Ch. 17 Advertising, Sales Promotion, Publicity...
Ch. 17 Advertising, Sales Promotion, Publicity... MKTG 3650
Popular in Foundations of Marketing
verified elite notetaker
Popular in Marketing
This 10 page Class Notes was uploaded by Alora Lornklang on Tuesday May 10, 2016. The Class Notes belongs to MKTG 3650 at University of North Texas taught by David Strutton in Spring 2016. Since its upload, it has received 9 views. For similar materials see Foundations of Marketing in Marketing at University of North Texas.
Reviews for Ch. 17 Advertising, Sales Promotion, Publicity...
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 05/10/16
MKTG 3650 Foundations of Marketing Practice Ch. 17 Advertising, Sales Promotion, Publicity, Public Relations, And Personal Selling Elements of the Promotional Mix The four “P’s” of marketing provide a means by which any Firm’s product, price, place and promotional factors can be mixed and managed in ways that deliver differentiating value to targeted B2C or B2C segments. 4 Marketing Truths The price of any product is whatever customers are willing to pay Customers never wake up wanting to pay higher prices, although many are manipulated into willingly paying more as a consequence of their exposure to marketing communications. All customers do wake up seeking more value, especially more value for their money. By voting with their feet, buyers determine and demonstrate the amount hey are willing to pay. Mixing Promotions The elements that collectively comprise the promotional mix each feature comparative communication strengths and weaknesses. Advertising Advertising is any form of oneway, paid, and nonpersonal marketing communication that is aimed at targeted consumers and delivered en masse through electronic, print, or Internetbased media with the purpose of informing, remind, or persuading targeted consumers or Firms about the values or differences that are associated with a product/brand. Strengths: o Effective at reminding and informing recipients o They are good at conveying emotions and stimulating emotional responses from customers exposed to them Weaknesses o Is not as persuasive as some other forms of marketing communication o People are starting not to pay attention to ads Types of Advertising Product advertising o Product advertising focuses on promoting Firms’ branded products and services. o Dominates virtually all media from radio and TV to Internet and Social Media o Several forms of product advertising exist, based largely on the product’s stage in its life cycle. These include pioneering, advertising, selective demand advertising, and reminder advertising. Pioneering Advertising o AKA informative advertising, is purposed toward creating awareness and trial for new products that are in the intro stages of their product life cycles. o This form of advertising is used to develop primary demand for the product category, rather than demand for individual brands Selective Demand or Persuasive Advertising o As products move through their life cycles, the nature and purpose of advertising changes. o The focus becomes one of persuasion; persuading customer to buy or continue to buy the advertiser’s brand. Reminder Advertising o As products move into late maturity and eventually into decline, reminder advertising is employed to keep the brand in consumers’ minds. Institutional Advertising o Promotes organizations rather than products. o Institutional advertising is intended to promote the image of an organization by highlighting specific activities in which the organization is engaged, people who represent the organization and/or ideas and points of view espoused by the organization. Advocacy Advertising o A type of institutional advertising in which Firms attempt to message their positions on some important issue. o The purpose is to sway the opinions of targeted audiences. The Advertising Process: Six Key Advertising Decisions Management in any Firm that advertises must engage six major advertising decisions or actions. Identify the Target Audience o The target audience or audiences toward which advertising is directed will be the target market or markets to which the Firm’s products are targeted. Establishing Objectives o The advertising objectives that marketing managers choose to emphasize should be based on what is happening with respect to: Other elements of the Firm’s marketing mix The Firm’s general positioning strategy The nature of the Firm’s intended targeted audience The life cycle stage of the product featured in the advertisement Setting the Advertising Budget Advertising objectives must already exist before any effort to establish an advertising budget. Allyoucanafford method o Spending all the money on advertising that they can afford Percentageofsales method o Firms set aside a preset percentage of their revenues earned during a particular period and spend that amount on advertising. The competitive parity approach o Entails emulating what competitors are doing In oligopolistic markets, where fewer but generally powerful competitors “bunch up,” actually playing