Chapter 16
Advertising and Public Relations
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Objectives
1. Identify the three major advertising objectives and the
two basic categories of advertising.
2. List the major advertising strategies.
3. Describe the process of creating an advertisement.
4. List and compare the major advertising media.
5. Outline the organization of the advertising function
and the role of an advertising agency.
6. Identify the principal methods of sales promotion.
7. Explain the roles of cross promotions, public relations,
publicity, and ethics in an organization’s promotional
strategy.
8. Explain how marketers assess promotional
effectiveness.
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Advertising
• Involves paid nonpersonal communication
through various media with the purpose of
informing or persuading members of a
particular audience.
• Used by marketers to reach target markets.
• A typical consumer is exposed to hundreds of
advertising messages each day.
• Provides an efficient, inexpensive, and fast
method of reaching the ever-elusive,
increasingly segmented consumer market.
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Two Broad Categories of
Advertisements
1. Product advertising is nonpersonal selling of a
particular good or service.
• This is the type of advertising the average person
usually thinks of.
2. Institutional advertising, in contrast, promotes a
concept, an idea, a philosophy, or the goodwill of an
industry, company, organization, person, geographical
location, or government agency.
• Often closely related to the public-relations function
of the enterprise.
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Advertising Objectives in Relation to
Stage in the Product Life Cycle
1. Informative advertising 2. Persuasive advertising
seeks to develop initial
demand for a good,
service, organization,
person, place, idea, or
cause.
attempts to increase
demand for an existing
good, service, organization,
person, place,
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3. Reminder advertising
strives to reinforce
previous promotional
activity.
Where do you think Quiznos is on the
Product Life Cycle? As the Advertising
Manager what form of advertising
would you recommend?
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Comparative Advertising
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Creating Ads
“What does J. Walter Thompson stand for?
We are for Brands.
We are for bringing Brands to life.
We are for bringing Brands back to life, where
necessary.
We are for nurturing, building and sustaining Brands
so that this should not become necessary.
We are for Brands you can eat, or drink, or drive, or
read, or wear, or give, or receive, or join;
technological Brands, trendy Brands, traditional
Brands.
We are for Brands which cross borders and Brands
from across the street.
More than anything, we are for Branding Ideas
vivid enough to make all of these things possible, in
every communications channel conceivable.
After all, we have our own Branding to think about...”
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Advertising
1.Retail Advertising, which includes all advertising by
retail stores that sell goods or services directly to the
consuming public.
– Varies widely in its effectiveness.
– Source, message, and shopping experience seem to
affect consumer attitudes toward these
advertisements.
2.Cooperative advertising - A retailer often shares
advertising costs with a manufacturer or wholesaler.
– Originated to take advantage of the media’s practice
of offering lower rates to local advertisers than to
national ones.
– Can create vertical links.
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Creating an Advertisement
1.
2.
3.
4.
Develop Goals
Create Plan
Develop and create ad
Select media
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Elements of the Advertising Planning
Process
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Advertising Messages
1. Starts with the customer benefits and moves
to the creative concept phase.
2. Marketers work to create an ad with
meaningful, believable, and distinctive
appeals.
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Anatomy of an Ad
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An Advertisement Should…
1. Gain attention and
interest
2. Inform and/or
persuade
3. Eventually lead to
a purchase or
other desired
action.
