Transcript Chapter 1

Lamb, Hair, McDaniel
MKTG2007-2008
14
CHAPTER
Designed by
Amy McGuire, B-books, Ltd.
Chapter 14
Integrated Marketing
Communications
Prepared by
Deborah Baker, Texas Christian University
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
1
Learning Outcomes
LO1
Discuss the role of promotion in
the marketing mix
LO2
Discuss the elements of the promotional mix
LO3
Describe the communication process
LO4
Explain the goal and tasks of promotion
Chapter 14
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2
Learning Outcomes
LO5
Discuss the AIDA concept
and its relationship to the promotional mix
LO6
Describe the factors that affect the
promotional mix
LO7
Discuss the concept of integrated marketing
communications
Chapter 14
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3
LO1
The Role of Promotion in
the Marketing Mix
Discuss the role of
promotion in the
marketing mix
Chapter 14
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4
The Role of Promotion
Promotion
Communication by
marketers that informs,
persuades, and reminds
potential buyers of a
product in order to
influence an opinion or
elicit a response.
LO1
Chapter 14
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5
The Role of Promotion
Promotional
Strategy
A plan for the optimal
use of the elements of
promotion:
 Advertising
 Public Relations
 Sales Promotion
 Personal Selling
LO1
Chapter 14
Competitive
Advantage
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6
The Role of Promotion
in the Marketing Mix
Overall
Marketing
Objectives
Marketing Mix
•
•
•
•
LO1
Chapter 14
Product
Place
Promotion
Price
Target Market
Promotional Mix
•
•
•
•
Advertising
Public Relations
Sales Promotion
Personal Selling
Promotion Plan
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7
Competitive Advantage
High product quality
Rapid delivery
Low prices
Excellent service
LO1
Chapter 14
Unique features
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8
LO1 REVIEW LEARNING OUTCOME
The Role of Promotion
in the Marketing Mix
Chapter 14
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9
LO2
The Promotional Mix
Discuss the
elements of the
promotional mix
Chapter 14
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10
The Promotional Mix
Combination of promotion
tools used to reach the
target market and fulfill the
organization’s overall goals.




Advertising
Public Relations
Sales Promotion
Personal Selling
LO2
Chapter 14
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11
The Promotional Mix
Impersonal, one-way
mass communication about
a product or organization
that is paid for by a
marketer.
LO2
Chapter 14
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12
Advertising Media
New
Advertising
Media
Traditional
Advertising Media








