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PRINCIPLES OF MARKETING
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Module 12: Communicating
Customer Value: Advertising and
Public Relations
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Copyright Warning
This presentation is the intellectual property of Pearson Education
Inc. 2011. Students are hereby advised that they may not copy or
distribute this work to any third party
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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 communications.
Describe and discuss the major decisions involved in developing an
advertising program.
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Explain how companies use public relations to communicate with
their publics.
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First Stop
Unilever Integrates Digital & Traditional Media
Background
Implementation
About Unilever: World’s # 2
advertiser spends $5.3 billion on global
advertising and promotion. Less is
being spent on traditional media; more
is being invested in online and digital.
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Recognition: Unilever was named
digital marketer of the year by
Advertising Age. However, Unilever
does not run digital campaigns in
isolationinfoof other media; rather, digital
is integrated with traditional media.
How They Do It: Innovative websites,
viral videos, and “webisodes”
represent key digital content. Real,
funny TV ads pull viewers to websites
to build consumer involvement with
brand. Public relations gets clips aired
on talk shows.
Results: The key benefit of all
integrated efforts is termed
“superdistribution”, which means digital
clips are picked up and shown by other
media for free. “Evolution” created
$200 million in free media coverage.
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Promotion Mix
Specific blend of promotion
tools that the company uses to
persuasively communicate
customer value and build
customer relationships.
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Also referred to as “marketing communications mix”.
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Figure 12.1:
Integrated Marketing Communications
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Integrated Marketing Communications
Several factors are changing the face of marketing communications:
Consumers.
Marketing strategies.
Communication technology.
These factors have shifted the marketing communications model so
that firms are doing less broadcasting and more narrowcasting.
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Integrated Marketing Communications
(IMC)
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Carefully integrating and
coordinating the company’s many
communication channels to
deliver a clear, consistent, and
compelling message about the
organization and its products.
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Integrated Marketing Communications
A strong need for integrated marketing communications exists.
Conflicting messages from different sources can create confusion or
blur brand perceptions.
Marketers must understand each promotion tool when shaping the
marketing communications mix.
Each brand contact delivers a message.
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Marketing in Action
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Burger King’s integrated, multipronged Whopper Freakout campaign
employed a carefully coordinated mix of TV, radio, rich media banner
ads,
and a Freakout web site. Successful? You bet! Sales grew by
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29%!
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Shaping the Overall Promotion Mix
Nature of advertising:
Can reach masses of geographically dispersed buyers at a low cost per
exposure.
Can repeat a message many times.
Consumers view advertised products as more legitimate.
Is impersonal, one-way communication.
Can be very costly for some media types.
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Shaping the Overall Promotion Mix
Nature of personal selling:
Involves personal interaction between two or more people.
Most effective tool at building preferences, convictions, and actions.
Allows relationship building and two-way communication.
Requires long-term commitment to sales force.
Most expensive promotion tool.
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Marketing in Action
With personal selling, customers
feel a greater need to listen and
respond. Two-way
communication is a key strength
of selling compared to other
forms of marketing
communications.
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Shaping the Overall Promotion Mix
Nature of sales promotion:
Includes a wide assortment of tools.
Attracts consumer attention.
Can be used to dramatize product offers.
Offers strong incentives to buy.
Invites and rewards quick consumer response.
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Effects are short-lived.
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Shaping the Overall Promotion Mix
Nature of public relations:
Very believable.
Reaches people who avoid salespeople and ads.
Can dramatize a company or product.
Tends to be used as an afterthought.
Planned use can be effective and economical.
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Shaping the Overall Promotion Mix
Nature of direct marketing:
Many forms of direct marketing exist.
Direct marketing forms share four primary characteristics:
Less public.
Immediate.
Customized.
Interactive.
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Well
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Figure 12.2:
Push vs. Pull Promotion Strategy
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Advertising
Advertising has been used for
centuries.
U.S. advertisers spend more than
$290 billion each year; worldwide
spending exceeds $604 billion.
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Advertising
Advertising is used by:
Business firms.
Not-for-profit organizations.
Professionals.
Social agencies.
Government.
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Figure 12.3:
Major Advertising Decisions
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Major Advertising Decisions
Advertising objective:
A specific communication task to be accomplished with a specific target
audience during a specific period of time.
Overall advertising goal is to help build customer relationships by
communicating customer value.
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Major Advertising Decisions
Advertising objectives can be classified
by purpose:
Informative advertising.
Persuasive advertising.
Comparative advertising (a special type
of persuasive advertising).
Reminder advertising.
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Fuel For
Thought
What is the objective of
this ad for
De Beers diamonds?
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Major Advertising Decisions
Setting the advertising budget:
Affordable method.
Percentage-of-sales method.
Competitive-parity method.
Objective-and-task method.
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Marketing in Action
Audi gained a competitive
advantage by spending
heavily on advertising and
promotion at a time when
rivals were retrenching.
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Major Advertising Decisions
Developing advertising strategy:
Creating advertising messages.
Message strategy and message
execution must break through the
clutter.
Advertising is being merged with
entertainment.
