Chapter Seven Marketing Services Making Your Mark in MarCom. Making Your Mark in MarCom.

Chapter SevenMarketing Services

Chapter SevenMarketing Services

Making Your Mark in MarCom.

Making Your Mark in MarCom.

Marketing ServicesMarketing Services Most Marketing Services relate to Marketing

Communications “MarCom” for short

Umbrella term for all promotional activities other than advertising.

MarCom services are growing New ways to market brands, and… New sources of career opportunities

Most Marketing Services relate to Marketing Communications

“MarCom” for short Umbrella term for all promotional activities other

than advertising. MarCom services are growing

New ways to market brands, and… New sources of career opportunities

Marketing ServicesMarketing Services Sales Promotion Direct Marketing Public Relations Marketing Research Event Marketing & Sponsorship Promotional Products

Sales Promotion Direct Marketing Public Relations Marketing Research Event Marketing & Sponsorship Promotional Products

Who Performs Marketing Services?

Who Performs Marketing Services?

Client Marketing Department Divisions of mega-agencies

Specialized Agencies Division within “IMC” agency

Specialized Agencies or suppliers

Client Marketing Department Divisions of mega-agencies

Specialized Agencies Division within “IMC” agency

Specialized Agencies or suppliers

Who Supervises Marketing Services?

Who Supervises Marketing Services?

At the Marketer, many options Director of Marketing Brand Management Specialized Manager (Promotion, etc.) MarCom Manager

At Specialized Agencies… Account Managers, Account Executives Project Managers

At the Marketer, many options Director of Marketing Brand Management Specialized Manager (Promotion, etc.) MarCom Manager

At Specialized Agencies… Account Managers, Account Executives Project Managers

The World of Sales Promotion


How Big is the World of Sales Promotion? Measured Volume (Fees, etc.) over $100 Billion! It breaks out this way…


Advertising 52.7%

Advertising 52.7%Consumer

Promotion 23.4%

Consumer Promotion

23.4%

Trade Promotion

18.4%

Trade Promotion

18.4%

Other5.5%Other5.5%



It’s actually larger… The biggest categories

Trade discounts Consumer Savings

…are not included! Overall, the Volume

is HUGE!!!

It’s actually larger… The biggest categories

Trade discounts Consumer Savings

…are not included! Overall, the Volume

is HUGE!!!

Advertising 52.7%

Advertising 52.7%Consumer

Promotion 23.4%

Consumer Promotion

23.4%

Trade Promotion

18.4%

Trade Promotion

18.4%

Other5.5%Other5.5%



Some Top Sales Promotion Agencies Some Top Sales Promotion Agencies



DraftFCB (Interpublic) EA, Taco Bell, Dow

Epsilon (Alliance Data Systems) P&G, Ford, Pepsico

Leo Burnett/Arc Worldwide (Publicis) McDonald’s, Comcast, CocaCola

Wunderman (WPP) Johnson&Johsnon, Unilever, Ford

Digitas (Publicis) American Express, Kraft, eBay

DraftFCB (Interpublic) EA, Taco Bell, Dow

Epsilon (Alliance Data Systems) P&G, Ford, Pepsico

Leo Burnett/Arc Worldwide (Publicis) McDonald’s, Comcast, CocaCola

Wunderman (WPP) Johnson&Johsnon, Unilever, Ford

Digitas (Publicis) American Express, Kraft, eBay

Two Types of Sales Promotion Trade Promotion (“Push” ) Consumer Promotion (“Pull” )

Both emphasize Short-Term Sales Two Types of Incentives

Less = Savings More = “Added Value”

More Product (Bonus Pack, BOGO*, etc.) A Prize (Sweepstakes) Something else (A Premium, or…)

Two Types of Sales Promotion Trade Promotion (“Push” ) Consumer Promotion (“Pull” )

Both emphasize Short-Term Sales Two Types of Incentives

Less = Savings More = “Added Value”

More Product (Bonus Pack, BOGO*, etc.) A Prize (Sweepstakes) Something else (A Premium, or…)



Trade PromotionsTrade Promotions Point-of-sale Point-of-sale

Trade PromotionsTrade Promotions

Dealer contests Dealer contests

Point-of-sale Point-of-sale

Merchandising the advertising

Deals and allowances Co-op advertising and then there’s…

Merchandising the advertising

Deals and allowances Co-op advertising and then there’s…

Consumer PromotionsConsumer Promotions Coupons/ FSIs (Free Standing Inserts) Coupons/ FSIs (Free Standing Inserts) Contests, sweepstakes

& games Contests, sweepstakes

& games

Cents-off promotions Cents-off promotions

Premiums Premiums Sampling/ Tastings Sampling/ Tastings Rebates Rebates

Gift with Purchase Gift with Purchase

Consumer Promotions/ Entertainment Brands

Consumer Promotions/ Entertainment Brands

7-Eleven becomes a Kwik-E-Mart Promoting “The Simpsons Movie”

3 weeks prior to release date 7-11 transformed 12 of its convenience stores into Kwik-E-Mart’s, featured in the Simpson’s fictious town.

