Chapter 5 ~ Advertising, Promotion and Sales

The importance of advertising

Advertising is the most

Visual marketing activity

Advertising is only

One part of marketing

It does NOT

Affect every purchase we make

Advertising tries to

Influence consumer choice

Advertising is most important

for products and services that
are:

1. identical
2. mass marketed(many places)
3. easy to describe
4. low priced
5. new
6. heavily competitive

Goals of Advertising:

1. brand awareness and positioning

2. brand trial
3. brand preference
4. brand reminder
5. brand repositioning

Both industrial and nonindustrial consumers need

To know about it before they can buy it

Advertising informs about

1. name
2. availability
3. benefits
4. appearance
5. ordering information

Positioning statements

Point out the differences among competitors

Brand Trial assumption:

If one tries it and likes it, theyll buy it

Many brand trial ads include

A coupon or samples

Brand preference focuses on

the (also from chapter 1)

Value Equation

Why do they include

People are sheep
statements like most popular
and number 1

Endorsement

Statement by a recognized celebrity that they use the brand

Celebrities will endorse

Almost any product

Brand reminder used when

Older brands are attacked by new competitors

Brand repositioning

Marketers look for new target consumers

Brand repositioning often

Decision
needed in this stage of the PLC

Danger in repositioning

Alienate the old target market

Creating the Message

Advertising is a form of

Communication

Communication model

1. intent
2. message
3. media
4. reception
5. action

Intent (goals)

1. brand awareness and positioning

2. brand trial
3. brand preference
4. brand reminder
5. brand repositioning

Often the company itself does The advertising agency

not create the advertising; who
does

Ad agencies do the following

Initially, newspapers and

magazines received revenue
only from

1. 1.

buy media

2. 2.

create

3. 3.

place

4. 4.

monitor effectiveness

Sales of the periodical

Ad agencies bought advertising 85%

for how much % of price

Regular companies bought

100%
advertising for how much % of
the price

Thus ad agencies made money The savings in their costs of ads

from

Therefore businesses paid the

same for advertising space
whether it had used

Today clients pay for

An agency of not

1. 1.

space

2. 2.

time

Message: intent to message

3. 3.

Creativity

1. 1.

find unique selling proposition

2. 2.

select an appeal for Target Market

3. 3.

create message for the selected media

Unique Selling Proposition

Feature or benefit that cannot be duplicated

Big idea

Message that will communicate USP to T.M.

SWOT

Advertising appeals

1. 1.

Strength

2. 2.

Weakness

3. 3.

opportunities

4. 4.

Threats

1. 1.

biological

2. 2.

emotional

3. 3.

rational

4. 4.

social

Biological

Health and security: lower level needs

Emotional

Promises:
1. 1.

love

2. 2.

fun

Rational: Focuses on

Stresses:

3. 3.

adventure

4. 4.

romance

Reasoning abilities

1. 1.

convenience

2. 2.

cost savings

3. 3.

safety

4. 4.

warranties

5. 5.

ease of purchase

Rational appeal most likely to

use

Value equation to prove worth

Social Appeals: Focuses on

The way social pressures influence consumer behaviour

Examples

Social appeal will often set up

1. 1.

beauty

2. 2.

body shape

3. 3.

social behaviour

Negative situation

Selecting the Media

A medium

Carries a message to an audience

Factors to determine Medium

1. reach
2. frequency
3. selectivity
4. durability
5. lead-time
6. mechanical requirements
7. clutter
8. costs

Reach

Number of people who are exposed

Most media set their prices

Based on their circulation or audience

Frequency

Number of times message will be seen or heard

Frequency and reach combine to Number of times message was seen or heard
tell you:

Selectivity

Ability of the medium to focus on a target market

Durability

Length of time an advertisement lasts

Lead time

The amount of time required to create an ad

Mechanical requirements

Technical complexity of preparing the ads.

