Instructor’s Visual Index Kotler/Armstrong

Chapter 15: Advertising, Sales Promotion

and Public Relations

Advertising,
Sales Promotion What is Advertising?
and Public Relations &
Any form of nonpersonal presentation
Integrated Marketing and promotion of ideas, goods, or
services by an identified sponsor.

India

• Forecast growth of 16%.

• Despite a slight erosion in magazine advertising
compared with other media, Government policy
is driving solid expansion of the industry -
which already is the sixth largest in the region.
• Almost all legal restrictions on foreign
publishers have been removed and, even though
the administrative process remains cumbersome
and frustrating, several magazine publishers –
including Condé
Condé Nast – are preparing to enter
the Indian market.

Indian Advertising Industry Segmentation of Advertising Spends

Media Spends as % of Total Ad Spend

Year Print TV Radio Cinema Outdoor Internet
2000 49.0% 39.3% 2.5% 0.5% 8.4% 0.3%

2001 48.4% 40.6% 2.7% 0.4% 7.5% 0.4%

2002 47.2% 41.9% 2.9% 0.7% 7.0% 0.4%

2003 46.6% 43.0% 2.9% 0.7% 6.5% 0.4%

2004 46.3% 43.7% 2.9% 0.6% 6.0% 0.3%

 Copyright 1999 Prentice Hall

Instructor’s Visual Index
Chapter 15: Advertising, Sales Promotion
Marketing Communications Mix
• Advertising
• Any paid form of nonpersonal presentation and
promotion of ideas, goods, or services by an
identified sponsor.
• Sales Promotion
• Short-
Short-term incentives to encourage the
purchase or sale of a product or service.
Marketing Communication Mix
• Direct Marketing
• Direct connections with carefully targeted
individual consumers to both obtain an
immediate response and cultivate lasting
customer relationships—
relationships—the use of telephone,
mail, fax, e-
e-mail, the Internet, and other tools
to communicate directly with specific
consumers.
The Need for IMC
Using IMC, the company carefully
integrates and coordinates its many
communication channels to deliver
a clear, consistent, and compelling
message about the organization
and its brands.
 Copyright 1999 Prentice Hall
Kotler/Armstrong
and Public Relations
Marketing Communications Mix
• Public Relations
• Building good relations with the company’
company’s
various publics by obtaining favorable publicity,
building up a good corporate image, and handling
or heading off unfavorable rumors, stories, and
events.
• Personal Selling
• Personal presentation by the firm’
firm’s sales force for
the purpose of making sales and building
customer relationships.
The Changing Communications
Environment
Two factors are changing the face of today’s
marketing communications:
As mass markets have fragmented, marketers
are shifting away from mass marketing
Vast improvements in information technology
are speeding the movement toward segmented
marketing
Integrated Marketing Communication
Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Advertising Personal Selling

• Can reach masses of geographically • Involves personal interaction between two

dispersed buyers. or more people.
• Can repeat a message many times. • Allows relationship building.
• Is impersonal, one-
one-way communication. • Most expensive promotion tool.
• Can be very costly for some media types.

Sales Promotion Public Relations

• Wide assortment of tools. • Very believable.

• Attracts consumer attention. • Reaches people who avoid salespeople and
• Offers strong incentives to buy. ads.
• Invites and rewards quick consumer • Can dramatize a company or product.
response. • Tends to be used as an afterthought.
• Effects are short-
short-lived. • Planned use can be effective and
economical.

Direct Marketing Push vs. Pull Promotion Strategy

• Many forms that share four characteristics:

• Nonpublic
• Immediate
• Customized
• Interactive
• Well suited to highly targeted marketing.

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Advertising Major Decisions in Advertising

• Advertising has been used for centuries.

