Chapter 12 slides

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Transcript Chapter 12 slides

Communicating Customer Value:
Advertising and Public Relations
Chapter 12
Rest Stop: Previewing the Concepts
Define the five promotion mix tools for
communicating customer value
Discuss the changing communications landscape
and the need for integrated marketing
Describe and discuss the major decisions
involved in developing an advertising program
Explain how companies use public relations to
communicate with their publics
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First Stop: Microsoft vs. Apple
• Apple’s “Get a Mac” campaign attacks
Microsoft, helps Apple increase market share
• Microsoft’s retaliatory “I’m a PC” campaign,
followed by the “Laptop Hunters” campaign,
strikes a chord with Windows users
• Microsoft’s advertising features actual users
• Turns around Apple’s categorization of PC
users as stodgy and boring
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Promotion mix
• The specific blend of promotion tools that
the company uses to persuasively
communicate customer value and build
customer relationships
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Five Major Promotion Tools
Paid form of nonpersonal presentation and promotion of ideas,
goods, or services by an identified sponsor
Short-term incentives to encourage the purchase or sale of a
product or service
Personal presentation by the firm’s sales force for the purpose of
making sales and building customer relationships
Building good relations with the company’s various publics by
obtaining favorable publicity, building up a good corporate image,
and handling or heading off unfavorable rumors, stories, and events
Direct connections with carefully targeted individual consumers to
both obtain an immediate response and cultivate lasting customer
The New Marketing Communications
• Major factors changing today’s marketing
• Changing consumers
• Changing marketing strategies
• Sweeping advances in communications
• Companies these days are doing less
broadcasting and more narrowcasting
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Integrated marketing
• Carefully integrating and coordinating
the company’s many communications
channels to deliver a clear, consistent,
and compelling message about the
organization and its products
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Figure 12.1 – Integrated Marketing
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Integrated Marketing Communications
• Recognize all points
where the customer
may encounter the
company’s brands
• Deliver a consistent
and positive
message at each
The “HD loves HB” integrated
marketing communications campaign
uses a rich, well-coordinated blend of
promotion elements to successfully
deliver Häagen-Dazs’ unique message
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Marketing at Work
• Following bigbudget ad flops,
SoBe abandoned
traditional media
• Digital and
interactive media
are key to SoBe’s
new marketing
SoBe’s new bottom-up approach
blends interactive digital content
with traditional media and hands-on
PR to engage customers in the most
effective way
The Nature of Advertising
• Reaches masses of geographically dispersed
buyers at a low cost per exposure
• Enables the seller to repeat a message often
• Can build up long-term image for a product
• Can trigger quick sales
• Consumers tend to view advertised products
as more legitimate
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The Nature of Personal Selling
• Is most effective in building up buyers’
preferences, convictions, and actions
• Allows all kind of customer relationships to
spring up
• Is a company’s most expensive promotion
• Buyers feel a greater need to listen and
respond to personal selling
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The Nature of Sales Promotion
• Attracts consumer attention
• Offers strong incentives to purchase
• Can be used to dramatize product offers and
boost sagging sales
• Invites and rewards quick responses
• Effects are short-lived
• Not very effective in building long-run brand
preference and customer relationships
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The Nature of Public Relations
• Is very believable
• Reaches many
• Dramatizes a
company or product
• Economical if used
with other mix
With personal selling, the customer
feels a greater need to listen and
respond, even if the response is a
polite “No thank-you”
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The Nature of Direct Marketing
• Message is directed to a
specific person
• Message is immediate
and customized
• Allows a dialogue
between the marketing
team and the consumer
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Figure 12.2 – Push vs. Pull
Promotion Strategy
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Push strategy
• Sales force and trade promotion are used to push
the product through channels
• Producer promotes the product to channel
members who in turn promote it to final
Pull strategy
• Company spends a lot of money on consumer
advertising and promotion to induce final
consumers to buy the product, creating a demand
vacuum that pulls the product through the channel
Figure 12.3 – Major Advertising
