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Slide 1: 

Advertising and Sales Promotion BA1723 Chapter 1

Marketing : 

Marketing The process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create the exchanges that satisfy individual and organisation objectives.

Marketing Mix : 

Marketing Mix Product Price Place Promotion

Promotion : 

Promotion The coordination of all seller-initiated efforts to set up channels of information and persuasion in order to sell goods and services or promote an idea.

Elements of Promotional Mix : 

Elements of Promotional Mix

Advertising : 

Advertising Advertising is defined as any paid form of non personal communication about an organisation, product, service or idea by an identified sponsor

Introduction to Advertisement : 

Introduction to Advertisement The activity of attracting public attention to a product or business, as by paid announcements in the print, broadcast, or electronic media. Paid form of a non personal message communicated through the various media by industry, business firms, nonprofit organizations, or individuals. Advertising is persuasive and informational and is designed to influence the purchasing behavior and/or thought patterns of the audience. Advertising is a marketing tool and may be used in combination with other marketing tools, such as sales promotions, personal selling tactics, or publicity.

Forms of Advertisements : 

Forms of Advertisements Advocacy Comparative Cooperative Direct-mail Informational Institutional Outdoor Persuasive Product Reminder Point-of-purchase Specialty advertising.

Paid Aspect : 

Paid Aspect The space or time for an advertising message generally must be bought. In case of Public Service Announcements (PSA) whose advertising space or time is donated by the media.

Non Personal Aspect : 

Non Personal Aspect Non personal component means that advertising involves mass media. (e.g. TV, radio, magazines, newspapers) that can transmit a message to large groups of individuals, often at the same time.

Integrated Marketing Communication IMC : 

Integrated Marketing Communication IMC IMC agencies Coordinating the various promotional elements

The consumer decision-making process : 

The consumer decision-making process Need recognition --Functional or Emotional benefits Information Search and Evaluation --Internal and External search --Consideration Set --Evaluative Criteria Purchase 4. Post-purchase use and evaluation Customer satisfaction Cognitive dissonance

How Advertising Works : 

How Advertising Works Some things we know about Advertising An Advertising Communication Model Note it is more difficult for the audience to communicate back to the advertiser. Feedback is one purpose of Market Research

Slide 14: 

The Lavidge-Steiner Learning Model Advertising How Advertising Works Begins with Awareness Moves to Conviction and Purchase NOTE: Process may be quite rapid and you may try before being totally convinced How people “learn” ads

Media Planning : 

Media Planning Finding the best way to get the message to the target market. “Best” means largest part of market at best price and in best media environment for the message Media/Medium: general category as TV, radio, newspaper, magazines, direct mail Media vehicle: specific carrier within a medium: Time magazine or Today Show

Buying terms : 

Buying terms Exposures Reach Coverage (waste coverage) Frequency Exposures Gross Impressions

Media Planning and Buying : 

Media Planning and Buying Media: still big business Setting media objectives Developing media strategies Media selection procedures Media buying functions Media buyer’s special skills Global media buying Staging a media plan Outline

Media: Still Big Business : 

18 Media consolidation: a new perspective The aperture concept in media planning Media planning information sources Media: Still Big Business

Setting Media Objectives : 

19 Setting Media Objectives Finding target audiences in media opportunities Sales geography Timing

Setting Media Objectives : 

20 Setting Media Objectives Duration: how long to advertise? Schedule and the advertising budget Consumer use cycles Competitive advertising

Developing Media Strategies : 

21 Developing Media Strategies Target audience strategies: new technology of measurement Retail scanners Database developments Marketing mix modeling Internet audience measurement

Developing Media Strategies : 

22 Developing Media Strategies Geographic strategies: allocating media weight Timing and duration strategies Size and length strategies

Media Selection Procedures : 

23 Media Selection Procedures Audience measures used in media planning Gross impressions Gross rating points Reach and media planning

Media Selection Procedures : 

24 Media Selection Procedures Frequency and media planning Average frequency Frequency distribution Combining reach and frequency goals

Media Selection Procedures : 

25 Media Selection Procedures Cost efficiency as a planning dimension Cost per thousand How to calculate CPMs Cost per rating Selecting and buying acceptable media

Media Buying Functions : 

26 Media Buying Functions Providing information to the media planner Selecting media vehicles Negotiating media prices/authorizing the buys Monitoring vehicle performance Post-campaign analysis Billing and payment