Can affect costs

Clutter

Competition for the audiences attention

Internal Clutter

Competition within the same area, or medium

External Clutter

Competition occurring in the real world while the audience is

viewing/reading/listening

Costs

Costs of preparation plus space/time

Costs per thousands

How much money it costs to reach 1000 people

Types of Media

Magazines

Of the 8 factors listed in section 9.3, magazines rate very high

on:
1. Selectivity,
2. durability
On the negative side
1. Lead time
2. costs
3. clutter

5 main parts of good magazine

ad

1. headline

2. illustration
3. body copy
4. signature
5. layout

Headline

Largest type, less than 7 words

Illustrations should

Continue the thought stated in the headline

Body copy

Not too much unless very well done

Signature

Brand identification:
1. logo
2. slogan
3. package
4. brand name

Layout

The structure of the ad

Newspapers

Excellent for: local advertisers

Newspapers offer a wide variety Ad sizes

of

Why is this good?

Most advertisers can afford them

Other advantages

1. lead time
2. mechanical requirements

Disadvantages

1. durability
2. clutter

Television is a very

Versatile medium

Why?

Local, regional, national and international

TVs power comes

In the ability to combine sight and sound

Television advertising is:

1. effective
2. expensive

Why is it expensive?

Disadvantages

Production

1. cost
2. selectivity
3. clutter
4. durability

AIDA

1. attract the consumers attention

2. interest
3. desire

4. action

Radio is

Everywhere

Radio has a good

Local reach

Advantages

1. Lead time
2. mechanical requirements
3. selectivity

Disadvantages

1. costs
2. frequency
3. durability
4. clutter

Out-of-home

1. Billboards
2.

bus

3. subway

Advantages

1. Frequency
2. reach
3. clutter

Disadvantages

1. selectivity
2. mechanical requirements

3. cost

Direct to home often called:

2 Types:

Junk Mail

1. Targeted campaigns
2. Aggregate campaigns

Targeted campaigns

Uses information to locate potential customers

Aggregate campaigns

Use local distribution companies or telemarketers to saturate

an area

Advantages

1. reach
2. costs

Disadvantages

1. selectivity
2. clutter

The Internet

3 Major types:
1. web sites
2. ads on other sites
3. e-mail advertising

Web Sites

www can be advertised in several ways

1. yellow pages
2. other ads

3. search engines

Search Engines

Examples:

Websites that return lists when prompted by people looking

for specific information

1. google
2. yahoo
3. ask
4. msn

How they work:

The company on the top of the list pays 1 cent more per hit
than the company in number 2 spot

However

If there are no competitors for your product or service, a well

constructed site will be found by certain search engines such
as Google. (see Beta tags in your FrontPage notes)

Advantages

1. selectivity
2. inexpensive
3. mechanical requirements
4. durability
5. frequency

Creative use of permission based That targets a customer database is the best way to reach
e-mail
interested consumers

Specialty Advertising

Company puts brand

identification on:

Also known as premium and incentive marketing

1. matchbooks
2. golf caps
3. shirts
4. pens watches
5. toys

Advantages (9.3)

1. durability
2. selectivity
3. mechanical requirements
4. costs

Disadvantages

1. lead time
2. reach
3. work?

With the advent of the ad server, marketing through the Internet opened new frontiers for
advertisers and contributed to the "dot-com" boom of the 1990s. Entire corporations operated
solely on advertising revenue, offering everything from coupons to free Internet access. At the
turn of the 21st century, a number of websites including the search engine Google, started a
change in online advertising by emphasizing contextually relevant, unobtrusive ads intended to
help, rather than inundate, users. This has led to a plethora of similar efforts and an increasing
trend of interactive advertising.

The incredibly large number of websites and the ability to use search engines like
Google, has made it increasingly difficult for retailers to decide where to spend
their advertising dollars. Traditional Media as outlined above is under serious
attack and are losing a lot of advertising revenue to online advertisers.
Publicity
Publicity

Free Media coverage + or -

Negative publicity

Can damage sales

Public relations companies

Coordinates media relations, lobbies government and manages

crises.

