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Marketing Management

Chapter-18

Managing Mass CommunicationsAdvertising, Sales Promotion, Events

and Public Relations

Part : 07Promotion

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MARKETING MANAGEMENT12th edition

18 Managing Mass

Communications

Kotler Keller

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Chapter Questions What steps are involved in developing an advertising

program? How should sales promotion decisions be made? What are the guidelines for effective brand-building

events and experiences? How can companies exploit the potential of public

relations and publicity?

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Advertising

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Advertising Advertising is the paid form of non-personal

presentation and promotion of ideas, goods or services by an identified sponsor.

In small companies, advertising is handled by someone in the sales or marketing department, who works with the advertising agency.

A large company will often set-up its own advertising department.

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Advertising Agency Most companies use an outside agency to help create

advertising campaigns and to select and purchase media.

An Advertising Agency is an independent company that provides specialized advertising services.

Today Advertising Agencies are redefining themselves as “Communication Companies” that assist clients to improve their overall communications effectiveness by offering strategic and practical advice on many forms of communication.

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Major Advertising Agencies in Pakistan Sr# Advertising Agency Main Clients01 JWT Bata, Orient, Hang-Ten02 Maxus Nestle, Tetrapak,

Mitchell’s03 Orient Advertising Mobilink, Coca-Cola,

Unilever, Nestle, Sony04 Evernew Lake City, Royal Fans05 Red PEL, Haleeb05 Synergy Dawn Bread, Bank

Alfalah06 Blitz Nurpur, Unifoam07 Lowe & Rauf Rose Petal, Servis08 Media Network Sufi, Nirala, Master09 Digital Creations Care, Black Beauty10 Time & Space Seasons, Treat,

Marhaba

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Product vs Institutional Advertising A very basic scheme classifies advertising as Product

Advertising or Institutional Advertising.a. Product Advertising : An advertisement promoting a

specific product. Example: Ads of brands like Pepsi, Coca-Cola etc.

b. Institutional Advertising : An advertisement designed to promote an organizational image, stimulate generic demand for a product, or build goodwill for an industry. Example: Ads by Health/Dairy Departments to promote milk/tea as a drink. Example: United Airlines spent millions over the years communicating its corporate philosophy with the ‘Fly the Friendly Skies’ campaign.

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Product vs Institutional Advertising

Product Advertising United Airlines‘Fly the Friendly Skies’ campaign

Institutional Advertising

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Advertising Objectives

Informative Advertising

ReminderAdvertising

ReinforcementAdvertising

PersuasiveAdvertising

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Advertising Objectives There are generally four advertising objectives.1. Informative Advertising : To create brand awareness

and knowledge of new products or new features of existing products. Example : Nestle Milkpak ad featuring more iron contents in milk.

2. Persuasive Advertising : To create liking, preference and conviction and purchase of a product or service. Some persuasive advertising uses Comparative Advertising, which makes an explicit comparison of attributes of two or more brands. Example : Ariel ads against Surf Excel.

3. Reminder Advertising : To stimulate repeat purchase. Example : Coca-Cola or Pepsi ads.

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Advertising Objectives4. Reinforcement Advertising : To convince current

purchasers that they made the right choice. Example : Automobile ads often depict satisfied customers enjoying special features of their new car.

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Advertising Objectives

Nestle MilkpakInformative Advertising

HondaReinforcement Advertising

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Advertising Objectives

Coca-ColaReminder Advertising

ArielComparative Advertising against

Surf Excel

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Choosing Among Major Media TypesThe major advertising media are as follows. Newspapers Television Direct Mail Radio Magazines Outdoor Yellow Pages (a telephone directory of businesses,

categorized according to the product or service provided)

Newsletter Brochures Internet

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Alternative Advertising Options For a long time, TV was the dominant medium,

however in recent years, researchers have noticed its reduced effectiveness; while its costs have risen faster than other media costs. Therefore many marketers are looking for alternative advertising media as follows.

a. Place Advertising b. Product Placementc. Point-OF-Purchase (POP)

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Alternative Advertising Options Place Advertising or Out-of-Home or Outdoor Advertising

(Billboards, Public Spaces include the placement of traditional TV and print ads in unconventional places such as movies, airlines, hotel elevators, and other public spaces. It also includes the Transit Ads on buses, subways and trains)

Product Placement (Product Placement has expanded from movies to all types of TV shows. Cameo Appearance in movies or TV, Virtual Logos in Sports, Ads in monthly bills, Branded Entertainment (online mini films) etc.)