Television
Radio
Newspapers
Magazines
Books
Direct mail
Billboards
Transit cards





Internet
Banner ads
Viral marketing
E- mail
Interactive video
LO2
Chapter 14
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13
Advertising
Advantages
 Reach large number
of people
 Low cost per
contact
Disadvantages
 Total cost is high
 National reach is
expensive for
small companies
 Can be microtargeted
LO2
Chapter 14
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14
Public Relations
The marketing function that
evaluates public attitudes,
identifies areas within the
organization that the public
may be interested in, and
executes a program of
action to earn public
understanding and
acceptance.
LO2
Chapter 14
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15
Beyond the Book
LO2 Reality-Based Product Advertising
Chapter 14
 Jaguar is giving an $80,000 Jaguar XK to a select
group of “beautiful people”—just to be seen in it
 It is reality-based product placement—where real
life blurs seamlessly into advertising
 The success of the
campaign is “how
many people touch
and see the car”
SOURCE: Gina Chon, “Jaguar Tries a Living
Product Placement,” Wall Street Journal,
June 29, 2006, B1.
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16
The Function of
Public Relations
LO2
Chapter 14
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17
Sales Promotion
Marketing activities—
other than personal
selling, advertising, and
public relations—that
stimulate consumer
buying and dealer
effectiveness.
LO2
http://www.nabiscoworld.com
Online
Chapter 14
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18
Sales Promotion
Free samples
Contests
Premiums
Trade Shows
Vacation Giveaways
Coupons
End
Consumers
Company
Employees
Trade
Customers
LO2
Chapter 14
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19
Personal Selling
Planned presentation to
one or more prospective
buyers for the purpose
of making a sale.
LO2
Chapter 14
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20
Personal Selling
Traditional
Selling
Relationship
Selling
LO2
Chapter 14
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21
LO2 REVIEW LEARNING OUTCOME
Elements of the Promotional Mix
Chapter 14
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22
LO3
Marketing Communication
Describe the
communication
process
Chapter 14
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23
Communication
Communication
The process by which we exchange or
share meanings through a common set
of symbols.
LO3
http://www.mcdonalds.com
Online
Chapter 14
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24
Marketing Communication
Categories of
Communication
Interpersonal
Communication
Mass
Communication
LO3
Chapter 14
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25
Marketing Communication
As Senders
As Receivers
 Inform
 Develop messages
 Persuade
 Adapt messages
 Remind
 Spot new
communication
opportunities
LO3
Chapter 14
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26
The Communication Process
Noise
Sender
LO3
Chapter 14
Encoding
Message
Message
Channel
Decoding
Message
Receiver
Feedback
Channel
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27
Characteristics of the Elements
in the Promotional Mix
LO3
Chapter 14
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28
Characteristics of the Elements
in the Promotional Mix
Advertising
Communication Mode
Communication Control
Feedback Amount
Indirect and impersonal
Low
Little
Feedback Speed
Delayed
Message Flow Direction
One-way
Message Content Control
Yes
Sponsor Identification
Yes
Reaching Large Audience
Message Flexibility
Fast
Same message to all audiences
LO3
Chapter 14
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29
Characteristics of the Elements
in the Promotional Mix
Public Relations
Communication Mode
Communication Control
Feedback Amount
Usually indirect, impersonal
Moderate to low
Little
Feedback Speed
Delayed
Message Flow Direction
One-way
Message Content Control
No
Sponsor Identification
No
Reaching Large Audience
Message Flexibility
Usually fast
Usually no direct control
LO3
Chapter 14
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30
Characteristics of the Elements
in the Promotional Mix
Sales Promotion
Communication Mode
Communication Control
Feedback Amount
Feedback Speed
Message Flow Direction
Usually indirect and impersonal
Moderate to low
Little to moderate
Varies
Mostly one-way
Message Content Control
Yes
Sponsor Identification
Yes
Reaching Large Audience
Message Flexibility
Fast
Same message to varied target
LO3
Chapter 14
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31
Characteristics of the Elements
in the Promotional Mix
Personal Selling
Communication Mode
Communication Control
Feedback Amount
Feedback Speed
Message Flow Direction
Direct and face-to-face
High
Much
Immediate
Two-way
Message Content Control
Yes
Sponsor Identification
Yes
Reaching Large Audience
Message Flexibility
Slow
Tailored to prospect
LO3
Chapter 14
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32
The Impact of Blogging
Corporate
Blogs
Sponsored by a company or
one of its brands and
maintained by one or more of
the company’s employees.
Independent and not
Noncorporate associated with the
Blogs
marketing efforts of any
particular company or brand.
LO3
3
Chapter 14
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33
LO3 REVIEW LEARNING OUTCOME
The Communication Process
Chapter 14
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34
LO4
The Goals and Tasks
of Promotion
Explain the goals and
tasks of promotion
Chapter 14
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35
Goals and Tasks of Promotion
Informing
Reminding
Target
Audience
LO4
Persuading
http://www.tide.com
Online
Chapter 14
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36
Goals and Tasks of Promotion
Informing
Reminding
PLC Stages:
PLC Stages:
Introduction
Early Growth
Maturity
Target
Audience
PLC Stages:
Growth
Maturity
LO4
Chapter 14
Persuading
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37
Goals and Tasks of Promotion
Informative Promotion

Increase awareness

Explain how product works

Suggest new uses

Build company image
LO4
Chapter 14
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38
Goals and Tasks of Promotion
Persuasive Promotion

Encourage brand switching

Change customers’ perceptions of
product attributes

Influence immediate buying decision

Persuade customers to call
LO4
Chapter 14
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39
Goals and Tasks of Promotion
Reminder Promotion

