Chapter Seven
Marketing Services
Making
Your Mark
in MarCom.
Marketing Services
 Most Marketing Services relate to
Marketing Communications
 “MarCom” for short
 Umbrella term for all promotional
activities other than advertising.
 MarCom services are growing
 New ways to market brands, and…
 New sources of career opportunities
Marketing Services
 Sales Promotion
 Direct Marketing
 Public Relations
 Marketing Research
 Event Marketing & Sponsorship
 Promotional Products
Who Performs
Marketing Services?
 Client Marketing Department
 Divisions of mega-agencies
 Specialized Agencies
 Division within “IMC” agency
 Specialized Agencies or suppliers
Who Supervises
Marketing Services?
 At the Marketer, many options
 Director of Marketing
 Brand Management
 Specialized Manager (Promotion, etc.)
 MarCom Manager
 At Specialized Agencies…
 Account Managers, Account Executives
 Project Managers
The World of
Sales Promotion
 How Big is the World of Sales Promotion?
 Measured Volume (Fees, etc.) over $100 Billion!
 It breaks out this way…
Other
Trade
5.5%
Promotion
18.4%
Advertising
52.7%
Consumer
Promotion
23.4%
The World of
Sales Promotion
 How Big is the World of Sales Promotion?

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Measured Volume (Fees, etc.) over $100 Billion!
It breaks out this way…
Other
It’s actually larger…
Trade
The biggest categories Promotion 5.5%
 Trade discounts
18.4%
Advertising
 Consumer Savings
52.7%
Consumer
 …are not included!
Promotion
23.4%
 Overall, the Volume
The World of
Sales Promotion
 Some Top Sales Promotion Agencies
 DraftFCB (Interpublic)
 EA, Taco Bell, Dow
 Epsilon (Alliance Data Systems)
 P&G, Ford, Pepsico
 Leo Burnett/Arc Worldwide (Publicis)
 McDonald’s, Comcast, CocaCola
 Wunderman (WPP)
 Johnson&Johsnon, Unilever, Ford
 Digitas (Publicis)
 American Express, Kraft, eBay
The World of
Sales Promotion
 Two Types of Sales Promotion
 Trade Promotion (“Push” )
 Consumer Promotion (“Pull” )
 Both emphasize Short-Term Sales
 Two Types of Incentives
 Less = Savings
 More = “Added Value”
 More Product (Bonus Pack, BOGO*, etc.)
 A Prize (Sweepstakes)
 Something else (A Premium, or…)
Trade Promotions
 Point-of-sale
Trade Promotions
 Point-of-sale
 Dealer contests
 Merchandising the
advertising
 Deals and allowances
 Co-op advertising
 and then there’s…
Consumer Promotions
 Coupons/ FSIs (Free Standing Inserts)
 Contests, sweepstakes
& games
 Gift with Purchase
 Premiums
 Sampling/ Tastings
 Rebates
 Cents-off promotions
Consumer Promotions/
Entertainment Brands
 7-Eleven becomes a Kwik-E-Mart
 Promoting “The Simpsons Movie”
 3 weeks prior to release date 7-11
transformed 12 of its convenience stores
into Kwik-E-Mart’s, featured in the
Simpson’s fictious town.
 Sales doubled in the 12
Kwick-E-Mart stores.
The World of
Direct Marketing
 Simply put, direct marketing occurs
when you buy direct from a marketer
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


By returning a coupon
By calling an 800#
By responding to a mail solicitation
By shopping on the Internet
By responding to a telemarketer
who called you during dinner
The World of
Direct Marketing
 Sales from Direct Marketing Efforts
 add up to… $1.96 trillion!
 8.7% of total US GDP
 1.3 million direct marketing
employees
Source: DMA Economic Impact Statement 2003
The World of
Direct Marketing
 Sales from Direct Marketing Efforts
 163 billion in expenditures.
Estimated (by the DMA) to be
52.1% of all advertising
expenditures.
 Whatever the exact amount…
It’s BIG!
Source: DMA Economic Impact Statement 2008
The World of
Direct Marketing
 Types of Direct Marketing Companies
 Direct Marketers
 Examples: American Express, Land’s End
 Direct Marketing Agencies
 Example: DraftFCB (Interpublic)
 Support Services
 Examples: Call Centers, Catalog Printers,
List Management Services, the Post Office
The World of
Direct Marketing
 CRM = Customer Relationship Marketing
 LTV = Lifetime Value
 Direct Marketers work to maximize the value of
the relationship with their customers, to get the
most LTV (Lifetime Value)
 Doing all those things is “CRM”
 Increased valuation of current customers
is a driving force in marketing today
Some Key Reasons for
Direct Marketing’s Growth
 Changing consumer lifestyles
 Shopping opportunity for “time-poor” consumers
 More consumer credit
 Now it’s easy to buy from a direct marketer
 Better “Direct Marketing technology”
 More and better lists of potential customers
 Better technology for “massaging the database”
 Big Changes in Media
 More cost-efficient media opportunities
 The Internet makes direct response easy
Consumer Complaints About
Direct Marketing
Some Current Issues:
 Annoyance
 List removal option of DMA
 Privacy issues
 Who owns your information?
 Data technology raises new concerns
 Unscrupulous practices
 Example: Negative option
 Major Result – The “Do Not Call” List.
The Key to Success in
Direct Marketing
 List Quality
 Internal lists
is Key
 Compiled by
organization itself
 External lists
 Purchased from
 List brokers
 List compilers
Improving Performance
 Improve the List
 Improve the Offer/Incentive
 Improve the Messaging
 “List Enhancement”
 Add more information about households on current list
 Cleaning the list: the “merge-purge” function when
combining different lists
 Continual testing against previous success
 Improve results and knowledge
The World of
Public Relations
 Marketing PR (MPR)
 Supports marketing efforts
 Corporate PR (CPR)
 Deals with broader range
issues, from investor
relations to employee
communications
of
Marketing PR:
Product Publicity
 The Basics:
 The Objective - obtaining free
time or space in the media that
represents favorable mention
Marketing PR:
Product Publicity
 The Basics:
 The Objective - obtaining free time
or space in the media that represents
favorable mention
 The Strategy - product publicity,
like all PR, must be newsworthy
 The Benefit - the value of
“implied” or “third-party”
endorsement by the media
Product Publicity
Activities
 Press Releases (immediate news)
 Technical and Case History stories
 Feature stories
 Press Tours
 Press to Company
 Company to Press
Corporate PR Activities
(Non-Marketing Related PR)
 Investor Relations
 Employee Communications
 Government Relations (lobbying)
 Crisis Management (oil spills, etc.)
 Community Relations
 Advocacy Advertising (corporate
point of view on public issues)
PR Agency
Ownership
 PR Agencies now part of mega-agency groups
 Ad Organizations by PR Revenue (2012)
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WPP
Omnicom
Interpublic
Publicis
Havas
$1.49 billion
$1.29 billion
$1.21 billion
$0.53 billion
$0.22 billion
 Mergers Continue
 Y&R now included in WPP totals
 Omnicom and Publicis combine for top spot at $1.82 billion.
PR Agency
Ownership
 PR Agencies now part of mega-agency groups
 Top Ten PR Agencies in 2012
2012 Net Fees
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Edelman
APCO Worldwide
Waggener Edstrom Worldwide
W2O Group
Ruder Finn
Text 100 Global PR
MWW Group
ICR
DKC
Finn Partners
$655,900,289
$121,800,000
$118,426,000
$62,005,000
$56,148,000
$50,930,028
$42,875,000
$36,554,283
$32,896,560
$32,293,000
O’Dwyer’s Magazine, May 2013
Integration &
Amplification!
Look What Happens
When It All Works
Together!
Integration &
Amplification!
The World of
Marketing Research
 The Business of Evaluation
 FEEDBACK is critical nourishment for
marketers
 The Product is FACT, not opinion
 Accurate information gathering is also critical.
 Research reputations depend on the dependability
of their data
The World of
Marketing Research
 Two types of entities provide this critical
marketing information:
 Internal Marketing Research Departments
 At the marketer
 At a full-service agency
 Outside Marketing Research Firms
 Ongoing services (Nielsen)
 Projects (Surveys, focus groups, etc.)