Sales doubled in the 12 Kwick-E-Mart stores.

7-Eleven becomes a Kwik-E-Mart Promoting “The Simpsons Movie”

3 weeks prior to release date 7-11 transformed 12 of its convenience stores into Kwik-E-Mart’s, featured in the Simpson’s fictious town.

Sales doubled in the 12 Kwick-E-Mart stores.

Simply put, direct marketing occurs when you buy direct from a marketer By returning a coupon By calling an 800# By responding to a mail solicitation By shopping on the Internet By responding to a telemarketer

who called you during dinner

Simply put, direct marketing occurs when you buy direct from a marketer By returning a coupon By calling an 800# By responding to a mail solicitation By shopping on the Internet By responding to a telemarketer

who called you during dinner

The World of Direct Marketing


Sales from Direct Marketing Efforts

8.7% of total US GDP 1.3 million direct marketing employees

Sales from Direct Marketing Efforts

8.7% of total US GDP 1.3 million direct marketing employees



$1.96 trillion! $1.96 trillion! add up to… add up to…

Source: DMA Economic Impact Statement 2003Source: DMA Economic Impact Statement 2003

Sales from Direct Marketing Efforts Sales from Direct Marketing Efforts



It’s BIG! It’s BIG!

163 billion in expenditures. Estimated (by the DMA) to be 52.1% of all advertising expenditures.

Whatever the exact amount…

163 billion in expenditures. Estimated (by the DMA) to be 52.1% of all advertising expenditures.

Whatever the exact amount…

Source: DMA Economic Impact Statement 2008Source: DMA Economic Impact Statement 2008

Types of Direct Marketing Companies Types of Direct Marketing Companies



Direct Marketers Examples: American Express, Land’s End

Direct Marketing Agencies Example: DraftFCB (Interpublic)

Support Services Examples: Call Centers, Catalog Printers,

List Management Services, the Post Office

Direct Marketers Examples: American Express, Land’s End

Direct Marketing Agencies Example: DraftFCB (Interpublic)

Support Services Examples: Call Centers, Catalog Printers,

List Management Services, the Post Office

CRM = Customer Relationship Marketing LTV = Lifetime Value

Direct Marketers work to maximize the value of the relationship with their customers, to get the most LTV (Lifetime Value)

Doing all those things is “CRM” Increased valuation of current customers

is a driving force in marketing today

CRM = Customer Relationship Marketing LTV = Lifetime Value

Direct Marketers work to maximize the value of the relationship with their customers, to get the most LTV (Lifetime Value)

Doing all those things is “CRM” Increased valuation of current customers

is a driving force in marketing today



Some Key Reasons for Direct Marketing’s Growth

Some Key Reasons for Direct Marketing’s Growth

Changing consumer lifestyles Shopping opportunity for “time-poor” consumers

More consumer credit Now it’s easy to buy from a direct marketer

Better “Direct Marketing technology” More and better lists of potential customers Better technology for “massaging the database”

Big Changes in Media More cost-efficient media opportunities The Internet makes direct response easy

Changing consumer lifestyles Shopping opportunity for “time-poor” consumers

More consumer credit Now it’s easy to buy from a direct marketer

Better “Direct Marketing technology” More and better lists of potential customers Better technology for “massaging the database”

Big Changes in Media More cost-efficient media opportunities The Internet makes direct response easy

Consumer Complaints About Direct Marketing

Consumer Complaints About Direct Marketing

Some Current Issues: Annoyance

List removal option of DMA Privacy issues

Who owns your information? Data technology raises new concerns

Unscrupulous practices Example: Negative option

Major Result – The “Do Not Call” List.

Some Current Issues: Annoyance

List removal option of DMA Privacy issues

Who owns your information? Data technology raises new concerns

Unscrupulous practices Example: Negative option

Major Result – The “Do Not Call” List.