Remind customers that product
may be needed

Remind customers where
to buy product

Maintain customer awareness
LO4
Chapter 14
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40
LO5
Promotional Goals
and the AIDA Concept
Discuss the AIDA
concept and its
relationship to the
promotional mix
Chapter 14
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41
LO5 The AIDA Concept
AIDA
Concept
Model that outlines the process
for achieving promotional goals
in terms of stages of consumer
involvement with the message.
Attention
Interest
Desire
Action
Chapter 14
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42
LO5 The AIDA Concept
Action
Desire
Interest
Attention
Conative (doing)
Affective (feeling)
Cognitive (thinking)
http://www.nascar.com
http://www.kelloggs.com
Online
Chapter 14
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43
Biz Flix
LO5
Chapter 14
About a Boy
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44
LO5 REVIEW LEARNING OUTCOME
The AIDA Concept
Chapter 14
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45
LO6
Factors Affecting the
Promotional Mix
Describe the factors
that affect the
promotional mix
Chapter 14
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46
LO6
Factors Affecting the
Choice of Promotional Mix
Nature of the product
Stage in PLC
Target market factors
Type of buying decision
Promotion funds
Push or pull strategy
Chapter 14
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47
Sales ($)
LO6 Stage in the Product Life Cycle
Maturity
Introduction
Growth
Decline
Time
Light
Advertising;
preintroduction
publicity
Chapter 14
Heavy use of
Advertising;
PR for
awareness;
sales
promotion
for trial
Advertising,
PR, brand
loyalty;
personal
selling for
distribution
Ads decrease;
sales
promotion;
personal
selling;
reminder &
persuasive
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
AD/PR
decrease;
limited
sales
promotion;
personal
selling for
distribution
48
LO6 Target Market Characteristics
For…
Advertising
Sales Promotion
Less Personal Selling
Chapter 14

Widely scattered
market

Informed buyers

Brand-loyal repeat
purchasers
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49
LO6 Type of Buying Decision
Advertising
Routine
Sales Promotion
Neither Routine
nor Complex
Advertising
Public Relations
Personal Selling
Complex
Print Advertising
Chapter 14
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50
LO6 Available Funds




