MKT Chapter 12: Advertising and Public Relations, Sales Promotions

Advertising

Any paid form of presentation and promotion of products (goods, services, or information) by an identified sponsor

4 Steps of an Advertising Campaign

1. Set objectives

2. Set a budget

3. Develop advertising strategy

4. Evaluate the campaign

Advertising Objectives

Informative advertising, persuasive advertising, and, and reminder advertising

informative advertising

used when introducing a new product category to build primary demand (building a brand, explaining how a product works, etc)

persuasive advertising

communication used to motivate consumers to take action (building brand pref, encouraging switching brands, etc)

reminder advertising

Advertising used to remind consumers about an established brand's uses, characteristics, and benefits

Advertising Budget:

the dollars and resources allocated to a product or a company's advertising program. Target market, objectives, and budget are interdependent upon each other

Affordable Method

Budget based on what the company can afford; simple but often leads to underspending.

Percentage‑of‑Sales Method

Budget is a fixed % of sales; links promotion to sales but treats sales as the cause.

Comparative Parity

Match competitors' spending; easy benchmark but assumes competitors know the "right" amount.

Objective‑and‑Task Method

Define objectives → determine tasks → estimate costs; most logical but hardest to calculate.

Madison & Vine

Blending advertising with entertainment (advertainment, branded entertainment).

Execution Style

the approach, style, tone, words, and format used for executing an advertising message

Slice of Life

shows one or more "typical" people using the product in a normal setting

Lifestyle

shows how a product fits in with a particular lifestyle

Fantasy

creates a fantasy around the product or its use

Mood or image

builds a mood or image around the product or service, such as beauty, love, intrigue, or serenity

Musical

shows people or cartoon characters singing about the product

Personality symbol

creates a character that represents the product

Technical expertise

shows th3e company's expertise in making the product

Scientific evidence

presents survey or scientific evidence that the brand is better or better liked than one or more other brands

Testimonial evidence or endorsement

features a highly believable or likeable source endorsing the product

Advertising media

vehicles through which advertising messages are delivered to their intended audiences

Steps in advertising media selection:

1. Determining reach, frequency, impact, and engagement

2. Choosing among major media types

3. Selecting specific media vehicles

4. Choosing media timing

Reach

number or percentage of people exposed to the ad campaign during a given period of time

Frequency

how many times the average person is exposed to the message

Impact

the qualitative value of message exposure through a given medium

Engagement

the relevance of ad content for its audience

Major Media Types

TV, digital, mobile, social media, newspapers, direct mail, magazines, radio, and outdoor

CPM (Cost Per Mille)

Cost per 1,000 impressions.

CPC (Cost Per Click)

Cost paid each time a user clicks an ad.

CPA (Cost Per Action)

Cost paid when a user completes a desired action (purchase, signup).

Return on Advertising Investment

Net return from advertising ÷ advertising cost.

Day‑After Recall Test

Measures how much of the ad people remember the next day.

Warmth Monitor

Measures emotional response (neutral → emotional).

Total Sales

Baseline Sales + Incremental Sales from Ad

Lift

Incremental sales ÷ baseline sales.

Cost of Incremental Sales

Advertising Spending ÷ Incremental Sales

Public Relations (PR)

Activities that build good relations with a company's publics and manage its image.

Lobbying

Building relationships with government officials to influence legislation.

Product Publicity

Publicizing specific products.

Public Affairs

building and managing national or local community relations

Investor Relations

Maintaining communication with shareholders and financial stakeholders.

Development

PR for nonprofits to gain donor or volunteer support.

Tools of Public Relations

news, special events, written materials, audio visual materials, corporate identity materials, public service activities

News

occur naturally or create news opportunities

Special events

press conferences, brand tours

Written materials

annual reports, brochures, articles, and company newsletters and magazines

Audiovisual materials

DVDs and online videos

Corporate identity materials

logos, stationery, business cards, buildings, uniforms

Public service activities

orporate social responsibility (CSR), good-will activities

Press Release

A news‑style communication tool that sounds like a reporter, includes facts, quotes, and contact info.

Advertising

Paid, controlled message, product‑focused, targets end‑users.

PR

"Free," less control of messaging, more credibility, long‑term brand reputation, targets stakeholders.

Sales Promotion

Short‑term incentives to encourage immediate purchase. "Reasons to buy now."

Samples

Trial amounts of a product; most effective and expensive.

Coupons

Certificates offering savings on purchases.

Rebates

Refunds after purchase when proof is submitted.

Price Packs

Instant savings off the regular price.

Premiums

Free or low‑cost goods offered as incentives (e.g., Happy Meal toys).

Point-of-purchase (POP) Promotions

Displays and demonstrations that take place at the point of sale

Contests / Sweepstakes / Games

Opportunities for consumers to win something.

Event Marketing

Creating or sponsoring events to promote a brand.

Global Firm

A company operating in multiple countries to gain marketing, production, R&D, and financial advantages that are otherwise unavailable to a domestic firm

Standardized Global Marketing

Same marketing strategy and mix worldwide; cost‑efficient.

Adapted Global Marketing

Adjusting strategy and mix for each market; higher cost but higher return and recognition.

Straight Extension

Selling the same product with the same communications in every global market. No changes to product or messaging.

Communication Adaptation

Keeping the same product, but changing the marketing communications to fit local culture, language, or norms.

Product Adaptation

Changing the product to meet local needs or preferences while keeping the same communications.

Dual Adaptation

Adapting both the product and the communications for each international market.

Product Invention

Creating an entirely new product specifically for a foreign market (communications may or may not change).