling.

Displays, promotional giveaways

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Managing Sales PromotionManaging Sales Promotiony Select from wide range of techniques, depending on

your objectives

y Select promotional devices based on:

Nature of target audience

Your promotional objectives: Push vs. Pull.

Cost of device-- sampling can get costly.

Current economic conditions-- coupons, rebateswork best in recessionary period.

y Evaluating Sales Promotion:

Much easier than with advertising.

Usually clear start, finish, goal.

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Public RelationsPublic Relations

y A tool designed to influence favourably attitudestowards an organization, its products and policies.

yy Public relationsPublic relations is often overlooked by

management because of: Organization structure; not in marketing.

Inadequate definitions; loosely defined.

Unrecognized benefits; many non-believers.

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PublicityPublicity

PublicityPublicity is a form of public relations

that includes any communication

about an organization or itsproducts that is presented by the

media but is not paid for by the

organization.

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Strengths of PublicityStrengths of Publicity

y Can announce new products, recognizeemployees, report good results, breakthroughs.

y Key Benefits:

Lower cost than advertising or personal selling. Increased readership; advertising ignored often.

More information.

Timeliness.

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Weaknesses of PublicityWeaknesses of Publicity

y Some loss of control over message.

y Limited exposure; only happens once.

y

Not free; preparation costs.

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Documents

Management of Advertising, Sales Promotion and Public Relations