Marketing

Leslie Lum

The Market

This is where it all begins--

Target Market

• Who is it?• How big is it?

Demographics of the American Market• Characteristics of people• Gender• Age• Ethnic group• Education• Income

Population – www.census.gov

• The American population is described using demographics such as gender, marital status, age, education, income and ethnicity

• On a sheet of paper, estimate:– Percent female, percent male– Percent married, divorced, never married– Percent under 25 years, etc. Median age– Percent with college– Percent white, black, Asian, etc.

Gender

Population by Gender 2000

Female51%

Male49%

Marital Status

Never Married23%

Divorced10%Widowed

7%

Married60%

Married?

Income

Household income has been been rising

0%

20%

40%

60%

80%

100%

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

Pe

rce

nt

of

To

tal

Over $100K

$50 to 100K

$25 to 50K

Under $25K

Source: U.S. Census (2001 Dollars)

IncomeMedian US household income is rising.

25,000

30,000

35,000

40,000

45,000

1967

1968

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

Source: US Census, 2001 Dollars

AgeBirths in US

2.25

2.5

2.75

3

3.25

3.5

3.75

4

4.25

4.5

1909

1912

1915

1918

1921

1924

1927

1930

1933

1936

1939

1942

1945

1948

1951

1954

1957

1960

1963

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

Mill

ion

s

Grandparents

Parents

Baby Boomers

BabyBustor Gen X

Baby Boomletor Gen Y

Age

2 000 000 4 000 000 6 000 000 8 000 000 10 000 000 12 000 000

Under 5 years

5 to 9 years

10 to 14 years

15 to 19 years

20 to 24 years

25 to 29 years

30 to 34 years

35 to 39 years

40 to 44 years

45 to 49 years

50 to 54 years

55 to 59 years

60 to 64 years

65 to 69 years

70 to 74 years

75 to 79 years

80 to 84 years

85 years and over

Female

Male

Total Population

AgeAge distribution of US population

5 000 000

10 000 000

15 000 000

20 000 000

25 000 000

Un

der

5 y

ears

5 to

9 y

ears

10 t

o 1

4 ye

ars

15 t

o 1

9 ye

ars

20 t

o 2

4 ye

ars

25 t

o 2

9 ye

ars

30 t

o 3

4 ye

ars

35 t

o 3

9 ye

ars

40 t

o 4

4 ye

ars

45 t

o 4

9 ye

ars

50 t

o 5

4 ye

ars

55 t

o 5

9 ye

ars

60 t

o 6

4 ye

ars

65 t

o 6

9 ye

ars

70 t

o 7

4 ye

ars

75 t

o 7

9 ye

ars

80 t

o 8

4 ye

ars

85 y

ears

an

d o

ver

AgeThe US population will be aging

0

5

10

15

20

25

30

35

Under 10 10 to 19 20 to 34 35 to 54 54 to 64 65 andover

Pe

rce

nt

of

Tota

l

2000 2050

Income

0

20,000

40,000

60,000

80,000

100,000

120,000

Less thanGrade 9

Grade 9 to 12 High School Some College Associates Bachelors Masters Professional Doctorate

Male

Female

Income goes up with education(Annual income 2001)

IncomeIncome fluctuates with age

(Annual income 2001)

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

18 to 24 25 to 29 30 to 34 35 to 39 40 to 44 45 to 49 50 to 54 55 to 59 60 to 64 Over 65

Male

Female

The population is becoming more educated

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

Pe

rce

nt

of

To

tal College and more

Some College

High School

Some High School

Elementary

Education

EthnicityMinority populations will continue to grow

1212

13

15

1 1 1 12

34

9

6

9

12

24

0

5

10

15

20

25

30

1980 1990 2000 2050

Pe

rce

nt

of

To

tal

Black

Native

AsianPacific

Hispanic orLatino

18

Context of Multicultural Markets

Where US immigrants came from

-

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

18

20

s

18

30

s

18

40

s

18

50

s

18

60

s

18

70

s

18

80

s

18

90

s

19

00

s

19

10

s

19

20

s

19

30

s

19

40

s

19

50

s

19

60

s

19

70

s

19

80

s

19

90

s

Europe

Asia

America

Africa

South America

Central America

Carribean

19

Growth

0%

50%

100%

150%

200%

250%T

ota

l

Wh

ite

Bla

ck

Am

eric

an I

nd

ian

and

Ala

ska

Nat

ive

Asi

an P

acif

ic

So

me

oth

erra

ce

His

pan

ic

Wh

ite

No

nH

isp

anic

Min

ori

ty

Multicultural groups grew the fastest from 1980 to 2000

20

Going forward

Cumulative Change in Population1995-2050

0

20

40

60

80

100

120

140

2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Mill

ion

s o

f P

eop

le

Hispanic

Asian Pacific Islander

Native

Black

White NonHispanic

Source: U.S. Census

21

Going forwardMulticultural populations will continue to grow as a

portion of the population

12 12 13

15

1 1 1 123

4

9

6

9

12

24

0

5

10

15

20

25

30

1980 1990 2000 2050

Pe

rce

nt

of

To

tal

Black

Native

Asian Pacific

Hispanic orLatino

22

Going forward

23

The future is now

Ethnic Composition of the 100 Largest US Cities

0% 10% 20% 30% 40% 50% 60%

White

Black

Hispanic (any race)

Asian2000

1990

Whites less than 50% of large cities.

24

Dynamics

0.0

5.0

10.0

15.0

20.0

25.0

30.019

80

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Per

cen

t o

f p

op

ula

tio

n w

ith

fo

ur

year

s o

f co

lleg

e o

r m

ore

All races57% growth

African Americans115% growth

Hispanic40% growth

The proportion of college-educated minorities is growing

25

Dynamics

Median income of minorities grew between 1991 and 2001

0

10,000

20,000

30,000

40,000

50,000

60,000

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Ho

us

eh

old

me

dia

n in

co

me

in 2

00

1 d

olla

rs

Black +24%

Hispanic +17%

Asian Pacific Islander +16%

Non-Hispanic White +11%

26

Purchasing Power Growth  2002 2007 Change

African American $645.9 billion $852.8 billion 32%

Asian American $296.4 billion $454.9 billion 53%

Hispanic* $580.5 billion $925.1 billion 59%

Gay, Lesbian, Transgender

$451 billion $608 billion 35%

White $6,252 billion $7,910 billion 27%

27

African Americans

• 34.7 million African Americans with 1.8 million as African American along with another race

• This group grew 21.5% versus 13.2% for the total population between 1990 and 2000

• Definition of the segment is complex task– 700,000 are Hispanic blacks– Black with white number 785,000

28

Immigration is still a factor

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

1900s 1910s 1920s 1930s 1940s 1950s 1960s 1970s 1980s 1990s

Immigrants from Africa grew in the 1990s

29

Age and Gender

200 000 400 000 600 000 800 000 1 000 000 1 200 000 1 400 000 1 600 000 1 800 000 2 000 000

Under 5 years

5 to 9 years

10 to 14 years

15 to 19 years

20 to 24 years

25 to 29 years

30 to 34 years

35 to 39 years

40 to 44 years

45 to 49 years

50 to 54 years

55 to 59 years

60 to 64 years

65 to 69 years

70 to 74 years

75 to 79 years

80 to 84 years

85 years and over

Females

Males

African Americans - Age Versus Gender

30

Versus Whites

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%

Under 5 years

5 to 9 years

10 to 14 years

15 to 19 years

20 to 24 years

25 to 29 years

30 to 34 years

35 to 39 years

40 to 44 years

45 to 49 years

50 to 54 years

55 to 59 years

60 to 64 years

65 to 69 years

70 to 74 years

75 to 79 years

80 to 84 years

85 years and over

Black

WhiteAlone

Percent of GroupSource: US Census 2000(agesexrace)