Chapter 14
Trade-offs with funds available
Number of people in target market
Quality of communication needed
Relative costs of promotional
elements
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51
LO6 Push and Pull Strategies
PUSH STRATEGY
Manufacturer
promotes to
wholesaler
Wholesaler
promotes to
retailer
Retailer
promotes to
consumer
Consumer
buys from
retailer
Orders to manufacturer
PULL STRATEGY
Manufacturer
promotes to
consumer
Consumer
demands
product
from retailer
Retailer
demands
product
from wholesaler
Wholesaler
demands
product from
manufacturer
Orders to manufacturer
Chapter 14
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52
LO6 REVIEW LEARNING OUTCOME
Factors Affecting Promotional Mix
Chapter 14
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53
LO7
Integrated Marketing
Communications
Discuss the concept
of integrated
marketing
communications
Chapter 14
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54
Integrated Marketing
Communications
Integrated
Marketing
Communications
The careful coordination of all
promotional messages to assure
the consistency of messages at
every contact point where a
company meets the consumer.
LO7
Chapter 14
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55
IMC Popularity Growth
 Proliferation of thousands
of media choices
 Fragmentation of the
mass market
 Slash of advertising
spending in favor of
promotional techniques
that generate immediate
response
LO7
Chapter 14
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56
LO7 REVIEW LEARNING OUTCOME
Integrated Marketing Communications
Chapter 14
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57
Lamb, Hair, McDaniel
MKTG2007-2008
15
CHAPTER
Designed by
Amy McGuire, B-books, Ltd.
Chapter 14
Advertising and
Public Relations
Prepared by
Deborah Baker, Texas Christian University
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
58
Learning
Outcomes
LO1 Discuss the effects of advertising
on market share and consumers
LO2 Identify the major types of
LO3
Chapter 14
advertising
Discuss the creative decisions in
developing an advertising campaign
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59
Learning
Outcomes
LO4
Describe media evaluation
and selection techniques
LO5 Discuss the role of public
relations
in the promotional mix
Chapter 14
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60
1
LO
The Effects of Advertising
Discuss the effects of
advertising on market
share and consumers
Chapter 14
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61
The Effects of Advertising
U.S. advertising was almost $300
billion in 2006
In 2005, 32 companies spent over
$1 billion each
The advertising industry is small—
only 155,000 employed by the
12,000 advertising agencies
LO1
Chapter 14
Ad budgets of some firms are
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62
The Effects of Advertising
Top Ten
Leaders
by U.S.
Advertising
Spending
LO1
Chapter 14
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63
Advertising and Market Share
New brands with a small market
share spend proportionally more
for advertising and sales
promotion than those with a large
market share.
 Beyond a certain level of
spending, diminishing returns
set in.
LO1  New brands require higher
spending to reach a minimum
Chapter 14
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64
The Effects of Advertising
on Consumers
 The average U.S. citizen
is exposed to hundreds
of ads each day.
 Advertising may change
a consumer’s negative
attitude toward a
product, or reinforce a
positive attitude.
LO1
Chapter 14
 Advertising can affect consumer
ranking of a brand’s attributes.
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65
LO1 REVIEW LEARNING OUTCOME
Effects of Advertising
Chapter 14
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66
2
LO
Major Types of Advertising
Identify the major
types of advertising
Chapter 14
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67
Major Types of Advertising
Institutional
Advertising
Enhances a company’s image
rather than promotes a
particular product.
Product
Advertising
Touts the benefits of a
specific good or service.
LO2
Chapter 14
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68
Major Types of Advertising
Institutional
Advertising
Corporate identity
Advocacy
advertising
Pioneering
Product
Advertising
LO2
Chapter 14
Competitive
Comparative
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69
Product Advertising
Pioneering
 Stimulates primary demand for new
product or category
 Used in the PLC introductory stage
Competitive
 Influences demand for brand in the
growth phase of the PLC
 Often uses emotional appeal
Comparative
 Compares two or more competing
brands’ product attributes
 Used if growth is sluggish, or if
competition is strong
LO2
http://www.pizzahut.com
http://www.papajohns.com
Online
Chapter 14
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70
LO2 REVIEW LEARNING OUTCOME
The Major Types of Advertising
Chapter 14
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71
LO3 Creative Decisions in Advertising
Discuss the
creative decisions
in developing an
advertising campaign
Chapter 14
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72
Creative Decisions in
Advertising
Advertising
Campaign
LO3
Chapter 14
A series of related
advertisements focusing
on a common theme,
slogan, and set of
advertising appeals.
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73
Creative Decisions in
Advertising
Determine the
advertising objectives
Make creative decisions
LO3
Chapter 14
Make media decisions
Evaluate the campaign
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74
Setting Objectives: The
DAGMAR Approach
Define target audience
Define desired percentage change
Define the time frame for change
LO3
Chapter 14
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75
Creative Decisions
Identify product benefits
Develop and evaluate advertising appeals
Execute the message
Evaluate the campaign’s effectiveness
LO3
Chapter 14
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76
Identify Product Benefits
 “Sell the Sizzle, not the Steak”
 Sell product’s benefits,
not its attributes
 A benefit should answer
“What’s in it for me?”
LO3
Chapter 14
 Ask “So?” to determine
if it is a benefit
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77
Identify Product Benefits
Attribute
“Powerade’s new line has been
reformulated to combine the scientific
benefits of sports drinks with
B vitamins and to speed up energy
metabolism.”
- So?
Benefit
“So, you’ll satisfy your thirst with a
great-tasting drink that will power you
throughout the day.”
LO3
Chapter 14
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78
Advertising Appeals
LO3
Chapter 14
Profit
Product saves, makes, or protects money
Health
Appeals to body-conscious or health seekers
Love or romance
Used in selling cosmetics and perfumes
Fear
Social embarrassment, old age, losing health
Admiration
Reason for use of celebrity spokespeople
Convenience
Used for fast foods and microwave foods
Fun and pleasure
Key to advertising vacations, beer, parks
Vanity and egotism
Used for expensive or conspicuous items
Environmental
Consciousness
Centers around environmental protection
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79
Unique Selling Proposition
Unique Selling
Proposition
LO3
Chapter 14
A desirable, exclusive, and
believable advertising
appeal selected as the theme
for a campaign.
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80
Executing the Message
Scientific
Slice-of-Life
Musical
Lifestyle
Spokesperson/
Testimonial
Demonstration
Mood or
Image
LO3
Chapter 14
Fantasy
Real/
Animated
Product
Symbols
Humorous
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81
LO3 REVIEW LEARNING OUTCOME
Creative Decisions for Ad Campaign
Set
advertising
objectives
Identify benefits
Develop appeal
Evaluating
results helps
marketers
adjust objectives
for future
campaigns
Chapter 14
Execute
message
Evaluate
campaign results
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82
LO4 Media Decisions in Advertising
Describe media
evaluation
and selection
techniques
Chapter 14
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83
Media Decisions in Advertising
LO4
Chapter 14
Monitored Media
Unmonitored Media
Newspapers
Direct Mail
Magazines
Trade Exhibits
Yellow Pages
Cooperative Advertising
Internet
Brochures
Radio
Coupons
Television
Catalogs
Outdoor Media
Special Events
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84
Major Advertising Media
Newspapers
Magazines
Radio
Television
Outdoor Media
Yellow Pages
LO4
Chapter 14
Internet
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85
Newspapers
Advantages