• U.S. advertisers spend more than $237 billion each
year; worldwide spending approaches $470 billion.
• Advertising is used by:
• Business firms
• Nonprofit organizations
• Professionals
• Social agencies
• Government

Setting Advertising Objectives Comparative Advertising

• An advertising objective is a specific

Progresso makes
communication task to be accomplished with
side-by-side
a specific target audience during a specific comparisons of its
period of time. soup versus
• Classified by purpose: Campbell’s, inviting
• Inform consumers to
“Enjoy a better
• Persuade
soup…with a more
• Compare adult taste.”
• Remind

Budget Setting the Advertising Budget

Affordable
Based on What the Company Thinks it Can Afford

Percentage-of-Sales
Percentage-of-Sales
Based
Based on
on aa Percentage
Percentage of
of Current
Current or
or Forecasted
Forecasted Sales
Sales

Competitive-Parity
Competitive-Parity
Set
Set Budget
Budget to
to Match
Match Competitors
Competitors

Objective-and-Task
Objective-and-Task
Set
Set Objectives,
Objectives, Determine
Determine Tasks
Tasks to
to Achieve
Achieve Objectives,
Objectives,
Sum
Sum ofof Task
Task Costs
Costs Equals
Equals Budget
Budget

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Strategy Developing Advertising Strategy

• Consists of two major elements:

• Creating advertising messages

• Selecting advertising media

The Message Strategy A New Advertising Challenge

Identify Customer Benefits

Develop Compelling Creative Concept

The “Big Idea”

Advertising Appeals Should Be

Meaningful, Believable, & Distinctive The new wave of personal video recorders, such as TiVo, has armed
viewers with an arsenal of new-age zipping and zapping weapons.

Message Execution Celebrity Endorsement

Testimonial Slice
Slice of
of Life
Life
Testimonial Evidence
Evidence
or
or Endorsement
Endorsement
Lifestyle
Lifestyle Nike’
Nike’s association
Scientific
Scientific Evidence
Evidence Typical with Michael Jordan
helps the brand
Approaches Fantasy
Fantasy
Technical
Technical Expertise
Expertise succeed, but also
emphasizes the
Personality
Personality Symbol
Symbol
Mood
Mood or
or Image
Image qualities that Nike
stands for.
Musical
Musical

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Message Execution Selecting Advertising Media

• Choose a tone • Reach

• Use memorable, attention-
attention-getting words • Percentage of people exposed to ad
• Choose correct format elements • Frequency
• Illustration • Number of times a person is exposed to ad
• Headline • Media Impact
• Copy • The qualitative value of a message exposure
through a given medium

Choosing Media Type Deciding on Media Timing

• Factors to consider: • Must decide how to schedule the advertising

• Media habits of target consumers over the course of a year
• Nature of the product • Follow seasonal pattern
• Type of message • Oppose seasonal pattern
• Cost • Same coverage all year
• Media vehicles • Choose the pattern of the ads
• Specific media within each general media type • Continuity
• Pulsing

Evaluating Advertising Other Advertising Considerations

Small Companies: Large Companies:

Advertising
Sales Departments
Measure the communication effects of an ad. Departments
“Copy Testing”

Advertising Agency:
A marketing services firm that assists companies in
planning, preparing, implementing, and evaluating all or
Measure the sales effects of an ad.
portions of their advertising programs.
Is the ad increasing sales?

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

International Advertising Decisions Top 10 Slogans Of The Century

• Diamonds are forever (DeBeers)

Adaptation of • Just do it (Nike)
• The pause that refreshes (Coca-
(Coca-Cola)
Global Advertising • Tastes great, less filling (Miller Lite)
Lite)
• We try harder (Avis)
• Good to the last drop (Maxwell House)
• Breakfast of champions (Wheaties
(Wheaties))
Advertising Media Costs • Does she ... or doesn't she? (Clairol)
• When it rains it pours (Morton Salt)
& Availability • Where's the beef? (Wendy's)

HONORABLE MENTIONS
• Look Ma, no cavities! (Crest toothpaste)
• Let your fingers do the walking (Yellow Pages)
Regulation of • Loose lips sink ships (public service)
Advertising Practices • M&Ms melts in your mouth, not in your hand (M&M candies)
• We bring good things to life (General Electric)

Sales Promotion Sales Promotion

• Sales promotion consists of short-

short-term Today’s food
incentives to encourage the purchase or marketers are
sales of a product or service. using more and
more push
promotions,
• The idea behind sales promotion is to including
generate immediate sales. consumer price
promotions.

