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Mass selling Communicating with large numbers of potential customers Master 1 International Business Engineer “Non”-personal selling Used when the target market is large and dispersed Communication / promotion Advertising is the main form of mass selling Session 2 : Advertising any paid form of nonpersonal communication eg. Techniques include billboard ads and TV commercials G. de Lanauze Publicity is the generation of awareness about a product beyond regular advertising methods. Usually less costly than advertising because sometimes the message is spread for free by a newspaper article or TV story. Communication G. de Lanauze Advertising: a definition Advertising Advertising is the nonpersonal communication of information usually paid for and usually persuasive in nature about products, services or ideas by identified sponsors through the various media. Bovee/Arens, 1992 Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 3 Advertising program development Modern ad spending tops $231 billion in U.S. annually, $500 billion worldwide. Communication 16- 4 G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 Reaches masses of geographically dispersed buyers at a low cost per exposure Mission : what are our advertising objectives ? • • Enables the seller to repeat a message often Money : How much can we spend? Can build up long-term image for a product Message : What message should we send? • • Signage in ancient times offers evidence of early advertising. The Nature of Advertising Advertising is any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor • 2 BuraphaMaster 1 IAI - 2015 / 2016 Media : Which media should we use? Can trigger quick sales Measurement: How should we evaluate the results? Consumers tend to view advertised products as more legitimate Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 5 Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 12 - 6 1 Major advertising decisions The Ad Agency’s Role Objectives setting •Communication objectives •Sales objectives Knowledge of the target (socio-demographics, purchases) Motivations, information level and need for information Verification of the coherence with the marketing mix Budget decisions •Percentage of sales/ affordable approach •Competitive parity pproach Reasons for using an ad agency Highly skilled specialists Specialization in a particular industry Objective viewpoint of the market Broad range of experience Agency selection National (local) versus international agency Communication’s available modes Message decisions (creative strategy) Media decisions Control of efficiency Control of the choices coherence Researchers Artists •Reach, Frequency, impact, •Media types ; media planning •Message strategy •Message execution Writers Advertising evaluation •Communication impact •Pretesting and testsing •Sales impacts Photographe 7 BuraphaMaster 1 IAI - 2015 / 2016 Communication G. de Lanauze Decentralized Advertising System Communication G. dersLanauze Media Analysts Other Skills BuraphaMaster 1 IAI - 2015 / 2016 8 Agency Compensation Plans Corporate Commissions Production Finance Human Resources R&D Marketing Around 15% of airtime fees Markup Charges Sales Product Management Brand Manager Advertising Dept Ad agency Brand Manager Communication G. de Lanauze Production cost + fixed percent Marketing services Fee Systems Hourly rates or by project Marketing Research Incentive Systems Tightly-specified objectives Sales promotion Package design Ad agency BuraphaMaster 1 IAI Merchandising - 2015 / 2016 9 BuraphaMaster 1 IAI - 2015 / 2016 Communication G. de Lanauze Message creation: the creative strategy Message content Express product value Good advertising creative strategy translates the brand’s positioning statement into a persuasive and memorable message. A great creative will provide lasting impact even if advertising budgets are constrained. “ How you say it is as critical as what you say” Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 10 11 •Functional value •Social value •Psychological value •Economic value •Whatever else the consumer thinks is important Communication G. de Lanauze Three ways to differentiate the product Perceptible Actual differences Easily seen Imperceptible Actual differences Can’t be seen Induced No actual differences Parity products BuraphaMaster 1 IAI - 2015 / 2016 12 2 Two basic ways of presenting a sales message • • Intellectually/ Rationally Usually about the product’s function Usually copy heavy and line drawings Emotionally appeal to psychological, social or symbolic needs. Usually not about the product’s function Usually copy is light with high connotative content Uses photographs or video Psychological appeals • • • • • Self-preservation Sex Greed Self-esteem Personal enjoyment • • • • • Fear Humor Fantasy Imitation Altruism • • • Constructiveness Destructiveness Curiosity Shift towards emotional execution strategy in the later part of the product lifecycle Intense competition and proliferation of substitutable products (Michelin) Critical to increase “Product involvement” 13 BuraphaMaster 1 IAI - 2015 / 2016 Communication G. de Lanauze Communication G. de Lanauze Creative Execution Styles •Slice of Life •Lifestyle •Fantasy •Mood or Image •Testimonial Evidence or Endorsement BuraphaMaster 1 IAI - 2015 / 2016 14 Endorsement Celebrity endorsers may be movie stars, politicians, sports stars, or other public personalities •Musical •Personality Symbol •Technical Expertise •Scientific Evidence •Comparative Testimonials feature ordinary people who talk about their product experiences Communication G. de Lanauze 16- 15 BuraphaMaster 1 IAI - 2015 / 2016 Communication G. de Lanauze Message generation and creative development A good ad focuses on one or two core selling propositions Marketing brief Creative brief (3) Roughs creating Project choice (1) and presentation to the customer Message preparing 16- 16 Complaints about advertising • It perpetuates stereotypes • Absolutely true • It has to • Makes people buy things they don’t need • Not true • Advertising can’t make anybody do anything Validation of positioning statement Creative development BuraphaMaster 1 IAI - 2015 / 2016 Execution (2) Pretest Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 CAMPAIGN 17 Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 18 3 Media Planning and Strategy : Basic Terms Media planning: The series of decisions involved in delivering the message to the target audience. Media plan: The actual document detailing media planning decisions. Media planning strategy Media objectives: Objectives of media plan. Media strategies: action plans to reach objectives. Medium: channel such as print, broadcast. Media vehicle: Specific carrier in a media category (television, magazines). Communication G. de Lanauze Media Versus Vehicles BuraphaMaster 1 IAI - 2015 / 2016 20 Selecting Advertising Media Media are the general communication methods that carry advertising messages—television, magazines, newspapers, and so on. Advertising media: Vehicles through which advertising messages are delivered to their intended audiences Vehicles are the specific broadcast programs or print choices in which advertisements are placed. For example, television is the media, and American Idol is the vehicle. Steps in advertising media selection: • Determining reach, frequency, and impact • Choosing among major media types • Selecting specific media vehicles • Choosing media timing Each medium and vehicle has a unique set of characteristics and virtues. Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 21 The medias strategy: choice of the media and media-planning Media-planning consists in choosing the media in which the ads will be seen (number of insertions, period of appearance) Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 12 - 22 Developing the Media Plan Situation Analysis Marketing Strategy Plan Practical criterions: • Accessibility of the medias, reservation time, entry ticket,… Creative Strategy Plan Setting Media Objectives Determining Media Strategy Quantitative efficiency criterions: • Power, target covering, repetition power, fit with the target, … Selecting Broad Media Classes Qualitative criterions: • Ability to increase message value, communication quality (colors, music, movement, …), impact on distribution, … Selecting Media Within Class Media Use Decision — Broadcast Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 23 Communication G. de Lanauze Media Use Decision — Print Media Use Decision — Other Media BuraphaMaster 1 IAI - 2015 / 2016 24 4 Creative / media synergies Specifying Media Objectives Media planners for Absolut vodka work with creatives to design ads targeted to specific audiences. The ad at left appears in theater playbills. Communication G. de Lanauze 16- 25 BuraphaMaster 1 IAI - 2015 / 2016 Deciding on media 1. What proportion of the population should be reached with advertising message during specified period (reach) 2. How frequently should audience be exposed to message during this period (frequency) 3. How much total advertising is needed to accomplish reach and frequency objectives (weight) 4. How should the advertising budget be allocated over time (continuity) 5. How close to the time of purchase should the target audience be exposed to the advertising message (recency) 6. What is the most economically justifiable way to accomplish objectives (cost) Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 26 Define the target market Media selection is finding the most cost-effective media to deliver the desired number of exposures to the target audience: Reach: the percentage of people in the target market who are exposed to the ad campaign during the defined time duration Eg; 70% of the target market during the first three months of the campaign Reach: number of persons exposed at least once Total number of exposures (E) E=RxF Frequency Average number of exposure for one person Impact Qualitative value of an exposure Frequency: A measure of how many times an average individual in the target market who have been reached . Weighted number of exposures (WE) WE=RxFxI Advertising Exposure Gross Rating Points = 70(Reach) 4(Frequency) = 280 GRP’s 1GRP = 1 exposure to 1% of the audience. Trade-off between reach and frequency Qualitative Measures : Impact: qualitative aspect of the medium Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 27 Weight: Gross Rating Points Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 28 The Concept of Effective Reach Gross rating points, or GRPs, are an indicator of the amount of gross weight that a particular advertising schedule is capable of delivering Effective reach is based on the idea that an advertising schedule is effective only if it does not reach members of target audience too few or too many times GRPs=Reach(R) X Frequency(F) Target Rating Points (TRPs): Adjust a vehicle’s rating to reflect just those individuals who match the advertiser’s target audience Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 29 Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 30 5 Cost considerations Continuity How advertising is allocated during the course of an advertising campaign: how should the media budget be distributed? Cost per Thousand (CPM) Continuous advertising schedule: an equal number of ad dollars are invested throughout the campaign Target Market (TM) CPM= Cost of ad # of contacts (expressed in thousands) Pulsing: some advertising is used during every period of the campaign, but the amount of advertising varies from period to period. Flighting: the advertiser varies expenditures throughout the campaign and allocates zero expenditures