Advertising, Sales Promotion ch 19 & 20 Principle Of Marketing

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Information about Advertising, Sales Promotion ch 19 & 20 Principle Of Marketing
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Published on December 6, 2008

Author: faisal3rd

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Slide 1: Advertising, Sales Promotion, Public Relation Chapter Chapter Goals : Chapter Goals To gain an understanding of: The nature of advertising The importance of advertising to the firm and society Different types of advertising Development of advertising campaigns Selection of advertising media The use of public relations and publicity Advertising : Advertising Includes all activities involved in presenting a non-personal, sponsor-identified, paid-for message about a product or organization. Can classify it by: The target audience: consumers or businesses Product/service vs. organization/company Objective: Primary or selective demand The Nature of Advertising : The Nature of Advertising advertising is distinguished from other forms of promotion as follows it has a verbal and/or visual message the sponsor of the message is identified delivery is through recognizable media there is payment by the advertiser to the media for carrying the message advertisers are increasingly being able to reach specific audiences with tailor-made messages Advertising to Target Audiences : Advertising to Target Audiences advertising can be classified by the target audience to which it is directed consumer advertising generally appears in mass media and is directed to end consumers: may be product or institutional in nature business-to-business advertising is often called trade advertising and is directed to a business market What is Being Advertised? : What is Being Advertised? product advertising is designed to promote the sale of a specific product or service: may be direct-action, quick-response may be indirect-action over a longer time institutional advertising promotes the firm or tries to create a positive image: may promote customer service or send a public service message What are the Objectives? : What are the Objectives? primary-demand advertising is intended to stimulate use of a category of products selective-demand advertising is intended to encourage purchase of a particular brand or the products and services of a specific firm Comparative Advertising : Comparative Advertising Selective-demand advertising Involves comparing a product to its competing brand May be: Direct, naming competitors outright Less direct, alluding to competitors (e.g., “leading brand”, “Brand X”) but not naming them Co-operative Advertising : Co-operative Advertising co-operative advertising involves the sharing of the cost of advertising by two or more sponsors: a manufacturer and retailers (vertical), or a group of retailers (horizontal) An Advertising Campaign (Steps 1 and 2) : An Advertising Campaign (Steps 1 and 2) Transforming a theme into a coordinated advertising program to accomplish a specific goal. Objectives of the campaign determined by firm’s overall marketing strategy. Typical objectives are: Support personal selling Improve dealer relations Introduce a new product Counteract substitution Expand use of a product category The Advertising Campaign (Steps 3 and 4) : The Advertising Campaign (Steps 3 and 4) Creating a message that: Gets and holds the attention of the intended audience. Influences the audience in the desired way. Selecting media involves: The choice of a medium such as television, radio, newspaper, or magazine. The specific category of the selected medium to be used, such as special interest (Chatelaine) vs. general interest magazines (Maclean’s). The specific media vehicles. The Campaign Budget : The Campaign Budget A budget must be allocated among the various activities comprising the overall promotional program. Promotional budgets can be extended with co-operative advertising. Choosing Media : Choosing Media Objectives of the ad. Audience coverage. Requirements of the message. Time and location of the buying decision. Media cost (CPM) Media characteristics. Characteristics of Key Media : Characteristics of Key Media Newspapers: flexible, local Television: versatile, powerful but costly, fragmented Direct Mail: personal, selective, effective, but tough Radio: strong locally, cheap but single medium Magazines: top quality, little flexibility More Key Media : out-of-home advertising specialty advertising emerging media: World Wide Web infomercials place-based media videos and CD-ROMs yellow pages More Key Media Evaluating the Major Media : Evaluating the Major Media Newspapers: are flexible and timely, have a local orientation and wide coverage, low cost Television: is versatile, but audience is now fragmented, reaches mass audiences Direct mail: is efficient, targets certain audience More Media Evaluations : More Media Evaluations Radio stations target specific segments, low cost, local orientation, short message life Magazines deliver quality advertising to specific segments, message stays around The Changing Nature of Media : The Changing Nature of Media media are becoming less mass, more targeted cable TV offers many specialty channels direct-to-home TV adds to fragmentation lots of new out-of-home media Yellow Pages and other directories on CD-ROM place-based media where they shop and live advertising on the Web works as Yellow Pages does -- the customer seeks out the advertiser Evaluating Advertising : Evaluating Advertising It is difficult to measure the sales effectiveness of advertising because: Ads have different objectives. Ads can have an effect over time period. Measurement problems. Effectiveness can be tested: Before an ad is presented. While it is being presented. After it has completed its run. Organizing for Advertising : Organizing for Advertising Develop an internal advertising department. Many large retailers do this. Use an outside advertising agency. Specialized, skilled professionals. Experienced, many services offered Do both. Sales Promotion : Sales Promotion Demand-stimulating devices designed to supplement advertising and facilitate personal selling. Sales promotions include such things as coupons, in-store displays, premiums, trade shows, in-store demonstrations, and contests. The target for these activities may be middlemen, end users, or the producer’s own sales force. Types of Sales Promotion : Types of Sales Promotion Trade promotions, directed to members of the distribution channel. Consumer promotions, aimed at consumers. Consumers got 3.3 billion coupons for packaged goods alone in 1996. Advantages of Sales Promotion : Advantages of Sales Promotion It can produce short-term results. Competitors are using sales promotions. Sales promotions are attractive to price-conscious consumers. Can enhance/facilitate retail salesmanship which is often of low quality. Key Reasons for Sales