Media Buyers’ Ability to Negotiate : 

27 Media Buyers’ Ability to Negotiate Vehicle performance Unit costs Preferred positions Extra support offers

Changes in Media Buying : 

28 Changes in Media Buying Media buying services Online media buying Global media buying Maintaining plan performance Monitoring audience research Scheduling and technical problems

Staging a Media Plan : 

29 Staging a Media Plan Background and situation analysis Media objectives and aperture opportunities Strategy: selection of media The flow chart: scheduling and budgeting allocation

Role of advertising in Economy : 

Role of advertising in Economy All that ad has to do is to sell a product or service Ads do the sales job better Performs economic function by being an art of persuasion Ads create wide markets

Effects of Advertising : 

Effects of Advertising Effects of advertising on costs Effects of advertising on total marketing costs Effects of advertising on total manufacturing costs Effects of advertising on price Prevents price competition for a longer period Effects of advertising on quality Stimulates product improvement Effects of advertising on investment and the level of national income

Social aspects of advertising : 

Social aspects of advertising Consumerism Consumer culture Consumer awareness

Code of Advertising Ethics in India : 

Code of Advertising Ethics in India Advertising shall be designed as to confirm to the laws of the country and should not offend against morality, decency and religious susceptibilities of the people.

General rules of conduct in advertising : 

General rules of conduct in advertising derides any race, caste, color, creed and nationality; is against any of the directive principles, or any other provision of the Constitution of India; tends to incite people to crime, cause disorder or violence, or breach of law or glorifies violence or obscenity in any way; presents criminality as desirable; adversely affects friendly relations with foreign States; exploits the national emblem, or any part of the constitution or the person or personality of a national leader or State Dignitary; relates to or promotes cigarettes and tobacco products, liquor, wines and other intoxicants;

General rules of conduct in advertising : 

General rules of conduct in advertising No advertisements message shall in any way be presented as News. Advertisements for services concerned with the following shall not be accepted:- Money lenders; Chit funds; Saving schemes and lotteries other than those conducted by Central and State Government organisations, nationalised or recognized banks and public sector undertakings; Matrimonial agencies;

General rules of conduct in advertising : 

General rules of conduct in advertising Unlicensed employment services; Fortune tellers or sooth-Sayers etc. and those with claims of hypnotism; Foreign goods and foreign banks. Betting tips and guide books etc. relating to horse-racing or the other games of chance.

General rules of conduct in advertising : 

General rules of conduct in advertising No advertisement shall contain references which are likely to lead the public to infer that the product advertised or any advertised or any of its ingredients has some special or miraculous or super-natural property or quality, which is difficult of being proved, e.g. cure for baldness, skin whitener, etc. Advertisements shall not contain disparaging of derogatory references to another product or service. Testimonials must be genuine and used in a manner not to mislead the listeners. Advertisers or Advertising Agencies must be prepared to produce evidence in support of their claims.

General rules of conduct in advertising : 

General rules of conduct in advertising No advertisement of any kind of jewellery (except artificial jewellery) or precious stones shall be accepted. Information to consumers on matters of weight, quality or prices of products where given shall be accurate. Advertisements indicating price comparisons or reductions must comply with relevant laws. Advertisements for products specifically offered to women shall not be advertised as products that are effective in inducing miscarriage. Advertisements relating to claims about curing of sexual weakness, premature ageing, loss of virility, sexual excesses etc. shall not be accepted.

General rules of conduct in advertising : 

General rules of conduct in advertising There should be no exaggerated claims regarding the composition, character, action and suitability of the purpose for which it is recommended. When words such as college, clinic, institute and laboratory are used in advertisements, such references can be made only when the said establishment does actually exist. The portrayal of the female form shall be aesthetic and within the well established norms of good taste and decency. Women must not be portrayed in derogatory light and in a manner that emphasizes passive, submissive qualities and encourages them to play a subordinate and secondary role in family and in society. Scientific or statistical excerpts from technical literature etc. may be used only with a proper sense of responsibility to the ordinary viewer.

