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MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 1
Global Promotion
• Promotion objectives• Problems and
opportunities in promotional transplantation
• Legal issues
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 2
Promotion: Strategic and Tactical Objectives
• Awareness• Trial• Attitude toward the
product– Beliefs– Preference
• Temporary sales increases
EmergingMarkets/New Products
Mature markets/establishedproducts
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 3
Tools in Integrated Marketing Communication• Advertising
– Media– Direct mail– Billboards– Other
• Sales promotion• Public relations• Distribution as promotion• Placements/endorsements
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 4
Advertising Prominence
• Higher income countries tend to spend more on advertising. However:– Some exceptions– Lower media costs in developing
countries may understate extent of use
• U.S. has especially high advertising spending.
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 5
Ad Spending vs. Income
Country Spending PC Income Ratio
U.S. $445.00 $35,610 1.25%
Canada $157.00 $21,930 0.72%
Argentina $76.00 $6,940 1.10%
Brazil $32.00 $3,070 1.04%
Chile $43.00 $4,590 0.94%
China $0.30 $890 0.03%
Hong Kong $419.00 $25,330 1.65%
India $1.20 $460 0.26%
Japan $262.00 $35,610 0.74%
Australia $246.00 $19,900 1.24%
France $157.00 $22,730 0.69%
Germany $230.00 $23,560 0.98%
Italy $118.00 $19,390 0.61%
Sweden $211.00 $25,400 0.83%
UK $252.00 $25,120 1.00%
Russia $0.02 $1,750 0.00%
Ad Spending vs. PC Income
-0.50%
0.00%
0.50%
1.00%
1.50%
2.00%
$0 $10,000 $20,000 $30,000 $40,000
Per Capita Income
Pctg
. Ad S
pendin
g
Average=0.82%
Note questionable reliability of data and possible accounting issues.
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 6
Country Economic Growth vs. Ad Spending: No Clear Pattern
Economic Growth To PC Ad Spending Ratios
-10.00% -5.00% 0.00% 5.00% 10.00% 15.00%
Economic Growth
% In
com
e S
pent on
Advert
isin
g
2.0%
0.0%
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 7
Regional Media Tendencies
• India: Outdoor
• Europe: Print media; radio advertising avoided
• Television: U.S., China, Japan, Latin America (e.g., novelas)
• Movie going countries: Cinema advertising
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 8
Global Advertising
• International TV channels: CNN, SkyTel
• Magazines with regional editions: Time, Newsweek, Playboy, Cosmopolitan
• International newspapers: Financial Times, Wall Street Journal
• Internet
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 9
Advertising Budgeting Approaches• Percentage of sales
• Competitive parity
• Affordability
• Objective and taskCOUNTRYPRIORITY
COUNTRYPRESTIGE
GATEWAYPOTENTIAL
COMPETITIVEINTENSITY
GROWTHPOTENTIAL
CURRENTMARKET
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 10
Advertising (Agency) Processes
AGENCY ORIN-HOUSE
SELECTIONBUDGETING
OBJECTIVEDETERMINATION
CAMPAIGNEVALUATION
MEDIASELECTION
MESSAGECREATION
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 11
Promotional Tools
• In-store promotions
• Customers
• Cross-marketing
• Publicity and public relations
• Cause marketing
• Product placement
• Trade fairs
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 12
Constraints on Global Communications Strategies
• Language barriers• Cultural barriers• Local attitudes
toward advertising• Production/cost• Media availability• Advertising
regulations
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 13
Flops in the Transplantation of Advertising• Man and his dog• “A can a week is all
we ask”• “Follow the leader--
he’s on a Honda!”• Detergent ad• “Get your teeth their
whitest!”• Marlboro man in
Hong Kong
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 14
Symbolism
• Green: Health in U.S.; in Latin America, jungle (associated with danger)
• Marlboro man: freedom in U.S.; dusty, unappealing life in Hong Kong
• Perfume against raindrop: Cool, refreshing feeling to Europeans; symbol of fertility to some Asians
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 15
Cultural Dimensions in Advertising• Directness vs.
indirectness
• Comparative advertising
• Humor appeal
• Gender roles
• Explicitness
• Sophistication
• Popular vs. traditional culture
• Information content vs. fluff
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 16
Promotion as a Means of Positioning• How do people see advertising
and promotion efforts?• Promotion as a means to
communicate– benefits of product– use of product– product image
• Differences in desires by culture
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 17
Advertising Standardization: Advantages
• Economies of scale• Consistent image• Appeal to global consumer
segments• Conservation/maximum utilization
of creative talent• Cross-fertilization--moving
knowledge across marketsEssentiallyparallel to product/
positioning standardization
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 18
Disadvantages
• Cultural differences• Advertising and
promotional regulations• Market lifecycle stage
(maturity)• Local commitment to
campaign (“Not-invented-here)
Again, parallel to product/positioning standardization
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 19
Humor
• Humor appears to be a universal phenomenon
• However, there are great differences in form across the World
• “A can a week is all we ask” worked in U.S. but was seen as silly in Canada
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 20
Values
• Americans tend to emphasize individuals; in other cultures, standing out from the group may not be desirable
• Popular vs. traditional culture
• Perception of comparative advertising
• Eastern Europeans want more facts in advertising
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 21
Contrasting Advertising Perspectives (Aithison 2002)
• Western– “Atomistic”—broken
down to smallest component parts
– “Unique selling propositions”
– “How to”– Positioning– May be “dull and boring”– “Copy focused”
• Asian– Holistic– “Everything relates
to everything else”– How things “fit
together” and “relate”
– Visual and oral
Jim Aitchison, How Asia Advertises, New York: Wiley, 2002.
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 22
Advertising Content Comparisons
• American:– Individual benefit and pleasure (e.g.,
“Make your way through the crowd)
• Korean– Collective values (e.g., “We have a way of
bringing people together)
MKT 376 PROMOTION AND E-COMMERCE Lars Perner, Instructor 23
Legal Issues in Promotion
• Media allowed for advertising
• Comparative advertising
• Price promotions– coupons– premiums