in some months. CPM-TM= Cost of ad # of TM contacts (expressed in thousands) 31 BuraphaMaster 1 IAI - 2015 / 2016 Communication G. de Lanauze Communication G. de Lanauze Three Scheduling Methods Magazine Audience Measurement Circulation: measure of how many copies of an issue are sent to market including subscriptions and distributor sales Continuity Readership: estimate of the number of people actually reading an issue of a magazine; more than one person typically reads the same copy of a magazine Flighting Pulsing Jan Feb Mar 32 BuraphaMaster 1 IAI - 2015 / 2016 These number are broken down by reader characteristics to more accurately define a target audience, ex. SRDS handout Apr Communication G. de Lanauze May Jun Jul Aug Sep Oct Nov Dec BuraphaMaster 1 IAI - 2015 / 2016 33 Communication G. de Lanauze Profiles of Major Media Types Choosing Among Major Media Types Medium Choose media that effectively and efficiently present the message to customers Consider each medium’s impact, effectiveness, and cost • Print • Broadcast Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 34 BuraphaMaster 1 IAI - 2015 / 2016 35 Advantages Television Good mass-marketing coverage; low cost per exposure; combines sight, sound, and motion; appealing to the senses Newspapers Flexibility; timeliness; good local market coverage; broad acceptability; high believability Internet High selectivity; low cost; immediacy; interactive capabilities Direct mail High audience selectivity; flexibility; no ad competition within the same medium; allows personalization Magazines High geographic and demographic selectivity; credibility and prestige; high-quality reproduction; long life and good passalong readership Radio Good local acceptance; high geographic and demographic selectivity; low cost Outdoor Flexibility; high repeat exposure; low cost; low message competition; good positional selectivity Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 12 - 36 6 Selecting Specific Media Vehicles Profiles of Major Media Types Medium Choose the best media vehicles—specific media within each general media type Compute the cost per 1,000 persons reached by a vehicle Limitations Television High absolute costs; high clutter; fleeting exposure; less audience selectivity Newspapers Short life; poor reproduction quality; small pass-along audience Internet Potentially low impact; the audience controls exposure Direct mail Relatively high cost per exposure; “junk mail” image Magazines Long ad purchase lead time; high cost; no guarantee of position Radio Audio only; fleeting exposure; low attention (“the half-heard” medium); fragmented audiences Outdoor Little audience selectivity; creative limitations Consider the costs of producing ads for different media Balance media costs against several media effectiveness factors Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 37 Communication G. de Lanauze Television Pros and Cons Advantages BuraphaMaster 1 IAI - 2015 / 2016 Radio Pros and Cons Disadvantages Advantages Disadvantages Mass Coverage Low Selectivity Local Coverage Audio Only High Reach Short Message Life Low Cost Clutter Impact of Sight, Sound and Motion High Absolute Cost High Frequency Low Attention Getting High Prestige High Production Cost Flexible Fleeting Message Low Cost Per Exposure Clutter Low Production Cost Attention Getting Communication G. de Lanauze Favorable Image Well-segmented Audience BuraphaMaster 1 IAI - 2015 / 2016 39 Communication G. de Lanauze Magazine Pros and Cons Advantages 12 - 38 BuraphaMaster 1 IAI - 2015 / 2016 40 Newspaper Pros and Cons Advantages Disadvantages Disadvantages Segmentation Potential Long Lead Time for Ad Placement High Coverage Short Life Quality Reproduction Visual Only Low Cost Clutter High Information Content Lack of Flexibility Short Lead Time for Placing Ads Low Attention Getting Longevity Ads Can Be Placed in Interest Sections Poor Reproduction Quality Multiple Readers Timely (Current Ads) Selective Reader Exposure Reader Controls Exposure Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 41 Communication G. de Lanauze Can Be Used for Coupons BuraphaMaster 1 IAI - 2015 / 2016 42 7 Outdoor Pros and Cons Advantages A never ending list of possibilities Disadvantages Location Specific Sort Exposure Time High Repetition Short Ads Easily Noticed Poor Image Local Restrictions Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 43 Communication G. de Lanauze Internet Pros and Cons Disadvantages User Selects Product Information Limited Creative Capabilities User Attention and Involvement Websnarl (Crowded Access) Interactive Relationship Technology Limitations Direct Selling Potential Few Valid Measurement Techniques Flexible Message Platform Limited Reach Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 44 Choice of the medias at international level • Advantages BuraphaMaster 1 IAI - 2015 / 2016 • • Few really international media exist (except some very specific TV channels (MTV), radios (BBC news), Magazines (National Geographic) Internet is a good international medium The weight and diffusion of the different media may differ a lot between countries Media characteristics in selected countries: 45 Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 46 © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Control of the communication actions Pre-testing: Analysis of the various elements of the message and its impact according to the company’s goals Methods (surveys: folder test, preview,…) Post-testing: Measure of the campaign efficiency : evolution of the notoriety and memorization (top of mind, spontaneous, assisted). Campaign evaluation Panels and barometers: Longitudinal surveys of the ad’s indicators. Audience (Médiamétrie), IPSOS scores (recognition, attribution, agreement), … Communication G. de Lanauze BuraphaMaster 1 IAI - 2015 / 2016 47 8