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internet media promotion 2 Other 13 internet media promotion 2 Other 13 Figure 7-22 How U.S. marketers would invest the majority of their marketing dollars if budget were not an issue, May 2002 as a percent of respondents not an issue. While no comparative figures were available from previous years, you can see how the monies would be spread around. Figure 7-23, from a different source, shows how some of these dollars were allocated. The advantage of more target selectivity has led to an...
Allocating the Budget
Once the budget has been appropriated, the next step is to allocate it. The allocation decision involves determining which markets, products, and or promotional elements will receive which amounts of the funds appropriated. Allocating to IMC Elements As noted earlier, advertisers have begun to shift some of their budget dollars away from traditional advertising media and into sales promotions targeted at both the consumer and the trade. Direct marketing, the Internet, and other promotional...
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On the basis of their results shown in Figure 7-21 , the authors concluded that the budget-setting process is still a perplexing issue to many managers and that institutional pressures led to a greater proportion of dollars being spent on sales promotions than managers would have preferred. In addition, the authors concluded that to successfully develop and implement the budget, managers must 1 employ a comprehensive strategy to guide the process, avoiding the piecemeal approach often employed,...
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Belch Advertising and IV. Objectives and 7. Establishing Objectives The McGraw-Hill Promotion, Sixth Edition Budgeting for Integrated and Budgeting for the Companies, 2003 Marketing Promotional Program Communications Programs brand 101 gained a 12.6 percent market share by spending 34 percent of the total advertising dollars in this category. Likewise, brand 401 in the toiletry industry had a 30 percent share of advertising dollars to gain 19.5 percent of sales. To determine how much to spend,...
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Figure 7-19 Share of advertising sales relationship two-year summary The major disadvantage of this method is the difficulty of determining which tasks will be required and the costs associated with each. For example, specifically what tasks are needed to attain awareness among 50 percent of the target market How much will it cost to perform these tasks While these decisions are easier to determine for certain objectives for example, estimating the costs of sampling required to stimulate trial...
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Note Figures exceed 100 due to multiple responses. NA No answer. Note Figures exceed 100 due to multiple responses. NA No answer. Belch Advertising and I IV. Objectives and I 7. Establishing Objectives I I The McGraw-Hill Promotion, Sixth Edition Budgeting for Integrated and Budgeting for the Companies, 2003 Marketing Promotional Program Communications Programs cific objectives in mind, and setting objectives without regard to how much money is available makes no sense. For example, a company...
Cutting Budgets WhenTimes Get ToughWise Strategy or Potential Pitfall
A downturn in the U.S. economy led a number of companies to slash their advertising budgets significantly in 2001 and 2002. Even the top spenders cut deeply, with GM cutting the budget by 24 percent and the top 10 overall spending 7 percent less on the average. The companies seemed to be saying that since sales are down, advertising expenditures should go down. But is this the right thing to do A lot of companies don't think so. For example, not all of the top 10 advertisers slashed budgets...
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Figure 14-5 Here's who's watching and buying from infomercials Exhibit 14-8 A variety of companies use infomercials to sell their products are designed to be viewed as regular TV shows. Consumers dial a tollfree or 900 number to place an order. Programs such as Liquid Luster, Amazing Discoveries, and Stainerator the so-called miracle-product shows were the most common form of infomercial in the 1980s. While this form of show is still popular, the infomercial industry has been adopted by many...
Couponing
The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon. Coupons have been around since 1895, when the C. W. Post Co. started using the penny-off coupon to sell its new Grape-Nuts cereal. In recent years, coupons have become increasingly popular with consumers, which may explain their explosive growth among manufacturers and retailers that use them as sales promotion incentives. As Figure 16-2 showed, coupons are the most popular sales promotion technique...
Promotion Type Percent of Respondents
Cents-off promotions Couponing in retailers' ads Couponing in-store shelf dispenser, handouts Sampling new products Sampling established products Money-back offers other refunds major study conducted by the Promotion Marketing Association in 2002 found that the vast majority of consumers receiving a sample either use it right away or save it to use sometime later.27 Sampling generates much higher trial rates than advertising or other sales promotion techniques. Getting people to try a product...