31

Educational attainmentHighest Education Received

0%

5%

10%

15%

20%

25%

30%

35%

40%

Hig

h sch

oo

lg

radu

ate

So

me co

llege

Asso

ciated

egree

Occu

patio

nal

Asso

ciated

egree

academ

ic

Bach

elor's

deg

ree

Master's d

egree

Pro

fession

ald

egree

Do

ctorate

Percent of Blacks

Percent of All races

32

Educational attainment

0.0

5.0

10.0

15.0

20.0

25.0

30.0

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Pe

rcen

t o

f p

op

ula

tio

n w

ith

fo

ur

yea

rs o

f c

olle

ge

or

mo

re

All races57% growth

African Americans115% growth

Hispanic40% growth

The proportion of college-educated African Americans has doubled since 1980

33

Income

0

2

4

6

8

10

12

14

16

18

20

Under$5000

5000 to9999

10000 to14999

15000 to24999

25000 to34999

35000 to49999

50000 to74999

75000 to99999

100000and over

Percent Blacks1980Percent Blacks1990Percent Blacks2000

Proportion of African American families with incomes above $50,000 has grown tremendously from 1980 to 1990

+42%

+91%

+369%

Source: Money and Income in the US 2000, US Census

34

Poverty rates

0

5

10

15

20

25

30

35

40

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

Black poverty rates have fallen but are still much higher than white nonHispanic poverty rates

Black poverty rate as percent of all people in group

White poverty rate as percent of all people in group

Source: US Census

35

Where African Americans live

36

RacismHow important an issue is racial discrimination to you?

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Very important Somewhat important Not important at all Don't know/No Answer

Blacks

Whites

Source: Pew Hispanic Center

37

Causey Learning Center

38

Hispanic Americans

Mexican58%

Puerto Rican10%

Cuban4%

Dominican2%

Central American5%

South American4%

Spaniard0%

All other17%

Latino population by country of origin

Source: US Census (raceagesex)

39

Hispanic AmericansMexican immigrants

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

1901-10 1911-20 1921-30 1931-40 1941-50 1951-60 1961-70 1971-80 1981-90 1991-2000

40

Hispanic Americans

Hispanic or Latino immigrants from all regions grew in the last 40 years

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

1900s 1910s 1920s 1930s 1940s 1950s 1960s 1970s 1980s 1990s

Argentina

Ecuador

Columbia

Cuba

El Salvador

Other Central America and Other South America

(dashed line)

41

Hispanic Americans

200 000 400 000 600 000 800 000 1 000 000 1 200 000 1 400 000 1 600 000 1 800 000 2 000 000

Under 5 years

5 to 9 years

10 to 14 years

15 to 19 years

20 to 24 years

25 to 29 years

30 to 34 years

35 to 39 years

40 to 44 years

45 to 49 years

50 to 54 years

55 to 59 years

60 to 64 years

65 to 69 years

70 to 74 years

75 to 79 years

80 to 84 years

85 years and over

Female

Male

Hispanic or Latino

42

Hispanic Americans

The Hispanic population is younger than the white nonHispanic population

0% 2% 4% 6% 8% 10% 12%

Under 5 years

10 to 14 years

20 to 24 years

30 to 34 years

40 to 44 years

50 to 54 years

60 to 64 years

70 to 74 years

80 to 84 years

Percent of Group

Hispanic

White Alone

Source: 2000 US Census

43

Hispanic Americans

Hispanic youth as a percent of all US youths will grow

0%

5%

10%

15%

20%

25%

Under 1 year 1 to 4 years 5 to 13 years 14 to 17 years

Source: 2000 US Census

44

Hispanic Americans

0%

5%

10%

15%

20%

25%

30%

35%

Hig

h s

cho

ol

gra

du

ate

So

me

coll

ege

Ass

oci

ate

deg

ree

Occ

up

atio

nal

Ass

oci

ate

deg

ree

acad

emic

Bac

hel

or'

s d

egre

e

Mas

ter'

s d

egre

e

Pro

fess

ion

ald

egre

e

Do

cto

rate

Per

cen

t o

f H

isp

anic

s

NonHispanic White

Hispanic

Hispanic Americans lag in educational attainment

45

Hispanic Americans

0.0

5.0

10.0

15.0

20.0

25.0

30.0

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Percent ofPopulation

Percent ofHispanics

The proportion of college-educated is rising

46

Hispanic Americans

Hispanic income levels have not grown as quickly due to more new immigrants

0

5

10

15

20

25

Under$5000

5000 to9999

10000 to14999

15000 to24999

25000 to34999

35000 to49999

50000 to74999

75000 to99999

100000 andover

Per

cen

t o

f H

isp

anic

s

1980

1990

2000

Source: US Census

47

Hispanic Americans

48

Hispanic Americans

During the past five years, have you, a family member, or a close friend experienced discrimination because of your racial or ethnic background

