Advertising
Definition: Paid communication intended to inform, persuade, or remind consumers about products or services.
Q&A:
Q: What is the primary goal of advertising?
A: To influence consumer behavior and drive sales or awareness.
Example: A TV commercial showcasing the features of a new smartphone.
Advertising Objectives
Definition: Goals that guide advertising efforts, such as increasing awareness, generating interest, or driving sales.
Q&A:
Q: What are common advertising objectives?
A: Informative, persuasive, and reminder objectives.
Example: A campaign to increase brand awareness of an eco-friendly detergent.
Informative Advertising
Definition: Advertising focused on providing information about a product or service.
Q&A:
Q: When is informative advertising most useful?
A: During the introduction phase of a product lifecycle.
Example: An ad explaining how an electric vehicle reduces carbon emissions.
Persuasive Advertising
Definition: Advertising aimed at convincing consumers to choose a specific brand or product.
Q&A:
Q: What techniques are used in persuasive advertising?
A: Emotional appeals, endorsements, and comparisons.
Example: An ad showing how a fitness tracker improves your health.
Comparative Advertising
Definition: Advertising that directly compares a product to competitors.
Q&A:
Q: Why do companies use comparative advertising?
A: To highlight advantages over competitors.
Example: A detergent ad showing it removes stains better than another brand.
Reminder Advertising
Definition: Advertising designed to remind customers of a product or service.
Q&A:
Q: Why is reminder advertising important?
A: To maintain brand loyalty and encourage repeat purchases.
Example: A Coca-Cola ad during the holiday season.
Reinforcement Advertising
Definition: Ads aimed at reassuring customers they made the right purchase.
Q&A:
Q: How does reinforcement advertising benefit a brand?
A: It builds customer loyalty and satisfaction.
Example: A car company thanking customers for choosing their brand.
Institutional Advertising
Definition: Promotes a company’s values or reputation rather than specific products.
Q&A:
Q: What is the purpose of institutional advertising?
A: To build goodwill and strengthen brand identity.
Example: An ad showcasing a company's commitment to sustainability.
Advocacy Advertising
Definition: Advertising that promotes a social, political, or environmental cause.
Q&A:
Q: How does advocacy advertising benefit a brand?
A: It aligns the brand with positive social values.
Example: A company promoting renewable energy initiatives.
Native Advertising
Definition: Ads that blend seamlessly with the content of the platform they appear on.
Q&A:
Q: Why is native advertising effective?
A: It feels less intrusive and engages users more effectively.
Example: A sponsored article promoting skincare products on a lifestyle blog.
Advertising Campaign
Definition: A coordinated series of advertisements with a unified theme or goal.
Q&A:
Q: What elements are essential in an advertising campaign?
A: Clear objectives, creative messaging, and targeted media.
Example: Nike’s “Just Do It” campaign focusing on empowering athletes.
5 Steps in Developing/Implementing Advertising Campaign
Identify the target audience.
Set advertising objectives.
Develop the creative message.
Select appropriate media channels.
Measure campaign effectiveness.
Q&A:
Q: Why is measuring effectiveness critical?
A: To assess whether objectives are met and guide future campaigns.
Example: Monitoring website traffic after launching an online ad campaign.
Advertising Metrics
Definition: Measurements used to evaluate ad performance, such as reach and frequency.
Q&A:
Q: What do advertising metrics help companies achieve?
A: They provide insights into campaign success and ROI.
Example: Tracking impressions and clicks for a digital ad.
Frequency
Definition: The number of times an individual is exposed to an ad within a time period.
Q&A:
Q: How does frequency influence advertising success?
A: Repeated exposure increases message retention.
Example: Seeing a billboard ad three times a week on your commute.
Reach
Definition: The total number of unique individuals exposed to an ad.
Q&A:
Q: Why is reach an important metric?
A: It measures how widely the message is distributed.
Example: A Super Bowl ad reaching 100 million viewers.
Rational Appeal
Definition: Ads that use logic and facts to persuade consumers.
Q&A:
Q: When is rational appeal most effective?
A: For high-involvement products like cars or appliances.
Example: An ad comparing fuel efficiency of hybrid vehicles.
Emotional Appeal
Definition: Ads that evoke emotions to influence behavior.
Q&A:
Q: What emotions are commonly used in emotional appeals?
A: Happiness, fear, love, and nostalgia.
Example: A charity ad showing children in need to encourage donations.
Puffery
Definition: Exaggerated or subjective claims in advertising not meant to be taken literally.
Q&A:
Q: Is puffery considered misleading?
A: No, as it’s understood as opinion or hyperbole.
Example: A pizza ad claiming it has “the best taste in the world.”
Advertising Ethics
Definition: Guidelines to ensure advertising is truthful, fair, and socially responsible.
Q&A:
Q: Why are advertising ethics important?
A: To build trust and avoid legal or reputational issues.
Example: Avoiding false claims about health benefits in a food ad.
Sales Promotion
Coupons
Definition: Vouchers offering discounts on products or services.
Example: A 20% off coupon for online shopping.
Cents Off
Definition: Discounts in the form of a reduced price on the packaging.