followtheleader games when it comes to pricing Developing an Advertising Strategy Two part process o 1) Entails selecting the proper advertising channel/source/media o 2) Requires the best possible message, the most memorable, believable, distinctive, sticky, and/or contagious message, be developed for and delivered through the ad itself. Select Advertising Media Rising media costs and increasingly fragmented consumer markets make this choice more important today than ever before. Media should be selected such that it matches up appropriately with the particular market segment that the Firm is seeking to reach and inform, remind, or persuade. Creating the Advertising Message During this stage Firms first must decide on the exact nature of the primary message that it eventually will seek to communicate to targeted audiences. Messages should typically emphasize the most important customer benefit or value associated with the brand that is being advertised. Some Key Advertising Appeals Fear Appeals are employed to scare people into buying or not buying and using certain products. Sex Appeals are intended to either make one feel more attractive by using a product, attack sexual imagery to the product, or employ a “sexy” celebrity to endorse the product. Humor Appeals are employed to gain attention and hopefully, create a positive “affective” response to the ad that can rub off on the product. Slice of Life appeals show the product being used by the “typical consumer” in a normal setting. Lifestyle appeals show the product being used within the context of someone enjoying a specific lifestyle orientation to experience. Demonstration ads show the product actually being used. The objective is to specifically highlight key benefits or features. Testimonial ads attempt to use endorsers who appear likable and believable to attest to the product’s utility and value. Personality Symbols are essentially trade characters that have been created to represent the product. Emotional appeals build a mood or image surrounding the product and its use. All that is desired is to create an emotional response to the ad that may “rub off” on the product. Effective Message Appeals Should be… Memorable “Believable” Distinctive Focused on some determinant feature, aspect, benefit, or problemsolving capability that is associated with the brand/product. Measuring Advertising Effectiveness Reach and frequency are two important success metrics for any advertiser. The metric known as reach captures the percentage of consumers within a targeted market who are exposed to a given message during a specified period of time. Reach measures “how many” The metric known as frequency captures the number of times consumers comprising the targeted market are exposed to a given message during the same specified period of time. Frequency measures “how often?” The threehitrule also exists as an informal but seemingly universal principle. The rule suggests that in order for a “messaging” Firm or individual to influence a recipient’s behavior or teach the recipient something important the recipient must be exposed to the message at least three times. Advertising’s Greatest Hits—Oldies but Goodies “A Diamond is Forever” “They’re Grreat!” “Nothing Sucks like an Electrolux” “Nothing Outlasts the Energizer” “The Best Part of Waking Up is Folger’s in Your Cup” Sales Promotions Sales promotions include a variety of shortterm incentives that offer value to B2C or B2B targets. Sales promotion incentives also might be used to improve and otherwise motivate the sales efforts of a partnering intermediary, or to secure preferred product placement or treatment from partnering intermediaries inside existing or potential supply chains. Retailerrelated communication objectives Sales Promotions Tools The most commonly used sales promotion tools are coupons, samples, refunds, or rebates; the use of contests, sweepstakes and games; patronage or loyalty related rewards; and those supply chain incentives that we called spiffs. Coupons are tickets or documents that can be exchanged for price discounts, usually in retail settings. Samples might include a “freebie” portion of food or other products in malls, grocery stores, or your own mailbox. A rebate is a giveback to customers by way of a refund, price reduction, or a return on what has already been paid to purchase a product. Sweepstakes, contests, and games are forms of sale promotion where one or more prizes are granted to the winner or winners. Pointofpurchase (POP) materials are specialized types of sales promotions that include endofaisle displays, window signs, special display racks, shelf coupon dispensers, and displays near, on, or next to checkout counters. o Their purpose is to draw consumers’ attention to new products and products that are on a special offer. Loyalty or patronage sales promotions are used to encourage and incentivize, repeat, or loyal, purchasing behavior amongst key customers, and to offer premiums, special deals or price discounts as purchase grow. The word “spiff” traditionally has been defined as an immediate bonus