ADVERTISING MANAGEMENT Eastern Institute of Management 2 nd Year 1 st Semester
Nov 26, 2014
ADVERTISING MANAGEMENT
Eastern Institute of Management2nd Year 1st Semester
Advertising and the Marketing Process
What is Marketing ?
• The American Marketing Association Defines Marketing as the Process of Planning and Executing the Conception, Pricing, Promotion, and Distribution of Ideas, Goods, and Services to Create Exchanges That Satisfy the Perceived Needs, Wants, and Objectives of the Customer and the Organization.
Research StageAnalyze Marketing Environment
Strategic StageDevelop Objectives and Strategies
Tactical StageSpecific Tools Are Selected
Implementation StageCoordinate Strategy With Marketing Activities
Evaluation StageAssess How Well Objectives Were Achieved
The Marketing PlanA Marketing Plan is a Blueprint of Planned Marketing Activity That Strives to Create a Competitive Advantage for an Individual Product, a Product Line, or an Idea.
The Four Main Types of Marketing
Undifferentiated ApproachDevelop One Marketing Strategy That Will Appeal to As
Many People as Possible. (Gasoline)
Undifferentiated ApproachDevelop One Marketing Strategy That Will Appeal to As
Many People as Possible. (Gasoline)
Type of BuyerType of Buyer ConsumerCharacteristics
ConsumerCharacteristics
Market Segmentation ApproachDivide the Entire Heterogeneous Market Into SegmentsThat Are More Homogeneous, Then Focus on Specific
Target Markets Based on Groupings Such As:
Market Segmentation ApproachDivide the Entire Heterogeneous Market Into SegmentsThat Are More Homogeneous, Then Focus on Specific
Target Markets Based on Groupings Such As:
Benefits SoughtFrom Product
Benefits SoughtFrom Product
Approaching the Market
A Competitive Marketing Strategy Designed to Create Product Differences in the Eyes
of the Consumer.
A Competitive Marketing Strategy Designed to Create Product Differences in the Eyes
of the Consumer.
Intangible Differences
Image That Implies Difference such as
Status, Enjoyment or Masculinity
Intangible Differences
Image That Implies Difference such as
Status, Enjoyment or Masculinity
Tangible DifferencesProduct Features, Color,
Size,Quality of Performance,
Options or Price
Tangible DifferencesProduct Features, Color,
Size,Quality of Performance,
Options or Price
Product Differentiation
Marketing Concept
• The marketing concept suggests that marketing should focus first on the needs and wants of the customer, rather than finding ways to sell products that may or may not meet customers’ needs.– Step 1. Determine what the customer needs and
wants.– Step 2. Develop, manufacture, market, and
service the goods and services that fill those particular needs and wants.
Four Tools of Marketing
Market Coverage?Push, Pull or ComboStrategy?
Channel Direct or Indirect?
Channel of Distribution Influencers
Exclusive Distribution: Only one distributor is allowed to sell the brand in a market area. i.e.Ethan Allen
Selective Distribution: Increased number of outlets, but limit number to most profitable. i.e. Timex
Intensive Distribution: Places product in every possible outlet. i.e. soft drinks
Direct Marketing: Companies that distribute products without the use of a reseller.
Indirect marketing: product is distributed through a channel structure that includes one or more resellers.
Push Strategy: Directs marketing efforts at resellers.
Pull Strategy: Directs marketing efforts to the ultimate consumer.
Combination Strategy: Most often used and combines push and pull strategies.
Customary or ExpectedPricing
Customary or ExpectedPricing
Psychological Pricing
Psychological Pricing
PriceLiningPrice
Lining
Pricing StrategiesPricing
Strategies
PricingThe Price a Seller Sets for a Product is Based Not
Only on the Cost of Making and Marketing the Product, But Also on the Seller’s Expected Profit
Level.
PackagingPackaging
AdvertisingAdvertising
Public RelationsPublic
Relations
Point-of-Sale
Point-of-Sale
PersonalSelling
PersonalSelling
DirectMarketing
DirectMarketing
Sales Promotion
Sales Promotion
How the Marketer May Communicate With
Target Markets.