Example: A shampoo bottle marked “50 cents off.”
Rebates
Definition: Partial refunds offered after a purchase.
Example: A $50 mail-in rebate for buying a laptop.
Samples
Definition: Free product trials to encourage purchases.
Example: Cosmetic brands giving small samples of new products.
Premiums
Definition: Free or low-cost items given as incentives with purchases.
Example: A tote bag given with a magazine subscription.
Contests
Definition: Promotions requiring participants to compete for prizes.
Example: A photo contest with the best entry winning a vacation.
Sweepstakes
Definition: Random drawings for prizes, requiring no purchase or skill.
Example: A “win a free car” sweepstakes entry.
Loyalty Programs
Definition: Rewards programs encouraging repeat business.
Merchandise Allowance
Definition: A promotional incentive offered by manufacturers to retailers to encourage them to promote or display the manufacturer’s product.
Q&A:
Q: Why do manufacturers provide merchandise allowances?
A: To boost product visibility and sales in retail stores.
Example: A cereal manufacturer offering a discount to retailers for prominently displaying its products.
Cooperative Advertising
Definition: An arrangement where manufacturers and retailers share the cost of advertising a product.
Q&A:
Q: What is the primary benefit of cooperative advertising?
A: It reduces costs for both the retailer and manufacturer while increasing exposure.
Example: A clothing brand and a department store sharing the cost of a local newspaper ad.
Dealer Loader
Definition: Incentives provided by manufacturers to retailers to encourage bulk purchasing or product promotion.
Q&A:
Q: How does a dealer loader benefit retailers?
A: It provides extra stock or gifts that improve profitability.
Example: A car dealership receiving a free display vehicle for meeting a sales quota.
Employee Sales Promotion
Definition: Incentives or training provided to employees to improve sales performance.
Q&A:
Q: What types of rewards are common in employee sales promotions?
A: Bonuses, contests, and recognition awards.
Example: A retailer offering sales associates bonuses for exceeding monthly sales targets.
Public Relations (PR)
Definition: Managing a company’s communication with the public to build a positive image and maintain good relationships.
Q&A:
Q: What is the primary goal of PR?
A: To foster a positive image and manage public perceptions.
Example: A company issuing a press release about its charitable work.
Public Relations Tools
Annual Reports
Definition: Documents outlining a company’s financial and operational achievements over the year.
Example: A nonprofit highlighting its yearly accomplishments to attract donors.
Speeches
Definition: Formal presentations to communicate messages directly to an audience.
Example: A CEO speaking about the company’s sustainability goals at a conference.
Blogs
Definition: Online articles written to share expertise or insights and engage audiences.
Example: A fitness brand writing blogs on healthy lifestyles to promote its products.
Brochures
Definition: Printed or digital materials summarizing a company’s offerings.
Example: A travel agency distributing brochures about vacation packages.
Event Sponsorships
Definition: Financial or in-kind support of an event to promote a brand.
Example: A beverage company sponsoring a music festival.
Press Release
Definition: Official statements issued to the media to share news or announcements.
Example: A tech company announcing a product launch through a press release.
Publicity
Definition: Free media coverage generated by a company’s activities or news.
Example: A restaurant gaining media attention after hosting a celebrity chef.
Offline Publicity
Definition: Publicity through traditional media like newspapers or TV.
Example: A retail store featured in a local newspaper.
Online Publicity
Definition: Publicity through digital platforms like blogs and social media.
Example: A viral tweet about a brand’s new product.
Image Repair Theory
Definition: A communication strategy used to address and recover from negative publicity.
Q&A:
Q: Why is image repair critical?
A: To rebuild trust and minimize damage to a brand’s reputation.
Example: A company apologizing and implementing corrective measures after a product recall.
Crisis Communication
Definition: Strategic communication during emergencies to minimize harm and maintain public trust.
Q&A:
Q: What is the key to effective crisis communication?
A: Transparency, speed, and empathy.
Example: A company addressing data breaches by informing customers promptly.
Personal Selling
Definition: Direct interaction between a salesperson and a customer to make a sale.
Q&A:
Q: Why is personal selling effective?
A: It allows for tailored communication and building relationships.
Example: A car salesperson helping a customer choose a vehicle based on their needs.
Relationship Selling
Definition: Building long-term relationships with customers to encourage loyalty and repeat business.
Q&A:
Q: How does relationship selling benefit companies?
A: It increases customer retention and lifetime value.
Example: A financial advisor maintaining regular contact with clients.
Steps of Personal Selling Process
Prospecting
Definition: Identifying potential customers.
Example: A real estate agent researching potential homebuyers.
Pre-Approach
Definition: Gathering information about prospects before interaction.
Example: Learning about a client’s preferences before a meeting.
Approach
Definition: Initial contact with a potential customer.
Example: A salesperson introducing themselves at a trade show.
Sales Presentation
Definition: Explaining the product’s benefits to the customer.
Example: A software company demonstrating its product to a business.
Objections
Definition: Customer concerns or doubts raised during the sales process.
Example: A customer questioning the price of a service.
Closing
Definition: Securing the customer’s agreement to purchase.
