Chapter 16—Designing and Managing Integrated Marketing Communications

True/False Questions

1. Marketing communications are only carried out prior to the sale to the consumer. False (moderate) p. 303

2. The source’s expertise, trustworthiness, and likeability determine the level of source credibility. True (moderate) p. 307

3. The percentage-of-sales method is a promotional budgeting method that forces management to spell out assumptions about the relationship among dollars spent, exposure levels, trial rates, and regular usage. False (difficult) p. 308

4. One downside to using public relations and publicity is the lack of credibility. False (moderate) p. 309

5. The objective-and-task method for budgeting requires management to spell out its assumptions about the relationship among dollars spent, exposure levels, trial rates, and regular usage. True (moderate) p. 309

6. Any paid form of nonpersonal promotion of ideas, goods, or services where the originator of the promotion is known is called public relations and publicity. False (easy) pp. 309-310

7. When developing an advertising program, the five critical Ms are mission, money, media, message, and measurement. True (moderate) p. 312

8. Reminder advertising works best for new products. False (easy) p. 313

9. Japanese ads tend to be less direct and appeal more to the emotions, when compared to U.S. ads. True (moderate) p. 314

10. Audiences can be measured according to circulation, which is the number of physical units carrying the advertising. True (moderate) p. 316

11. The cost-per-thousand for a medium that reaches 10,000,000 people at a cost of $135,000 is $13.50. False (moderate) p. 317

12. Pulsing calls for spending all of the advertising dollars in a single period. False (moderate) p. 317

13. Pulsing is continuous advertising at low-weight levels reinforced periodically by waves of heavier activity. True (moderate) p. 317

14. Copy testing is always done before ads are run. False (easy) p. 318

15. A firm that wants to attract new triers, reward loyal customers, or increase the repurchase rate of occasional users would be best served by sales promotion. True (moderate) p. 318

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16. A coupon is a type of consumer promotion that provides a price reduction after the purchase rather than at the retail store. False (easy) p. 318

17. Although sales promotions are short-term in nature, they can be “consumer franchise building” if they reinforce understanding about the brand. True (moderate) p. 319

18. Public relations is an ineffective tool in the launch of a new product. False (moderate) p. 322

19. Public relations involves a variety of programs that are designed to promote or protect a company’s image or its individual products. True (moderate) p. 322

20. Direct mail marketing can include the use of e-mail, voice mail, and fax mail. True (moderate) p. 325

Multiple Choice Questions

21. The first step in the development of effective communication is _______________.a.) identifying the target audience (moderate) p. 303b.) determining the communication objectivesc.) designing the messaged.) setting the budgete.) selecting the communication channels

22. _______________ is the set of beliefs, ideas, and impressions that a person holds regarding an object.a.) Image (easy) p. 304b.) Atmospherec.) Eventd.) Mediae.) Message

23. An ad in Surfer Girl magazine says, “ Mr. Zog’s sex wax gloms onto your stick better and longer than any other wax.” This is an example of a(n) _______________ appeal.a.) moralb.) emotionalc.) cognitived.) sociale.) rational (moderate) p. 305

24. Michelin Tires has commercials featuring diaper-clad babies sitting in Michelin tires. A voiceover tells you the tires are more expensive than many brands but that what is riding on them is priceless. This is an example of a(n) _______________ appeal.a.) moral b.) emotional (easy) p. 306c.) social d.) discriminante.) rational

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25. Ads that state you should buy Harley Davidson because it is made in America are using a(n) _______________ appeal.a.) moral (moderate) p. 306b.) emotional c.) social d.) rational e.) cognitive

26. The ad says, “ For about the cost of a cup of coffee a day, you can make little Pablo’s life so much better.” This is an example of a(n) _______________ appeal.a.) rationalb.) practicalc.) reciprocald.) emotional (moderate) p. 306e.) provocative

27. The headline for an ad reads, “ Power Bars give you all you need—when you need it!” This is an example of a(n) _______________ appeal.a.) rational (moderate) p. 306b.) practicalc.) reciprocald.) emotionale.) provocative