Geographic selectivity
Short-term advertiser
commitments
News value and immediacy
Year-round readership
High individual market
coverage
Co-op and local tie-in
availability
Short lead time





Disadvantages




Limited demographic
selectivity
Limited color
Low pass-along rate
May be expensive
LO4
Chapter 14
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86
Beyond the Book
LO4 Free Newspapers?
 The new Baltimore Examiner is delivering
250,000 newspapers—at no charge and
unsolicited!
 Advertising brings in the revenue for
this niche publication targeting
households with income of $73,000 or
more.
 The ads are $2,900 for a full page,
compared with $17,000 for its
competition, the
Baltimore Sun.
 The Examiner is betting that
SOURCE: Joseph T. Hallinan, “Do New Free Dailies
low ad rates and the target
Mean Sun is Setting for Paid Newspapers?,” Wall
Street
Journal, Aprilwill
5, 2006, B1.be a valuable
market
proposition
to advertisers.
Chapter 14
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87
Cooperative Advertising
Cooperative
Advertising
LO4
Chapter 14
An arrangement in
which the
manufacturer and the
retailer split the
costs of advertising
the manufacturer’s
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88
Magazines
Advantages





Good reproduction
Demographic selectivity
Regional/local selectivity
Long advertising life
High pass-along rate
Disadvantages





Long-term advertiser
commitments
Slow audience build-up
Limited demonstration
capabilities
Lack of urgency
Long lead time
LO4
Chapter 14
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89
Radio
Advantages




Low cost
Immediacy of message
Short notice scheduling
No seasonal audience
change
Highly portable
Short-term advertiser
commitments
Entertainment carryover



Disadvantages





No visual treatment
Short advertising life
High frequency to
generate comprehension
and retention
Background distractions
Commercial clutter
LO4
Chapter 14
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90
Television
Advantages



Wide, diverse audience
Low cost per thousand
Creative opportunities for
demonstration
Immediacy of messages
Entertainment carryover
Demographic selectivity
with cable



Disadvantages







Short life of message
Consumer skepticism
High campaign cost
Little demographic
selectivity with stations
Long-term advertiser
commitments
Long lead times for
production
Commercial clutter
LO4
Chapter 14
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91
Chapter 14
 The number of ads in TV shows is a
longstanding complaint of viewers and
advertisers.
 The media is cluttered and consumers
05
change channels or speed through
04
commercials on
03
a DVR.
Year
Beyond the Book
LO4 TV Advertising: Is Less More?
02
01
 Tests are being
2000
conducted to feature
shorter commercial 13.5
pods.
SOURCE:
Suzanne Vranica,
“TV-Ad Test to Show if Less is More,”
Wall Street Journal, April 5,2006, B3.
14
14.5
15
15.5
Commercial Minutes
per Hour
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92
Outdoor Media
Advantages




Repetition
Moderate cost
Flexibility
Geographic selectivity
Disadvantages



Short message
Lack of demographic
selectivity
High “noise” level
LO4
Chapter 14
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93
Internet
Advantages


Fast growing
Ability to reach narrow
target audience
Short lead time
Moderate cost