Rapid Growth of Sales Promotion Sales Promotion Objectives

• Sales promotion can take the form of • Consumer Promotions: increase short-
short-term
consumer, business, trade, or sales force sales or help build long-
long-term market share.
promotions. • Trade Promotions:
Promotions: get retailers to:
• carry new items and more inventory
• Rapid growth in the industry has been
• advertise products
achieved because:
• give products more shelf space
• Product managers are facing more pressure to • buy ahead
increase their current sales
• Sales Force: getting more sales support.
• Companies face more competition
• In general, sales promotion should build long-
long-
• Advertising efficiency has declined
term customer relationships.
• Consumers have become more deal oriented

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Consumer Sales Promotion Tools Consumer Sales Promotion Tools

Cash
Cash or
or other
other award
award offered
offered for
for
Sample
Sample Offers
Offers aa trial
trial amount
amount of
of aa product
product Patronage
Patronage Rewards
Rewards regular
regular use
use of
of aa product
product or
or service
service
Savings
Savings when
when purchasing
purchasing specified
specified Point-of-Purchase
Point-of-Purchase Displays
Displays or
or demonstrations
demonstrations at
at the
the
Coupons
Coupons products
products Promotions
Promotions point
point of
of purchase
purchase or
or sale
sale
Cash
Cash Refunds
Refunds Refund
Refund of
of part
part of
of the
the purchase
purchase price
price
“Rebates” by Consumers
Consumers submit
submit an
an entry
entry to
to be
be
“Rebates” by mail
mail Contest
Contest judged
judged by
by aa panel
panel
Price
Price Packs
Packs Reduced
Reduced prices
prices marked
marked on
on the
the label
label or
or
“Cents-Off
“Cents-Off Deals”
Deals” package
package by
by producer
producer Consumers
Consumers submit
submit their
their names
names for
for aa
Sweepstakes
Sweepstakes drawing
drawing
Goods
Goods offered
offered free
free or
or low
low cost
cost as
as an
an
Premiums
Premiums incentive
incentive to
to buy
buy aa product
product Consumers
Consumers receive
receive something
something each
each
Advertising
Advertising Articles
Articles imprinted
imprinted with
with an
an advertiser’s
advertiser’s Games
Games time
time they
they buy
buy which
which may
may help
help them
them
Specialties
Specialties name
name given
given as
as gifts
gifts win
win aa prize
prize

Trade Promotion Business Promotion

Objectives Tools Objectives Tools

Persuade resellers to Discounts Generate business Conventions

carry a brand leads
Allowances Trade shows
Give a brand shelf Stimulate purchases
space Free Goods Sales contests
Reward customers
Promote brand in Push Money
advertising Motivate salespeople
Specialty Advertising
Push brand to Items
customers

Trade Show Developing the Sales Promotion Program

Decide on the Size of the Incentive

Set Conditions for Participation

Decide How to Promote and

Distribute the Promotion Program

Decide on the Length of the Program

Evaluate the Program

More than 4,300 trade shows take place every year, drawing as many
as 85 million people.

 Copyright 1999 Prentice Hall

Instructor’s Visual Index Kotler/Armstrong
Chapter 15: Advertising, Sales Promotion
and Public Relations

Public Relations Public Relations

Public relations is used to

• Public relations involves building good promote products,
relations with the company’
company’s various people, places, ideas,
publics by obtaining favorable publicity, activities, organizations,
and even nations. New
building up a good corporate image, and York City turned its
handling or heading off unfavorable image around when its “I
rumors, stories, and events. Love New York!”
campaign took root,
bringing millions more
tourists to the city.

Public Relations Functions Public Relations Tools

• Press relations or • Lobbying • News • Audiovisual

press agency • Speeches materials
• Special events • Corporate identity
• Product publicity • Investor relations materials
• Buzz marketing
• Public service
• Mobile marketing
activities
• Public affairs • Development • Written materials
• Company Web site

Major
Major Public
Public Relations
Relations Decisions
Decisions

Setting
SettingPublic
PublicRelations
RelationsObjectives
Objectives

Choosing
Choosingthe
thePublic
Public Relations
RelationsMessages
Messages
and
andVehicles
Vehicles

Implementing
Implementingthe
the Public
PublicRelations
RelationsPlan
Plan

Evaluating
Evaluating Public
Public Relations
RelationsResults
Results

 Copyright 1999 Prentice Hall