28. Source credibility is a function of the source’s _______________.a.) personal, social, and moral influencesb.) quality of expression—both verbal and nonverbalc.) likeability, expertise, and trustworthiness (difficult) p. 307d.) recognizability, trustworthiness, and reputatione.) knowledge, reputation, and perceived expertise

29. A pharmaceutical drug rep giving her sales presentation to the office manager and the doctor is using a(n) _______________ communication channel.a.) personal (moderate) p. 307b.) expertc.) advocated.) informale.) competent

30. How are professionals using the personal influence channel when they encourage their clients to recommend their services to others?a.) They are creating opinion leaders.b.) They are using word-of-mouth referral channels. (difficult) p. 307c.) They are identifying influential individuals and devoting extra time to them.d.) They are using believable people in testimonial advertising.e.) They are communicating through community influentials, such as local talk show hosts and

organizational presidents.

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31. _______________ are occurrences such as news conferences and grand openings designed to communicate to target audiences.a.) Atmospheres b.) Display mediac.) Events (moderate) p. 308d.) Interactive communication channelse.) Mood enhancers

32. Newspapers, magazines, and direct mail are all examples of which of the following types of media?a.) print media (easy) p. 308b.) broadcast mediac.) electronic mediad.) display mediae.) intermittent media

33. Which of the following types of media best describe audiotape, videotape, CD-ROM, DVD, and Web pages?a.) print mediab.) broadcast mediac.) electronic media (easy) p. 308d.) display mediae.) intermittent media

34. Which of the following is not used as a supporting argument when considering the percentage-of-sales promotional budget setting method?a.) It makes sales the determiner of promotion. (moderate) pp. 308-309b.) It links sales to corporate expenditures.c.) It focuses attention on the relationship of costs and price and unit profit.d.) It encourages stability when others in the industry spend the same percentage.e.) Sales and promotional expenditures are related.

35. Ohana Surf, on the north shore of Oahu, Hawaii, is preparing its promotional budget for next year. If its first step is to forecast next year’s sales, then Ohana is probably using the _______________ method.a.) percentage-of-sales (difficult) pp. 308-309b.) affordablec.) market shared.) competitive-paritye.) objective-and-task

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36. Which of the following is a weakness of the percentage-of-sales method of establishing the promotion budget?a.) The percentage-of-sales method of establishing the promotion budget assumes the competition

knows what it is doing.b.) The percentage-of-sales method of establishing the promotion budget is a complicated, time-

consuming process.c.) The percentage-of-sales method of establishing the promotion budget leads to a budget that

ignores market opportunities. (difficult) pp. 308-309d.) The percentage-of-sales method of establishing the promotion budget ignores the role of

promotion as an investment in the business.e.) The percentage-of-sales method of establishing the promotion budget discourages promotional

wars.

37. In an ideal world, which is the preferred method of setting a promotion budget?a.) percentage-of-sales methodb.) arbitrary allocationc.) affordable methodd.) competitive-parity methode.) objective-and-task method (easy) p. 309

38. If Ohana Surf, on the north shore of Oahu, Hawaii, wants to use the promotional tool that will build the long-term image of the store and give the best cost per exposure, it should use _______________.a.) direct mailb.) public relations and publicityc.) advertising (moderate) p. 309d.) sales promotione.) personal selling

39. The three distinct benefits of _______________ are its ability to communicate, its ability to act as an incentive, and its invitation to consumers to buy now.a.) direct mailb.) sales promotion (moderate) p. 309c.) advertisingd.) public relationse.) personal selling

40. If the director of marketing for a textile firm is concerned with the buyer-readiness stages of his customers, the best promotional tool for him to use would be _______________.a.) direct mailb.) public relations and publicityc.) sales promotiond.) advertisinge.) personal selling (moderate) p. 310

41. At what stage of buyer readiness is sales promotion the most cost-effective promotional tool?a.) awarenessb.) comprehensionc.) conviction d.) orderinge.) reordering (moderate) p. 310

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42. At what stage of buyer readiness are advertising and publicity the most cost-effective promotional tools?a.) awareness (moderate) p. 310b.) comprehensionc.) conviction d.) orderinge.) reordering