31%

13%

46%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Latinos

Whites

African Americans

Source: 2002 National Latino Survey, Pew Hispanic Center and Kaiser Family Foundation

49

Hispanic Americans

Percent of group who think discrimination against Latinos is a problem

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Succeeding in the US

The workplace

School

African American

White

Latino

Source: 2002 National Latino Survey, Pew Hispanic Center and Kaiser Family Foundation

50

Hispanic Americans

Latino discrimination against each other

Major problem

Minor problem

Not a problem

Source: 2002 National Survey of Latinos, Pew Hispanic Center and Kaiser Family Foundation

51

Asian Americans

0% 50% 100% 150% 200% 250%

Total

White

Black

American Indian and Alaska Native

Asian Pacific

Some other race

Hispanic

White NonHispanic

Minority

Growth rate from 1980 to 2000

Asian Pacific populations grew the fastest from 1980 to 2000

52

Asian Americans

Asian Population by Country of Origin

0 500,000 1,000,000 1,500,000 2,000,000 2,500,000

Malaysian

Sri Lankan

Other Asian

Indonesian

Bangladeshi

Thai

Taiwanese

Other Asian Not specified

Pakistani

Laotian

Hmong

Cambodian

Japanese

Korean

Vietnamese

Asian Indian

Filipino

Chinese, except Taiwanese

53

Asian Americans

Asian immigration increased in the past thirty years

0

100,000

200,000

300,000

400,000

500,000

600,000

1850s 1860s 1870s 1880s 1890s 1900s 1910s 1920s 1930s 1940s 1950s 1960s 1970s 1980s 1990s

Vietnam

Philippines

China

India

Korea

Hong Kong

Japan

54

Asian Americans

0%

5%

10%

15%

20%

25%

30%

35%

Hig

h s

cho

ol

gra

du

ate

So

me

colle

ge

Ass

oci

ate

deg

ree

Occ

up

ati

on

al

Ass

oci

ate

deg

ree

acad

em

ic

Bac

hel

or'

s d

egre

e

Mas

ter'

s d

eg

ree

Pro

fess

ion

ald

eg

ree

Do

cto

rate

Percent of Asians

Percent of TotalPopulation

Asians are more educated that the population

55

Asian Americans

Larger proportion of Asian American households have higher incomes

0

5

10

15

20

25

Under$5000

5000 to9999

10000 to14999

15000 to24999

25000 to34999

35000 to49999

50000 to74999

75000 to99999

100000and over

Percent White NonHispanic

Percent Asian American

56

Asian Americans

57

Case Study: Uwajimaya

58

American Indian

0 100000 200000 300000 400000 500000 600000 700000 800000

Pueblo

Iroquois

Blackfeet

Apache

Chippewa

Sioux

Choctaw

Latin American Indian

Navajo

Cherokee

In Combination with Other

Tribe Alone

59

American Indian

60

American Indian

American Indian and Alaskan Native Age Distribution

50 000 100 000 150 000 200 000 250 000

Under 5 years

5 to 9 years

10 to 14 years

15 to 19 years

20 to 24 years

25 to 29 years

30 to 34 years

35 to 39 years

40 to 44 years

45 to 49 years

50 to 54 years

55 to 59 years

60 to 64 years

65 to 69 years

70 to 74 years

75 to 79 years

80 to 84 years

85 years and over

FemaleMale

61

American Indian

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Under5 years

5 to 17 18 to20

21 to24

25 to34

35 to44

45 to54

55 to59

60 to64

65 to74

75 to84

Over85

years

Per

cen

t o

f G

rou

p

Total Population

American Indian and Alaskan Native

62

American Indian

American Indian educational attainment lags general population

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

High School and Higher Bachelors and Higher

Per

cen

t o

f g

rou

p

Total Population

American Indian

Source: Census 2000

63

American Indian

American Indian household income is lower than the US population

10%

19%

29%

19%

10%12%

16%

25%

31%

16%

7%5%

0%

5%

10%

15%

20%

25%

30%

35%

Under$10000

10000 to24999

25000 to49999

50000 to74999

75000 to99999

100000 andover

Per

cen

t o

f G

rou

p

US Population

American Indian

64

American Indian

65

American Indian

American Indian Incidence Divided by US Incidence

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50

Children Abused or Neglected 1995

Single Parent Female Head 1995

Teen Drug Use 1999

Teen Cigarette Use 1999

Arrests 1998

Arrest for Driving Under the Influence 1998

SIDS Death Rate 1994-6

Accident Deaths 1998

Diabetes Mellitus Mortality 1998

Cirrhosis Deaths 1998

66

Native Hawaiians

67

Mixed Race

Percent of group of mixed race

0% 5% 10% 15% 20% 25% 30%

Under 5 years

10 to 14 years

20 to 24 years

30 to 34 years

40 to 44 years

50 to 54 years

60 to 64 years

70 to 74 years

80 to 84 years

White

African Heritage

Asian Heritage

68

Mixed Race

American Indian Alone63%

White Combination27%

Black Combination5%

White/Black Combination

3%Other

2%

American Indians have a high percent of mixed race

69

Mixed Race

Hawaiian Alone46%

Asian Combination16%

White Combination13%

Asian/White Combination

10%

Other15%

Hawaiians have a high proportion of mixed race

You need to target your market and know who your customer is

Market Segmentation

• Demographic - Age, gender, education, income, ethnicity

• Geographic - Northeast, South, Midwest, Southwest, West

• Behavior - Sports, shopping habits

• Psychographic - Yuppies• Propensity to buy

Propensity to Buy

LaggardsLate

MajorityEarly

MajorityEarly

AdoptersInnovators

"TheChasm"

Technology Adoption Process

Who is the target market?

• Target• Wal-Mart• Gap• REI• Abercrombie and Fitch• Nordstrom

The Customer

Now that you know the market, how do you

target?

Target a market

• Choose for desirable characteristics

• Buying or purchasing power• Growth opportunities• No or limited competition• If you can’t make a profit---

abort

Customer Value Proposition• Selection• Price• Convenience• Quality• Those are the easy ones--It’s

the hot buttons that work: Safety, health, esteem, etc.

Give the customer a compelling reason to buy• Design product or service to satisfy

needs - not the other way around• Get partners to provide a complete

package• Make your customer aware of your

offering• Get your customer to buy• Don’t let go of the customer

Customer Life Cycle

Intent toPurchase

Repurchase Advocacy

CustomerSales

Time

CustomerAwareness

How long does acustomer stay

with thebusiness?

How did thecustomer getto know thebusiness?

Whattriggered the

initial buydecision?

Createprofile

for leadgeneration.

What canbe cross-

sold?

Satisfactionsurveys.Events to

trigger crosssells.

How to getcustomer torecommendbusiness?

Developrelationship.

Viralmarketing.

Createbrand

awareness.

Continuedcontact.

Customer Life Cycle

Why manage the customer?• New customers are expensive

to get• Existing customers are easy to

reach• You know a lot about them• They can be your best

marketers

The Supermarket Customer• Female• Shop 2.2 times per

week• 31% arrive with

list• traveled 1.8 miles• needs: dieting,

economizing, indulging and impressing guests

The Supermarket - A Science• 30,000 SKU’s - selection• Store labels to left of national brands -

we tend to look right• Sampling - 80% of those who sample

buy• Best sellers 51 to 53 inches off floor• Slow background music - the more time

you spend the more you buy• Endcaps and in-aisle gondolas• Don’t arrange by alphabet or type

Your Exercise

• Bellevue Community College• What is the customer value

proposition?• What products should BCC

market?• Map the customer life cycle and

what should be marketed at each point.

Products

Now that you’ve decided on your customer, what do

you do?

