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MARKETING
Real People, Real Choices
Fourth Edition
CHAPTER 13
Advertising and
Public Relations
It’s an Ad Ad Ad Ad World
• Advertising is nonpersonal communication
paid for by an identified sponsor using mass
media to persuade, inform, and remind an
audience
• 2004: over 265 billion USD spent on
advertising
• Biggest spenders: Automobiles, financial
services, food and beverages and retail.
• What could be some threats to advertising?
13-2
Types of Advertising
• Product advertising - message focuses on a
specific product or service
– Category advertising (Got Milk?; The other
white meat, etc.)
– Brand advertising
• Institutional advertising - message focuses on
activities, personality, or point of view of a
company
– advocacy advertising (2004: MTV’s
“choose or lose” campaign)
– public service advertisements (antismoking; anti-drugs; drunk driving, etc.)
13-3
Purposes of Product Advertising
• To educate people about a new product
and what it does
• To emphasize a brand’s features and try
to convince the target market to choose
it over other options
• To ensure that people won’t forget about
a well-established product
13-4
Who Creates Advertising?
• An advertising campaign is a coordinated,
comprehensive plan that carries out
promotion objectives and results in a series of
advertisements placed in media over a period
of time
• Agencies
– limited-service
• Creative boutiques
• Specialize in few options e.g. Internet
advertising
– full-service
13-5
Largest Ad Agencies
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J. Walter Thompson
Leo Burnett Worldwide
McCann-Erickson Worldwide
BBDO Worldwide
Grey Worldwide
Ogilvy & Mather
Foote Cone & Belding
• Worldwide billings exceed several billion USD
13-6
The Body of Campaign Creation
• Account management
– Campaign strategy and client relations
• Creative services
– Visualization and writing of the ads
• Research
– Market and Advertising Research
• Media planning
– Planning, buying and placing the campaign
13-7
Developing the Campaign
• Identify the Target Market
• Establish objectives
– What should the campaign achieve
– Budget (in cooperation with client)
• Prepare creative brief
• Design Ad Campaign
• Choose Media and Schedule
• Pretest Campaign
• Full rollout
13-8
Design the Ad
• Creative strategy is the process that
turns a concept into an advertisement
• Creatives try to develop a “big idea”
(e.g. “Think Small”)
• Creatives:
– art directors
– copywriters
– photographers
13-9
Advertising Appeals
• Reasons Why (USP)
(e.g. M&Ms melt in your mouth,
not in your hand)
• Comparative
Advertising (e.g. Coke &
Pepsi; DHL, Fedex and UPS;
etc.)
• Demonstration (e.g.
kitchen appliances, vacuum
cleaners, etc.)
• Testimonial (e.g. dentists
endorsing toothpastes, etc.)
• Slice-of-Life (e.g. breakfast
cereal bars on the go)
• Lifestyle (e.g. Cars, clothes,
personal grooming products)
• Fear (e.g. Insurance, drugs)
• Sex (e.g. Victoria’s Secret;
Calvin Klein; etc.)
• Humor (e.g. Dodge Hemmi;
Sonic etc.)
• Slogans and Jingles (e.g.
“Your friendly neighborhood
agent”; With Allstate you are in
good hands”, etc.)
13-10
Step 4: Pretest What Will Be Said
• Copy testing measures ad effectiveness
– Concept testing
– Test commercials
– Finished testing
• Focus Groups
• Projective Techniques
• Limited area surveys
13-11
Step 5: Choose the Media
• Media planning is a problem-solving process
for getting a message to a target audience in
the most effective fashion
– Where to say it
– When to say it
• Highly complicated numbers game
• Hundreds of media options from mass media
to video games, DVDs, placements,MP3
players, cell phones, cable channels, etc.
13-12
Television
• Pros
– Creative and flexible
(see & hear)
– Prestigious
– High impact
messages
– Network TV is cost
effective for reaching
mass audience
– Cable TV is good for
reaching targeted
group
• Cons
– Quickly forgotten
– Requires frequent
repetition
– Increasingly
fragmented audiences
– High costs on an
absolute basis
– Shorter ads result in
increased clutter
13-13
Radio
• Pros
• Cons
– Good for selective
– Listeners may not
targeting
pay full attention
– Heard out of
– Small audiences
home
mean ads must be
– Relatively low
repeated
cost
frequently
– Can be modified
– Not appropriate for
quickly
products requiring
– Uses listener
demonstration
imagination
13-14
Newspapers
• Pros
• Cons
– Wide exposure and
– Most don’t spend
extensive market
much time reading
coverage
newspapers
– Flexible format permits
– Low readership among
use of color, different
teens and young
sizes and editions
adults
– Useful for comparison
– Short life span
shopping
– Very cluttered
– Local retailers can tie in
– General decline in
with national ads
reading habits
13-15
Magazines
• Pros
– Narrowly targeted
audiences by
specialized
magazines
– High credibility and
interest level provide
good ad environment
– Long life span and
pass along rate
– Excellent visual
quality
• Cons
– With exception of
direct mail, the most
expensive form
– Long deadlines
– Must use several
magazines to reach
target
13-16
Outdoor
• Pros
– Very high reach
– Low cost
– Good for
supplementing
other media
• Cons
– Hard to
communicate
complex messages
– Cannot
demonstrate
product
effectiveness
– Controversial and
disliked
13-17
Internet Advertising
• Banners (less that
1% click through rate)
• Buttons (small
banners anywhere in
the web page)
• Search engine
and directory
listings
• Pop-up ads (open a
separate window)
• Email
– permission
marketing (opt
out options given by
marketer)
– Spamming
(junkmail on the
internet)
13-18
Media Scheduling
• Specifies the exact media to use for the
campaign, when and how often the
message should appear
• Outlines the planner’s best estimate of
which media and vehicles will be most
effective in attaining campaign
objectives
13-19
Factors Affecting Media Scheduling
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Target market profile
People reached by different vehicles
Advertising patterns of competitors
Capability of medium to convey desired
information
• Compatibility of product with editorial
content
13-20
Media Scheduling Terms 1
• Impressions – the number of people
who will be exposed to a message
placed in one or more media vehicles
• Reach – the percentage of the target
market exposed to the media vehicle at
least once.