Disadvantages



LO4
Difficult to measure ad
effectiveness and ROI
Ad exposure relies on
“click through” from
banner ads
Not all consumers have
access to Internet
http://www.fox.com
http://www.abc.com
Online
Chapter 14
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94
Alternative Media
Shopping Carts
Floor Ads
Computer
Screen Savers
Subway
Tunnel Ads
DVDs
Video Game Ads
Interactive Kiosks
Cell Phone Ads
Ads in Movies
LO4
Chapter 14
Advertainments
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95
Beyond the Book
LO4 Videogame Advertising
Chapter 14
 Microsoft plans to acquire Massive
inc., a start-up that places ads
in video games.
 Ads are inserted into the game
environment.
 Video games could become
a large new medium for
advertising.
SOURCE: Robert A. Guth and Nick Wingfield,
“Microsoft’s ‘Massive’ Move into Game Ads,” Wall
Street Journal, April 26,2006, B1.
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96
Beyond the Book
LO4 Directory Assistance Advertising
Chapter 14
 Companies are offering free
telephone directory assistance—but
there’s an advertisement first.
 The audio ads are narrowly
targeted,
and are 10
to 12 seconds.
 The growth of such free services
could represent another change
in the telecom industry.
Buckman, “Your
 SOURCE:
DialRebecca
1-800-FREE411
or
Listing, and a Word From Our Sponsor,”
1-800-411-METRO
Wall
Street Journal, April 20,2006, B1.
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97
Qualitative Factors in Media Selection
 Attention to the commercial and
the program
 Program liking
 Lack of distractions
 Other audience behaviors
LO4
Chapter 14
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98
Media Scheduling
Continuous
Media Schedule
Advertising is run steadily
throughout the period.
Flighted
Media Schedule
Advertising is run heavily every
other month or every two weeks.
Pulsing
Media Schedule
Advertising combines continuous
scheduling with flighting.
Seasonal
Media Schedule
Advertising is run only when the
product is likely to be used.
LO4
Chapter 14
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99
Beyond the Book
LO4 Media Scheduling on the Web
 Competition for Web advertising
spots is driving up prices.
 Some Web advertisers now run
campaigns based on time of day.
Examples:
● McDonald’s: breakfast meals
during morning hours
● Xerox: copier ads during the workday
● Budweiser: beer ads on Friday
afternoons
 Scheduling Web ads during prime
SOURCE: David Kesmodel, “More Marketers Place Web Ads
bytimes
Time of Day,” Wall
June 23,efficient
2006, B1.
isStreetaJournal,
more
use of ad
dollars
more
targeted.
Chapter 14
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by South-Western,
a division
of Thomson Learning. All rights reserved
100
LO4 REVIEW LEARNING OUTCOME
Media Evaluation and Selection
Type: Newspaper
Magazine
Radio
Television
Outdoor
Internet
Alternative
Scheduling:
continuous
flighted
Considerations:
Mix
Cost per contact
Reach
Frequency
Audience
selectivity
How much of each?
How much per person?
How many people?
How often?
How targeted is
audience?
pulsing
seasonal
Winter
Chapter 14
Spring
Summer
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
Fall
101
5
LO
Public Relations
Discuss the
role of public
relations in the
promotional mix
Chapter 14
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102
LO5 Public Relations
Public
Relations
The element in the promotional mix
that:
 evaluates public attitudes
 identifies issues of public concern
 executes programs to gain public
acceptance
Chapter 14
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103
LO5 Functions of Public Relations
Press relations
Product publicity
Corporate communication
Public affairs
Lobbying
Employee and investor relations
Crisis management
Chapter 14
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104
LO5 Public Relations Tools
New product publicity
Product placement
Consumer education
Event sponsorship
Issue sponsorship
Internet Web sites
http://www.vw.com
http://www.chevrolet.com
Online
Chapter 14
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105
Beyond the Book
LO5 Example of Consumer Education
Chapter 14
 Corporations are teaching public
school students about personal
finance.
 People under age 25 are a fastgrowing group for credit card debt
increases and bankruptcy.
 Is it appropriate to use
educational materials with
a corporate identity?
 How should financial literacy
SOURCE: Diya Gullapalli, “Your Kid’s Teacher: The Bank,”
be
Wall
Streettaught?
Journal, April 8-9, 2006, B1.
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106
LO5
Managing Unfavorable
Publicity
Crisis
Management
A coordinated effort to handle the
effects of unfavorable publicity or of an
unfavorable event.
Chapter 14
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107
Biz Flix
LO5
Chapter 1
EdTV
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108
LO5 REVIEW LEARNING OUTCOME
The Role of Public Relations
Chapter 14
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109