Products

• Anything sold to your market• Doesn’t have to be physical• Most ideas don’t make it to the

marketplace• Needs to meet the needs of

customer

Product Development

Screening Ideas

Business Analysis

Prototype Development

Product Testing

Commercialization

5,000Drugs

10 get FDAApproval

3 Profitable

How does a new product get marketed?• All markets have “power

users”• Get power users excited about

it• Then comes the critical phase

when you get the rest of the market to adopt

High school types and product adoption

http://quizfarm.com/test.php?q_id=39704Chav, Rocker, Skater, Emo, Goth,

Trendy, Prepy Ect

Marketing a New Product

Think of someproducts that

jumped the chasm and some that

didn’t

Source: Geoffrey Moore

Crossing the Chasm

Product Life Cycle

Where are these products in the product life cycle?• Television (98%)• Telephone (96%)• Broad Band Internet Access

(30%)• Cell phones (80%)

Branding

Keeping your company in the customer’s mind

Brands

• Creating a brand identity is important for both large and small businesses

• A brand is the image the customer has of your product or company

• If you can tie your brand image to something of value to the customer it can go a long way in making your enterprise successful

• The best brands have very loyal customers

Top Brands

Levels of Brand Loyalty

• Awareness - Can tell you what the brand is about

• Preference - Will buy it if it is available

• Brand loyalty - Will buy nothing else

The Brand - Mapping Consumer Values• Favorite brands• What’s important in buying a

soft drink?• How do the brands map for

your values?

Channels

Getting the product to the customer

Channel

• Systems for getting your product to the customer

• Could be within your own enterprise or with partners

• There are lots of ways of doing it

A simple example - Target

• Stores• Catalog• Website

Other Channels - Give an example of a product you bought using each• Sales people• Distributors• Brokers• Agents• Internet• Wholesalers• Shopping Channel

Channel Selection

• How can you best serve the customer?

• What is the most cost effective way to getting product to the customer?

• How can you avoid conflict?• How can you keep control?• How can you enhance your brand?

Channel Selection

• Name all the channels for the Starbucks brand (note not the coffee, the brand)

PromotionPromotion

The message

PromotionPromotion

• Persuasive techniques used to communicate with target market

• Goals– Inform - where to find it, cost, use– Persuading - motivate to use or

switch– Remind - maintain contact

Four Elements of Promotion• Advertising• Promotion• Public Relations

MEDIA TYPE 2007 2006 2005 2004

NATIONAL TV 32.0% 31.5% 31.6% 31.0%

MAGAZINES 20.4% 19.3% 19.8% 19.0%

NEWSPAPERS 17.7% 18.8% 20.2% 20.4%

LOCAL TV 11.3% 12.5% 11.5% 13.1%

INTERNET 7.6% 6.6% 5.8% 5.3%

RADIO 7.2% 7.5% 7.7% 7.8%

ALL OTHER 3.9% 3.8% 3.5% 3.3%

TOTAL 100.0% 100.0% 100.0% 100.0%

Share of Measured Advertising Spending

Advertising MediaAdvertising Media

• Media - Newspaper, radio, television, internet

• Media plan - allocation of ad budget to various media

• Media mix - combination of media and choice of specific newspaper, magazine or television slot

Media BuyingMedia Buying

• Cost per thousand - cost to reach 1,000 people

• Reach - total number of audience members exposed to message at least once (% total)

• Frequency - average number of times exposed to message

• Continuity - timing of ad messages

Major Advertising MediaMajor Advertising Media

Advantage Disadvantage

Newspaper Broad reach andcheap

Clutter andgraphic quality

Television Broad reach andcreative

High costEffective?

Direct mail Target market Cost andtargetting

Radio Low cost No visual andshort life

Magazines Target Cost and demoabilities

Public RelationsPublic Relations

• Reputation of company• Getting press coverage• Press release• Press conference

Sales PromotionSales Promotion

– coupons– contests– in store point of sale display– Special events sponsorship– Premiums - free gifts– Specialty advertising - baseball caps,

pens, mugs, tee-shirts

How would you devise an ad campaign for a new kid’s Nintendo game?

– Type of promotion?– Which magazines?– Which radio stations?– Which television shows?