that is offered in exchange for a sale. Sales Promotions: Advantages and Disadvantages Advantage: The primary strength of sales promotions is because they work. Advantage: The use of sales promos is extremely effective at changing recipient behavior, especially in the shortrun. Advantage: Sales promotions can be used in several flexible ways. Disadvantage: The primary weakness of sales promotions is that their use builds customer loyalty to the deal. Disadvantage: History and experience have shown that the sort of customer who is incentivized by sales promotions is more likely to be loyal to the deal rather than the branded product or store. Disadvantage: Secondary weakness: incentives are easily duplicated by competitors or abused by customers, or may lead to sales promotion wars. Disadvantage: Sales promotions alone would rarely provide the basis for successful promotional campaigns. Public Relations and Publicity Public relation (PR) efforts intended to build or sustain “good relations” or relationships with various publics, or groups, that people, organizations, or nations believe are important. Public relations entails Firminitiated communications efforts that seek to manage the collective emotions, opinions and beliefs held about the Firm or its brand by various publics who are important to the Firm’s future success prospects. Publicity management, as a subset of PR, entails nonpersonal, indirectly paid or unpaid communiqués that relate and contribute to the narrative that a Firm would prefer to have written, pronounced, or discussed about its brand, products, people, activities or strategies, etc. PR can and should be used to: o Build or promote existing brand equity. o Announce great new breakthroughs or products. o Clean up the mess after screwups arise Public Relations and Publicity: Strengths and Weaknesses The underlying strength of any positive messages delivered through either public relations—related sources is that such information is purportedly more credible Firms generally do not pay for PR press releases or new stories but instead develop and circulate info and attempt to manage perceptions of events as well as news cycles. Perpetual Needs The world of business of business and marketing and indeed the world itself unfolds and intertwines in ways that perpetually create both the opportunity and need for public relations to step up and in, for purposes of cleaning up the mess. Public Relations’ Functions and Tools The functions routinely performed by public relations professionals include management of media relations, publicity, and lobbying and investor relations. Public relations experts generally handle and manage the public relations promotional function through the use of: o News releases, generally initiated to counter the negative or accentuate the positive o Speeches, in terms of either writing or delivering them. o News conference and grand openings, including fun events, such as General Motors displaying its new, youthtargeted vehicles on campus. o Website management, blogs, and tweets Personal Selling Personal selling o Like other promotional mix elements, exists fundamentally to inform, remind, and persuade prospects or customers. o Is also routinely used to establish or strengthen relationships with prospects or customers. o Entails twoway persontoperson interactions in which message receivers provide instantaneous feedback to senders’ hopefully influential messages. The primary purpose of personal selling is to shape the purchasing decisions made by carefully targeted individuals or groups. The primary objective is persuasion. At least 4 exchange conditions exist in which the use of personal selling is usually appropriate o When the unit sales volume involved is sufficiently high o When the prices of individual or bundled products being sold are sufficiently high to justify the higher costs associated with personal selling efforts o When products being marketed are so complex that their precise use or benefits must be explained or demonstrated to customers o When the problemsolving capabilities of products must be customized in order to successfully match and resolve customers’ special problems or needs Types of Personal Selling Order getters are salespeople tasked with generating new business Delivery salespeople are responsible for delivering and stocking products for which an order has already been placed Outside order takers are traveling salespersons who visit customers in the field and generate orders in the process. Missionary salespeople don’t actually get involved in making sales. Their job is to provide B2B customers and prospective customers with information, assist in promotion activities with the Firm’s supply chain partners, and generally work to build goodwill. Sales engineers are technical experts in industries where products must be tailored to the needs of specific customers. Team selling is employed by Firms in industries selling complex products and solutions to B2B customers. The Personal Selling Process Prospecting and Qualifying o Prospecting is the process of