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very little research and sales analysis they relied on manufacturers for information regarding the sales performance of individual brands. In recent years, however, several developments have helped to transfer power from the manufacturers to the retailers. With the advent of optical checkout scanners and sophisticated in-store computer systems, retailers gained access to data concerning how quickly products turn over, which sales promotions are working, and which products make money.10...
Discussion Questions Qbg
1. The lead-in to the chapter discusses the fact that the companies that spend the most on advertising do not necessarily achieve the highest brand value for their products. Sometimes,those who spend very little are able to achieve this objective. Explain what factors may lead to these results. Provide examples. 2. Some marketers feel that the cereal companies have focused too much on sales objectives, creating a situation in which price cutting and couponing have become essential to selling...
Summary Vzs
This chapter has examined the role of objectives in the planning and evaluation of the IMC program and how firms budget in an attempt to achieve these objectives. Specific objectives are needed to guide the development of the promotional program, as well as to provide a benchmark against which performance can be measured and evaluated. Objectives serve important functions as communications devices,as a guide to planning the IMC program and deciding on various alternatives, and for measurement...
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advertising area. The agency position is that promotional monies are harder to track in terms of effectiveness and may be used improperly if not under its control. In many cases commissions are not made on this area, and this fact may contribute to the agency's reluctance. 39 The orientation of the agency or the firm may also directly influence where monies are spent. Many ad agencies are managed by officers who have ascended through the creative ranks and are inclined to emphasize the creative...
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Exhibit 16-13 Armor All uses on-package samples for related products Sunflower Group's SiteLinkPlus provides companies with a fulfillment service for samples On-package sampling, where a sample of a product is attached to another item, is another common sampling method see Exhibit 16-13 . This procedure can be very cost-effective, particularly for multiproduct firms that attach a sample of a new product to an existing brand's package. A drawback is that since the sample is distributed only to...
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Network Advertising A common way advertisers disseminate their messages is by purchasing airtime from a television network. A network assembles a series of affiliated local TV stations, or affiliates, to which it supplies programming and services. These affiliates, most of which are independently owned, contractually agree to preempt time during specified hours for programming provided by the networks and to carry the national advertising within the program. The networks share the advertising...
To Whom Shall We Advertise
While a number of target markets might be derived from the situation analysis, to decide which specific groups to go after, the media planner may work with the client, account representative, marketing department, and creative directors. A variety of factors can assist media planners in this decision. Some will require primary research, whereas others will be available from published secondary sources. The Simmons Market Research Bureau SMRB provides secondary information syndicated data on...
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Figure 1G-6 How high indexes can be misleading Figure 1G-6 How high indexes can be misleading keters may wish to use this information to determine which groups are now using the product and target them or to identify a group that is currently using the product less and attempt to develop that segment. While the index is helpful, it should not be used alone. Percentages and product usage figures are also needed to get an accurate picture of the market. Just because the index for a particular...
Imc Perspective 111
The Super Bowl Is Not the Only Big Advertising Game in Town The Super Bowl has long been considered the premier event for television advertising. Despite the high costs of advertising on the Super Bowl, many companies think it is well worth the money. They point out that the big game is usually the most watched program of the year and delivers more than 100 million viewers. Advertisers also note that the Super Bowl is one occasion where as much attention is paid to the commercials as to the...
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DAGMAR An Approach to Setting Objectives In 1961, Russell Colley prepared a report for the Association of National Advertisers titled Defining Advertising Goals for Measured Advertising Results DAGMAR .13 In it, Colley developed a model for setting advertising objectives and measuring the results of an ad campaign. The major thesis of the DAGMAR model is that communications effects are the logical basis for advertising goals and objectives against which success or failure should be measured....