How the Marketer May Communicate With
Target Markets.
Marketing Communication Mix
Marketing Communication• Personal Selling
– Face-to-face contact between the marketer and a prospective customer.
– Most important for companies that sell products requiring explanation, demonstration, and service.
• Advertising– Has a greater ability to reach a larger number of people
simultaneously.– Has less ability to prompt an immediate change in
behavior.• Sales Promotion
– Communication devices offered for a limited period of time to generate immediate sales.
Marketing Communication• Public Relations
– Set of activities intended to enhance the image of the marketer to create goodwill.
• Direct Marketing– Interactive system that allows two-way communication.– Provides a mechanism for the prospect to respond.– Can occur at any location.– Provides a measurable response.– Requires a database of consumer information.
• Point-of-Sale/ Packaging– All the communication devices and marketing messages
found at the place where the product is sold.
Advertising’s Role in the Marketing Plan Advertising is One of Several Marketing Communication
Options.
Advertising vis-à-vis SalesFor an advertising agency
standpoint, it is very important to realize that they can increase
sales with their effort.
AIDA Model
Attract Attention
Gain Interest
Create a Desire
Precipitate Action
Concept of the AIDA Model
•The AIDA model states that advertising agency should know how to draw attention of a buyer to get the customer interested by exhibiting its advantages, benefits and features. Interest is followed by desire. It is advertising agency’s duty to create a desire in a buyer to buy a specific product.•All three steps of the AIDA policy will help you to stimulate the action towards the purchase of a product. AIDA theory guides and leads you to build a better advertising business. BIG B’s of advertising world have followed AIDA to generate good advertisement campaigns.
Consumer Must go through…
Awareness
Comprehension (Image/Identity)
Conviction (Attitude)
Action (Purchase)
DAGMAR Model
Defining Advertising Goals for Measured Advertising Results
It emphasizes the communication task of Advertising as contrasted to the Marketing Objectives of the organization.
The Advertising goal should be specific…should be written, measurable task involving a starting point, a defined audience and a fixed time period.
DAGMAR Model Concept• Suppose you are marketing a service or a product and your
customer knows nothing about the product. • As your client is unaware of the product, the first step is to make
him Aware of your product by posting advertisement regarding your product on respective websites.
• Comprehension is the second step of DAGMAR. Try to know the answers to these following questions.– a) What is your product about? – b) What are product’s potential features and benefits of product? – c) What will your customer get from your product? And how?
• Answers to all these questions will help you to get a potential customer.
• Next stage is Conviction and this is very important. Convince your customer by telling him the benefits of your product. After convincing, your next step starts i.e. action, which is not controlled by you. You have to depend on the customer.
• However, your previous actions will have a major role to play. If you have been able to convince, the customer ad have answered him satisfactorily and then you will definitely be the winner of the day.
AIDA vs DAGMAR
Awareness
Interest
Desire
Action
AIDAAIDA DAGMARDAGMAR
Awareness
Comprehension
Conviction
Action
Form of Advertising Content of Advertising
Why Hire an Advertising Agency?
• Hiring an agency can result in several benefits:– Offer objective advice.– Draw on the collective experience and
training of its staff.– Provide people and management skills to
accomplish advertising objectives.– Provide supportive environment for
professional advertising people.
A Walk through an Advertising Agency
Advertising Agency
• Board of Directors (Privately held)• CEO/CMD/Chairman/MD• Servicing : Client Servicing/Brand Holder• Planning : Brand Planner• Creative : Copy/Art• Media: Planner/Buyer• Research : Consumer Behaviour/Pre Test/Post
Test• Film : Producer/Director/Unit• Finance/HR/L&D etc.
