marketing: an introduction · •breaking through the clutter •merging advertising and...
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Marketing: An IntroductionThirteenth Edition
Chapter 12Engaging
Consumers and
Communicating
Customer value:
Advertising and
Public Relations Copyright © 2017, 2015, 2013 Pearson Education, Inc. All Rights Reserved
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First Stop: GEICO- From Bit Player to
Behemoth through Good Advertising
GEICO has muscled its
way to the number-two
position in its ultra-
competitive industry.
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Promotion Mix
• A promotion mix, or marketing communications mix, is
a specific blend of promotion tools:
– Advertising
– Sales promotion
– Personal selling
– Public relations (PR)
– Direct and digital marketing
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Learning Objective 12-1 Summary
A company’s total promotion mix consists of tools that
the company uses to engage customers, persuasively
communicate customer value, and build customer
relationships.
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New Marketing Communications
Model (1 of 3)
• Factors changing the face of today’s marketing
communications:
– Changing consumers
– Changing marketing strategies
– Advancements in digital technology
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New Marketing Communications
Model (2 of 3)
Method’s successful
“Clean happy” campaign
began as an online-only
effort.
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New Marketing Communications
Model (3 of 3)
• Marketers reach smaller consumer segments in
interactive and engaging ways.
• Mix of traditional mass media and a wide array of
online, mobile, and social media
• Content marketing managers create, inspire and
share brand messages and conversations.
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Figure 12.1 – Integrated Marketing
Communications
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Nature of the Promotion Tools (1 of 2)
Promotion tool Description
Advertising • Reaches masses of buyers at a low cost per
exposure
• Builds a long-term image for a product
• Can trigger quick sales
• Has a public nature and is viewed as legitimate
• Very expressive
• Impersonal and lacks the direct persuasiveness of
salespeople
Personal selling • Personal interaction between two or more people
• Allows all kinds of customer relationships to spring up
• Buyer feels a greater need to listen and respond
• Most expensive promotion tool
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Nature of the Promotion Tools (2 of 2)
Promotion tool Description
Sales promotion • Wide assortment of tools with unique qualities
• Attracts attention and offers incentives to purchase
• Used to dramatize product offers and boost sales
• Invites and rewards quick response but has short-
lived effects
Public relations • Very believable to readers
• Can dramatize a company or product
• Reaches many prospects
• Effective and economical when well thought out
Direct and
digital marketing
• More targeted and interactive
• Immediate and personalized
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Figure 12.2 - Push versus Pull
Promotion Strategy
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Learning Objective 12-2 Summary
• New marketing communications model
– More targeted, social, and engaging
• Integrated marketing communications
– Integrates and coordinates the company’s many
communications channels
– Delivers a clear, consistent, and compelling message
about the organization and its brands
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Figure 12.3 Major Advertising
Decisions
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Table 12.1 - Possible Advertising
Objectives (1 of 2)
Informative Advertising blank
Communicating customer value Suggesting new uses for a product
Building a brand and company image Informing the market of a price change
Telling the market about a new product Describing available services and
support
Explaining how a product works Correcting false impressions
Persuasive Advertising blank
Building brand preference Persuading customers to purchase
now
Encouraging switching to a brand Creating customer engagement
Changing customer perceptions of
product value
Building brand community
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Table 12.1 - Possible Advertising
Objectives (2 of 2)
Reminder Advertising blank
Maintaining customer relationships Reminding consumers where to buy
the product
Reminding consumers that the product
may be needed in the near future
Keeping the brand in a customer’s
mind during off-seasons
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Methods of Setting the Advertising
Budget
• Affordable Method
• Percentage-of-Sales Method
• Competitive-Parity Method
• Objective-and-Task Method
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Setting the Advertising Budget
Coca-Cola spends hundreds
of millions of dollars
annually, but is that “half
enough or twice too much”?