43. Hospitals are engaged in intense competition to fill their maternity beds. What type of advertising would hospitals most likely use for advertising their new amenities like Jacuzzis in every room, filet mignon or lobster on the menu, and afternoon teas for the new mothers and their families?a.) descriptiveb.) persuasivec.) reminderd.) informative (moderate) p. 312e.) instructive

44. Within the last couple of years several cosmetics manufacturers have introduced non-clumping mascara. Revlon was one of those manufacturers. Revlon should use _______________ advertising to increase selective demand for its non-clumping mascara.a.) descriptiveb.) persuasive (moderate) pp. 312-313c.) reminderd.) informativee.) instructive

45. Advertising for Advil pain reliever shows how Advil is superior to Tylenol. This is an example of _______________ advertising.a.) descriptiveb.) persuasive (moderate) p. 313c.) reminderd.) informativee.) instructive

46. Abercrombie and Fitch could use _______________ advertising to reduce the cognitive dissonance experienced by someone who recently purchased its brand of high-fashion, high-priced clothing and wonders if they got the value for their money.a.) persuasive b.) comparative c.) reinforcement (moderate) p. 313d.) informative e.) descriptive

47. When setting the advertising budget, management should consider all of the following factors EXCEPT:a.) product life cycle stageb.) market share and consumer basec.) competition and clutterd.) product substitutabilitye.) width of the company’s product line (difficult) p. 313

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48. In developing a creative strategy, advertisers follow all of the following steps EXCEPT:a.) message generationb.) message evaluation and selectionc.) message executiond.) subliminal implementation (difficult) pp. 313-315e.) social responsibility review

49. The number of different persons exposed to a particular media schedule at least once during some specified time is the _______________ of an advertisement.a.) iterationb.) frequencyc.) reach (moderate) p. 315d.) impacte.) gross rating points

50. The qualitative value of an exposure through a given media vehicle is called _______________.a.) iterationb.) frequencyc.) reach d.) impact (difficult) p. 315e.) gross rating points

51. Assume you are advertising very expensive authentic Turkish carpets to upscale investors in Germany. Credibility and prestige are important. The best medium for your advertising message is _______________.a.) televisionb.) newspapersc.) magazine (moderate) p. 316d.) direct maile.) radio

52. The owner of a dive shop that provides its customers with scuba training and sells dive equipment and accessories would like to advertise. He is considering outdoor advertising. Outdoor advertising would _______________.a.) give its ad high repeat exposure (difficult) p. 316b.) provide tremendous audience selectivityc.) allow the restaurant to create very creative adsd.) not have to contend with cluttere.) provide all of the above benefits to the restaurant

53. Audiences can be measured according to _______________, which is the number of physical units carrying the advertising.a.) circulation (moderate) p. 316b.) flightingc.) effective audienced.) effective ad-exposed audiencee.) continuity

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54. Audience size can be measured according to how many people with the right target characteristics are exposed to the ad. This is called _____________.a.) circulation b.) audiencec.) effective audience (moderate) p. 317d.) effective ad-exposed audiencee.) bottom-line measure

55. If a 30-second advertisement during an old Seinfeld rerun costs $160,000 and reaches 8,000,000 people, the cost per thousand for a Coca-Cola ad would be _______________.a.) $2.00b.) $5.00 c.) $12.50d.) $15.00e.) $20.00 (moderate) p. 317

56. The media timing pattern in which advertising is run evenly throughout a given period is called _______________.a.) flightingb.) concentrationc.) pulsingd.) burstinge.) continuity (moderate) p. 317

57. A Thai restaurant buys an ad in every issue of its small town’s weekly newspaper, and two lunchtime ads every day on the local radio station. The owner has used this pattern of advertising for many years. Which of the following terms best describes the Thai restaurant’s media timing?a.) flightingb.) concentrationc.) pulsingd.) burstinge.) continuity (moderate) p. 317

58. Which of the following calls for spending all of the advertising dollars in a single period?a.) burstingb.) continuityc.) pulsingd.) concentration (moderate) p. 317e.) flighting

59. An advertiser on a limited budget that schedules media so that a heavy dose of advertising is followed by a period of no advertising is using a pattern called _______________.a.) burstingb.) continuityc.) pulsingd.) concentratione.) flighting (moderate) p. 317