identifying prospective customers o The key questions to qualify: Does the prospect need and want the product? Does the prospect have the resources to buy the product? Can the prospective buyer obtain the required financing? o In the case of B2B sales an additional qualifying dimension is the likelihood that the prospect will buy enough to justify investing in a long term relationship PreApproach o The preapproach is primarily a consideration with B2B selling. This is a homework step in which as much is learned about the prospect as possible. Approach o The initial contact with a qualified prospect. Armed with knowledge generated via the last two steps, the seller is prepared to contact the prospect and make an initial presentation Presentation o A formal presentation may not occur on the first visit however, at some point a formal presentation will be made in which a case must be made for why the seller’s product provides differentiation value beyond those values offered by competitors Handling Objections o Objections are offered as reasons why the prospect may be hesitant to commit. Astute sellers will view these objections as opportunities for providing additional info, further confirming the values provided by their products. Close o Asking for the sale o Alternative formats for closing sales The assumptive close assumes the buyer has made a positive decision and only minor points need to be clarified to “finalize the details of the sale” With the standingroomonly close, the seller frames the sale as urgent to receive, for example, a special price or free gift before some deadline passes Using the sharp angle close, the buyer asks for a concession, such as free delivery or additional features. The final objection close is used if the seller is confident that the customer understands and agrees with the differentiating values of the salesperson’s product. The close is initiated by asking the buyer for an objection, one which should not occur if all has gone well to this point. Followup o Includes postsale activities that provide added value to buyers and provide feedback to sellers. Advantages and Disadvantages of Personal Selling Advantage: the initial sales messages can be priori tailored to precisely address the needs of the audience Advantage: reduces the amount of wasted effort Advantage: it offers marketing Firms their best opportunity to close sales Advantage/Disadvantage: Its flexibility Disadvantage: far more expensive to execute on a percustomerreached basis Direct Marketing Direct marketing includes various types of direct communications initiated with and targeted toward B2C or B2B customers. Direct contacts are initiated to produce requests for additional info, visits to the soliciting retailer, or actual order to purchase brands being promoted through direct marketing efforts. Advantages o Can be interactive o Messages can be prepared quickly, specifically tailored and adjusted to address the needs of the target audience o Opens up the possibility of establishing closer relationships with customers o One of the fastest growing promotional mix elmeents Disadvantages o Expensive in time and money o Preparation and delivery requires extensive use of a widereaching, perpetuallyupdated marketing research databases o Growing consumer concerns about invasions of privacy Other Communication Elements Great product designs generally feature an intriguing blend of form and functionality. The prices of product/brands also communicate volumes about the brand The distinctive shapes or styles of products similarly send messages about the quality, panache, and spirit of respective brands The retailers, or supply chain partners, through which manufacturers/marketers choose to distribute their brands, speak directly about those brands Pull Promotions Describes informative, reminder or persuasive supply chain communications that are targeted directly at enduse consumers. Goal: to stimulate the desire for a specific product/brand among final users or ultimate consumers. Pull promotional strategies presume that, when they are properly motivated or incentivized, ultimate consumers can dramatically influence and stimulate the flow of products throughout entire supply chains Pull strategies are often used during new product launches Pull strategies occasionally prove so effective that their use resurrects marketing dinosaurs, which are products or brands from another era that have long since lost their buzz. Push Promotions Target promotional mix efforts directly at the next downstream intermediary, as opposed to enduse consumers themselves. Supply chins exist as actual linkedtogether networks of buyerseller relationships Push sales promotions are typically launched by manufacturers and aimed at intermediaries, or resellers. The success of push promotions depends on how receptive intermediaries are to the promotional message and/or incentives. The use of push promos allow supply chain members to exercise great control over what is said and how things are said about their products.
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'