Rules and acts framed to maintain standards in advertising : 

Rules and acts framed to maintain standards in advertising Drugs and Cosmetics Act, 1940. Drugs Control Act, 1950. Drugs and Magic Remedies (Objectionable Advertisement) Act, 1954. Copyright Act, 1957. Trade and Merchandise Marks Act, 1958. Prevention of Food Adulteration Act, 1954. Pharmacy Act, 1948. Prize Competition Act, 1955. Emblems and Names (Prevention of Improper Use) Act, 1950. Consumer Protection Act, 1986. Indecent Representation of women (Prohibition) Act, 1986. AIR / Doordarshan Code. Code of Ethics for advertisement in India issued by the Advertising Council of India Code of standards in relation to the advertising of medicines and treatments Standards of practice for Advertising Agencies

Ethics in advertising : 

Ethics in advertising Advertising should be in conformity with the laws of land Advertisements should not be done against the cultural, religious and aesthetic values of the people It should not propagate hatred and defame the peace of the nation It should not aim to exploit the illiteracy and superstition of the people to gain benefits Advertisements should disseminate factual information Advertisement should not hide or divert facts (They can inform the ingredients of the product and the need for using the product) Misleading statements (visual or verbal) should be avoided Price, quality, procedure to procure, guarantee and warranty etc. should be communicated with utmost care and prudence (cautiousness)

Ethics in advertising : 

Ethics in advertising Comparisons which unfairly disparage (criticize) a competitive product for service should be avoided No advertisement should encourage or instigate the people to practice illegal practices Patent marks of other reputed concerns should not be used to cheat the consumers Obscene words / scenes in advertisements should be avoided Without real intention, it should not be announced that money will be returned if the purchaser is not satisfied with the products

Ethics in advertising : 

Ethics in advertising Apart from state advertisements, national symbols and the photographs of national leaders should not be used without getting prior permission from the competent authorities concerned No advertising should canvass for pawn broking, deposits for unregistered financial firms and employment bureaus, bogus marriage brokerage, astrology and magical skills.

Legal issues of advertising : 

Legal issues of advertising Article 19 (1) all citizens shall have the right to freedom of speech & expression. Article 19(1) a - restricts & prohibits the ads for drugs Article 19(2) – right to information and expression can be resticted on the following grounds

Legal issues of advertising : 

Legal issues of advertising Security of the state Friendly relations with foreign states Public order Decency of morality Contempt of court Defamation Incitement (encouragement) of an offence Sovereignty and integrity of India

Legal issues of advertising : 

Legal issues of advertising Obvious untruths and exaggeration Advertisements should not depict children leaning dangerously outside windows, over bridges or climbing dangerous hills. Advertisement should not show children using or playing with matches or any inflammable or explosive substance Viz. playing with knives, guns & electrical appliances Advertisements shall not propagate products the use of which is banned under law Comparisons should be factual and accurate.

Advertisement objectives : 

Advertisement objectives Inform and build awareness To increase the sales To retain the loyalty of present & former customer To support the sales force To build brand image “Top of mind” “First choice” To persuade To support other marketing efforts To encourage action

Inform : 

Inform Introducing new products Informing the market of a price change Explaining how the product works

Persuade : 

Persuade Buiding brand preference Encouraging switching tour brand Changing customers perception of products attributes Becomes more important as competition increases Comparative advertising

Remind : 

Remind Most important for mature products Reminding customers that the product may be needed in the near future Reminding them where to buy Describing available services Correcting false impressions Reducing consumer’s fears Persuading consumer to receive a sales call Keeping the product in their mind during off-seasons

Advertising Agency : 

Advertising Agency Advertising agency is defined as an organisation whose business consists in acquisition as a principal of the right to use space or time in advertising media and the administration on behalf of the advertisers, of advertising appropriations made by them.

Tasks of an advertising agency : 

Tasks of an advertising agency Copy writing Art pictures & photographs Media planning & buying of space Radio & television – producing commercial spots The work of market research Production film or tape for use Public relations Forwarding the advertising materials to the media owners and the clients in time

Agency should require : 

Agency should require Sales ability Creative ability Management ability

Types of Advertising Agencies : 

Types of Advertising Agencies Full Service Agencies Creative Boutique Interactive Agency In-House Agency Media-Buying Agency Direct Marketing Agency E-Commerce Agencies Sales Promotion Agencies Event-Planning Agencies Design Firms Public Relations Firms

Full-service advertising agency : 

Full-service advertising agency A full service agency typically includes an array of advertising professionals to meet all the promotional needs of clients. Full service agencies are not necessarily large organisations employing hundreds or even thousands of people.