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60. __________ is a media timing approach that involves continuous advertising at low-weight levels, reinforced periodically by waves of heavier activity.a.) Burstingb.) Continuityc.) Pulsing (moderate) p. 317d.) Concentratione.) Flighting

61. _______________ is a key ingredient in many marketing campaigns and consists of a diverse collection of incentive tools, mostly short term, designed to stimulate trial, or quicker or greater purchase, of particular products or services by consumers or the trade.a.) Advertisingb.) Public relationsc.) Sales promotion (moderate) p. 318d.) Personal sellinge.) Market segmentation

62. Pepsi is using a sales promotion campaign for AMP, its new energy drink based on its popular Mountain Dew recipe. Pepsi is running coupons in magazines aimed at teenagers and college students, offering refund offers for multiple purchases, and mailing samples to homes in selected zip codes. All of the methods that Pepsi is using are types of _______________.a.) intermediary promotional activitiesb.) trade promotionsc.) public relations activitiesd.) functional promotionse.) consumer promotions (moderate) p. 318

63. All of the following are examples of tools for consumer promotions EXCEPT_______________.a.) samplesb.) couponsc.) premiumsd.) prizese.) display allowances (moderate) p. 318

64. A firm that wants to attract new prospects, reward loyal customers, or increase the repurchase rate of occasional users would be best served by _______________.a.) personal sellingb.) direct marketingc.) advertisingd.) sales promotion (moderate) p. 318e.) an unbiased public relations article

65. When a movie studio uses toys in fast food restaurant kid’s meals to advertise their latest movie, they are using _______________.a.) tie-in promotions (moderate) p. 320b.) prize promotionsc.) point-of-purchase promotionsd.) premiumse.) promotion bundling

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66. Tom’s used _______________ when it placed a coupon for $1.00 off any 12-pack of soda on packages of its Hot Fries snacks.a.) a price packb.) a prize promotionc.) a point-of-purchase promotiond.) a cross-promotion (moderate) p. 320e.) promotion bundling

67. _______________ involves a variety of programs that are designed to promote or protect a company’s image or its individual products.a.) Advertisingb.) Public relations (moderate) p. 322c.) Sales promotiond.) Personal sellinge.) Market segmentation

68. When Virginia did its “ Virginia Is for Lovers” campaign to help people think positively about a state they may have had negative feelings about, this was an example of what type of marketing public relations?a.) assisting the launch of new productsb.) assisting in repositioning a mature product (moderate) p. 322c.) defending products that have encountered public problemsd.) influencing specific target groupse.) building interest in a product category

69. Public relations is particularly effective in _______________.a.) building awareness and brand knowledge in new and existing products (difficult) p. 322b.) reinforcing the buyer’s decisionc.) developing and maintaining a long-term increase in salesd.) enabling companies to adjust to short-term variations in the supply and demand of their marketse.) preventing intermediaries from misusing trade promotions

70. The original and oldest form of direct marketing is _______________.a.) telemarketingb.) “ junk” mailc.) the field sales call (moderate) p. 325d.) catalog marketinge.) e-marketing

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Essay Questions

71. Tom Elrich is responsible for setting the promotional budget for a microwave dish that cooks bacon on a rack over a drip pan. It is a new product for the market and for the small plastics manufacturer that Tom works for. Tom has only a very limited amount of time to set the budget. In a short essay, explain the different budgeting options Tom has, choose one of the forms, and justify it by discussing its pros and cons.

Answer:(1) The affordable method of setting budgets simply determines the amount of budget by how much the company has available. (2) The percentage-of-sales method sets promotion expenditures at a specified percentage of sales (either current or anticipated). (3) The competitive-parity method lets companies set their promotion budget to achieve share-of-voice parity with competitors. (4) The objective-and-task method calls upon marketers to develop promotion budgets by defining specific objectives, determining the tasks that must be performed to achieve these objectives, and estimating the costs of performing these tasks. In selecting one of these methods, competitive-parity is illogical. The objective-and-task, while a sound method, is time-consuming. Of the two remaining methods, the affordable method is probably the easiest to use. It does completely ignore the role of promotion as an investment and the immediate impact of promotion on sales volume. The percentage of anticipated sales method is useful because it encourages management to think in terms of promotion cost, selling price, and profit per unit, but the question is does Tom have time to accurately predict sales? On the negative side, this method uses circular reasoning. It leads to the same thing as the affordable method—a budget based on available funds not market opportunities. Most students, if they reason through what they know about budgeting, should select affordable method given the circumstances.(difficult) pp. 308-309