Example: A salesperson asking for the sale after addressing objections.
Follow-Up
Definition: Checking in after the sale to ensure customer satisfaction.
Example: A phone call to ensure the customer is satisfied with their purchase.
Sales Management
Definition: Overseeing and directing a company’s sales team to achieve goals.
Q&A:
Q: What are the key roles of a sales manager?
A: Setting goals, training, and evaluating performance.
Example: A sales manager providing monthly performance feedback.
Sales Team Roles
Captive Salespeople
Definition: Employees dedicated to selling only their company’s products.
Example: A salesperson working exclusively for Apple.
Independent Sales Representative
Definition: Freelancers selling products for multiple companies.
Example: A rep selling for different home appliance brands.
Inside Salespeople
Definition: Sales staff who work from the company’s office or remotely.
Example: Telemarketers contacting customers by phone.
Outside Salespeople
Definition: Salespeople who visit clients in person.
Example: A pharmaceutical rep visiting doctors’ offices.
Sales Goals/Objectives
Definition: Targets set for sales teams to achieve.
Example: A goal of increasing sales by 20% in a quarter.
Territory Management
Definition: The process of organizing and managing sales efforts within specific geographic or market territories.
Q&A:
Q: Why is territory management important?
A: It ensures resources are allocated efficiently, reduces overlap, and improves sales coverage.
Example: Assigning one salesperson to cover the Midwest region to focus on customers there.
Approaches to Territory Management
Geographic Approach
Definition: Organizing sales territories based on geographical boundaries.
Example: Dividing sales regions into North, South, East, and West zones.
Product Approach
Definition: Organizing sales territories based on specific product lines.
Example: Assigning one salesperson to sell software and another to sell hardware.
Customer Approach
Definition: Organizing sales territories based on customer segments or types.
Example: Assigning one team to handle corporate clients and another for small businesses.
Combination Approach
Definition: A mix of geographic, product, and customer approaches for optimal coverage.
Example: A salesperson focuses on small businesses in the East region for a specific product line.
Sales Implementation
Definition: The process of executing the sales plan to achieve organizational goals.
Q&A:
Q: What is key to successful sales implementation?
A: Effective training, clear objectives, and strong leadership.
Example: Launching a new CRM system to help sales reps streamline their workflow.
Salary
Definition: A fixed compensation paid to employees regularly.
Q&A:
Q: How does a salary benefit salespeople?
A: It provides financial stability regardless of performance.
Example: A salesperson receiving $60,000 annually, regardless of the number of sales made.
Incentives
Definition: Additional rewards offered to motivate and boost performance.
Q&A:
Q: What types of incentives are commonly used in sales?
A: Bonuses, commissions, and recognition awards.
Example: A salesperson earning a $5,000 bonus for exceeding their sales quota.
Types of Incentives
Intrinsic Incentives
Definition: Internal motivators like job satisfaction or personal growth.
Example: A salesperson feeling fulfilled after helping a customer solve a problem.
Extrinsic Incentives
Definition: External rewards like money or recognition.
Example: A salesperson receiving a "Top Seller of the Month" award.
Compensation Plan
Definition: A structured plan outlining how employees are paid, including salary, commissions, and bonuses.
Q&A:
Q: Why is a well-designed compensation plan critical?
A: It motivates employees and aligns their goals with the company’s objectives.
Example: A compensation plan offering a $50,000 base salary plus 5% commission on sales.
Sales Control
Definition: The process of monitoring and regulating sales activities to meet objectives.
Q&A:
Q: What tools are commonly used for sales control?
A: CRM systems, sales reports, and performance reviews.
Example: A manager tracking sales reps’ progress through monthly performance reports.
Sales Assessment
Definition: Evaluating the performance of salespeople and sales strategies.
Q&A:
Q: Why is sales assessment important?
A: It identifies strengths, weaknesses, and areas for improvement.
Example: Analyzing quarterly sales data to determine if the team met its goals.
Customer Relationship Management (CRM)
Definition: A system or strategy for managing a company’s interactions with current and potential customers.
Q&A:
Q: What is the purpose of CRM?
A: To improve customer satisfaction, loyalty, and sales.
Example: Using Salesforce to track customer interactions and sales opportunities.
CRM-Related Concepts
Touchpoint
Definition: Any interaction between a company and a customer.
Example: A customer visiting a brand’s website or contacting customer service.
CRM Process
Definition: The steps involved in managing customer relationships, including data collection, analysis, and engagement.
Example: Collecting customer feedback, analyzing it, and tailoring marketing campaigns accordingly.
Share of Customer
Definition: The percentage of a customer’s total spending in a category that goes to a specific company.
Example: A grocery store aiming to increase its share of a customer’s monthly food budget.
Customer Equity
Definition: The total value a company expects to earn from its customer base.
Example: A luxury brand calculating the long-term value of its loyal customers.
Customer Focus
Definition: A business strategy centered on understanding and meeting customer needs.
Example: A software company designing products based on user feedback.
Lifetime Value (LTV)
Definition: The total revenue a company expects to earn from a customer over their lifetime.
Example: A subscription service calculating the average lifetime value of each subscriber.