Communications Objectives
Some marketers do recognize the problems associated with sales-oriented objectives. They recognize that the primary role of an IMC program is to communicate and that planning should be based on communications objectives. Advertising and other promotional efforts are designed to achieve such communications as brand knowledge and interest, favorable attitudes and image, and purchase intentions. Consumers are not expected to respond immediately rather, advertisers realize they must provide...
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campaigns designed to create and enhance favorable perceptions of their stores. In this case, sales-oriented objectives would not be appropriate the effectiveness of the campaign would be based on its ability to create or change consumers' image of the store. Sales-oriented objectives are also used when advertising plays a dominant role in a firm's marketing program and other factors are relatively stable. For example, many packaged-goods companies compete in mature markets with established...
Information Search
The second stage in the consumer decision-making process is information search. Once consumers perceive a problem or need that can be satisfied by the purchase of a product or service, they begin to search for information needed to make a purchase decision. The initial search effort often consists of an attempt to scan information stored in memory to recall past experiences and or knowledge regarding various purchase alternatives.9 This information retrieval is referred to as internal search....
Reaching for the Skyy
The last five years have been heady times for vodka as the product category has experienced strong growth and one wave of chic new brands has been followed by another. Consumption of vodka has increased steadily since 1998, and the vodka category is double the size of the next distilled-spirits segment, rum. Ironically, a bland-tasting product that was best known for helping Russians make it through a cold, bleak winter has become a status symbol for many trendy 20- and 30-somethings in...
Advantages of Television
TV has numerous advantages over other media, including creativity and impact, coverage and cost effectiveness, captivity and attention, and selectivity and flexibility. Creativity and Impact Perhaps the greatest advantage of TV is the opportunity it provides for presenting the advertising message. The interaction of sight and sound offers tremendous creative flexibility and makes possible dramatic, lifelike representations of products and services. TV commercials can be used to convey a mood or...
Advantages and Disadvantages of Promotional Products Marketing
Like any other advertising medium, promotional products marketing offers the marketer both advantages and disadvantages. Advantages include the following 1. Selectivity. Because specialty advertising items are generally distributed directly to target customers, the medium offers a high degree of selectivity. The communication is distributed to the desired recipient, reducing waste coverage. 2. Flexibility. As the variety of specialty items in Figure 13-7 demonstrates, this medium offers a high...
Advantages and Disadvantages of Yellow Pages The Yellow Pages
offer the following advantages to advertisers 1. Wide availability. A variety of directories are published. According to the Yellow Pages Publishers Association, consumers refer to the Yellow Pages more than 19.4 billion times yearly.24 2. Action orientation. Consumers use the Yellow Pages when they are considering, or have decided to take, action. 3. Costs. Ad space and production costs are relatively low compared to other media. 4. Frequency. Because of their longevity Yellow Pages are...
Advantages and Disadvantages of Direct Marketing
Many of the advantages of direct marketing have already been presented. A review of these and some additions follow 1. Selective reach. Direct marketing lets the advertiser reach a large number of people and reduces or eliminates waste coverage. Intensive coverage may be obtained through broadcast advertising or through the mail. While not everyone drives on highways where there are billboards or pays attention to TV commercials, virtually everyone receives mail. A good list allows for minimal...
Characteristics of Objectives
A second major contribution of DAGMAR to the advertising planning process was its definition of what constitutes a good objective. Colley argued that advertising objectives should be stated in terms of concrete and measurable communications tasks, specify a target audience, indicate a benchmark starting point and the degree of change sought, and specify a time period for accomplishing the objective s . Concrete, Measurable Tasks The communications task specified in the objective should be a...
Guidelines for Evaluating Creative Output
Advertisers use numerous criteria to evaluate the creative approach suggested by the ad agency. In some instances, the client may want to have the rough layout or storyboard pretested to get quantitative information to assist in the evaluation. However, the evaluation process is usually more subjective the advertising or brand manager relies on qualitative considerations. Basic criteria for evaluating creative approaches are discussed next Is the creative approach consistent with the brand's...
Transit Advertising
Another form of out-of-home advertising is transit advertising. While similar to outdoor in the sense that it uses billboards and electronic messages, transit is targeted at the millions of people who are exposed to commercial transportation facilities, including buses, taxis, commuter trains, elevators, trolleys, airplanes, and subways. Transit advertising has been around for a long time, but recent years have seen a renewed interest in this medium. Due in part to the increased number of women...
Target Market Selection
After evaluating the opportunities presented by various market segments, including a detailed competitive analysis, the company may select one, or more, as a target market. This target market becomes the focus of the firm's marketing effort, and goals and objectives are set according to where the company wants to be and what it hopes to accomplish in this market. As noted in Chapter 1, these goals and objectives are set in terms of specific performance variables such as sales, market share, and...
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some of the more successful companies have allocated additional funds during hard times or downturns in the cycle of sales. Companies that maintain or increase their ad expenditures during recessions achieve increased visibility and higher growth in both sales and market share compared to those that reduce advertising outlays . For example, Sunkist can attribute at least some of its success in maintaining its strong image to the fact that it has maintained consistent levels of advertising...
Greg Hancock
Sales Representative for Rolling Stone Magazine I chose the University of Southern California to get my undergraduate degree because they had one of the top-rated Business Entrepreneurship programs, which I felt would prepare me to own my own business. However, after graduating I realized it takes a lot of money and experience to start up a new business. I lacked both, so I searched for a job to learn sales, marketing and advertising. These are important skills, no matter what industry you work...
Organization of This Text
This book is divided into seven major parts. In Part One we examine the role of advertising and promotion in marketing and introduce the concept of integrated marketing communications. Chapter 1 provides an overview of advertising and promotion and its role in modern marketing. The concept of IMC and the factors that have led to its growth are discussed. Each of the promotional mix elements is defined, and an IMC planning model shows the various steps in the promotional planning process. This...
Commissions from Media
The traditional method of compensating agencies is through a commission system, where the agency receives a specified commission usually 15 percent from the media on any advertising time or space it purchases for its client. For outdoor advertising, the commission is 16 percent. This system provides a simple method of determining payments, as shown in the following example. Assume an agency prepares a full-page magazine ad and arranges to place the ad on the back cover of a magazine at a cost...
Identifying the Target Audience
The marketing communication process really begins with identifying the audience that will be the focus of the firm's advertising and promotional efforts. The target audience may consist of individuals, groups, niche markets, market segments, or a general public or mass audience Figure 5-2 . Marketers approach each of these audiences differently. The target market may consist of individuals who have specific needs and for whom the communication must be specifically tailored. This often requires...
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Figure 10-12 Using BDI and CDI indexes Figure 10-12 Using BDI and CDI indexes High BDI and high CDI High BDI and low CDI This market usually represents good sales potential for both the product category and the brand. High BDI and high CDI High BDI and low CDI This market usually represents good sales potential for both the product category and the brand. The category is not selling well, but the brand is probably a good market to advertise in but should be monitored for declining sales. The...
Age Of Sales Method
Belch Advertising and IV. Objectives and 7. Establishing Objectives The McGraw-Hill Promotion, Sixth Edition Budgeting for Integrated and Budgeting for the Companies, 2003 Marketing Promotional Program Communications Programs there will be sufficient monies to cover this budget, with increases in sales leading to budget increases and sales decreases resulting in advertising decreases. The percent-age-of-sales method is simple, straightforward, and easy to implement. Regardless of which basis...
Distribution Channel Decisions
As consumers, we generally take for granted the role of marketing intermediaries or channel members. If we want a six-pack of soda or a box of detergent, we can buy it at a supermarket, a convenience store, or even a drugstore. Manufacturers understand the value and importance of these intermediaries. One of a marketer's most important marketing decisions involves the way it makes its products and services available for purchase. A firm can have an excellent product at a great price, but it...
The Future of Agency Compensation
As you can see there is no one method of agency compensation to which everyone subscribes. The recent ANA survey found that nearly half of advertisers made significant changes in their compensation plans in the past three years, while 21 percent plan more changes soon. One of the most significant findings from the recent ANA survey is the rapid rise in incentive-based compensation agreements, as 35 percent of advertisers are using some type of performance-based system versus only 13 percent 10...