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Setting Advertising Objectives
• Advertising objective: A specific
communication task to be accomplished with
a specific target audience during a specific
period of time
• Advertising objectives can be classified by
their primary purpose:
• To inform
• To persuade
• To remind
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Informative advertising
• Issued heavily when introducing a new-product category
• Objective is to build primary demand
Persuasive advertising
• Becomes more important as competition increases
• Objective is to build selective demand
Reminder advertising
• Important for mature products
• Helps to maintain customer relationships and keep
consumers thinking about the product
Comparative Advertising
• Some persuasive
advertising becomes
advertising or attack
Over the past few years, Verizon
Wireless and AT&T have attacked each
other ruthlessly in comparative ads
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Setting the Advertising Budget
• Advertising budget: The dollars and other
resources allocated to a product or a
company advertising program
• Methods:
Affordable method
Percentage-of-sales method
Competitive-parity method
Objective-and-task method
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Setting the Advertising Budget
• Affordable method: Setting promotion
budget at the level management thinks the
company can afford
• Percentage-of-sales method: Setting
promotion budget at a certain percentage of
current or forecasted sales or as a percentage
of the unit sales price
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Setting the Advertising Budget
• Competitive-parity method: Setting the
promotion budget to match competitors’
• Objective-and task method: Developing the
promotion budget by
• Defining specific objectives
• Determining the tasks that must be performed to
achieve these objectives
• Estimating the costs of performing these tasks
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Advertising Strategy
• The plan by which
the company
accomplishes its
• Major elements:
• Creating messages
• Selecting media
Breaking through the clutter: Today’s
consumers, armed with an arsenal
of weapons, are increasingly
choosing not to watch ads
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Madison & Vine
• The merging of
advertising and
entertainment to
break through the
clutter and create
new avenues for
reaching consumers
with more engaging
NBC’s The Biggest Loser and
health-club chain 24 Hour
Fitness have created a product
placement partnership that fully
and thematically integrates the
brand with the show
Forms of Madison & Vine
• Advertainment - Aims to make ads
themselves so entertaining that people want
to watch them
• Brand entertainment or brand integrations Making the brand an inseparable part of
some other form of entertainment
• Most common form is product placements
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Message Strategy
• Advertiser must next develop a compelling
creative concept
• Creative concept: Compelling big idea that
brings the advertising message strategy to life
in a distinctive and memorable way
• Creative concept guides the choice of specific
appeals to be used in an advertising
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Message Strategy
• Advertising appeals should be:
• Meaningful – Pointing out benefits that make the
product more desirable or interesting to
• Believable – Consumers must believe that the
product or service will deliver the promised
• Distinctive – Should tell how the product is
better than competing brands
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Execution Style
• The approach, style,
tone, words, and
format used for
executing an
advertising message
Execution styles: This ad creates a
nostalgic mood around the product.
“So I baked her the cookies she’s
loved since she was little”
Types of Execution Styles
Slice of life
Shows one or more “typical” people using the product in a
normal setting
Shows how a product fits in with a particular lifestyle
Creates a fantasy around the product or its use
Mood or image
Builds a mood or image around the product or service,
such as beauty, love, intrigue, or serenity
Shows people or cartoon characters singing about the
Personality symbol
Creates a character that represents the product
Technical expertise
Shows the company’s expertise in making the product
Scientific evidence
Presents survey or scientific evidence that the brand is
better or better liked than one or more other brands
Testimonial evidence
or endorsement
Features a highly believable or likable source endorsing
the product
Consumer-Generated Messages
• User-generated
advertising efforts
can produce new
ideas and fresh
perspectives on the
• Boost consumer
involvement and
with the brand
Online crafts marketplace/community ran a contest inviting consumers
to tell the story in 30-second
videos. The results were “positively
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Marketing at Work
• PepsiCo’s Doritos
brand has been very
successful with
Consumer-generated messages: Last
year, three Doritos “Crash the Super
Bowl” ads finished in USA Today’s top
five. This “Pug goes for the chips” ad
tied for first place.