CEO of Advertising Agency
Advertiser/Client
Creative DirectorA/c PlannerPlng. Director
A/c ExecutiveA/c Director
CopywriterVisualiser Art Director
Traffic Controller
Media PlannerBudget Controller
Radio Outdoor Press TV Others
Advertising UniverseTG Segment
Brief
ApprovedCampaign
Campaign
Media Buyer
Film MakerProducer
Production House
Research Agency
EventManagement
Marketing Objective
Planning by Advtg OpportunitiesTG BehaviourResearch
BudgetAdvtg Objectives& Strategy
Co-ordinateMarketingMix Factors
Create the Advertisement
CreativeMediaPlan
CustomersLanguage
Place the AdIn Media
Pre Test theAd through Research
The Advertising Plan
Marketing Objectives
• Decide what the marketing objectives is out to achieve in terms of:· Increase sales of brand x· Increase market share· Generate 500 new enquiries each month· Increase distribution penetration· Establish a network of distributors
Communication Planning• Determining the demand factors.• Identifying the Target Group.• Assess the Competition• Legal and Regulatory Environment
Advertising Objectives
• Decide what the Advertising Objectives is out to achieve in terms of:· Increasing brand awareness, Positioning the service as the friendliest on the market, Repositioning a beer from an old mans drink to a young mans drink, Maintaining brand X as the preferred brand, Supporting the launch of a new shop by generating 50% awareness in the city, Repositioning the Daily newspaper as an up-market business newspaper, etc.,
Advertising Strategy • How we get there- how the objectives are achieved. Strategy drives
the tactics in the same direction. • The strategy summarizes the tactics, by helping to harmonize and
integrate all tactical communication tools. The strategy should also include selection of target markets, positioning, selection of communication tools, sequence of communication tools (are different tools used at different stages?), time scales and more. Examples of such strategies include:
• The Tupperware direct response campaign that combines personal selling in party format and toll free numbers and catalogues.
• The IBM Position the business as a solution provider for all your computing problems, e.g. conferences, published papers, training awareness days etc.– Daewoo Cars Position Daewoo as a customer focused firm that is
happy to deal directly with customers.• Stage 1. Build customer credibility through TV and motoring
press• Stage 2. Develop dialogue with customers about current
issues about car ownership • Stage 3. Launch brand·
Advertising Budget
Setting the budget can be achieved in four main ways:
1. Objective and task approach - Where the cost of implementing the objectives determines the budget.
2. Percentage of sales approach, whereby the budget is determined by a fixed percentage of sales.
3. Competition matching approach, whereby the firm’s budget spend matches that of the competition.
4. Arbitrary approach, where the CEO sets an arbitrary figure that does not take account of the cost of implementation.
Creative Planning
• Identify the target audience : Decide whom the message is for.
• Determine the response sought : What would the marketer like the audience to do after they get the message?
• Choose the message : Write the copy, or produce the appropriate image.
• Choose the channel : Decide the most appropriate medium (i.e. TV, radio, or other medium) is most appealing to the audience.
• Select the source’s attributes : Decide what it is about the product or company that needs to be communicated.
• Collect feedback : Carry out market research to monitor how effective the promotion was.
Media Planning • Determining the media channels to utilise.
– In order to achieve maximum reach (no. of customers).– The frequency of coverage (no. of times a customer is exposed to the
advert).– The scheduling of coverage (e.g. prime time or early morning for
radio and TV.)– The size of the advert (e.g. half page in a paper)– The positioning of the advert (e.g. on the front page of a magazine
or paper).• In Advertising the decision is based on the cost per thousand viewers,
listeners or readers. • Creating the platform Deciding the basic issues and selling points that
the communication must convey. This clarifies the thinking on producing the communication plan.
• Action Plans to outline the details of the tactics : Detailed action plans implement the tactics in various forms including:· Project management skills· Time management· Prioritising· People management· An ability to get things done and plan for contingencies
• Control Plans should identify how progress should be reviewed, monitored, measured and controlled. So measurement systems need to be built in from the start.
An Example
Months prior to November work with Production, R& D to get the product right in line with Customer Needs and branding exercise done with Agency and Consultant.
• December : Press Release to trade press and retailers • January :
– Sales campaign to persuade retailers to stock the product – Press Release to trade press, TV programs if newsworthy
enough – Begin a teaser campaign
• February : Launch Teaser campaign • March : Once 50 per cent retailer penetration has occurred, start
public campaign to maximize brand awareness • April : Begin a new campaign to inform consumers about the
brand. Possibly use money-off promotion, linked promotions, etc. • May : Review progress using market research. Possibly release
PR to specialist trade press
The Brief
Brief
Types of Advertising - Client• Institutional/Corporate – promotes organizational
images and ideas not specific products eg : Union Bank • Advocacy – promotes a company’s position on a public
issue eg : Tata Motors on Singur Isssue• Brand/Products/Service – promotes a product use,
feature or benefit, Service, Brand eg : Vodafone, Vivel, Jet Airways etc.,
• Pioneer – promotes a product category rather than a brand eg : Apple i-pod, i-phone etc
• Political – promotes polictical party idealogy, messages eg : BJP Campaign, US Presidential Election
• Public Service/Social Service – promotes the cause of social awareness, urges action eg : Teach for India from TOI
Types of Advertising - Media• Print Advertising – Newspapers, Magazines,
Brochures, Fliers • Outdoor Advertising – Billboards, Kiosks,
Tradeshows and Events • Broadcast/Electronic Media Advertising –
Television, Radio and the Internet • Covert Advertising – Advertising in Movies :
James Bond and Sony Erickson Cybershot• Non - conventional Methods – Village Hailers,
Slides in Movie Halls, Van Publicity, • Brand Experience : Promos in Malls, Retail
Advertising at POP
Types of Advertising - Type
• Reminder – reminds consumers about an established brands features, benefits, characteristics, uses
• Reinforcement – assures consumers that they have made the right choice
• Competitive – promotes a brands competitive features w.r.t another brand
• Comparative – compares two or more brands on the basis of one or more characteristics
• Celebrity Advertising
• Surrogate Advertising – Advertising Indirectly
Advertising Campaign
• The creation and execution of a series of advertisements that communicate to a particular target audience• Thematic Campaign – Brand Promise (Pull
Strategy)• Tactical Promotion – Brand Sale (Push
Strategy)• Relaunch Campaign • Repositioning Campaign
Thematic Campaign
Thematic Campaign
Thematic Campaign
Tactical (Promotion) Campaign
Brooke Bond
Repostioning (Brand Image)
India’s Pride Power & Control
Relaunch
New India Kings Pack
Advertising LayoutCompany Logo
Brand Logo
Headline
Body Copy Baseline
Creating a Campaign
• Identify and analyze target audience (need, problem etc)
• Define advertising objectives (what would it do)• Create the advertising content (based on a brief)• Determining the Advertising Appropriation• Pre-test with a sample size• Evaluate the results and rework if necessary• Develop media plan and budget• Run the campaign• Evaluate its effectiveness
Identifying and Analyzing TG
• TG is group of similar people to whom the advertisement is aimed at• Demographic• Psychographic• Lifestyle• Attitudes
Defining the Objectives
• What does the firm hope to accomplish with the campaign• Objectives should be clear, precise and
measurable• Increase in sales ?• Increase in awareness ?
Advertising Content
• Basic issues or selling points that must be included in the campaign• Simple• One or two such points• Must be important to the TG
Advertising Appropriation
• Advertising Budget for a specified period• The size of the market and the geographic
spread will determine the budget• Budgeting Approach
• Objective and Task : Determining the objectives and the cost needed to attain them
• Percent of Sales : What percent of past sales determines the budget
• Competitive Matching• Arbitary
Top 10 US SpendersCOMPANY SALES USD
MILLIONADVERTISING SPEND USD MLN
% OF SALES
General Motors 132399 3374 2.5
Procter & Gamble 20334 2541 12.5
Ford 108296 2408 2.2
Pepsi Co 18295 2210 12.1
Pfizer 19932 2189 11.0
Daimler Chrysler 72708 1985 2.7
AOL Time Warner 32676 1885 5.8
Phillip Morris 52098 1816 3.5
Walt Disney 20970 1757 8.4
Johnson & Johnson
20204 1618 8.0
For 2002
Pretesting
• Pretesting is a research method that seeks to minimize mistakes by getting consumer reactions to ad messages before they are placed in the media.
