Advertising And Sales Promotion Strategy

Advertising and Sales Promotion Strategy

The Marketing Communications Mix Advertising Advertising

Any AnyPaid PaidForm Formof ofNonpersonal Nonpersonal Presentation by an Presentation by anIdentified Identified Sponsor. Sponsor.

Sales Promotion

Short-term Incentives to Encourage Trial or Purchase.

Public Relations

Personal Personal Selling Selling Direct Marketing

Protect and/or Promote Company’s Image/products.

Personal Presentations. Direct Communications With Individuals to Obtain an Immediate Response.

Advertising PROS • Message can be repeated for exposure • Very expressive -- can be used to create image • Can reach a geographically diverse audience CONS • Can be tuned out • Can be expensive • Hard to measure results

Personal Selling PROS • Interactive - can be customized • Allows a relationship to develop • Better understanding of customer needs • Buyer will pay more attention to the message CONS • Expensive • Can only reach a small number of consumers

Publicity PROS • Very believable • “Free advertising” CONS • Hard to implement • Hard to control • Hard to measure its effectiveness

Sales Promotion PROS • Attract attention • Strong incentives will induce consumers to act • Quick response • Encourages trial of product CONS • Can create price sensitive customers • Can be costly • Easy for competition to imitate

Channels of Sales Promotions MANUFACTURER Push

Trade Promotions RETAILER

Push

Retail Promotions CONSUMER

Consumer Promotions Pull

Consumer Promotion -- PULL Consumer-Promotion Objectives Entice EnticeConsumers Consumersto to Try TryaaNew NewProduct Product Lure LureCustomers CustomersAway Away From FromCompetitors’ Competitors’Products Products Get GetConsumers Consumersto to“Load “LoadUp’ Up’ on onaaMature MatureProduct Product Hold Hold&&Reward Reward Loyal Loyal Customers Customers Consumer ConsumerRelationship Relationship Building Building

Consumer-Promotion Tools Samples Samples Coupons Coupons Cash CashRefunds Refunds Price PricePacks Packs Premiums Premiums

Advertising Advertising Specialties Specialties Patronage Rewards Contests Sweepstakes Sweepstakes Games Games

Point-of-Purchase Point-of-Purchase Displays Displays

Trade Promotions -- PUSH Trade-Promotion Objectives

Trade-Promotion Tools

Persuade PersuadeRetailers Retailersor or Wholesalers Wholesalersto toCarry CarryaaBrand Brand

Price-Offs Price-Offs

Premiums Premiums

Give GiveaaBrand BrandShelf ShelfSpace Space

Allowances Allowances

Promote PromoteaaBrand Brandin in Advertising Advertising

Buy-Back Buy-Back Guarantees Guarantees

Patronage Patronage Displays Rewards Rewards

Push PushaaBrand Brandto toConsumers Consumers

Free FreeGoods Goods Contests Contests

Discounts Discounts Push PushMoney Money Specialty Specialty Advertising Advertising Items Items

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Target market selection This is the single most important decision, because all other decisions build upon it. Is the budget sufficent? Is the media message correct? Are the media outlets appropriate? All of these questions will depend upon the target audience’s size, motivations, concerns, etc.

Start by describing with demographic data Target market of a national chain of child day-care centers: “Female household heads aged 25 to 34 employed outside the home who have one or more children under age 6 at home and live or work within within 10 miles of a current center.”

But need to add life-style and psychographic profile data “This group aspires to have both a successful career and family. These women are serious about child-rearing responsibilities and are avid readers of books and articles on the subject. They are primarily outer-directed Emulators and Achievers in terms of VALS categories. They are concerned about where and with whom they leave their children. Heir child’s “experience” is of crucial importance, while cost of the service is an important, but secondary, concern.”

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Problem with using $ of revenue or units sold as an advertising objective 1. Advertising is only one of many factors impacting whether a sale occurs. 2. Advertising has a carryover / delay effect that extends beyond a calendar or fiscal year.

