BUAD 307 PROMOTION Lars Perner, Instructor 1 Promotion Integrated Marketing Communication Elements of promotion Advertising Strategies Other Methods of

BUAD 307 PROMOTION Lars Perner, Instructor 1

Promotion Integrated Marketing Communication Elements of promotion ● Advertising Strategies ●

Other Methods of Promotion


Learning Objectives

• Understanding the obstacles that advertising messages face

• Understanding the choices facing marketing managers regarding– Promotional objectives– Promotional message– Media choice– Advertising and promotion

spending


Elements of the Promotion Mix

• Advertising• Sales Promotion

– Sales– Coupons– Rebates– Premiums

• Personal selling• Public relations• Direct marketing


Promotion by Decision Stage

• Pre-purchase– Influence

decision, preference

– Samples to induce trial

• Purchase– Sales promotion– Point-of-

purchase (POP) displays

• Post-purchase– Increase

repurchase propensity


Developing the Advertising Program

IDENTIFYING THE IDENTIFYING THE TARGET AUDIENCETARGET AUDIENCE

SPECIFYING SPECIFYING ADVERTISING ADVERTISING OBJECTIVESOBJECTIVES

DESIGNING THE DESIGNING THE ADVERTISEMENT(S)ADVERTISEMENT(S)

SETTING THE SETTING THE ADVERTISING ADVERTISING

BUDGETBUDGET


Some Media Alternatives

• Television– Conventional advertisements– Infomercials– Sponsorship programming– “Placements”

• In programming • “Superimposed”

• Radio

• Magazines• Newspapers• Outdoor• Internet• Point-of-purchase• Other

– Movie theaters– On other products


Reaching the Customer: Encoding, “Noise,” and “Decoding”

ENCODINGENCODINGTHE THE

MESSAGEMESSAGE

MESSAGEMESSAGECHANNELCHANNEL

DECODINGDECODINGTHETHE

MESSAGEMESSAGERECEIVERRECEIVER

CHANNEL CHANNEL FEEDBACKFEEDBACK

NOISENOISE

SENDERSENDER

Text, p. 211..

Mktg mgrMktg mgrAdvertising mgrAdvertising mgrAdvertising Advertising agency agency

AdvertisementAdvertisementCouponCouponSales presentationSales presentationPress releasePress releaseStore displayStore display

Media, SalespersonMedia, SalespersonRetail storeRetail storeNews programNews program

ReceiverReceiver interpretation of interpretation of the messagethe message

CustomersCustomersMedia audienceMedia audienceNews mediaNews mediaClientsClients

Other adsOther adsNews articlesNews articlesOther store displays Other store displays


Some Promotional Objectives

• Brand awareness– Knowledge of product category

• Existence

• Benefits

• Functions

• Technology

– Knowledge of brand differences

• Brand attitude– Favorable beliefs about the

brand• Overall

• Relative to competitors

• Product category or brand trial

• Brand preference– Willingness to pay a premium

for the brand– Resistance to competitor

promotions (e.g., sales, coupons)

– Willingness to buy under less convenient circumstances

• Increase in product category or brand usage

– Quantity used– Frequency used– Scope of uses

• Increase in short term sales


Promotional Objectives Across the Product Life Cycle (PLC)

• Introduction– Advertising and

public relations awareness

– Sales promotion trial

– Personal selling distribution

• Growth– Advertising and PR

brand loyalty

– Less emphasis on sales promotion

• Maturity– Advertising

persuasion, reminder

– Sales promotion market share

• Decline– Reduction in

advertising and PR

– More emphasis on sales promotions temporary sales

Text, p. 217Text, p. 217


Increase in Product Category or Brand Usage—Product Category Potential Examples

• Scope of uses– Orange juice: “It isn’t

just for breakfast anymore”

– Baking soda– ZipLock™ bags– WD-40™ (lubrication

and sticker removal)

• Quantity used– Calcium supplements– Milk

• Frequency used– Cosmetics– Deodorant– Wine– Greeting cards– Phone calls

• Cell phone minutes• Call to family/friends

– Hotels, airlines– Conference calls– Car engine oil– Canned soup


Communications Objectives

• Informing– Awareness– Interest– Benefits– Other information

• Persuading– Preference based on

competitive advantages

– Brand switching or prevention of brand switching

• Reminding– Trigger memories– Maintain preference

and buying habits


Some Advertising Strategies

• Comparative ads– Illegal in most countries

– Generally very disliked by U.S. consumers but still relatively effective

• Humor appeal– A way to get attention to the

advertisement—but the consumer may remember the humor and not what the product featured was

• Adding beliefs• Classical conditioning

(association)

• Fear appeal– To be effective:

• Feared stimulus must be of medium intensity—enough to motivate action but not so intense that the individual “tunes out” the ad

• A clear solution must be offered—e.g., use Listerine™ to avoid tooth loss due to gingivitis

• Repetition• Celebrity endorsements


The Elaboration Likelihood Model and Likely Effectiveness of Celebrity Endorsements

Product Product important orimportant orexpensive?expensive?

Celebrity Celebrity endorsementsendorsements

more likely to bemore likely to beeffectiveeffective

NoNo

Is endorserIs endorsercongruent withcongruent with

productproductendorsed?endorsed?

Unlikely to beUnlikely to beeffectiveeffective

More likelyMore likelyto be to be

effectiveeffective

NoNo YesYes

YesYes

LowLowelaboratioelaboratio

nn

HighHighelaborationelaboration


Executing The Advertising Program

• Pre-testing– Several “story boards” or actual ads are

created– Ads are tested on consumers

• Instant response technologies (consumers either rate approval or have physiological measures taken throughout an ad duration

– The best performing ad or ads are chosen subject to constraints imposed (e.g., need to specify a certain message or use certain types of models)

• Possible redesign• Carrying out advertisement

– Full service agencies– Limited service agencies– In-house


Advertising Intensity and Return --A Typical RelationshipAdvertising Intensity and Return --A Typical Relationship

0

0.2

0.4

0.6

0.8

1

Res

pons

e (e

.g.,

sal

es,

reca

ll)

0 5 10 15 20 25 Amount of Advertising Spending

The “S”-Shaped Curve

Saturation Point

Relatively

high effecti

veness

Too little to domuch good


Sample Exam Question


Measuring Advertising EffectMeasuring Advertising Effect

• Several possible criteria:– Scanner data

• Individual TV exposure can be matched against actual purchases

• Available only for grocery products

– Increase in sales (but it may be impossible to separate effects of different simultaneous ads)

– Lab studies:• Recall• Attitude toward product• Preference


Japanese Advertising—Use of animation and cartoon characters


Breaking Through the Clutter

Documents

BUAD 307 PROMOTION Lars Perner, Instructor 1 Promotion Integrated Marketing Communication Elements of promotion Advertising Strategies Other Methods of