CM217 quiz 2

ch 5,6,8,9, 10-14

ad agency structure

follows an ad process

strategy - creative - media - production

how advertising starts

strategy and marketing plan

marketing

**All the ways you get a product or service to people to facilitate the “exchange”**

exchange

trading one thing for another thing of value and facilitated by marketing

larger marketing context of advertising

* understand relationship between product and marketplace
* locate and understand customers and their wants and needs
* communicate it in a powerful way

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key drivers of marketing decision, what advertisers are first thinking about

* establishing a target market
* classifying your product
* setting your pricing
* determining placement with distribution approach
* choosing types of promotion

target markets

The market segment or group within the market segment toward which all marketing activities will be directed.

market segmentation

* **Marketers** select specific markets that offer the greatest potential and fine-tune the mix of marketing elements to match the needs and wants of the target market.
* identify groups with shared needs and characteristics

types of markets

consumer and business

cosumer markets

* target of most advertising
* consumers - people who buy the product for their own or someone else’s personal use

consumer segmentation

* grouping customers based on shared characteristics to tailor messages
* defined by
* demographic
* geographic
* psychographic
* behavioristic

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demographic

based on a population’s statistical characteristics with quantifiable factors such as gender, age, ethnicity, occupation, income

geographic

based on geographical regions with shared characteristics such as culture, traditions, lifestyles, also often combined with geographic segmentation to make geodemographic segmentation

geodemographic segmentation

based on two principles

* people who live in the same neighborhood tend to be demographically similar
* neighborhoods can be categorized by characteristics of populations and two or more neighborhoods can be placed in the same category, even though they are geographically separated

psychographic

defining consumer markets based on psychological variables including values, attitudes, personality, lifestyle/activities

behavioristic

grouping os consumers by their purchase behavior - how they buy and use products/brands, determine their user status

user status

varying degrees of loyalty to certain brands and products and different types

sale user

user status type, the most brand loyal and require the lease amount of advertising and promotion

semisole users

user status type; typically use Brand A but have an alternate selection if it is not available or if other is promoted with a discount

discount users

user status type; semisole users of competing brand B, they won’t buy brand A at full price but perceive it well enough to buy it at a discount

aware nontriers

user status type; use competitive products in the category but haven’t taken a liking to Brand A but aware

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trial/rejectors

user status type; tried brand A because of its advertising message, but didn’t like the product

repetoire users

user status type; perceive two or more brands to have superior attributes and will buy at full price. These are brand switchers; therefore, they are the primary target for brand advertising

behavioristic

usage rate: defining consumers and light, medium, or heavy users of products, purchase occasion: how often consumers buy a product; benefits sought: segmenting consumers based on the benefits being sought such as high quality, low price, the symbolism

benefits sought

segmenting consumers based on the benefits being sought such as high quality, low price, functionalitys

symbolism

consumer motivated by sex appeal, status/image, self identity

benefit segmentation

is prime objective of many consumer attitude studies for many successful and campaigns. Some product categories are characterized by substantial brand switching from one purchase to next, which occurs in response to different need states that consumers may experience

types of markets

consumer and business

business markets

organizations that buy natural resources, component products, and services that they resell and use to conduct their business, or use to manufacture another product

* gov agencies
* retailers
* wholesalers
* banks

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business market characteristics

* employ professional buyers and use systematic purchasing procedures
* concentrated geographically
* small numbers of buyers

B2B marketing

directed at people who buy goods and services for resale for use in a business or organization, or for manufacturing other products. Special advertising types:

* trade
* professional

trade

advertisng type; targets resellers to promote distribution

professional

advertising type; targets professionals in a given industry

product classifications

* by market - consumer and industrial goods
* by rate of consumption and tangibility - durable/non, services
* by purchasing habits - convenience, shopping, specialty, unsought goods
* by physical description - packaged, hard, soft, services

utility

product’s ability to satisfy both functional needs and/or psychological wants

functional utility

* form: provides a tangible good
* task: performs a task
* possesion: available for purchase
* time: available when wanted
* place: available where wanted

psychological utility

offers symbolic or psychological desire satisfaction, such as status or sex appeal

product life cycle

progressive stages in the life of a product - including introduction, growth, maturity, and decline - that affect the way a product is marketed and advertised

introduction stage

initial phase of the product life cycle when a new product is introduced, costs are highest and profits are lowest

* attract early adopters, people willing to try new services
* create primary demand - consumer demand for whole product category
* pull strategy - marketing, ads aimed to induce trial purchase
* push strategy - marketing, ads aimed at getting products into the dealer pipeline and accelerate sales

growth stage

market expansion as more and more customers make their first purchases while others are already making their second or third purchase

* first substantial product
* rapid market expansion
* biggest rewards
* ad expenditures decrease
* individual firms realize first substantial profits

maturity stage

market is saturated with products, the number of new customers has dwindled, and competition is most intense

* profits diminish
* selective demand
* sales increase at expense of competitors
* market segmentation, product positioning

decline stage

stage in the product life cycle when sales begin to decline due to obsolescence, new tech, or changing consumer tastes

* cease promotions
* phase out the product

product positioning

the way it is ranked in consumer’s mind by the benefits it offers, way it is classified or differentiated

brand

* most important way any product can differentiate itself
* combination of name, words, symbols, or design that creates core feeling

pricing element

the amount charged for a good or service, influences consumer perceptions of a brand

key factors influencing price

* market demand (law of supply and demand)
* product and distribution costs
* competition
* corporate objectives

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psychological pricing

setting a high price to make it seem valuable to influence customer behavior or perceptions

distribution (place) element

place, distribution, element is decided before ad is created to make a method of distribution and be consistent with the brand’s image

ways of distribution

* direct
* indirect
* intensive
* selective
* exclusive

direct distribution

direct distributors sell directly to consumers from the manufacturer, advertising burden carried entirely by manufacturer

indirect distribution

most companies market their products through a distribution channel that includes a network of resellers that operate between the producer and the user

intensive distribution

distribution strategy based on making the product available to consumers at every possible location

selective distibution

distribution method limits the number of outlet

exclusive distribution

this grants exclusive rights to a wholesaler or retailer in one geographic region

promotion/communication element

includes all marketing related communications between the seller and the buyer, based on target market and other areas of the 4 P’s

marketing communications /marcom

all planned messages that companies create to support their marketing objectives and strategies, work hollistically to make a message, surround consumer with integrated marketing

promotion key elements with IMC

advertising, PR, sales, sponsorship, events, branded content, direct marketing, personal selling

marketing mix

* after target market is designated
* elements of marketing decision are determined
* company has a complete product concept and a strategic basis for marketing to that target
* written marketing plan

marketing plan key components

* situation analysis
* marketing objectives
* marketing strategy
* marketing tactics

situation analysis

factual statement of the organization’s current situation and how it got there

* compiles all relavent facts about industry and company history, growth, products, etc.
* points out strengths, weaknesses, threats, opportunities

companies in industry

leaders in the industry who are the players

growth patterns within industry

primary demand, what drives purchasing and potential growth areas

history of industry

tech advances, product expansion

characteristics of industry

distribution patterns, pricing patterns, product patterns, promotional activity, geographic characteristics

swot analysis: the company

think about

* history
* size/growth
* profitability
* scope of business
* reputation
* strengths/weakessnes

swot: the product

* product story - development, quality, packaging
* sales features - ex/inclusive
* research - tech breakthroughs
* sales history - profits and costs
* share of market and trends

swot competition

* who is the competition - their products, audiences and goals, history, growth
* strengths and weaknesses - sales features, quality, etc.
* marketing activities of competition

marketing objectives

many kinds, “what” marketing needs to achieve

* corporate
* brand
* need-satisfying
* business

corporate objectives

profit, return on investment, net worth - for the corporation overall

brand objectivse

based on needs of target market, focus on brand measurement and engagement - for the brand

need-satisfying objectives

as a producer of products or services to a satisfier of target market needs - for the consumer/product relationship

business objectives

specific, quantitative, realistic business goals, for the bottom line business

marketing strategy

statement of how the company is going to achieve its marketing objectives and involves