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Ad Text
• Serif font
– Easy to read
– Tiny horizontal strokes help reader’s eye flow from
letter to letter
– Times, Garamound, Goudy, New Century
Schoolbook
• Bold sans serif (without serifs)
– Good for headlines & subheads
– Bring more attention since slow reader down
– Arial bold, helvetica black, univers bold, trade gothic
• Turn Eye Appeal into Buy Appeal
– www.MacGraphics.net, Karen Saunders, 888-7967300
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Comparison of Advertising Media
Alternatives
MEDIA
OUTLET
PERCENTAGE OF
TOTAL*
ADVANTAGES
DISADVANTAGES
Broadcast
Network
television
17
Mass coverage; repetition; flexibility; prestige
High cost; temporary
message; public distrust; lack
of selectivity
Cable television
8
Mass coverage; repetition; flexibility; prestige
Temporary message
Radio
8
Immediacy; low cost; flexibility; targeted audience;
mobility
Short life span; highly
fragmented audience
Newspapers
19
Tailored to individual communities; ability to refer back
to ads
Short life span
Direct mail
19
Selectivity; intense coverage; speed; flexibility;
opportunity to convey complete information;
personalization
High cost; consumer
resistance; dependence on
effective mailing list
Magazines
5
Selectivity; quality image reproduction; long life;
prestige
Lack of flexibility
Outdoor
2
Quick, visual communication of simple ideas; link to
local goods and services; repetition
Brief exposure; environmental
concerns
3
Two-way communications; flexibility; link to selfdirected entertainment
Poor image reproduction;
limited scheduling options;
difficult to measure
effectiveness
Print
Electronic
Internet
*An estimated 20 percent is spent on a variety of miscellaneous media, including Yellow Pages listings, business papers, transit displays, point-of-purchase displays, cinema advertising, and regional farm
papers.
SOURCE: Data from “Advertising Boom in U.S. Ended in ’01,” Advertising Age, May 13, 2002, p. 24.
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Interactive Ads WSJ 5/05
• By 2010, 80% of viewers will watch TV on
demand and skip through traditional
commercials
• Interactive ads allowing viewers to opt to get
more info about products
– Chrysler- 15,000 click-throughs for more info in 3
weeks
– Old Spice Red Zone Body Wash, Reebok, Cadillac
• Sony’s “XXX:State of the Union” ad on
satellite-tv
– On-screen icon linked to 30-min. program about the
movie
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Outdoor Ads – $23B Industry in Growth
2006
• CBS won bid for London subway adv. (Tube)
– Development team of 18 in London for 2 yrs.
– TV screens & projectors beaming ads on
walls
– Will stick up glueless posters by 3M
• #2 growing adv. segment after Internet
• Clear Channel billboards in London with
reflective cells that change color
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Interactive Ads
• Sharp’s Aquos LCD, 9-04
– Tell mysterious story -www.moretosee.com
– Consumers must go to the Web for the
conclusion
– Live performances of story in NY storefront
• Man in pool, women watches from afar, car
comes flying through air and crashes into
pool.
• www.subservientchicken.com – 328M hits for BK
in 1st 4 months (Crispin, Porter, Bogusky)
– Viral or buzz advertising
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Sports Illustrated Magazine
Digital platforms wsj 06
• Magazine model for new millenium
• Verizon V Cast phone broadcasts Rick Reilly’s
weekly video segment, Riffs of Reilly
• I Pod: video from 2006 swimsuit edition sold
as a podcast
– Download of edition, photo shoot outtakes &
other content for $6
• Web: Internet frame-grad from SI.com
• Shock magazine:
– Digital subscriptions by email for $15/yr.
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Digital Formats
• TV Guide: 60 blogs from staffers
• Runner’s World: podcasts
– Adidas sponsored free training podcasts for NY &
Boston Marathon
• Car and Driver: engine sounds as ring tones from cars
such as Ferrari
• Hearst: unit focused on podcasts, video, blogging &
mobile content
• Time’s Office Pirates: web only publication
• Conde Nast: Epi to Go sends food lists to cellphones
from Bon Appetit & Gourmet
• MaximToGo.com: sexy women for cellphones & rude
ring tones (burbs…) for $2 up
• Give print advertisers “added value” promo online
– Vogue puts up ShopVogue.com 3 times/yr.
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Media Scheduling
1.Setting the timing and
sequence for a series of
advertisements.
2.A variety of factors
influence this decision
1.Sales patterns
2.Repurchase cycles
3.Competitors’ activities
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Alloy & Media Scheduling
Alloy is a media, direct marketing and marketing
services company focusing on Generation Y.