72. The venture capital group has just given a small publishing house $2.1 million to help the publisher continue to grow. The managers/owners decide they need to spend about $500,000 on getting the word out about the company. JoAnn remembers from a marketing class she took in college something about “ reach, frequency, and impact” when it comes to choosing your media for a promotional effort. She asks you, a friend, if you remember these words and what they might mean for how she chooses to spend her promotional budget. Respond to JoAnn’s question in a brief essay.

Answer: Reach refers to the number of different persons or households that are exposed to a particular media schedule at least once during a specified period.Frequency refers to the number of times within a specified period that an average person or household is exposed to the message.Impact refers to the qualitative value of an exposure through a given medium.When planning her media, JoAnn should realize that there will be trade-offs among these elements. Reach is most important when launching new products, but frequency is most important when there are strong competitors and a complex story to tell. It generally takes several exposures to get a person to pay attention to an ad and remember it, so JoAnn will need to take that into account when planning her media usage.(moderate) p. 315

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73. Machaca-filled burritos have long been a favorite dish at Mexican restaurants in southern Arizona. Maria Gutierrez decided to market this traditional treat regionally under the brand name Mama G’s. She sells a package of dehydrated machaca meat with a stack of flour tortillas and some envelopes of her favorite salsa. Discuss the five major decisions that she had to make when developing the advertising program for Mama G’s.

Answer:The five major decisions that Gutierrez had to make are known as the five Ms. First, she had to decide on Mission – what were her advertising objectives? Second, she had to create primary demand for her product in the area of the country that was unfamiliar with it. Then she had to determine a sales level that she wanted to accomplish with a specific audience in a specific period of time. Her next issue was Money. How much should she spend on budget? How should she determine that amount? Then she needed to consider her Message. What message should be sent? Should she focus on the good taste, the nutritional value, the product’s heritage, or some other feature? After deciding on her copy, pictures (if any), headlines etc., she would need to select her Media. Where would she run her advertisements? What combination of media would she use? Would she use sales promotions and public relations along with advertising? Her final decision would have to do with Measurement. How would she evaluate the results of her advertising efforts? How would she ascertain that she got value from her advertising expenditures?(moderate) p. 312

74. In a short essay, discuss the three types of advertising objectives in terms of their impact on product life cycle.

Answer:Informative advertising would be most likely used in the introductory stage when the advertiser needs to create primary demand. As the competition heats up in the growth stage, advertisers rely heavily on persuasive advertising. With mature products, some advertisers rely on reminder advertising. In the decline stage, the advertising budget is typically decreased. Sometimes there is no advertising at all for products in the decline stage. More commonly reminder advertising is used to let the consumer know the product is still available, or persuasive advertising such as “ Try it Again” is used.(moderate) pp. 312-313

75. Only-Documentaries.com ran an ad in Mother Jones magazines in which it announced it had nearly every video documentary in print and many no longer in print—all available for rental. The advertisement cost $16,000. Since the goal of this ad was to make people aware that Only-Documentaries.com rents and sells videos, it would want to measure the effectiveness of the ad. How could it measure the communication effect of the ad? How could it measure the sales effect of the ad? Given Only-Documentaries.com’s advertising objective, which measure would be more important?

Answer:Communication-effect research seeks to determine whether an ad is communicating effectively by using copy testing. It would have been done before the ad was run in the magazine. There are three ways it could be done. The direct rating method asks consumers to rate alternative ads – all marketing the same product. A portfolio test would have asked consumers to view a portfolio of ads. Consumers are then asked to recall the ads and their contents. The question is, “Did our ad stand out from the clutter?” Laboratory tests could also be used. This type of test monitors the physiological reactions to ads.