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Advertising Strategy
• Accomplishes the company’s advertising objectives
• Major advertising strategy elements:
– Creating advertising messages
– Selecting advertising media
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Creating the Advertising Message
and Brand Content
• Breaking through the clutter
• Merging advertising and entertainment
• Message and content strategy
• Message execution
• Consumer-generated content
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Selecting Advertising Media
• Advertising media: Vehicles through which
advertising messages are delivered to their intended
audiences
• Steps in advertising media selection:
– Determining reach, frequency, impact and engagement
– Choosing among major media types
– Selecting specific media vehicles
– Choosing media timing
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Profiles of Major Media Types (1 of 3)
Medium Advantages Limitations
Television • Good mass-marketing coverage
• Low cost per exposure
• Combines sight, sound, and
motion
• Appealing to the senses
• High absolute costs
• High clutter
• Fleeting exposure
• Less audience
selectivity
Digital,
mobile, and
social media
• High selectivity
• Low cost
• Immediacy
• Engagement capabilities
• Potentially low impact
• High audience control
of content and
exposure
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Profiles of Major Media Types (2 of 3)
Medium Advantages Limitations
Newspapers • Flexibility
• Timeliness
• Good local market coverage
• Broad acceptability and high
believability
• Short life
• Poor reproduction
quality
• Small pass-along
audience
Direct mail • High audience selectivity
• Flexibility
• No ad competition within the
same medium
• Allows personalization
• Relatively high cost
per exposure
• Junk mail image
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Profiles of Major Media Types (3 of 3)
Medium Advantages Limitations
Magazines • High geographic and
demographic selectivity
• Credibility and prestige
• High-quality reproduction
• Long life and good pass-along
readership
• Long ad purchase lead
time
• High cost
• No guarantee of
position
Radio • Good local acceptance
• High geographic and
demographic selectivity
• Low cost
• Audio only
• Fleeting exposure
• Low attention
• Fragmented audiences
Outdoor • Flexibility
• High repeat exposure
• Low cost
• Low message competition
• Good positional selectivity
• Little audience
selectivity
• Creative limitations
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Evaluating Advertising Effectiveness
& Return on Advertising Investment
• Return on advertising investment: Net return on
advertising investment divided by the costs of the
advertising investment
• Advertisers should regularly evaluate
– Communication effects
– Sales and profit effects
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Organizing for Advertising
• Small firms may use their sales department staff.
• Large companies may have their own advertising
departments.
• Advertising agency: Assists companies in planning,
preparing, implementing, and evaluating all or portions
of their advertising programs
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International Advertising Decisions
• Degree of adaptation
• Standardization benefits
– Lower advertising costs
– Greater global advertising coordination
– More consistent worldwide image
• Standardization drawbacks
– Ignores the fact that country markets differ in their
cultures, demographics, and economic conditions
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Problems Faced by Global Advertisers
• Countries differ in
– Media costs and availability
– Advertising practices
• Diversity between countries requires advertisers to
adapt their campaigns to meet local
– Cultures and customs
– Media characteristics
– Regulations
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Learning Objective 12-3 Summary
• Advertising is the use of paid, owned, earned, and
shared media by a seller to inform, persuade, and
remind consumers about its products or organization.
• Advertising decision making involves decisions about
objectives, budget, message, media, and evaluation
of results.
• Return on advertising investment
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Functions of Public Relations (PR)
Departments
• Press relations or press agency
• Product publicity
• Public affairs
• Lobbying
• Investor relations
• Development
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Public Relations (1 of 2)
• Promotes products, people, ideas, organizations, and
nations
• Builds good relations with consumers, investors, the
media, and communities
• Rebuilds interest in commodities for trade
associations
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Public Relations (2 of 2)
MilkPEP’s “Built With
Chocolate Milk” public
relations campaign is
repositioning chocolate milk.
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Role and Impact of PR
• Strong impact on public awareness at a lower cost
than advertising
• Power to engage consumers and make them part of
the brand’s story
• Limited and scattered use
• Powerful brand-building tool
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Major Public Relations Tools
• News
• Special events
• Written materials
• Audiovisual materials
• Corporate identity materials
• Public service activities
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Learning Objective 12-4 Summary
• Public relations functions
– Press agency, product publicity, public affairs, lobbying,
investor relations, and development
• Public relations tools
– News, special events, written materials, audiovisual
materials, corporate identity materials, and public
service activities.
• Company’s Web site and online social media can be
good PR vehicles
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