Download Advertising, SP & PR

Advertising, SP & PR
What is Advertising?
 It is any paid form of non – personal
presentation and promotion of ideas,
goods, services by an identified sponsor.
The 5 Ms of Advertising
 Mission – objectives
 Money – budgets
 Message – communication
 Media – what vehicles?
 Measurement - evaluation
Advertising Goal
 A specific communication task to be
achieved to a specific degree to be
communicated to a specific target
audience in a specific period of time.
Advertising objectives
 Informative
 Persuasive
 Comparative
 Reminder (reinforcement)
How much to spend?
Depends on the product
 What stage in the PLC
 Market share and the consumer base
 Competition and clutter
 Ad frequency
 Product substitutability
Message generation
 The greater the no. of alternatives, the
better is the likelihood to hit upon an
excellent message
 A good ad focuses on one core selling
proposition
 Messages may be rated on desirability,
exclusiveness and credibility
Message execution
Messages can take one of the following two
routes
 Rational
 Emotional
The Creative department has to decide on the
tone, format, style and words that would go into
the creation of the ad message. They must ensure
that it is not ‘deceptive’ or indulging in ‘puffery’.
Media selection
 The most cost effective media mix to
ensure achievement of the advertising goal.
How should you select media?
 Reach
 Frequency
 Impact
Reach
 No. of persons exposed to a particular
media schedule at least once during a
specified time period
Frequency
 No. of times within the specified period
that a person is exposed to that message
Impact
 Qualitative value of an exposure through a
given medium
 GRP (Gross rating points) = R * F
 Wt. GRP = R * F * I
Advertising Effectiveness
 It is a measure of the total advertising
effort of a company in relation with the
performance of the company in the market.
 Ad Effectiveness = SOM/SOV * 100
 A figure less than 100 indicates an
ineffective level of expenditure;a figure
above 100 indicates a high level of
effectiveness
Sales Promotion
 Whereas advertising gives a reason to buy,
SP gives an incentive to buy
Advertising vs. Sales Promotion
 80’s and 90’s – Ad : SP :: 60 : 40
 00’s
Ad : SP :: 40 : 60
 In some industries the skew in favour of SP
is even much more like liquor and tobacco
Reasons for greater use of SP Internal
 Accepted by top management as an
effective marketing tool
 More product managers are qualified to use
SP
 Field sales are under greater pressure to
achieve current sales
Reasons for greater use of SP External
 Proliferation of brands
 Frequent use by competitors
 Similarity of brands “me – toos”
 Consumers are more price savvy
 Trade demands to liquidate inventories,
even to stock
 Declining ad efficiencies
Advantages of SP
 Induces trials
 To reward loyal customers
 To induce stocking by the trade
 Adjust to short term variations in trade
 Liquidating inventories
 Preempting competition
Disadvantages of SP
 With too many promotion schemes ‘promotion
clutter’ confuses consumers
 Attracts ‘brand switchers’ and ‘deal prone’
customers
 Dilutes brand equity
 Preponement of purchases
 Lowers margins
 Expensive and wasteful, when not handled
properly
Types of SP
 Trade
 Consumer
Trade Promotion
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Schemes
Signage
Shelf space buying
Display windows buying and display schemes
Lucky draws
‘Mystery’ customer schemes
Sales contests
Consumer Promotions
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Loyalty programmes
Multipacks
Free samples
Free trials
Trade – ins
Cash rebates
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Free gifts
In – packs
Price packs
Coupons
Lucky draws
Price -offs
Developing a SP campaign
 Planning the programme
 Duration
 Incentive to be given
 Assessing viability
 Pretesting
 Implementing and controlling
 Evaluation
Public Relations
 Involves a variety of programmes to
promote or protect a company’s image or
products
Functions of PR
 Media relations
 Product publicity
 Corporate communications
 Lobbying
 Counseling
Marketing PR
 Assisting in new product launches
 Assisting in repositioning of product
 Building interest in product category
 Influencing specific target groups
 Defending products that have encountered
public problems
 Building corporate image that rubs off on
the products
Advantages of MPR
 Building awareness
 Building credibility
 Stimulate sales force and dealers
 Holds down promotion costs
The bottom line
 PR is difficult to measure, but if
consistently pursued with, it can have
tremendous synergy with advertising and
sales promotion, thereby reducing overall
promotion costs