Marketing II The Chang School-Ryerson University Continuing Education Instructor: Armand Gervais Email: agervais@ryerson.ca preferred Web: www.ryerson.ca/~agervais Office: Bus 308 Phone: 416-979-5000 Ext 4215 © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Lecture 6 Agenda Don’t Forget Name Tags Chapter 19 Break Time to work in Groups © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin CHAPTER ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: Explain the differences between product advertising and institutional advertising and the variations within each type. Understand the steps used to develop, execute, and evaluate an advertising program. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: Explain the advantages and dis-advantages of alternative advertising media. Understand the strengths and weaknesses of consumer-oriented and trade-oriented sales promotions. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO: Recognize public relations as an important form of communications. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Coca-Cola Soccer Photo © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS WHAT’S THE FUTURE OF ADVERTISING? THE ANSWER IS PERSONAL! Contextual marketing?? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin TYPES OF ADVERTISEMENTS Product Advertisements Institutional Advertisements © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Jeep Ad Pioneering, competitive, or reminder? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Xerox Ad Pioneering, competitive, or reminder? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FTD Ad Pioneering, competitive, or reminder? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Got Milk? Ad Competitive institutional advertisement © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Mac-Gray Print Ad Pioneering institutional advertisement © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Tobacco is Whacko Ad Advocacy advertisement © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. What is the difference between pioneering and competitive ads? A: Pioneering ads tell people what a product is, whereas competitive ads promote a specific brand’s features and benefits. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. What is the purpose of an institutional advertisement? A: To build goodwill or an image for an organization. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Identifying the Target Audience Xbox Mature adult Specifying Advertising Objectives Communicate other benefits besides gaming Ease of use Time shifting Setting the Advertising Budget © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-1 Super Bowl, super dollars. Pepsi and Monster.com place ads on the Super Bowl © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Designing the Advertisement Message Content Creating the Actual Message © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Penn Ad: Official Ball of 1988 French Open © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Pepsi TV Ad: “Britney Now & Then” Reinforcement ad with spokesperson © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Pepsi TV Ad: “Testimonial” Spokesperson with humorous appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Pepsi TV Ad: “Jackson Streets” Competitive Ad © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Diet Pepsi TV Ad: “Uh Huh” Reinforcement ad with spokesperson © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Sierra Mist TV Ad: “Pachanga” Pioneering ad with sex appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Mountain Dew TV Ad: “Ram” Reminder ad with humorous appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Xerox Ad Comparative Ad © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin PETA TV Ad: “Singing Cows” Advocacy ad with humorous appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Shell TV Ad: “Deadly Distractions” Advocacy ad with fear appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Golden Plump Chicken TV Ad Competitive ad featuring humorous appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Hush Puppies TV Ad Pioneering ad featuring humorous appeal © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. What are the characteristics of good advertising objectives? A: (1) A well-defined target audience, (2) measurable, and (3) over a specific time period. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. What is a potential shortcoming of using a celebrity spokesperson? A: The spokesperson’s image may change to become inconsistent with the company or brand. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Selecting the Right Media Choosing a Medium and a Vehicle within That Medium © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-2 U.S. advertising expenditures, by category (data in millions of dollars) © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Basic Terms Reach Rating Frequency Gross Rating Points Cost Per Thousand © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-3 The language of the media buyer © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin TNN Ad Print ad for cable station © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives Television Infomercials Radio Magazines Newspapers © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Different Media Alternatives (cont) Internet Outdoor Other Media Selection Criteria Scheduling the Advertising © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-4 Advantages and disadvantages of major advertising media © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin TV storyboards lead to commercials, which communicate with sight, sound, and motion © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Captivate TV Network Elevator Ad © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE ADVERTISING PROGRAM Scheduling the Advertising © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. You see the same ad in Time and Fortune magazines and on billboards and TV. Is this an example of reach or frequency? A: Frequency © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. Why has the Internet become a popular advertising medium? A: Large new audience, offers advantages over other forms primarily through combining their advantages, offers potential for tracking effectiveness. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 3. What factors must be considered when choosing among alternative media? A: Target audience media habits, product attributes, and cost. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin EXECUTING THE ADVERTISING PROGRAM Pretesting the Advertising Portfolio Tests Jury Tests Theater Tests © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-5 Alternative structures of advertising agencies used to carry out the advertising program © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin EXECUTING THE ADVERTISING PROGRAM Carrying Out the Advertising Program Full-service agency Limited-service agencies In-house agencies © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin EVALUATING THE ADVERTISING PROGRAM Posttesting the Advertising Aided Recall (Recognition-Readership) Unaided Recall Attitude Tests Inquiry Tests Sales Tests Making Needed Changes © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Skechers Ad Starch scores © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. Explain the difference between pretesting and posttesting advertising copy. A: Pretesting is done to test alternative copy or to determine whether the ad communicates the intended message. Pretests are done before the ad is placed in the media. Posttesting determines whether the ad accomplished its intended purpose. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. What is the difference between aided and unaided recall posttests? A: With aided recall, respondents see one or more actual ads on which they comment. With unaided recall, respondents are shown no ads and must rely on memory alone. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin SALES PROMOTION The Importance of Sales Promotion Consumer-Oriented Sales Promotion Coupons Deals Premiums Contests Sweepstakes © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin SALES PROMOTION Consumer-Oriented Sales Promotion (cont) Samples Continuity Programs Point-of-Purchase Displays Rebates Product Placement © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin FIGURE 19-6 Sales promotion alternatives © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Tom Cruise Photo Can you identify the product? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin SALES PROMOTION Trade-Oriented Sales Promotions Allowances and Discounts Cooperative Advertising Training of Distributor’s Salesforces © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. Which sales promotional tool is most common for new products? A: Samples © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. What’s the difference between a coupon and a deal? A: A coupon provides a reduced price for an item based on redemption. A deal is a short-term price reduction. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 3. Which trade promotion is used on an ongoing basis? A: Trade allowance © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin PUBLIC RELATIONS Publicity Tools © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin INCREASING THE VALUE OF PROMOTION Building Long-Term Relationships with Promotions Self-Regulation © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 1. What is a news release? A: An announcement regarding changes in a company or its product line. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Concept Check 2. What is the difference between government regulation and self-regulation? A: Government regulation involves laws or other controls set by an agency or local, state, or federal government, whereas self-regulation involves ethical guidelines for business practices set by advertising agencies, trade associations, and marketing organizations. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Internet Exercise 1 Recommend three websites for your college or university to advertise on. You can use www.adhome.com to help. What is the monthly rate for a full banner ad at each of the websites? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Internet Exercise 2 Describe the profile of the audience for each of the websites. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Internet Exercise 3 Calculate the CPM for each website. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Fallon Worldwide: In the Creativity Business Lee Dungarees Ad – Buddy Lee © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin VIDEO CASE 19-1 Fallon Worldwide: In the Creativity Business 1 Fallon Worldwide stresses its creativity, as shown by comments from the Fallon people in the case. (a) In what ways do the Lee Dungarees and BMW campaigns reflect their creativity? (b) Compare the sources of the ideas in the two campaigns. © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin VIDEO CASE 19-1 Fallon Worldwide: In the Creativity Business 2 In the Lee Dungarees and BMW campaigns, how were (a) the target markets and (b) each brand’s positioning changed from the situation prior to the campaign? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin VIDEO CASE 19-1 Fallon Worldwide: In the Creativity Business 3 The case does not discuss the media used in the Buddy Lee campaign. What media and communication vehicles should it use initially (a) to reach the target market of 17- to 22-year-olds? (b) to continue to reach them after the first couple of years of the campaign? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin VIDEO CASE 19-1 Fallon Worldwide: In the Creativity Business 4 The case also does not discuss the development of media in BMW’s “The Hire” campaign. (a) How could BMW and Fallon launch the films most successfully on the Internet? (b) What other media might they use after that launch? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin VIDEO CASE 19-1 Fallon Worldwide: In the Creativity Business 5 How might Fallon and its clients measure the success of (a) the Lee Dungarees and (b) the BMW campaigns? © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Feedback for X-box Overall marks were very good, they ranged from F to A Special care should be taken with grammar, spelling and format Errors in executive summary are unacceptable Do not repeat facts from the case in executive summary or tell me what you did in the report. Tell me what you learned! I should be able to determine the logic for your recommended marketing mix and the details of that mix from the Executive Summary State issues, conclusions and implications after analysis in appendices Bring this insight into the main report and suggest a course of action. Analysis is not just filling in the facts Must make a statement about the implications or identify an issue that relates to the analysis or impacts marketing mix Example: Impact of convergence: One segment that is underserved is older adults 30-50 who may be interested in some of the added features of X360. Since the X360 has a large hard drive it is able to record Television and allow users to watch later. If this was easy to do like TiVo this segment would be interested in purchasing the X360 © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin To Do’s for Next Class Begin to study for Final Exam Work on Final group project © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin