Chapter 7 - AdBuzz.com
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Transcript Chapter 7 - AdBuzz.com
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?
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
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)
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
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…