Transcript P-mail advertising

Chapter Sixteen
Using Other
Advertising Media
 2007 Thomson South-Western
Chapter Sixteen Objectives
• Explain why postal mail advertising is
an efficient and effective ad medium.
• Understand p-mail’s five distinctive
features compared to mass forms of
advertising.
• Appreciate the role of database
marketing, data mining, and lifetime
value analysis.
Chapter Sixteen Objectives
• Understand the role of audio-video
advertising.
• Appreciate the value of yellow-pages
advertising.
• Recognize the growth and role of videogame advertising (adver-gaming).
Chapter Sixteen Objectives
• Appreciate branded entertainment and
brand placements in various venues
(movies, TV, etc.).
• Understand the role of cinema
advertising and Web films.
• Appreciate the potential value of various
other ad media.
Postal Mail Advertising
P-mail advertising:
Advertising matter sent via the postal service to
the person whom the marketer wishes to
influence
Ex. Letters, postcards, programs, calendars,
catalogs, videocassettes, blotters, order blanks,
price lists, menus, etc.
P-Mail Advertising
1. Countdown mailing
3. Special Issue of
Road and Track
Magazine
2. Subsequent
Qualification
Mailing
4. Test-Drive
Kit
Mailing
P-Mail Distinctive Features
Targetability
Measurability
Accountability
Flexibility
Efficiency
What Functions Can P-Mail Accomplish?
1. Increase sales and usage from current
customers
2. Sell products and services to new
customers
3. Build traffic at a specific retailer or Web
site
What Tasks can P-Mail Accomplish?
1. Simulate product trial with promotional
offers and incentives
2. Generate leads for a sales force
3. Deliver product-relevant information and
news
4. Gather customer information that can be
used in building a database
5. Communicate with individuals in a
relatively private manner
Who Uses P-Mail Advertising
• All types of marketers
• Some budget as much as 10% of their
advertising to P-mail
• Car companies’ expenditures alone
exceeded $70 million in one year.
The Special Case of Catalogs
Consumer’s Perspective:
1. Catalog shopping saves time
2. Catalog buying appeals to consumers who
are fearful of shopping because of crime.
3. Catalogs allow people the convenience of
making purchase decisions at their leisure.
4. 800-numbers, web-sites, credit-cards, and
liberal-return policies make it easy to buy.
5. Merchandise quality and prices are often
comparable if not better than those of
stores
6. Guarantees are attractive
The Special Case of Catalogs
Growth rate has subsided because:
• The novelty of catalog scanning has
worn off for many consumers.
• The costs of catalog marketing have
increased dramatically
• Third-class postal increases in recent
years and sharp increases in paper
prices have also raised costs.
Database Marketing
• Successful direct mailing necessitates the
availability of computer databases and the
addressability inherent in the databases.
• Up-to-date databases allow a firm to offer
varied messages to different groups of
customers
Lifetime Value Analysis
Customer lifetime value:
Net Present Value (NPV) of profit that a
company stands to realize on average
new customer during a given number of
years.
Lifetime Value Analysis
5 ways to augment lifetime values:
1. Increase the retention rate
2. Increase the referral rate
3. Enhance the average purchase volume per
customer
4. Cut direct costs
5. Reduce marketing communication costs
The Practice of Data Mining
“information extraction activity whose goal is
to discover hidden facts contained in
databases”
RFM System:
• Recency of a customer’s purchase
• Frequency of purchases
• Monetary Value of each purchase
Audio-Video Advertising
- Videotapes, CD-ROMs, or DVDs are
used to present key video and audio
information about a brand.
- Research shows that customers are
less likely to throw these mailings away
than they are a brochure or other
printed material.
Yellow Page Ads
•
Annual revenues exceeding $15 billion.
•
Both local and national advertisers use the service
•
Heavy users tend to fall in the 25-49 demographic with
relatively
•
Reasons for using Yellow Pages:
•
Saving time spent shopping around for information
•
Saving energy and money
•
Finding information quickly
•
Learning about products and services
•
60% of American adults use yellow pages at least once
Yellow Page Ads
Yellow pages differ from other ad media:
Unlike other media, yellow pages consumers
actively seek ads
Advertiser largely determines quality of ad
placement by the actions it takes
Clear-cut limits on possible creative executions
Method of purchase (i.e. purchased for full
year).
Video-game Advertising (a.k.a.
Adver-gaming)
• Video game users usually play a single
game for 40 hours before they grow
tired of it.
• Over 60 million game players predicted
by 2009, with 40% in the 18-to-34 age
category.
• Today nearly 40% of game players are
girls and women.
Brand Placement in Movies
• Evidence of effectiveness of such advertising is limited
but growing
• Building Brand Awareness, as well as enhancing recall
• Peripheral Route of persuasion
• Little to lose and more to gain by using this form of
advertising
• Brand placement in movies dates back to the 1940s.
•
Limited research to verify effectiveness of this type of
advertising.
• Younger consumers appear to be the most responsive
to brand placement in movies.
Brand Placement in TV Programs
• Brand placement spending on television
is even greater than in movies,
accounting for nearly 60% of brand
expenditures in 2005.
• Brand placement in books and songs
reflect the lifestyles of the protagonists
and singers and is very prevalent in hiphop music.
Cinema Advertising and Web Films
• $350 million was spent in a recent year
on cinema ads prior to films.
• Especially valuable for reaching young
audiences.
• Web films are short feature films
available on the Internet for free viewing.
This media reaches a target of 18-35
year old men and women.
Virtual Signage
• Some brand logos seen at sports venues on
t.v. are virtual (i.e. computer generated image)
• Advertisers in the U.S. have embraced virtual
signage but in Europe regulators such as the
European Broadcasting Union have banned
virtual advertising from events in which it
holds broadcasting rights.