Global Marketing and World Trade

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C H A P T E R T W E N T Y
ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS
Cruise Vacation 999
Irwin/McGraw-Hill
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AFTER READING THIS CHAPTER YOU SHOULDBE ABLE TO

• Explain the differences between product
  advertising and institutional advertising and the
  variations within each type.
  
• Understand the steps used to develop, execute,
  and evaluate an advertising program.
  
• Explain the advantages and disadvantages of
  alternative advertising media.

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AFTER READING THIS CHAPTER YOU SHOULDBE ABLE TO

• Understand the strengths and weaknesses of
  consumer-oriented and trade-oriented sales
  promotions.
  
• Recognize public relations as an important form
  of communication.

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PP20-AA The Wild World of Web Advertising

• Presently Web advertisers are spending more than
  500 million annually. This number will approach
  5 billion in the near future. Why the rapid
  growth?
• - growing number of business and households on
  the Internet
  
• - advertising on the Web allows an advertiser to
  assess the
  
• success of the ad. Web technology allows
  advertisers to
  
• count the number of people who see an ad,
  how many click through it, and in some cases
  how many purchase it.
  
• - Web advertising has potential for creating
  value for
  
• customers by making ads interactive.

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PP20-BB Types of Advertisements

• Product Advertisements focused on selling a
  good or service.
  
• Types
• 1. pioneering or informational
• 2. Competitive or persuasive
• 3. Reminder
• Institutional Advertisements build goodwill or
  image for the
  
• organization.
• Types
• 1. Advocacy
• 2. Pioneering institutional
• 3. Competitive institutional
• 4. Reminder institutional

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PP20-CC Concept Check

• 1. What is the difference between
• pioneering and competitive ads?
• 2. What is the purpose of an institutional
• advertisement?

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PP20-1 Rising Media Costs Super Bowl, Super
Dollars

• Cost for 60
  second commercial

( 000)
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PP20DD The advertising decision process
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PP20-EE Developing the Advertising Program

• Developing the Advertising Program
• 1. Identifying the Target Audience
• 2. Specifying Advertising Objectives
• 3. Setting the Advertising Budget
• 4. Designing the Advertisement
• a. message content
• b. creating the actual message
• c. selecting the right media
• d. executing the advertising program
• e. evaluating the advertising program

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PP20MNN Examples of fear appeals

• Sponsor Medium Theme
• American Express Television A couple on a
  vacation was shownTravelers Check victimized by
  a robbery and left in a state of shock and
  desperation
• Partnership for a Print and Photos of an unbroken
  egg, a hotDrug-Free America television pan and
  the egg frying in the pan are shown. The copy
  reads, This is your brain on drugs.

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PP20-FF Concept Check

• 1. What are the characteristics of good
• advertising objectives?
• 2. What is the weakness of the
• percentage of sales budgeting
• approach.

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PP20-2 U.S. advertising expenditures by category
(data in millions of dollars)
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PP20B Business Web Site Plans
What are your organizations Web site plans?
Plan to have a Web sitesix months from now,but
do not currentlyhave one
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52
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Currently have a Web site
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PP203 The language of the media buyer

• Term What It Means
• Reach The number of different people or
  households exposed to an advertisement.
  
• Rating The percentage of households in a market
  that are tuned to a particular TV show or
  radio station.
  
• Frequency The average number of times an
  individual is exposed to an advertisement.
  
• Gross rating points (GRPs) Reach (expressed as a
  percentage of the total market) multiplied by
  frequency.
  
• Cost per thousands (CPM) The cost of advertising
  divided by the number of thousands of
  individuals or households who are exposed.

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PP20-4 Advantages and disadvantages of major
advertising media

• MEDIUM ADVANTAGES DISADVANTAGES
• television reaches extremely large high cost to
  prepare and run
  
• audience uses picture, print, ads short
  exposure time and
  
• sound, and motion for effect, perishable
  message difficult to
  
• can target specific audiences. convey complex
  information.
  
• Radio low cost can target specific no visual
  excitement short
  
• audiences ads can be placed exposure time and
  perishable
  
• quickly can use sound, message difficult to
  convey
  
• humor, and intimacy complex information.
• effectively.

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PP20-4b Advantages and disadvantages of major
advertising media

• MEDIUM ADVANTAGES DISADVANTAGES
• magazines can target specific audiences long
  time needed to place ad
  
• high quality color long life of limited
  control of ad position
  
• ad ads can be clipped and relatively high
  cost competes
  
• saved can convey complex for attention with
  other
  
• information. magazine features.
• Newspapers excellent coverage of local ads
  compete for attention with
  
• markets ads can be placed other newspaper
  features cant
  
• and changed quickly ads can control ad
  position on page
  
• saved quick consumer short life span cant
  target
  
• response low cost. Specific audiences.

continued
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PP20-4c Advantages and disadvantages of major
advertising media

• MEDIUM ADVANTAGES DISADVANTAGES
• internet video and audio capabilities animation
  and interactivity
  
• animation can improve require large files
  and more
  
• attention ads can be time to load.
  Effectivenss is
  
• interactive and link to still uncertain.
• advertiser.
• Outdoor low cost local market focus message
  must be short and
  
• high visibility opportunity simple low
  selectivity of
  
• for repeat exposures. Audience criticized as
  a traffic hazard, eyesore.

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PP20-GG Scheduling Advertising Factors to
Consider

• First, buyer turnover
• Second, purchase frequency
• Third, forgetting rate

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PP20HH Scheduling the Advertising
Most companies follow one of three basic
approaches

• Continous (drip) Schedule Steady schedule
  throughout the year.
  