Database is PR managers

Most valuable tool

Database contains

Names of writers, editors, producers, photographers and everyone

important in the media

Press releases

Print ready stories about + things about their clients

Press kit

Pictures, bios, tv clips other facts

Press conference

Interview, where media can ask questions

Press Junket

All expense paid trip organized by PR firms to take media people

to a PR event

Lobbyist

Try to convince politicians to support their side when voting on

legislation which affects business.

When things go wrong

PR firms provide damage control.

Sales Promotion

Sales Promotion

Non personal activities that marketers use to try to boost sales

over a specific period of time

Sales promotion adds value

By reducing price or adding a reward

Promotions are targeted to:

1. consumers
2. distributors

Businesses Use promotions

for:

1. build traffic in a store or trade show

2. create extra interest in product, during competitive or
tough period
3. motivate staff
4. introduce new product
5. clear old stock

Types of Promotions:

1. Contests & sweepstakes

2. Refunds and rebates
3. coupons
4. premiums and self liquidators

5. samples
6. special sales
7. POP displays

Contests & sweepstakes

Award a prize to a selected participant

Difference between the 2

Contest requires skill, sweepstakes is random only

Canadian law prohibit

Sweepstakes

Loopholes

1. Skill testing question

2. opportunity to enter without buying

Contests and sweepstakes help Create mailing lists

companies

Refund

Return of the full amount of the price

Rebate

Returns a portion of the price

Rebates can be used to

Group a number of brands together

Coupon is

A document that entitles the bearer to a discount

Sources

1. internet

2. mail
3. print ads
4. store
5. coupon books

Redemption Rate

# used vs. number issued

Premiums

Free product or service

Self liquidator

Product or service offered at a substantially reduced cost

In both cases

Consumer must buy another product or service first

Examples

1. cards
2. points

Samples are one of the

Most effective and expensive promotional activities

In store sampling is

The most effective

Reasons for Special sales:

1. new lines
2. old stock
3. old season
4. traffic during tough times
5. Holiday

Give 3 examples of special

sales:

1.
2.
3.

Point of Purchase Displays

1. racks
2. cases
3. shelves

Push or pull marketing?

Why is it effective?

1. inexpensive merchandise
2. attractively displayed

Display is free; why?

Retailers often have to buy lots of product to get it

Personal Selling

A sale is

Methods:

Transfer of title from seller to buyer

1. internet
2. phone
3. mail
4. person

Personal selling

Factors that determine

whether personal selling is
required:

When transfer is handled in person

1. complexity
2. high price
3. industrial vs. consumer
4. license requirements

Types of sales positions:

The sales process

1. retail clerk/cashier

Minimum wage

2. retail commissioned

% of total sales

3. detail/route

Salary + commission

4. contact

Good salary

5. sales representative

Commission-good potential

6. agent or broker

Commission-highly paid

7. sales engineer

Very high salary

8. auctioneer

Commission-based on bid

1. acquire knowledge
2. make approach
3. determine wants
4. present products
5. handle objections
6. close sale
7. follow up

Salespeople must

Know about the product or service they are selling

3 things salespeople should

remember:

1. Customer entered for a reason

2. once presented, customer can ask for help
3. cue is when customer stops to look at a specific product

Salespeople can only sell if:

They know what the customer wants

How can they accomplish this? Asking the right questions

Sale doesnt begin until:

A better way to sell

The customer objects.

1. anticipate all possible objections

2. develop a series of questions aimed at overcoming
objections before they arise
3. ask each question before attempting to close the sale, thus
leaving the customer with no rational reason not to buy.
They either buy, or look stupid!

Closing the sale

1. Always ask for the sale- assume it

1. will that be cash or credit?
2. when do you want it delivered
3. do want us to wrap it for you
4. do you want it in white or black?

Why sell add-ons?

1. may not be able to use without

2. free time

3. may lose easy sale

Good salespeople keep

Why?

Files on every customer

1. sell them other stuff in the future

2. sell to friends and relatives