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Communication-effect research is important, but given Only-Documentaries.com’s objective, sales-effect research would have been more useful. Only-Documentaries.com wants to know what sales were generated by the ad. The historical approach to sales-effect research involves correlating past sales to past advertising expenditures using advanced statistical techniques. Experimental design is another type of sales-effect research. It requires an advertiser to set up tests in which the impact of various levels of sales expenditures are tested to determine the sales impact of each. Only-Documentaries.com would be likely to use the historical approach to determine the effectiveness of its ad.(difficult) p. 318

Mini-Cases

Mini-Case 16-1Aspirin is so potent that many in the health professions contend that if it were invented today, it would be only available by prescription. In 1897, Felix Hoffman chemically concocted the first synthetic aspirin compound, known as acetylsalicylic acid. At the time he was working for the Bayer Company. In 1899 Bayer Aspirin was introduced. It was the first tablet ever to be marketed as a water-soluble pill. Fifty billion aspirins are consumed worldwide annually. A variety of painkillers line the store shelves today, but only aspirin is proven to have long-term cardiovascular and anticancer benefits. In spite of these positive aspects to the product, a concern that aspirin might contribute to Reye’s syndrome in children, a disease that affects the brain and liver, has led to aspirin having an identity crisis. There is a generation of individuals who have grown up assuming other drugs have completely replaced aspirin. Ask someone for a aspirin these days, and you’re likely to receive a Tylenol. Aspirin manufacturers are trying to educate people that simple aspirin can help keep them alive.

76. Refer to Mini-Case 16-1. Consumers who buy aspirin because the they have run out but not because they have a current need for the product are probably going through which response hierarchy sequence? a.) learn-feel-dob.) learn-do-feel (difficult) p. 304c.) learn-feel-do-feeld.) can-do-will-to-doe.) do-feel-learn

77. Refer to Mini-Case 16-1. The headline of an Anacin advertisement reads “ The taking of one aspirin daily may prevent heart attacks.” This ad is using a _______________ appeal.a.) moralb.) decodedc.) cognitived.) sociale.) rational (moderate) p. 305

78. Refer to Mini-Case 16-1. What type of communication should the aspirin industry use if its goal is to promote the benefits of aspirin in a manner that it seems to allow the industry to have little or no control over the message content?a.) advertisingb.) direct marketingc.) sales promotiond.) public relations and publicity (moderate) p. 322e.) personal selling

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Mini-Case 16-2Sedona Advertising is developing a marketing campaign for a Latter-Day Skates, a skateboard manufacturer. The greatest emphasis has been placed on the design of a series of ads featuring the riders using their boards in thrilling, extreme riding situations. The agency has pretested the recall of these print ads. As part of the ad evaluation process, the agency determined the Latter-Day’s share of voice is 6 percent and its share of market is 4.4 percent for its last ad campaign during which it spent $35,000. As part of this integrated marketing campaign, Sedona is also designing sales promotion activities. Latter-Day wants to link the sales of its best selling long boards to its new line of Vert-Rider specialty boards without cannibalizing sales of the established product. This is the first ever line of skateboards designed with vertical riding in mind. As Sedona gears up for this campaign, the owner of Latter-Day Skates announces he really wants to build community awareness of what the company does, especially its charitable work. This new promotional task is being added after most of the budget has already been allocated. Sedona Advertising is searching for a way to meet the owner’s goals within his current budget.

79. Refer to Mini-Case 16-2. What would be the most likely advertising objectives for the two products listed?a.) informative for the Vert-Riding lines; reminder for the best-selling long boards (difficult)

pp. 312-313b.) persuasive for bothc.) persuasive for the new product; reminder for the best-selling long boardsd.) informative for both productse.) persuasive for the new product; informative for the best-selling long boards

80. Refer to Mini-Case 16-2. The ads for the new Vert-Rider board are using what type of appeal?a.) rationalb.) emotional (easy) p. 306c.) morald.) casuale.) multinational

81. Refer to Mini-Case 16-2. The most probable way for Sedona to help Latter-Day Skates get the word out about their charitable work and still stay within the budget is to use _______________.a.) direct sellingb.) sales promotions techniquesc.) outdoor advertisingd.) public relations (moderate) p. 322e.) copy testing

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