Response Hierarchy Models Stages

AIDA Model

Hierarchy-ofEffects Model

InnovationAdoption Model

Exposure

Awareness Cognitive stage

Attention

Awareness

Affective stage

Interest

Attitude

Evaluation

Intention

Preference Desire

Behavior stage

Liking

Reception Cognitive response

Knowlege Interest

Communications Model

Action

Conviction Purchase

Trial Adoption

Behavior

Advertising Objectives • • •

Specific Communication Task Accomplished with a Specific Target Audience During a Specific Period of Time

Example advertising objective To increase from 12% to 35%, within one year , the number of homemakers, age 25-55, that list our brand in unaided recall when asked to name 5 different instant coffee brands.

Advertising Objectives • • •

Specific Communication Task Accomplished with a Specific Target Audience During a Specific Period of Time

Informative Informative Advertising Advertising Build BuildPrimary PrimaryDemand Demand

Persuasive Persuasive Advertising Advertising Build BuildSelective SelectiveDemand Demand

Reminder Reminder Advertising Advertising

Keeps KeepsConsumers ConsumersThinking Thinking About AboutaaProduct. Product.

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Advertising platform A statement of the basic idea or issues to be communicated in the advertisement. A general notion of the media type (e.g., TV, radio, newspapers, etc.)

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Issues to consider in setting advertising budget Product Life Cycle Market share Competitive clutter Product Substitutability

Setting Setting Advertising Advertising Budgets Budgets Affordable Method

Percentage-ofSales Method

Setting Promotion Budget at the Level the Company Thinks They Can Afford.

Setting Promotion Budget at a Certain % of Current or Forecasted Sales

Competitive-Parity Method

Objective-and-Task Method

Setting Promotion Budget to Match Competitors’ Outlay

Setting Promotion Budget by Defining Objectives, Tasks & Costs.

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Issues in Selecting Advertising Media Reach, Reach,Frequency, Frequency,and andImpact Impact Major MajorMedia MediaType TypeOptions Options

Media MediaHabits Habitsof ofTarget TargetConsumers Consumers Nature of the Product Nature of the Product Type Typeof ofMessage Message Cost Cost

Specific SpecificMedia MediaVehicles Vehicles

Specific SpecificMedia MediaWithin WithinaaGiven GivenType Type(e.g., (e.g.,E.R.) E.R.) Balance Media Cost Against Media Factors: Balance Media Cost Against Media Factors: Audience AudienceQuality Quality&&Attention, Attention,Editorial EditorialQuality Quality

Media MediaTiming Timing

Scheduling Schedulingof ofAdvertising AdvertisingOver Overthe theCourse Courseof ofaaYear Year Pattern Patternof ofAds: Ads:Continuity Continuityor orPulsing Pulsing

Profiles of Major Media Types Newspapers

Advantages: Flexibility, timeliness; good local market coverage; high believability Limitations: Short life; poor reproduction quality; small pass-along audience

Television

Advantages: Combines sight, sound, motion; high attention; high reach; appealing to senses Limitations: High absolute costs; high clutter; fleeting exposure; less audience selectivity

Direct Mail

Advantages: Audience selectivity; flexibility, no ad competition within same medium; allows personalization Limitations: Relative high cost; “junk mail” image

Profiles of Major Media Types Radio

Advantages: Mass use; high geographic and demographic selectivity; low cost Limitations: Audio only; fleeting exposure; lower attention; fragmented audiences

Magazines

Advantages: High geographic and demographic selectivity; credibility and prestige; high-quality reproduction; long life; good pass-along readership Limitations: Long ad purchase lead time; no guarantee of position

Outdoor

Advantages: Flexibility; high repeat exposure; low cost; low message competition Limitations: Little audience selectivity; creative limitations