Advantages of using a full service ad agency : 

Advantages of using a full service ad agency In-depth knowledge and skills Obtaining negotiating muscle with the media Coordinating advertising and marketing efforts Use services only when they are needed Availability of high-caliber creative talent Potential cost efficiencies

Disadvantages of using a full service ad agency : 

Disadvantages of using a full service ad agency Some control is lost Larger clients are favored over small clients Occasionally inefficient in media buying Specialists approach client problems in a stereotyped fashion Lack of cost accountability Financial instability of smaller boutiques

Steps in selecting an advertising agency : 

Steps in selecting an advertising agency The size of the agency. The relevant experience of the agency. Conflicts of interest. Creative reputation and capabilities. Production capabilities. Media purchasing capabilities. Other services available. Client retention rates. Personal chemistry

Steps in selecting an advertising agency : 

Steps in selecting an advertising agency Identify and prioritize corporate goals. Develop agency selection process and criteria. Initially screen firms based on credentials, size, capabilities, relevant experience and conflict of interests. Request client references. Do background check with other firms and media agents. Request written and oral presentation. Meet creatives, media buyers, account executives and other personnel that will work with account.

Capabilities of an ad agency : 

Capabilities of an ad agency Marketing & media planning Research & analysis Advertising campaigns – local, regional & national Creative concept / copywriting Logo / corporate identity development Graphic design & production Direct marketing programs Media placement Public relations / special event planning

Advertising Campaign : 

Advertising Campaign An advertising campaign is a series of advertisement messages that share a single idea and theme which make up an integrated marketing communication (IMC).

What is an ad campaign? : 

What is an ad campaign? Identification of consumers wants & needs Development of the right sales message Delivery of the sales message to the identified prospects Measurement of the effort or impact of the advertising sales message Integration of the advertising sales message with other forms of marketing communications.

Comprehensive advertisement campaign (steps) : 

Comprehensive advertisement campaign (steps) Situation analysis Marketing objectives Ad budget Message strategy: communication goals Media selection Implementation Control & Evaluation

Reach and Frequency : 

Reach and Frequency Reach is the number of different people who are exposed an advertising message at least once. Reach is simply the percentage of persons in a target population that is exposed to an advertising schedule at least once. It can also be expressed as “cume” and “unduplicated audience.”

Reach and Frequency : 

Reach and Frequency Frequency is the number of times thay are exposed to the message. Frequency simply measures the number of times a person sees your message in a given advertising schedule. One person may see your commercial three times over your advertising flight. That would be a frequency of three.

Media Planning: Print, Television, and Radio : 

Chapter 15 Media Planning: Print, Television, and Radio

Where are the 18–24 Year-Old Males? : 

Where are the 18–24 Year-Old Males? Smallest audience in prime time TV Far less likely than female counterparts to have heard of a brand from TV. Media organizations (Spike TV, Bravo) creating programming for this target market So, where are you?

Which Media: Print, Television or Radio? : 

Which Media: Print, Television or Radio? Great ads will fail if the media chosen do not reach the right audiences. Newspapers and magazines have inherent advantages and disadvantages. Broadcast media, TV and radio, also have inherent advantages and disadvantages.

Newspapers : 

Newspapers Newspapers $48.2 billion spent on newspaper ads in 2004 Ideal for reaching narrow geographic area Facing circulation declines

Newspapers Advantages : 

Newspapers Advantages Reach over 50% of households—150 million adults Geographic selectivity Timeliness Creative opportunities Credibility Audience interest Cost

Newspapers Disadvantages : 

Newspapers Disadvantages Limited segmentation Creative constraints Poor reproduction Cluttered environment Short life

Types of Newspapers : 

Types of Newspapers Target Audience General population Business Ethnic Geographic coverage Metropolitan area State National Frequency of Publication Daily Weekly

Categories of Newspaper Advertising : 

Categories of Newspaper Advertising Display Advertising Display advertising Co-op advertising Inserts Preprinted insert Free-standing insert Classified Advertising

Costs and Buying Procedures for Newspaper Ads : 

Costs and Buying Procedures for Newspaper Ads Rate Cards Costs determined by: Size of ad Use of color Size of audience Extent of coverage Space is sold in column inches or SAU sizes Rates lower for ROP (run of paper) rather than preferred position or full position.

Measuring Newspaper Audiences : 

Measuring Newspaper Audiences Circulation Paid circulation Controlled circulation Readership

Future of Newspapers : 

Future of Newspapers Survival of newspapers depends on their ability to evolve. In the future, newspapers will have to: Provide in-depth coverage of local issues. Increase coverage of national and international events. Provide follow-up reports of news. Maintain role as local source for consumer information. Become more mainstream in integrated brand promotions relating to new media.