Their media scheduling integrates direct mail
catalogs, print media, websites, on-campus
marketing programs, and promotional events.
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Measure the Effectiveness of Media
Schedule Plans
1. Reach refers to the number of different people or
households exposed to an advertisement at least once
during a certain time period.
2. Frequency refers to the number of times an individual
person is exposed to an advertisement during a certain
time period.
• By multiplying reach times frequency, advertisers
quantitatively describe the total weight of a media
effort, which is called the campaign’s gross rating
point.
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HeadOn ‘07
•
•
•
•
Sales up 234%
Spots annoy viewers
www.youtube.com/watch?v=Is3icfcbmbs
Among worst commercials
– Annoying, repetitive, obnoxious -- and
effective.
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Best Ads of ‘06
• Low –key, anti-advertising approach (non-typical Madison
Ave.)
• Merge advertising & entertainment
• Monkey business viral ad, Careerbuilder.com
– Cramer-Krasselt
– Consumers build video email with a chimp & record
custom voice greeting via telephone
– Site traffic up 25%
• Smirnoff’s new malt iced tea by Diageo PLC
– 2-min. video seen by over 2 M people on YouTube
mentioning tea only in passing
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Best Ads of ‘06
• Apple by Omnicom
– Hip (“Accepted” actor) Justin Long debates Apple’s
features with nerd (Daily Show commentator John
Hodgman)
– Competitive ads to a new height
• KFC by Interpublic Group
– Circumvent video recorders
– One frame with secret code “Buffalo” used for
coupon for free “Buffalo Snacker” sandwich
– 100,000 redeemed, 40% traffic increase
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Sales Promotion
 Marketing activities other than personal selling,
advertising, and publicity.
 Accounts for double the promotional dollar outlays of
advertising.
 Originally intended as short-term incentives aimed at
producing immediate consumer buying responses.
 Traditionally, these techniques were viewed as
supplements to other elements of the firm’s
promotional mix.
 Today, however, marketers recognize them as an
integral part of many marketing plans.
 Shifted from short-term to long-term goals.
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Principal Methods of Sales Promotion
Two major categories:
1. Consumer-oriented promotions take the form
of coupons and refunds, samples, contests
and sweepstakes, and specialty advertising.
2. Trade promotions include trade allowances,
point-of-purchase advertising, trade shows,
and dealer incentives, contests, and training
programs.
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Sampling as a Promotional Tool
There are many companies that are taking
advantage of sampling to promote their
products.
– Many of those same companies have found
the internet to be an effective tool to market
their products through sampling.
– The StartSampling Web Site is just one
place marketers can use to provide samples
and gather information on the market.
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Assessing Promotional Effectiveness
1. Pretesting is the assessment of an ad’s effectiveness
before it is actually used.
• Includes conviction tests and blind product tests.
2. Posttesting is the assessment of the ad’s
effectiveness after it has been used.
• Include readership test, unaided recall tests, inquiry
tests, and split runs.
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Advertising Ethics
Puffery and Deception
• Puffery refers to exaggerated claim of a product’s
superiority or the use of subjective or vague
statements that many not be literally true.
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UCC
The Uniform Commercial Code standardizes
sales and business practices throughout the
U.S. It makes a distinction between puffery and
any specific or quantifiable statement about
product quality or performance that constitutes
an “express warranty.”
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Select Top TV Commercials since 1980
http://www.usatoday.com/money/top25-ads.htm
Life Alert: I’ve Fallen, and I Can’t Get Up!
Energizer Bunny
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Wendy’s: Where’s the Beef?
Got Milk?
California Raisin Advisory Board:
Heard it Through the Grapevine
Playtex Model
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Chevy trucks: Like a Rock
Taster’s Choice Soap Opera
Pepsi: Michael Jackson on Fire
This is Your Brain on Drugs
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Budweiser: Croaking Frogs
Federal government: Crash Test Dummies
New Coke: Max Headroom
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Pets.com: Because Pets Can’t
Drive