IMC Perspectives
These boxed items feature in-depth discussions of interesting issues related to the chapter material and the practical application of integrated marketing communications. Each chapter contains several of these insights into the world of integrated marketing communications. Some of the companies brands whose IMC programs are discussed in these perspectives include Jet Blue, Dell Computer, Jupiter Media Matrix, BMW Mini-Cooper, Intel, USA Today, PT-Cruiser, and Dunkin' Donuts. Issues such as the...
Discussion Questions Fwb
1. A number of factors may lead to problem recognition among consumers. Discuss the various causes of problem recognition, and give an example of each. 2. Explain the concept of an evoked set. Why is this concept important to marketers Give examples of an evoked set, and how marketers might attempt to influence consumers to gain consideration. 3. Jerry Olson and J. Paul Peter define two broad categories of evaluative consequences. Describe each of these and provide examples. 4. Figure 4-10...
Competitive Analysis
In developing the firm's marketing strategies and plans for its products and services, the manager must carefully analyze the competition to be faced in the marketplace. This may range from direct brand competition which can also include its own brands to more indirect forms of competition, such as product substitutes. For example, when Lay's introduced Baked Lay's low-fat chips, the product ended up taking away sales from the regular Lay's potato chip brand. At the same time, new consumers...
Combining Direct Marketing with Personal Selling Telemarketing
and direct selling are two methods of personal selling others will be discussed in Chapter 18 . Nonprofit organizations like charities often use telemarketing to solicit funds. As you will see, for-profit companies are also using telemarketing with much greater frequency to screen and qualify prospects which reduces selling costs and to generate leads. Direct-mail pieces are often used to invite prospective customers to visit auto showrooms to test-drive new cars the salesperson then assumes...
Thomas L Aiello
Vice President, Account Supervisor Leo Burnett, USA I graduated from the U.S. Military Academy in 1993 with a bachelor's of science degree in engineering management. After West Point, I spent five years serving in the U.S. Army in the armored cavalry where I led groups of 50 or more soldiers. As a Captain, I was awarded the Army Commendation Medal for my accomplishments during real-world deployment to Panama, Korea, and Kuwait. My military training and experiences taught me valuable skills...
Taking Creative Risks
Many creative people follow proven formulas when creating ads because they are safe. Clients often feel uncomfortable with advertising that is too different. Bill Tragos, former chair of TBWA, the advertising agency noted for its excellent creative work for Absolut vodka, Evian, and many other clients, says, Very few clients realize that the reason that their work is so bad is that they are the ones who commandeered it and directed it to be that way. I think that at least 50 percent of an...
DirectResponse Agencies
One of the fastest-growing areas of IMC is direct marketing, where companies communicate with consumers through telemarketing, direct mail, and other forms of direct-response advertising. As this industry has grown, numerous direct-response agencies have evolved that offer companies their specialized skills in both consumer and business markets. Figure 3-10 shows the top 10 direct-response agencies several of which, including OgilvyOne, DraftWorldwide, and Grey Direct Marketing, are divisions...
How To Do A Persuasion Matrix For Marketing
1. The opening vignette discusses how a number of companies are using athletes with a bad-boy image as endorsers for their athletic shoes. Why do you think companies such as Reebok, And 1, and Pony use controversial athletes such as Alan Iverson, Latrell Sprewell,and Pete Rose as their spokesperson What risks are they taking by using these athletes to endorse their products 2. Discuss how marketers could use the persuasion matrix to plan their communication programs. Choose a print ad or TV...
Other Types of Agencies and Services
Not every agency is a large full-service agency. Many smaller agencies expect their employees to handle a variety of jobs. For example, account executives may do their own research, work out their own media schedule, and coordinate the production of ads written and designed by the creative department. Many advertisers, including some large companies, are not interested in paying for the services of a full-service agency but are interested in some of the specific services agencies have to offer....