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“Madison & Vine”
A term that has come to represent
the merging of advertising
entertainment in an effort to break
through the clutter and create new
avenues for reaching consumers
with more engaging messages.
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Visit the Adverblog’s archive on Advertainment for
current examples.
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Marketing in Action
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Ad agency JWT attempted to promote its “Madison & Vine” philosophy
to potential business partners with this ad.
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Major Advertising Decisions
Planning the message strategy:
Identify customer benefits that can be used as advertising appeals.
Develop compelling creative concept—the “big idea”.
Choose an ad advertising appeal that is:
Meaningful.
Believable.
Distinctive.
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Major Advertising Decisions
Message Execution Styles:
Slice of Life
Technical expertise
Lifestyle
Scientific evidence
Fantasy
Testimonial evidence or
endorsement
Mood or image
Musical
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Personality
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Major Advertising Decisions
Message execution process:
Choose the execution style.
Choose a tone.
Use memorable, attention-getting words.
Choose format elements:
Illustration.
Headline.
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Copy.
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Fuel For Thought
What is the message execution
style?
What is the tone of the ad?
Are the words used attentiongetting and memorable?
How does the illustration work
with the rest of the ad?
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Major Advertising Decisions
Consumer-generated messages:
Tapping consumers for message ideas or actual ads can involve:
Searching existing Web video sites.
Holding contests or inviting consumers to submit ad message ideas and
videos.
Benefits of consumer-generated messages:
Collects new ideas and fresh brand perspectives at relatively little expense.
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Boosts consumer involvement and gets consumers talking and thinking
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about the brand.
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Marketing in Action
The Doritos “Crash the Super
Bowl” ads are among the top-rated
ads on USA Today’s Super Bowl
Ad Meter.
Visit the “Crash” web site to learn
how you can submit your ad and
to view the ads created by the
most recent winners.
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Major Advertising Decisions
Developing advertising strategy:
Selecting advertising media.
Set reach, frequency, and impact goals.
Choose among major media types.
Select specific media vehicles.
Decide on media timing.
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Major Advertising Decisions
Deciding on reach, frequency, impact:
Reach: Percentage of people exposed to ad campaign in a given time
period.
Frequency: Number of times a person is exposed to advertisement.
Media Impact: The qualitative value of a message exposure through a
given medium.
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Major Advertising Decisions
Each media type has specific
advantages and disadvantages.
Choosing among media types requires
consideration of the:
Medium’s impact
Message effectiveness
Cost
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The media
mix should be regularly
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reexamined.
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Major Advertising Decisions
Media vehicles:
Specific media within each general media type, such as Newsweek.
Factors to consider when choosing vehicles:
Cost.
Audience quality.
Audience engagement.
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Editorial quality.
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Major Advertising Decisions
Marketers must also decide on media timing, or how to schedule the
advertising over the course of a year.
Follow seasonal pattern.
Oppose seasonal pattern.
Same coverage all year.
Choose the pattern of the ads:
Continuity.
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Pulsing.
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Marketing in Action
Many products, services, and
retailers advertise more
heavily before special
holidays, new seasons, or
even particular times of the
year, such as “Back to
School”.
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Evaluating Advertising and Return on
Advertising Investment
Return on advertising investment:
The net return on advertising investment divided by the costs of the
advertising investment.
Evaluating advertising involves:
Measuring the communication effects of an ad or campaign.
Measuring the sales and profit effects of the ad campaign.
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Marketing in Action
The 2010 Super Bowl drew the
single largest TV audience ever in
the US (105 million), with ad prices
ranging from $ 2.8 to $3 million for a
30 second spot. Was it worth it??
Learn how Nielsen measures ROI
for Super Bowl ads.
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Other Advertising Considerations
Organization of ad function:
Small companies—one person in firm.
Large companies—ad department that may also work with an ad
agency.
Advertising agencies employ specialists who perform ad tasks better
then the company’s own staff can.
Bring outside viewpoints to problem-solving.
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Wide range of experience.
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Other Advertising Considerations
International advertising issues:
To what degree should global advertising be adapted to various
countries?
Greater need for standardization of global brand advertising strategies.
Specific advertising programs must usually be adapted to local cultures and
other factors.
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Public Relations
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Building good relations with
the firm’s various publics by
obtaining favorable publicity,
building up a good corporate
image, and handling or
heading off unfavorable
rumors, stories, and events.
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Public Relations
Public relations departments perform the following functions:
Press relations or press agency.
Product publicity.
Public affairs.
Lobbying.
Investor relations.
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Development.
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Public Relations Role and Impact
Public relations:
May strongly impact public awareness at a lower cost than advertising.
Can yield spectacular results.
Is beginning to play an increasingly important brand-building role.
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Marketing in Action
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Starting
with preview events like the one shown above, Nintendo’s awardinfo
winning PR campaign for its new Wii game produced nonstep stock-outs for
more than two years.
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Major Public Relations Tools
News
Corporate identity materials
Speeches
Public service activities
Special events
Buzz marketing & social
networking
Written materials
Audiovisual materials
Company Web site
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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 communications.
Describe and discuss the major decisions involved in developing an
advertising program.
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Explain how companies use public relations to communicate with
their publics.
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