Magazines : 

Magazines Over $12 billion spent for advertising space in magazines annually in U.S. Magazines show diversity as a media class.

Magazine Advantages and Disadvantages : 

Magazine Advantages and Disadvantages Advantages Audience selectivity Audience interest Creative opportunities Long life Disadvantages Limited reach and frequency Clutter Long lead times Cost

Types of Magazines : 

Types of Magazines Types of Magazines Consumer publications Men’s Journal, Women’s Day, Ebony Business publications American Family Physician, Forbes Farm publications Successful Farming, Progressive Farmer

Costs and Buying Procedures for Magazines : 

Costs and Buying Procedures for Magazines Costs determined by: Circulation Size of ad Use of color Position in publication Rates also vary for: Bleed page Gatefold ad Run-of-paper advertisement Preferred position

Measuring Magazine Audiences : 

Measuring Magazine Audiences Rates are based on guaranteed circulation. Stated minimum number of copies that will be delivered to readers Publishers also estimate pass-along readership. Estimates are verified by Audit Bureau of Circulations

Future of Magazines : 

Future of Magazines Last 15 years have been a roller-coaster for magazines Currently: revenues and ad pages are up Advertisers find magazines useful Continued success requires: Adapting to new media options A robust environment for mergers and acquisitions in the industry

Television : 

Television For many, TV defines what advertising is In 2004 advertisers spent $68 billion on television. Many more billions are spent on commercial production.

Television Categories : 

Television Categories Network television Cable television Syndicated television Off-network syndication First-run syndication Barter syndication Local television Satellite and closed-circuit television

Advantages of Television : 

Advantages of Television Advantages Creative opportunities Coverage, reach, and repetition Cost per contact Audience selectivity Narrowcasting

Disadvantages of Television : 

Disadvantages of Television Disadvantages Fleeting message High absolute cost Poor geographic selectivity Poor audience attitude and attentiveness DVR/TiVo Clutter

Buying Procedures for Television Advertising : 

Buying Procedures for Television Advertising Sponsorship Participation Spot advertising Choosing a day-part Morning Daytime Early fringe Prime-time access Prime time Late news Late fringe

Measuring Television Audiences : 

Measuring Television Audiences Sources for network and local audience information: A. C. Nielsen Arbitron provides network information

Measures of TV Audiences : 

Measures of TV Audiences Television households Number of households in a market owning a television Households using television (HUT) Number of households tuned to a TV program in a time period

Measures of TV Audiences : 

Measures of TV Audiences Program Rating Percentage of TV households in a market that are tuned to a program during a time period = 20 rating

Measures of TV Audiences : 

Measures of TV Audiences Share of Audience Proportion of households using television (HUT) in a specific time period that are tuned to a program = 30 share

Future of Television : 

Future of Television Future appears exciting. Interactive era will affect TV as an advertising medium. DVRs increase viewer satisfaction but may compromise advertising. An increase in direct broadcast by satellite Arrival of HDTV Massive consolidation of media companies

Radio : 

Radio Radio categories Radio networks Radio syndication AM versus FM Satellite radio Types of radio ads Local spot radio Network radio advertising National spot radio advertising

Radio Advantages and Disadvantages : 

Radio Advantages and Disadvantages Advantages Cost Reach and frequency Target audience selectivity Flexibility and timeliness Creative opportunities Disadvantages Poor audience attentiveness Creative limitations Fragmented audiences Chaotic buying procedures

Buying Procedures for Radio Advertising : 

Buying Procedures for Radio Advertising Ad time may be purchased from: Networks Syndications Local radio stations About 80% is placed locally Radio has five basic day parts Morning drive time Daytime Afternoon/evening drive time Nighttime Late night

Measuring Radio Audiences : 

Measuring Radio Audiences Average quarter hour persons Average number of station listeners in a 15-minute segment Average quarter-hour share Percentage of total radio audience listening to a station during a specified 15-minute segment Average quarter-hour rating Audience during a quarter-hour expressed as a percentage of the measurement area population Cume Total number of different people who listen for at least five minutes in a 15-minute segment

The Future of Radio : 

The Future of Radio Subscription radio/satellite Emerging technologies and new media Consolidation