Advertising’s Role in Advertising’s Role in MarketingMarketingAffectionately named Affectionately named Chapter 2Chapter 2

Chapter OverviewChapter OverviewWhat is Marketing?What is Marketing?

The Key Players and MarketsThe Key Players and Markets

The Marketing ProcessThe Marketing Process

How Agencies WorkHow Agencies Work

International Marketing International Marketing (standardize/localize; corporate (standardize/localize; corporate HQ)HQ)

The Dynamics of Modern MarketingThe Dynamics of Modern Marketing

Marketing is the way a Marketing is the way a product is designed, product is designed, tested, branded, tested, branded, packaged, priced, packaged, priced, distributed, and distributed, and promoted.promoted.

ValueValueValueValue

CreateCreate

CommunicateCommunicate

DeliverDeliver

CustoCustomermer

CustoCustomermer

RelationshipRelationship

Marketing Marketing Planning - Planning - Key Key ConceptsConcepts

Customer-focused Customer-focused marketingmarketing

ExchangeExchange

Added valueAdded value

BrandingBranding

Marketing - Marketing - Key PlayersKey Players

MarketersMarketers

Suppliers and VendorsSuppliers and Vendors

- Added value, - Added value, Ingredient brandingIngredient branding

Distributors and Distributors and RetailersRetailers

- Same as sup. and ven.- Same as sup. and ven.

Advertising AgencyAdvertising Agency

Types of MarketsTypes of Markets

Consumer - privateConsumer - private

Business-to-Business-to-business (industrial)business (industrial)

InstitutionalInstitutional

Channel - resellersChannel - resellers

IMPORTANCEIMPORTANCEGenerally most is Generally most is spent on consumer spent on consumer markets, but B2B markets, but B2B advertising is almost advertising is almost as important.as important.

Mass media - Mass media - consumersconsumers

Specialized media - Specialized media - trade professionalstrade professionals

Marketing ProcessMarketing Process1. Research consumer market and 1. Research consumer market and competitive marketplace-->develop competitive marketplace-->develop situation analysissituation analysis2. Set objective for the marketing effort2. Set objective for the marketing effort3. Assess consumer needs and wants 3. Assess consumer needs and wants relative to product-->segment market into relative to product-->segment market into groups based on likelihood to respond--groups based on likelihood to respond-->target specific markets>target specific markets4. Differentiate and position product 4. Differentiate and position product relative to competitionrelative to competition5. Develop marketing mix strategy (prod. 5. Develop marketing mix strategy (prod. design, performance criteria, pricing, design, performance criteria, pricing, distribution, communication)distribution, communication)6. Evaluate effectiveness of strategy6. Evaluate effectiveness of strategy

Modern MarketingModern Marketing

Integrated marketing --> product, place, price Integrated marketing --> product, place, price and promotion work together [cohesive]and promotion work together [cohesive]

Relationship marketing --> customer Relationship marketing --> customer relationship managementrelationship management

Permission marketing --> willing inclusion into Permission marketing --> willing inclusion into marketingmarketing

Marketing Concept: It’s an Marketing Concept: It’s an APPROACHAPPROACH

Image: Image: http://www.tmonews.com/wp-content/uploads/2009/12/customer-service-cartoon-thumb.jpg

Focus on Focus on identifying the identifying the

needs and needs and wants of the wants of the

customercustomer

Solve Solve customers’ customers’ problemsproblems

Examples: Harley, Intel, UPS, United AirlinesExamples: Harley, Intel, UPS, United Airlines

ExchangExchangee

EconomicEconomic CommunicationCommunication

Image: Image: http://www.cartoonstock.com/newscartoons/cartoonists/tzu/lowres/tzun544l.jpg

Branding-->BrandBranding-->BrandMeaning -> Distinctive Identity -> FamiliarityMeaning -> Distinctive Identity -> Familiarity

Image: Image: http://smallbrandblog.com/wp-content/uploads/2010/11/branding-1.jpg

Example: Ivory - “It floats”; “99 and 44/100 percent Example: Ivory - “It floats”; “99 and 44/100 percent pure”pure”Legally protected brand->TrademarkLegally protected brand->TrademarkBrand equity is the reputation, meaning, and value the brand has acquired over time (financial value Brand equity is the reputation, meaning, and value the brand has acquired over time (financial value contributed to company)contributed to company)

Added ValueAdded Value- More convenient- More convenient- Lower price- Lower price- Higher quality- Higher quality

Essentially, ensure product utility Essentially, ensure product utility and convenienceand convenience

Image: Image: http://www.cartoonstock.com/lowres/jmo0216l.jpghttp://www.cartoonstock.com/lowres/jmo0216l.jpg

““Case Study”: Case Study”: PumaPuma

““Success in a crowded market”Success in a crowded market”

Position: “[blends] sport, lifestyle, Position: “[blends] sport, lifestyle, and fashion in a unique way”and fashion in a unique way”

““Blue mountain strategy”: not Blue mountain strategy”: not biggest mountain, but stand out biggest mountain, but stand out (how do things)(how do things)

Use: hot icons, trend influencers, Use: hot icons, trend influencers, market segmentation, design, market segmentation, design, marketing (guerilla, viral-online)marketing (guerilla, viral-online)

1980s trouble: commodity 1980s trouble: commodity product w/ no distinctive imageproduct w/ no distinctive image

Keywords: Keywords: innovative, retro, innovative, retro, individuality, individuality, differentiate, styledifferentiate, style

Benefits of Hiring an Benefits of Hiring an AgencyAgency

Specialized servicesSpecialized services

Objective adviceObjective advice

Experienced staffingExperienced staffing

Tailored management of all advertising Tailored management of all advertising activities/personnelactivities/personnel

IMPLEMENT A CREATIVE VISION OF THE CLIENTIMPLEMENT A CREATIVE VISION OF THE CLIENT

HELP REACH ADVERTISING GOALSHELP REACH ADVERTISING GOALS

Types of AgenciesTypes of AgenciesFull-ServiceFull-Service SpecializedSpecialized

Do it allDo it all

- Function- Function- Audience- Audience- Industry- Industry- Market- Market- Marketing - Marketing communication communication areaarea

(creative/(creative/media buying)media buying)

Agency OrganizationAgency Organization

Account Account ManagementManagement

managememanagement nt supervisorsupervisor

account account supervisorsupervisor

account account executiveexecutive

account account directordirector

Creative Creative Development Development and and ProductionProduction

creative creative directorsdirectors

creative creative groupgroup

copywritercopywriterss

art art directorsdirectors

producersproducers

Media Media Planning and Planning and BuyingBuying

outside outside specialistsspecialists

OR internal OR internal departmentdepartment

Agency OrganizationAgency OrganizationAccount Planning and Account Planning and ResearchResearch

Account planner - Account planner - gather intelligence gather intelligence on market and on market and consumers (voice of consumers (voice of consumer); strategic consumer); strategic specialistspecialist

Internal Agency Internal Agency ServicesServices

Financial servicesFinancial services

HRHR

PersonnelPersonnel

Traffic - tracking Traffic - tracking projects and projects and deadlinesdeadlines

Print productionPrint production

MoneyMoneyCommission (% add Commission (% add to media cost)to media cost)

FeeFee

Retainer (not Retainer (not common)common)