Download Chapter 12

Communicating
Customer Value
Advertising and Public
Relations
Chapter 12
Rest Stop: Previewing the Concepts
1. Define the five promotion mix tools for
2.
3.
4.
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.
Explain how companies use public
relations to communicate with their
publics.
Copyright 2011, Pearson Education Inc. Publishing as Prentice-Hall
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First Stop
Unilever Integrates Digital & Traditional Media
•
•
Background
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.
Recognition: Unilever was
named digital marketer of the
year by Advertising Age.
However, Unilever does not
run digital campaigns in
isolation of other media;
rather, digital is integrated
with traditional media.
•
•
Copyright 2011, Pearson Education Inc. Publishing as Prentice-Hall
Implementation
How They Do It: Innovative
Web sites, viral videos, and
“webisodes” represent key
digital content. Real, funny TV
ads pull viewers to Web sites 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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The Promotion Mix
• Promotion mix (also called marketing
communications mix):
 Specific
blend of promotion tools that
the company uses to persuasively
communicate customer value and build
customer relationships.
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The Promotion Mix
• The company’s total promotion mix
consists of a specific blend of:
 Advertising.
 Sales
promotion.
 Public relations.
 Personal selling.
 Direct marketing.
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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
• Integrated marketing communications
(IMC) defined:
 Carefully
integrating and coordinating the
company’s many communication channels to
deliver a clear, consistent, and compelling
message about the organization and its
products.
• A strong need for integrated marketing
communications exists.
• Marketers must understand each
promotion tool when shaping the
marketing communications mix.
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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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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.
 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.
 Well
suited to highly targeted marketing.
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Promotion Mix Strategies
• Push strategy:
 Promotion
strategy that calls for using
the sales force and trade promotion to
push the product through channels.
• Pull strategy:
 Promotion
strategy that calls for
spending a lot on advertising and
consumer promotion to induce final
consumers to buy the product.
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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.
Advertising is used by:
 Business
firms.
 Not-for-profit organizations.
 Professionals.
 Social agencies.
 Government.
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Major Advertising Decisions
• Setting advertising objectives.
• Setting the advertising budget.
• Developing advertising strategy.
• Evaluating advertising campaigns.
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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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Major Advertising Decisions
• Setting the advertising budget:
 Affordable
method.
 Percentage-of-sales method.
 Competitive-parity method.
 Objective-and-task method.
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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.
 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
• Planning the message strategy:
 Identify
customer benefits that can be
used as advertising appeals.
 Develop compelling creative concept—
the “big idea.”
 Choose an advertising appeal that is:
• Meaningful.
• Believable.
• Distinctive.
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Major Advertising Decisions
Message Execution Styles:
• Slice of Life
• Lifestyle
• Fantasy
• Mood or image
• Musical
• Personality
symbol
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• Technical
•
•
expertise
Scientific
evidence
Testimonial
evidence or
endorsement
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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.
• Copy.
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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.
• Boosts consumer involvement and gets consumers
talking and thinking about the brand.
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Major Advertising Decisions
• Steps in advertising media selection:
 Deciding
on reach, frequency, impact.
 Choosing among media types.
 Selecting specific media vehicles.
 Deciding 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
• The media mix should be regularly
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.
 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.
 Pulsing.
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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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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.
• 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
• Public relations:
 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.
 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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Major Public Relations Tools
• News
• Speeches
• Special events
• Written materials
• Audiovisual
materials
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• Corporate identity
•
•
•
materials
Public service
activities
Buzz marketing &
social networking
Company Web site
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Rest Stop: Reviewing the Concepts
1. Define the five promotion mix tools for
2.
3.
4.
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.
Explain how companies use public
relations to communicate with their
publics.
Copyright 2011, Pearson Education Inc. Publishing as Prentice-Hall
12 - 36