Role of Internal Marketing
Research Department
 Analyze company sales data
 Provide short-term and long-term sales and
industry projections
 Determine what primary research studies
need to be carried out
 Select and hire outside research firms
to conduct surveys and provide other
information
Types of Outside
Marketing Research Firms
 Limited-service Research Suppliers
 These supply a specific type of data, often to
all major marketers.
 Syndicated Research (Nielsen TV ratings)
 Standardized Research (Gallup & Robinson
ad recall pre-testing studies)
 Full-service Research Suppliers
 Focus Groups and Surveys
 “Starting from scratch” research projects
The World of
Event Marketing
 How big is the World of Event Marketing?
 Sports sponsorship
$13.01 billion
The World of
Event Marketing
 How big is the World of Event Marketing?
 Sports sponsorship
$13.01 billion
 Entertainment, tours, attractions $1.93 billion
The World of
Event Marketing
 How big is the World of Event Marketing?
 Sports sponsorship
$13.01 billion
 Entertainment, tours, attractions $1.93 billion
 Causes
$1.70 billion
 Festivals, fairs and annual events $825 million
The World of
Event Marketing
 How big is the World of Event Marketing?
 Sports sponsorship
$13.01 billion
 Entertainment, tours, attractions $1.93 billion
 Causes
$1.70 billion
 The Arts
$891 million
 Festivals, fairs and annual events
$825 million
 Associations and Memberships
$550 million
 That all adds up to...
$18.9 billion!
2012 Sponsorship Spending, Sponsorship.com
The World of
Event Marketing
The World of
Event Marketing
 Provides opportunities for:
 Sampling of product
 Widespread publicity in media
 Unique connection w. target market
 Cause marketing:
 A special type of event marketing
 Example: Children’s Miracle Network
The World of
Promotional Products
 A $16 billion business
 Company Brand or Logo
 Pens, hats, key rings, etc
 “Business Gifts”
 Higher priced items
 Many uses:
 Sales lead generation, trade
shows, awareness building,
employee morale, etc.
Who is
The Person
Who Helps Pull
All of This
Together?
The MarCom
Manager
 Relatively new position - result of “IMC.”
 Title/function more common on West Coast
 Evolving as marketers’ needs evolve
 Need to understand all forms of “IMC”
 “Jack-of-all-trades” promotional skills
 Emphasis will vary by industry
 High-tech = PR emphasis
 Packaged goods = Sales promotion emphasis
 Beverages = event and sports marketing emphasis
The Future of
Marketing Services
 Increased pressure for short-term revenue
 Dynamic growth in most areas
 Sales Promotion - up 20%
 Direct Marketing - up 15%
 Increased focus on existing customer “LTV”
 More loyalty programs
 More targeted programs
 More Customer Relationship Management
The Future of
Marketing Services
 New Technologies
 Interactive and Information Technology
 The Internet affects everybody!
 Virtually everyone will practice some form of direct or
highly targeted marketing with Internet response.
 New Companies
 Start-ups - need IMC from ground up
 Start-ups will be internal as well as external
 Example: Tadcast, a new startup company
 Create product placement for online videos
 Sponsors contest for best video about (Coca-Cola’s) new Honest Tea
- get the most hits on YouTube.
MediaPost News, Jan. 15, 2009
The Future of
Marketing Services
 Economics of Scale
 Large Mega-agencies will have more resources
 Large marketers will want more programs
 Competition
 All marketing services activity will increase
 Competition between services will also increase
 More Diversity
 Not just in population, but marketing approach
 Managing all of this will be a huge challenge!
In Conclusion…
You
Can Make
Your Mark
in MarCom.
Questions & Discussion
 Sales Promotion
 Direct Marketing
 Public Relations
 Marketing Research
 Event Marketing
 Promotional Products
The World of
Media Buying Services
 Independent companies that buy media time
and space for advertisers
 Originally, an alternative to the media
department of a full-service ad agency
 Evolved as media choices proliferated and
media buying became more complicated
 Now mega-agencies have “unbundled” their
media departments to create competing media
buying services
The World of
Media
Media
Buying
Agencies
Services
 The Pioneer: Dennis Holt builds Western into #1
 Bought by Interpublic
 Merged with Initiative
 Becomes model for all agencies
 WPP combines Ogilvy and JWT
Media Departments to form
MindShare
 Leo Burnett turns their Media
Department into StarCom
 Unbundling continues…