• Frequency – the average number of
times a person in the target group will be
exposed to the vehicle in a period
13-21
Media Scheduling Terms 2
• Gross Rating Points (GRPs) – reach *
frequency
• Cost per Thousand (CPM) – compares
the relative cost effectiveness of
different media vehicles that have
different exposure rates; it reflects the
cost to deliver a message to 1000
people
13-22
Media Scheduling: How Often?
• Continuous – steady stream throughout
year (products which we buy on a
regular basis)
• Pulsing – varies amount of advertising
based on when product is in demand
(e.g., suntan lotion)
• Flighting – advertising appears in short,
intense bursts alternative with periods of
little to no activity
13-23
Evaluating Advertising
• Posttesting means conducting research
on consumers’ responses to advertising
messages they have seen or heard
– unaided recall (recall in the absence
of a cue)
– aided recall (recall with a cue
provided)
– attitudinal measures (like / dislike)
13-24
Public Relations
• Attempts to influence the attitudes and
perceptions of consumers, stockholders, and
other stakeholders toward companies,
brands, politicians, celebrities, not-for-profit
organizations (e.g. Mel Gibson’s film – “The
Passion…”
• Do something good, then talk about it
• Why PR – “third party” reporting is seen to be
unbiased and therefore credible
• Create a crisis management plan
13-25
Some well known PR crises
• Tylenol and product tampering
• Wendy’s and finger in chili
• Pepsi & Coke – pesticides in cola
(India)
• Union Carbide in India – hundreds of
deaths due to gas leak
• Vioxx & heart attack and stroke victims
• Can you think of more?
13-26
Objectives of Public Relations
• Introducing new products
• Influencing government legislation
(lobbying)
• Enhancing the image of a city, region, or
country (Mauritius, Singapore – “So
easy to enjoy, so hard to forget”)
• Calling attention to a firm’s involvement
with the community (e.g. sponsoring
sporting events, rock concerts, special
events, etc.)
13-27
Planning a PR Campaign
• Develop objectives (e.g. International
Apple Institute – “An apple a day…”)
• Execute the campaign
• Evaluate the campaign
– Problems with gauging effectiveness
13-28
PR Campaign Strategy
• Statement of objectives
• Situation analysis
• Specification of target audiences,
messages to be communicated, specific
program elements to be used
• Timetable and budget
• Discussion of how the program will be
evaluated
13-29
PR Activities
• Press Releases (new products, new findings, etc.)
• Internal PR (newsletters, close-circuit TV, employee awards, etc.)
• Lobbying (influencing govt. officials to vote a certain way on
legislation, initiate new legislation, etc.)
• Speech writing (write speeches for senior executives –
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annual meetings, industry meetings, etc.)
Corporate identity (logos, symbols, stationery design, etc. for
companies, identity manuals)
Media relations (create and maintain access with reporters to
be used when needed)
Sponsorships (sporting events, rock concerts, etc.)
Special events (e.g. visits of dignitaries to plant, planning a
christmas party, etc,)
Advice and counsel (e.g. to top management on
communication issues)
13-30
Measuring Effectiveness
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In-house assessment
Awareness and Preference Studies
Counting of press clippings
Impression counts
13-31
Direct Marketing
• Any direct communication to a
consumer or business recipient that is
designed to generate a response in the
form of an order, a request for further
information, and/or a visit to a store or
other place of business for purchase of
a product
13-32
Forms of Direct Marketing
• Mail order (3% of overall retail US sales)
– Catalogs (e.g. Eddie Bauer, Lands End, Dell,
Gateway, JC Penney, Neiman Marcus, etc.)
– Direct mail (offers a specific product through mail
at one point in time – can be personalized)
• Telemarketing (cheap and easy; 1 in 6 Americans
cannot resist a telemarketing pitch; more effective in
B2B selling; national Do-not-call registry)
• Direct response television
– Infomercials
– Home shopping networks (QVC and HSN)
– Top selling categories: diet and health products,
kitchen appliances, exercise equipment and music
CDs)
13-33
M-Commerce
• Promotional activities transmitted over
mobile phones and other mobile
devices such as personal digital
assistants (PDAs)
– Prevalent in Europe and Asia
– Problems of “spim”
• What does the future hold?
– Have you seen Minority Report?
13-34