Promotion : Key Reasons for Sales Promotion Stimulating end-user demand. Sampling program for new/improved product Improving the marketing performance of middlemen and salespeople. Sell more, win a holiday trip. Supplementing advertising and facilitating personal selling. Displays, promotional giveaways Managing Sales Promotion : Managing Sales Promotion Select from wide range of techniques, depending on your objectives Select promotional devices based on: Nature of target audience Your promotional objectives: Push vs. Pull. Cost of device-- sampling can get costly. Current economic conditions-- coupons, rebates work best in recessionary period. Evaluating Sales Promotion: Much easier than with advertising. Usually clear start, finish, goal. Public Relations : Public Relations A tool designed to influence favourably attitudes towards an organization, its products and policies. Public relations is often overlooked by management because of: Organization structure; not in marketing. Inadequate definitions; loosely defined. Unrecognized benefits; many non-believers. Publicity : Publicity Publicity is a form of public relations that includes any communication about an organization or its products that is presented by the media but is not paid for by the organization. Strengths of Publicity : Strengths of Publicity Can announce new products, recognize employees, report good results, breakthroughs. Key Benefits: Lower cost than advertising or personal selling. Increased readership; advertising ignored often. More information. Timeliness. Weaknesses of Publicity : Weaknesses of Publicity Some loss of control over message. Limited exposure; only happens once. Not free; preparation costs. Slide 30: End of Chapter # 19 Chapter 20Strategic Marketing Planning : Chapter 20Strategic Marketing Planning Principle of Marketing Chapter Goals : Chapter Goals To gain an understanding of: The nature and scope of planning and how it fits within the management process Similarities and differences among mission, objectives, strategies and tactics The essential difference between strategic company planning and strategic marketing planning The steps involved in strategic marketing planning The purpose and contents of an annual marketing plan How planning models can be useful aids in developing a marketing program Slide 33: PLANNING Analyze situation Set goals Select strategies and tactics IMPLEMENTATION Organize Staff Direct EVALUATION Compare performance with goals Feedback, so management can adapt future plans and their implementation to the changing environment The Management Process Strategic Marketing Management : Strategic Marketing Management strategic management involves planning, implementation, and evaluation implies ongoing revision of the marketing program, based upon feedback consistent with the firm’s mission statement and based upon clear goals and objectives strategies suggest how firm will reach its goals tactics relate to how strategies will be implemented policies guide how the firm does business Slide 35: Strategic company planning 1. Define org. mission 2. Conduct situation analysis 3. Set org. objectives 4. Select appropriate strategies Strategic marketing planning 1. Conduct situation anal. 2. Develop marketing obj. 3. Determine positioning and differential advantage 4. Select target markets, measure market demand 5. Design strategic marketing mix Annual marketing planning Prepare annual marketing plan for each major product and company division PLANNING SEQUENCE IMPLEMENTATION AND EVALUATION Strategic Marketing Planning : Strategic Marketing Planning strategic planning is based upon what is happening in the firm’s environment matches resources with the opportunities, changes, and characteristics of the marketplace must be consistent with the firm’s mission objectives must be actionable and measurable formulation of objectives is often based upon an analysis of strengths, weaknesses, opportunities, and threats (SWOT) The Planning Process : The Planning Process involves carrying out a situational analysis; often including a SWOT analysis setting realistic marketing objectives determining strategies for positioning and for gaining a differential advantage on competitors selection of appropriate target market segments and an assessment of market demand identifying a strategic marketing mix that will appeal to the target segments Annual Marketing Planning : Annual Marketing Planning short-term plan prepared for a firm’s major functions summarizes strategies that will be used to achieve specific objectives over the year points out other activities that must be performed in implementation and evaluation outlines who is responsible and what resources are to be made available represents a “road map” to guide marketing activity over the coming year Contents of the Annual Plan : Contents of the Annual Plan executive summary situation analysis -- including resources objectives tailored to organizational goals strategies relating to segments and marketing mix tactics --activities to carry out strategies financial schedules -- projections timetable to guide implementation evaluation of performance against goals Strategic Business Units(SBU) : Strategic Business Units(SBU) To make planning more effective, a large, diverse organization may divide itself into smaller planning units called Strategic Business Units The unit should: Be a separately identifiable business Have a distinct mission Have separate competitors Have a separate group of executives charged with profit responsibility Have its own strategic plan The Boston Consulting Group Matrix : The Boston Consulting Group Matrix Using this model, a strategic business unit (SBU) can be classified according to two factors: its market share relative to competitors, and the growth rate of the industry in which the SBU operates. The resulting 2 x 2 grid has 4 quadrants that represent distinct categories of major products. Each category is assigned a name that reflects its market share, industry growth rate, cash needs, and appropriate strategies. Slide 42: Stars Cash cows Dogs Question marks High Low High Low COMPANY’S MARKET SHARE INDUSTRY GROWTH RATE Product-Market Growth Matrix : Product-Market Growth Matrix growth requires examination of both products and markets; what needs changing? Should you stay and fight? Or should you forge an alliance to meet the challenge? market penetration: sell more of present products/services to present markets market development: sell present products to new markets or segments product development: new products/services for existing markets diversification: new products to new markets Slide 44: PRESENT PRODUCTS PRESENTMARKETS NEW PRODUCTS NEWMARKETS Market penetration Market development Product development Diversification The product-market growth matrix depicts the options available in considering markets and products. Product Market Growth Matrix

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