Issues in Selecting Advertising Media Reach, Reach,Frequency, Frequency,and andImpact Impact Major MajorMedia MediaType TypeOptions Options

Media MediaHabits Habitsof ofTarget TargetConsumers Consumers Nature of the Product Nature of the Product Type Typeof ofMessage Message Cost Cost

Specific SpecificMedia MediaVehicles Vehicles

Specific SpecificMedia MediaWithin WithinaaGiven GivenType Type(e.g., (e.g.,E.R.) E.R.) Balance Media Cost Against Media Factors: Balance Media Cost Against Media Factors: Audience AudienceQuality Quality&&Attention, Attention,Editorial EditorialQuality Quality

Media MediaTiming Timing

Scheduling Schedulingof ofAdvertising AdvertisingOver Overthe theCourse Courseof ofaaYear Year Pattern Patternof ofAds: Ads:Continuity Continuityor orPulsing Pulsing

Issues in Selecting Advertising Media Reach, Reach,Frequency, Frequency,and andImpact Impact Major MajorMedia MediaType TypeOptions Options

Media MediaHabits Habitsof ofTarget TargetConsumers Consumers Nature of the Product Nature of the Product Type Typeof ofMessage Message Cost Cost

Specific SpecificMedia MediaVehicles Vehicles

Specific SpecificMedia MediaWithin WithinaaGiven GivenType Type(e.g., (e.g.,E.R.) E.R.) Balance Media Cost Against Media Factors: Balance Media Cost Against Media Factors: Audience AudienceQuality Quality&&Attention, Attention,Editorial EditorialQuality Quality

Media MediaTiming Timing

Scheduling Schedulingof ofAdvertising AdvertisingOver Overthe theCourse Courseof ofaaYear Year Pattern Patternof ofAds: Ads:Continuity Continuityor orPulsing Pulsing

Classification of Advertising Timing Patterns Concentrated

Level (1)

Rising (2)

Falling Alternating (3) (4)

(5)

(6)

(7)

(8)

(9) (9)

(10)

(11)

(12)

Continuous

Intermittent

Month

Number of messages per month

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Factors Impacting the Receipt of a Message Selective Attention

Selective Distortion

Selective Retention

Issues Issues to to Consider Consider in in Designing Designing the the Message Message Message Content Rational Appeals Emotional Appeals Moral Appeals

Message Structure Draw Conclusions Argument Type Argument Order Message Source Expertise, Trustworthiness, Likeability

Typical Message Execution Styles Comparisons Comparisons

Real Realor oranimated animated Symbol Symbol

Slice Sliceof ofLife Life

Mood Moodor or Image Image

Lifestyle Lifestyle Demonstration Demonstration Spokesperson Spokesperson Fantasy Fantasy Humor Humor

Musical Musical Scientific Scientific Evidence Evidence

Stylistic Approaches • • • •

Can present many points quickly Cost less than drama to produce Audience can become distracted Discount all or part of the facts

DRAMA

COMBINATION

LECTURE

• Characters speak to each other – not the audience • Consumers must infer lessons • Conclusions are more likely to be accepted

Common Appeals

Vanity Vanityand andegotism egotism Fun Funand andpleasure pleasure Convenience Convenience

Profit Profitmotive motive Health Healthconcerns concerns

Common Common Message Message Appeals Appeals

Love Love

Sex Sex

Admiration/worship Admiration/worship Fear Fear

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Identify and analyze target market

Evaluate advertising effectiveness

Define Advertising objectives

Create advertising platform

Determine advertising appropriation

Execute campaign

Create advertising messages

Develop Media plan

Advertising Evaluation Advertising Advertising Program Program Evaluation Evaluation

Communication Communication Effects Effects Is Isthe theadvertisement advertisement meeting meetingthe thespecific specific communication communicationobjective? objective?

Sales Sales Effects Effects (to (to the the extent extent possible) possible) Is Isthe theAd Ad Increasing IncreasingSales? Sales?