IE 450

Marketing Management and Research

Chapter 15
Advertising and Public Relations
Advertising
• Advertising is any paid form of nonpersonal presentation and
promotion of ideas, goods, or services by an identified sponsor.
• Although advertising is used mostly by business firms, a wide range of
not-for-profit organizations, professionals, and social agencies also
use advertising to promote their causes to various target publics.
• Advertising is a good way to engage, inform, and persuade, whether
the purpose is to sell Coca-Cola worldwide, help smokers kick the
habit, or educate people in developing nations on how to lead
healthier lives.
Advertising
• Marketing management must make four important decisions when
developing an advertising program: setting advertising objectives,
setting the advertising budget, developing an advertising strategy
(message decisions and media decisions), and evaluating advertising
campaigns.
Advertising
Setting Advertising Objectives
• An advertising objective is a specific communication task to be
accomplished with a specific target audience during a specific time.
• These objectives should be based on past decisions about the target
market, positioning, and the marketing mix, which define the job that
advertising must do in the total marketing program.
• Advertising objectives can be classified by their primary purpose—to
inform, persuade, or remind
Advertising
Setting Advertising Objectives
• Informative advertising is used when introducing a new product
category to build primary demand.
• Persuasive advertising is important with increased competition to
build selective demand.
• Comparative advertising is when a company compares its brand with
other brands.
• Reminder advertising is important with mature products to help
maintain customer relationships and keep customers thinking about
the product.
Advertising
Setting the Advertising Budget
• Factors that should be considered when setting the advertising
budget are:
• Stage in product life cycle: new products typically need relatively
large advertising budgets to build awareness and to gain consumer
trial. In contrast, mature brands usually require lower budgets as a
ratio to sales.
• Market share: building the market or taking market share from
competitors requires larger advertising.
• Competition: brands in a market with many competitors and high
advertising clutter must be advertised more heavily to be noticed
above the noise in the marketplace.
Advertising
Developing Advertising Strategy
• Advertising strategy is the strategy by which the company
accomplishes its advertising objectives and consists of:
• Creating advertising messages
• Selecting advertising media
Advertising
Developing Advertising Strategy - Creating messages
• No matter how big the budget, advertising can succeed only if it gains
attention, engages consumers, and communicates well.
• Advertising clutter: Today’s consumers, armed with an arsenal of
weapons, can choose what they watch and don’t watch. Increasingly,
they are choosing not to watch ads.
• Advertisements need to be better planned, more imaginative, more
entertaining, and more rewarding to consumers.
• People will engage and react only if they believe they will benefit
from doing so. Thus, developing an effective message strategy begins
with identifying customer benefits that can be used as advertising
appeals.
Advertising
Developing Advertising Strategy - Creating messages
• The message can be presented in the following execution styles:
• Slice of life shows one or more “typical” people using the product in a
normal setting.
• Lifestyle shows how a product fits in with a particular lifestyle.
• Mood or image builds a mood or image around the product or service,
such as beauty, love, intrigue, serenity, or pride.
• 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.
Advertising
Developing Advertising Strategy - Selecting media
• The major steps in advertising media selection are :
• Determining reach, frequency, impact, and engagement
• Choosing among major media types
• Selecting specific media vehicles
• Choosing media timing
Advertising
Developing Advertising Strategy - Selecting media
• Reach is a measure of the percentage of people in the target market
who are exposed to the ad campaign during a given period of time.
• Frequency is a measure of how many times the average person in the
target market is exposed to the message.
• Impact is the qualitative value of a message exposure through a given
medium.
• Engagement is a measure of things such as ratings, readership,
listenership, and click-through rates.
Advertising
Developing Advertising Strategy - Selecting media
• The major media types are television, digital and social media,
newspapers, direct mail, magazines, radio, and outdoor. Each medium
has its advantages and its limitations.
• Media planners want to choose media that will effectively and
efficiently present the advertising message to target customers. Thus,
they must consider each medium’s impact, message effectiveness,
and cost.
Advertising
Developing Advertising Strategy - Selecting media
• Media planners must also choose the best media vehicles—specific
media within each general media type.
• For example, television vehicles include Modern Family and ABC
World News Tonight. Magazine vehicles include Time, Real Simple,
and ESPN The Magazine. Online and mobile vehicles include Twitter,
Facebook, Pinterest, and YouTube.
Advertising
Developing Advertising Strategy - Selecting media
• An advertiser must decide the media timing and how to schedule the
advertising over the course of a year. The firm can vary its advertising
to follow the seasonal pattern, oppose the seasonal pattern, or be the
same all year. Most firms do some seasonal advertising.
• The advertiser must also choose the pattern of the ads, continuity—
scheduling evenly within a given period or pulsing — scheduling
unevenly within a given period.
Advertising
Evaluating Advertising Effectiveness
• Return on advertising investment is the net return on advertising
investment divided by the costs of the advertising investment.
• Measuring the communication effects of an ad or ad campaign tells
whether the ads and media are communicating the ad message well.
Individual ads can be tested before or after they are run.
• One way to measure the sales and profit effects of advertising is to
compare past sales and profits with past advertising expenditures or
to use experiments to test the effects of different advertising
spending levels.
Public Relations
• Public relations involves 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.
• PR departments may perform any or all of the following functions:
• Press relations involve the creation and placing of newsworthy
information to attract attention to a person, product, or service.
• Product publicity involve publicizing specific products.
• Public affairs involve building and maintaining national or local
community relations.
• Investor relations involve maintaining relationships with
shareholders and others in the financial community.
Public Relations
The Role and Impact of Public Relations
• Public relations can have a strong impact on public awareness at a
much lower cost than advertising can.
• Public relations has the power to engage consumers and make them
a part of the brand story and its telling.
Public Relations
Public Relations Tools
• PR uses several tools such as news, special events, news conferences,
speeches, brand tours, and sponsorships.
• PR also prepare written materials to reach and influence their target
markets. These materials include annual reports, brochures, articles,
and company newsletters and magazines.
• Corporate identity materials can also help create a corporate identity
that the public immediately recognizes. Logos, stationery, brochures,
business cards, buildings, uniforms, and company cars and trucks.