• Flighting (intermittent) Advertising reflects
  seasonal Schedule demand
  
• Pulse (burst) Schedule Steady and flighting
  schedules are combined

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PP20-II Concept Check

• 1. You see the same ad in Time and Fortune
  magazines and on billboards and TV. Is this
  an example of reach or frequency?
  
• 2. Why has the Internet become a popular
  advertising medium?
  
• 3. What factors must be considered when
  choosing among alternative media?

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PP20-JJ Pretesting the Advertising

• Pretests are conducted before the advertisements
  are place in any medium.
  
• Types of Pretest
• 1. Portfolio Tests
• 2. Jury Tests
• 3. Theater Tests

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PP205 Alternative structures of advertising
agencies used to carry out the advertising
program

• Type of Agency Service Provided
• Full-service agency Does research, selects media,
  develops copy, and produces artwork.
  
• Limited-service agency Specializes in one aspect
  of creative process usually provides creative
  production work buys previously unpurchased
  media space.
• In-house agency Provides range of services,
  depending on company needs.

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PP20-KK Posttesting the Advertising

• Posttests determine whether or not the
  advertisements have achieved their intended
  objectives. There are five approaches common in
  posttesting
• 1. Aided recall (recognition-readership)
• 2. Unaided recall
• 3. Attitude tests
• 4. Inquiry tests
• 5. Sales tests

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PP20-LL Concept Check

• 1. Explain the difference between
• pretesting and posttesting advertising
• copy.
• 2. What is the difference between aided
• and unaided recall posttests?

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PP20-6 Trends in expenditures for media
advertising, trade promotion, and consumer
promotion
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PP20-MM Consumer-Oriented Sales Promotion

• Coupons
• Deals
• Premiums
• Contests
• Sweepstakes
• Samples
• Continuity Programs
• Point-of-Purchase Displays
• Rebates
• Product Placement

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PP20-7a Sales Promotion Alternatives

• KIND OF SALES
• PROMOTION OBJECTIVES ADVANTAGES
  DISADVANTAGES
  
• coupons stimulate demand
  encourage retailer consumers delay
  
• support purchases
• deals increase trial reduce consumer
  consumers delay
  
• retaliate against risk purchases
  reduce
  
• competitors actions perceived
  product
  
• value
• premiums build goodwill consumers like free
  consumers buy for
  
• or reduced-price premium, not
  product
  
• merchandise
• contests increase consumer encourage consumer
  require creative or
  
• purchases build involvement with
  analytical thinking
  
• business inventory product

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PP20-7b Sales Promotion Alternatives

• KIND OF SALES
• PROMOTION OBJECTIVES ADVANTAGES
  DISADVANTAGES
  
• Sweepstakes Encourage present Get customer to
  use sales drop after
  
• customers to buy more product and store
  sweepstakes
  
• minimize brand more often
• switching
• Samples encourage new low risk for
  high cost for company
  
• product trial consumer
• Continuity encourage repeat help create
  loyalty high cost for company
  
• Programs purchases
• Point-of-purchase increase product
• displays trial provide in-store provide good
  hard to get retailer to
  
• support for other product visibility
  allocate high-traffic
  
• promotions space

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PP20-7c Sales Promotion Alternatives

• KIND OF SALES
• PROMOTION OBJECTIVES ADVANTAGES
  DISADVANTAGES
  
• rebates encourage customers effective at
  easily copied steal
  
• to purchase stop sales stimulating
  sales from future
  
• decline demand reduce perceived
• product value
• product introduce new positive message
  little control over
  
• placement products demonstrate in a
  noncommercial presentation of
  
• product use setting product

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PP20-NN Trade-Oriented Sales Promotions

• Allowances and Discounts
• - merchandise allowance
• - case allowance
• - finance allowance
• Cooperative Advertising
• Training of Distributors Salesforces

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PP20-OO Concept Check

• 1. What sales promotional tool is most
• common for new products?
• 2. Whats the difference between a
• coupon and a deal?
• 3. Which trade promotion is used on an
• ongoing basis?

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PP20-PP Definition of Publicity
Publicity is . . . .
is a method of obtaining nonpersonal
presentation(s) of an organization, good, or
service without direct cost.

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PP20-QQ Public Service Announcements

• Nonprofit organizations rely heavily on PSAs
  (public service announcements), which are free
  space or time donated by the media.

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PP20-RR Self-Regulation

• There are increasing efforts by advertising
  agencies, trade associations, and marketing
  organizations at self-regulation. By imposing
  standards that reflect the values of society on
  their promotional activities marketers can
• 1. Facilitate the development of new promotional
  methods
  
• 2. Minimize regulatory constraints and
  restrictions and
  
• 3. Help consumers gain confidence in the
  communication efforts used to influence their
  purchases.

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PP20-SS Concept Check

• 1. What is a news release?
• 2. What is the difference between
• government regulation and self-regulation?

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PP20-K Top 15 Ad Slogans of the Century

• Advertiser Slogan
• 1. DeBeers Diamonds Are Forever
• 2. Nike Just Do It
• 3. Coca-Cola The Pause That Refreshes
• 4. Miller Lite Tastes Great, Less Filling
• 5. Avis We Try Harder
• 6. Maxwell House Good To The Last Drop
• 7. Wheaties breakfast of champions
• 8. Clairol does she or doesnt she
• 9. Morton salt when it rains it pours
• 10. Wendys wheres the beef?
• 11. Crest toothpaste look ma, no cavities!
• 12. Yellow pages let your fingers do the walking
• 13. Public service loose lips sink ships
• 14. MM MMs melt in your mouth, not in your
  hands
  
• 15. General electric we bring good things to life