* re-stating the target market
* stating the strategic position
* determining the marketing mix

restating- the target market

first step beings by defining and selecting the target market using the processes of market segmentation and research

stating the strategic positioning

positioning refers to placing a brand competitively in the minds of customers

determining the marketing mix

a cost-effective mix (product, price, distrubution, and communication must be developed for each target market the company pursues

marketing tactics

a company’s objectives indicate where it wants to go; the strategy indicates the intended route; and the tactics determine the specific short-term actions to be taken

advertising plan

* swot analysis
* creative strategy
* creative concet
* media strategy
* measurement plan

creative strategy

* defines the target audience
* restates objective
* specifies key benefits
* offers support for benefits
* sets tone

media strategy

* defining media objectives
* states media target
* using media channels and timing

advertising strategy: research

* is a must
* research provides information that drives marketing and advertising decision making
* categorized in 2 ways - marketing and ad
* uses creative and media strategy
* used to gain understanding and key insights
* informs the brand, audience, message, creative, and media

marketing research

systematic gathering, recording, and analysis of information to help managers make marketing decisions

* helps identify consumer needs and market segments
* it provides information for developing new products and devising marketing strategies
* it helps assess the effectiveness of marketing programs and promotional activities

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advertising research

uncovers the information needed to make advertising decisions, systematic gathering and analysis of information to help develop or evaluate advertising strategies, individual ads, and campaigns

ad research: brand

* learn what consumers perceive about a brand and what qualities will lead to purchase and loyalty
* establish a unique positioning concept for the brand - bundle values to shape brand’s position and image over time
* inform a creative approach based on understanding of brand perception and the wants and needs of consumers

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ad research: target audience

develop a rich, deep profile of brand’s target audience

understand demographics, behavior to gain valuable insight

define target audience to ensure the advertising will be delivered to the most prospects with the least waste

ad research: message

* decipher what messages your audience will respond to
* find promising messages by studying consumer’s likes and dislikes
* determine which message elements will prove most successful

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ad research: the creative

* get an early read on which concepts the target audience responds best to, can drive which idea to go with (pre-testing)
* evaluate the effectiveness of an ad campaign after it runs (post-testing)
* provides useful guidelines for future - where to improve on creative

ad research: the media

* understand which media channels to put the creative to reach the target audience; understand consumer media behavior
* evaluate their intersts via systematic gathering and analysis based on effects of media vehicles

research process steps

* analyzing the situation/defining the problem
* conducting secondary research
* establishing research objectives
* conducting primary research
* interpreting and reporting the findings

research process step 1

SWOT analysis, some use marketing information system (IMS)

secondary research

learn more about the market and competition, uses two types of research data - primary and secondary

primary data

customized information and can focus on any issue agency chooses

secondary data

information previously gathered and published, includes company records, billings, sales data, database services, etc.

research process step 3

specific research objectives in written statements, should be specific and measureable, what do we expect from research?

research process step 4

gather primary research through qualitative and quantitative research

qualitative research

* projective techniques to understand subconcious feelings, opinions, etc.
* intensive techniques - in-depth interview, focus group, ethnographic research (understand how people live their lives)

quantitative research

* observations via people’s actions and data (UPC code)
* experiment via test market
* survey

research process step 5

report should state the problem and research objective and summarize the findings and draw conclusions

what research and strategic planning focuses most on

consumer behavior

consumer behabior

* the importance of knowing the customer, focal research on this
* the mental/emotional processes and the physical activities of people that purchase/use goods and services to satisfy particular needs and wants