Point-OF-Purchase (POP) (In-store Advertising like ads on shopping carts, shelves, aisles, floor space etc. as well as promotion options such as in-store demonstrations, and live sampling. As per research 70% of all buying decisions are made in the store. In-store advertising is designed to increase the number of spontaneous buying decisions)

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Place Advertising Billboards Public spaces Product placement Point-of-purchase

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Alternative Advertising Options

Virtual LogosProduct Placement

Transit AdsOutdoor Advertising

In-Store AdsPOP Promotions

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Sales Promotion

Coupons Trade Shows POP Displays

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Sales Promotion Sales Promotion consists of a collection of incentive

tools, mostly short-term, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade.

Sales Promotion includes the following.a. Consumer Promotion (targeted at end consumers)b. Trade Promotion (targeted at intermediaries)c. Business and Sales Force Promotion (targeted at

business growth and sales force)

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Sales Promotion

Business and Sales ForcePromotion

TradePromotion

ConsumerPromotion

SalesPromotion

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a) Major Consumer Promotion Tools Consumer Promotion is directed at end-consumers. It

can be categorized as either ‘Manufacturer Promotions’ or ‘Retailer Promotions’. Major consumer promotion tools are as follows.

i. Samples : Offer a free amount of product or service. ii. Coupons iii. Cash Refund (Rebates) : A price reduction by the

manufacturer instead of retailer.iv. Price Packs : A product sold at reduced price mentioned

on the package.v. Premiums (Gifts)vi. Frequency Programs : Rewards related to the

consumer’s frequency and intensity in purchasing the company’s product/service.

vii. Prizes (contents, sweepstakes, games)viii. Product Warranties

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a) Major Consumer Promotion Tools9. Tie-in Promotions : Two or more brands or companies

team up on coupons , refunds, and contests.10. Point-of-Purchase (POP) Promotion : POP displays and

demonstrations take place at the point-of-purchase or sale.

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b) Major Trade Promotion Tools1. Price-off (Off-Invoice or Off-List) : A stated discount off

the list price on each case purchased during a stated time period.

2. Allowance : An amount offered to an intermediary in return for a large order or performance of a specific activity like advertising or display.

3. Free Goods : Offers of extra cases of merchandise to intermediaries who buy a certain quantity.

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c) Major Business and Sales Force Promotion Tools

1. Trade Shows and Conventions : Industry associations organize annual trade shows and conventions. The firms can get several benefits by participating in such trade shows, including generating new sales leads, maintaining customer contacts, introducing new products, meeting new and present customers etc.

2. Sales Contests : A sales contest aims at inducing the sales force or dealers to increase their sales results over a stated period, with prizes (money, trips, gifts, or points) going to those who succeed.

3. Specialty Advertising : Consists of useful, low-cost items bearing the company’s name, address or message, like ballpoints, calendars, key-chains, diaries etc. The salespeople give those items to prospects and customers.

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c) Major Business and Sales Force Promotion Tools

Specialty Advertising Gifts and AwardsSales Contest

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Events and Experiences It relates to promoting products/services through Sports,

Entertainment tours, Festivals, Fairs, Annual Events, Arts and Cause Marketing.

The daily encounters with brands may also affect consumers’ brand attitudes and beliefs.

Example : Coca-Cola has created a brand experience through “Everything Coca-Cola in Las Vegas with a 100-foot lighted Coke bottle as part of the front of the building.

Example : To create a memorable brand experience, Harley-Davidson decided to “bring the party to the people” to celebrate its 100th-year anniversary in 2003. The Centennial Celebration was a gala of road tours, parades, music, test rides, exhibits, and exclusive parties.

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Events and Experiences

‘Everything Coca-Cola’In Las Vegas-USA

Harley-DavidsonRoad Tour in USA

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Public Relations Public : A Public is any group that has an actual or

potential interest in or impact on a company’s ability to achieve its objectives.

Public Relations, PR : PR involves a variety of programs designed to promote or protect a company’s image or its individual products.

Publicity : Publicity is any communication about an organization, its products, or policies through the media not paid for by the organization. Publicity can be good or bad.

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Public Relations- Major Tools The major tools in PR are as follows.a. Publications (Like annual reports, brochures, articles,

company newsletters, and magazines)b. Events (Like news conferences, seminars, outings,

trade-shows, exhibits, contests, and anniversaries) c. Sponsorships (Companies can promote their brands

and corporate name by sponsoring sports and cultural events and highly regarded causes)

d. News (One of the major tasks of PR professionals is to find and create favourable news about the company, its products, and its people, and get the media to accept press releases and attend press conferences)

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Public Relations- Major Tools e. Speeches (Increasingly, company executives must

field questions from the media or give talks at trade associations or sales meetings, and these appearances can build the company’s image)

f. Public Service Activities (Companies can build goodwill by contributing money and time to good causes)

g. Identity Media (Companies need a visual identity that the public immediately recognizes. The visual identity is carried by logos, stationery, brochures, signs, business cards, buildings, uniforms, and dress codes)

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Public Relations- Major Tools

Company NewslettersPublications

Yellow Color and Logo of Shell Identity Media

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Assignment