Lecture Principles of Marketing - Chapter 12: Communicating customer value

Chapter Twelve
Communicating Customer Value:
Advertising, Sales Promotion, and
Public Relations


Roadmap: Previewing the Concepts
1. Discuss the process and advantages of
integrated marketing communications.
2. Define the five promotion tools and discuss
the factors that must be considered in
shaping the overall promotion mix.
3. Describe and discuss the major decisions
involved in developing an advertising
program.
4. Explain how sales promotion campaigns are
developed and implemented.
5. Explain how companies use public relations
to communicate with their publics.
Copyright 2007, Prentice Hall, Inc.

12-2


Case Study
CP + B:  An Unusual Success Story
The Agency

The Tactics

 Has recently won both

multiple creative awards
and several major
advertising accounts.
 Located in South Beach,
FL, far removed from
mainstay agencies on
Madison Avenue in NY.
 Agency philosophy:
“Anything and everything
is an ad.”

 Heavy focus on guerilla
tactics, unconventional
uses of media, and holistic
marketing strategies while
TV is used only sparingly.
 Street level research helps
develop creative appeals.
 Tries to start a consumer
movement behind the
brand, and campaigns go
well beyond advertising.


The Marketing Communications
(Promotion) Mix







Advertising
Sales Promotion
Public Relations
Personal Selling
Direct Marketing


New Communications Realities
 Mass markets have fragmented,
leading to a shift away from mass
marketing.
 Improvements in information
technology are speeding movement
toward segmented marketing.
 These factors have shifted the
marketing communications model.
– Less broadcasting
– More narrow casting


Integrated Marketing
Communications
 Using IMC, the company carefully
integrates and coordinates its many
communication channels to deliver a
clear, consistent, and compelling
message about the organization and its
brands.

– Several factors influence the choice of
promotional tools.


Advertising
 Can reach masses of geographically
dispersed buyers.
 Can repeat a message many times.
 Is impersonal, one-way
communication.
 Can be very costly for some media
types.


Personal Selling
 Involves personal interaction between
two or more people.
 Most effective tool at building
preferences, convictions and actions.
 Allows relationship building.
 Most expensive promotion tool;
requires long-term commitment.


Sales Promotion
Wide assortment of tools.
Attracts consumer attention.
Offers strong incentives to buy.
Invites and rewards quick consumer
response.

 Effects are short-lived.






Public Relations
 Very believable.
 Reaches people who avoid salespeople
and ads.
 Can dramatize a company or product.
 Tends to be used as an afterthought.
 Planned use can be effective and
economical.


Direct Marketing
 Many forms that share four primary
characteristics:
– Nonpublic
– Immediate
– Customized
– Interactive

 Well suited to highly targeted
marketing.


Promotion Mix Strategies

 Push Strategy
– Producer directs its marketing activities
toward channel members to induce them
to carry the product and promote it to the
final consumers.

 Pull Strategy
– Producer directs its marketing activities
toward final consumers to induce them to
buy the product.


Advertising
 Advertising has been used for centuries.
 U.S. advertisers spend more than $264 billion
each year; worldwide spending approaches
$550 billion.
 Advertising is used by:
–
–
–
–
–

Business firms
Nonprofit organizations
Professionals
Social agencies
Government

Major Advertising Decisions





Setting advertising objectives
Setting the advertising budget
Developing advertising strategy
Evaluating advertising campaigns


Setting Advertising Objectives
 Advertising Objective:
– specific communication task to be
accomplished with a specific target
audience during a specific period of time.

 Classified by Purpose:
– Inform
– Persuade
– Compare
– Remind


Setting the Advertising Budget






Affordable method
Percentage-of-sales method
Competitive-parity method
Objective-and-task method


Developing Advertising Strategy
 Consists of two major elements:
– Creating advertising messages
• Message strategy and message execution must
break through the clutter.
– Selecting advertising media
• Set reach, frequency, and impact goals.
• Choose among major media types.
• Select specific media vehicles.
• Decide on media timing.


The Message Strategy
 Identify customer benefits
 Develop compelling creative concept—
the “Big Idea”
 Advertising appeals should be:
meaningful, believable, and distinctive


Message Execution








Slice of Life
Lifestyle
Fantasy
Mood or Image
Musical
Personality
Symbol

 Technical
Expertise
 Scientific
Evidence
 Testimonial or
Endorsement


Message Execution
 Choose a tone
 Use memorable, attention-getting
words
 Choose correct format elements
– Illustration
– Headline
– Copy

Setting Media Objectives
 Reach
– Percentage of people exposed to ad.

 Frequency
– Number of times a person is exposed to
advertisement.

 Media Impact
– The qualitative value of a message
exposure through a given medium.


Choosing Media Type
 Factors to consider when selecting
media type:
– Medium’s impact
– Message effectiveness
– Cost


Choosing Media Vehicles
 Media vehicles:
– Specific media within each general media
type

 Factors to consider:
– Cost

– Audience quality
– Audience attention
– Editorial quality


Deciding on Media Timing
 Must decide how to schedule the
advertising over the course of a year.
– Follow seasonal pattern
– Oppose seasonal pattern
– Same coverage all year

 Choose the pattern of the ads
– Continuity
– Pulsing


Evaluating Advertising
 Measure the communication effects of
an ad—“Copy Testing”
 Measure the sales effects of an ad
– Is the ad increasing sales?