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Selecting Advertising Media
• Advertising media: Vehicles through which
advertising messages are delivered to their
intended audiences
• Steps in advertising media selection:
Determining reach, frequency, and impact
Choosing among major media types
Selecting specific media vehicles
Choosing media timing
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Percentage of people in the target
market who are exposed to an ad
campaign during a given period of time
Number of times the average person in
Frequency the target market is exposed to the
Qualitative value of message exposure
through a given medium
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Choosing Among Major Media Types
• Choose media that
effectively and
efficiently present
the message to
• Consider each
medium’s impact,
effectiveness, and
Viewers most deeply engaged in
the Discovery Channel’s Dirty
Jobs series turned out to be
truck-buying men, a ripe
demographic for Ford’s F-Series
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Figure 12. 2 - Profiles of Major Media
Good mass-marketing coverage; low cost per exposure; combines
sight, sound, and motion; appealing to the senses
Flexibility; timeliness; good local market coverage; broad
acceptability; high believability
High selectivity; low cost; immediacy; interactive capabilities
Direct mail
High audience selectivity; flexibility; no ad competition within the
same medium; allows personalization
High geographic and demographic selectivity; credibility and
prestige; high-quality reproduction; long life and good pass-along
Good local acceptance; high geographic and demographic
selectivity; low cost
Flexibility; high repeat exposure; low cost; low message
competition; good positional selectivity
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Selecting Specific Media Vehicles
• Choose the best media vehicles—specific
media within each general media type
• Compute the cost per 1,000 persons reached
by a vehicle
• Consider the costs of producing ads for
different media
• Balance media costs against several media
effectiveness factors
Figure 12. 2 – Profiles of Major Media
High absolute costs; high clutter; fleeting exposure; less audience
Short life; poor reproduction quality; small pass-along audience
Potentially low impact; the audience controls exposure
Direct mail
Relatively high cost per exposure; “junk mail” image
Long ad purchase lead time; high cost; no guarantee of position
Audio only; fleeting exposure; low attention (“the half-heard”
medium); fragmented audiences
Little audience selectivity; creative limitations
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Deciding on Media Planning
• Decide how to schedule the advertising over
the course of a year
• Choose the pattern of ads
Scheduling ads evenly within a given
Scheduling ads unevenly over a given time
Return on Advertising Investment
• Net return on advertising investment divided
by the costs of the advertising investment
• Advertisers should regularly evaluate the:
• Communication effects
• Sales and profit effects
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Advertising agency
• A marketing services firm that assists
companies in planning, preparing,
implementing, and evaluating all or
portions of their advertising programs
International Advertising Decisions:
• Benefits
• Lower advertising costs
• Greater global advertising coordination
• More consistent worldwide image
• Drawbacks
• Ignores the fact that country markets differ
greatly in cultures, demographics, and economic
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International Advertising Decisions:
Standardized global advertising: VISA coordinates its worldwide
advertising under the theme “more people go with VISA,” a theme
that works as well in Brazil (left) as it does in the United States (right)
Public Relations
• Activities designed
to build good
relations with the
company’s publics
• Used to promote
products, people,
places, ideas,
activities, nations,
and organizations
NHLBI’s “The Heart Truth” campaign has
produced impressive results in raising
awareness of the risks of heart disease in
Functions of a Public Relations
• Press relations or
press agency
• Product publicity
• Public affairs
• Lobbying
• Investor relations
• Development
The power of PR: Apple’s iPad and iPad2
launches created unbounded consumer
excitement, a media frenzy, and long
lines outside retail stores—all with no
advertising, just PR
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The Role and Impact of PR
• PR has a strong impact on public awareness
at a much lower cost than advertising
• Can be a powerful brand-building tool
• Should work hand in hand with advertising
within an integrated marketing
communications program to help build
brands and customer relationships
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Major Public Relations Tools
Special events
Written materials
Audiovisual material
Corporate identity
• Public service
Papa John’s “Camaro Search”
campaign used traditional PR
media plus a host of new social
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Rest Stop: Reviewing the Concepts
Define the five promotion mix tools for
communicating customer value
Discuss the changing communications landscape
and the need for integrated marketing
Describe and discuss the major decisions
involved in developing an advertising program
Explain how companies use public relations to
communicate with their publics
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Copyright © 2013 Pearson Education, Inc.
Publishing as Prentice Hall
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