Developing the Media Plan
• Specifies media vehicles (press, tv, radio, billborads etc.,) and the schedule for running the advertisements
• Plan objectives focus on the reach and frequency that the budget will allow• Reach – the percentage of consumers in a
target market exposed to an advertisement in a specified period
• Frequency - The number of times the TG is exposed to the ad
Developing the Media Plan
• Cost Comparison Indicator – A means of comparing the cost of vehicles in a specific medium in relation to the number of people reached
• The indicator is stated a the cost of exposing one thousand people to an ad in a medium and its unit is CPM
Percentage of Media Spend
MEDIUM USD MILLION SPEND % of TOTAL
Television 59231 24.3
Newspaper 49050 20.1
Direct Mail 44591 18.3
Radio 19295 7.9
Yellow Pages 13228 5.4
Magazines 12370 5.1
Business Prss 4915 2.0
Internet 4333 1.8
Outdoor 1758 0.7
Miscellaneous 34919 14.4
TOTAL 243680 100.0
2000 USA
Strategy & Creative Content
• Consumer Insight – Brand Idea – Execution Idea –
• Copy – The verbal portion of advertisements, Headline, BaseLine, Body Copy etc.,
• Art – The visual portion of the advertisement• Story Board – A mock up combining copy and
visual material to show the sequence of major scenes in a TV commercial
Creative Content• Artwork – An advertisements illustration and
layout – rendering to printable form• Illustrations – Drawing, photos, charts, graphs
and tables used to spark the TG’s interest level• Layout – The physical arrangement of an ad’s
illustration and copy
Account ManagementDevelops Campaign’s
Strategy for Client
Specialists Who Create Advertising Campaigns
Creative ServicesDreams Up and Produce
the Ads
Media PlanningDetermines Effective
Communication Vehicles
Research & Marketing Services
Collect and Analyze Information to Help Develop a Strategy
An Advertising Campaign is a Coordinated, Comprehensive Plan that Carries Out Promotion Objectives and Results in a Series of Advertisements Placed in Media Over a Period of
Time.
Setting Message Goals
Setting Budget Goals
Increasing Brand
Awareness Increasing Salesby a CertainPercentage
Changing the Image of a
Product Recognizing a Need for the
Product
Establish Message and Budget Objectives
Unique Selling PropositionHumorous
Appeals
Fear Appeals
ComparativeAdvertising
Demonstration
Testimonial
Designing the Ad
Advertising Appeals
Slice-of-LifeLifestyle
Sex Appeals
Choosing Media
Types of Media:Where to
Say It
Computer Media Television
Out-of-Home Media Radio
Magazines
Directories Newspaper
Media Scheduling: When to Say It
• A media schedule specifies the exact media to use, when, and how often the message should appear.
• Assess advertising exposure - degree to which the target market will see an advertising message in a specific medium and depends on the following two factors:
Continuous ScheduleSteady Stream of Advertisinge.g. shampoo
FlightingAdvertising Appears in Short,
Intense Bursts AlternatingWith Periods of Little or
No Activity
Pulsing ScheduleVaries Adverting Depending
on Product Demande.g. suntan lotion
Media Scheduling:How Often to Say It?
Terminology
Terminology
Evaluating Advertising
• Post testing is research conducted on consumers’ responses to actual advertising messages they have seen or heard.
• Three ways to measure the impact of an advertisement are:• Unaided recall• Aided recall• Attitudinal measures.
Erosion of Brand Loyalty
Technology Gives Power Back to the People
Greater Emphasis on Point-of-Purchase Factors
The Rules Are Changing
The Advertising Environment is Cluttered
Some Consumers Are Turned Off by Advertising
Challenges Facing the Advertising Industry
Global ReachEstablishing Brand Images Globally
DiversityReflecting Cultural Diversity of Target
Markets
TechnologyCustomizing Advertising to Customer
Preferences
How the Advertising Industry is Meeting these
Challenges ?