The Key to Success inDirect Marketing

The Key to Success inDirect Marketing List Quality is Key List Quality is Key Internal lists

Compiled by organization itself

Internal lists Compiled by

organization itself External lists

Purchased from List brokers List compilers

External lists Purchased from

List brokers List compilers

Improving PerformanceImproving Performance Improve the List Improve the Offer/Incentive Improve the Messaging “List Enhancement”

Add more information about households on current list Cleaning the list: the “merge-purge” function when

combining different lists

Continual testing against previous success Improve results and knowledge

Improve the List Improve the Offer/Incentive Improve the Messaging “List Enhancement”

Add more information about households on current list Cleaning the list: the “merge-purge” function when

combining different lists

Continual testing against previous success Improve results and knowledge

Marketing PR (MPR) Supports marketing efforts

Marketing PR (MPR) Supports marketing efforts

The World of Public Relations

The World of Public Relations

Corporate PR (CPR) Deals with broader range of

issues, from investor relations to employee communications

Corporate PR (CPR) Deals with broader range of

issues, from investor relations to employee communications

Marketing PR: Product PublicityMarketing PR:

Product Publicity The Basics: The Basics:

The Objective - obtaining free time or space in the media that represents favorable mention


Marketing PR: Product PublicityMarketing PR:

Product Publicity The Basics: The Basics:


The Strategy - product publicity, like all PR, must be newsworthy


The Strategy - product publicity, like all PR, must be newsworthy

The Benefit - the value of “implied” or “third-party” endorsement by the media

The Benefit - the value of “implied” or “third-party” endorsement by the media

Product Publicity Activities

Product Publicity Activities

Press Releases (immediate news) Technical and Case History stories Feature stories Press Tours

Press to Company Company to Press

Press Releases (immediate news) Technical and Case History stories Feature stories Press Tours

Press to Company Company to Press

Corporate PR Activities(Non-Marketing Related PR)Corporate PR Activities(Non-Marketing Related PR)

Investor Relations Employee Communications Government Relations (lobbying) Crisis Management (oil spills, etc.) Community Relations Advocacy Advertising (corporate

point of view on public issues)

Investor Relations Employee Communications Government Relations (lobbying) Crisis Management (oil spills, etc.) Community Relations Advocacy Advertising (corporate

point of view on public issues)

PR Agencies now part of mega-agency groups PR Agencies now part of mega-agency groups Ad Organizations by PR Revenue (2012) Ad Organizations by PR Revenue (2012)

PR Agency OwnershipPR Agency Ownership

WPP $1.49 billion WPP $1.49 billion Omnicom $1.29 billion Interpublic $1.21 billion Publicis $0.53 billion Havas $0.22 billion

Mergers Continue Y&R now included in WPP totals Omnicom and Publicis combine for top spot at $1.82 billion.

Omnicom $1.29 billion Interpublic $1.21 billion Publicis $0.53 billion Havas $0.22 billion

Mergers Continue Y&R now included in WPP totals Omnicom and Publicis combine for top spot at $1.82 billion.

Top Ten PR Agencies in 2012 2012 Net Fees Top Ten PR Agencies in 2012 2012 Net Fees

PR Agency OwnershipPR Agency Ownership

PR Agencies now part of mega-agency groups PR Agencies now part of mega-agency groups

Edelman $655,900,289 Edelman $655,900,289 APCO Worldwide $121,800,000 Waggener Edstrom Worldwide $118,426,000 W2O Group $62,005,000 Ruder Finn $56,148,000 Text 100 Global PR $50,930,028 MWW Group

$42,875,000 ICR $36,554,283 DKC $32,896,560 Finn Partners

$32,293,000O’Dwyer’s

Magazine, May 2013

APCO Worldwide $121,800,000 Waggener Edstrom Worldwide $118,426,000 W2O Group $62,005,000 Ruder Finn $56,148,000 Text 100 Global PR $50,930,028 MWW Group

$42,875,000 ICR $36,554,283 DKC $32,896,560 Finn Partners

$32,293,000O’Dwyer’s

Magazine, May 2013

Look What Happens When It All Works

Together!

Look What Happens When It All Works

Together!

Integration &Integration &Amplification!

Integration &Integration &Amplification!

The Business of Evaluation FEEDBACK is critical nourishment for

marketers

The Product is FACT, not opinion Accurate information gathering is also critical. Research reputations depend on the dependability

of their data

The Business of Evaluation FEEDBACK is critical nourishment for

marketers

The Product is FACT, not opinion Accurate information gathering is also critical. Research reputations depend on the dependability

of their data

The World of Marketing Research


Two types of entities provide this critical marketing information: Internal Marketing Research Departments

At the marketer At a full-service agency

Outside Marketing Research Firms Ongoing services (Nielsen) Projects (Surveys, focus groups, etc.)

Two types of entities provide this critical marketing information: Internal Marketing Research Departments

At the marketer At a full-service agency

Outside Marketing Research Firms Ongoing services (Nielsen) Projects (Surveys, focus groups, etc.)



Role of Internal Marketing Research Department

Role of Internal Marketing Research Department

Analyze company sales data Provide short-term and long-term sales and

industry projections Determine what primary research studies

need to be carried out Select and hire outside research firms

to conduct surveys and provide other information

Analyze company sales data Provide short-term and long-term sales and

industry projections Determine what primary research studies

need to be carried out Select and hire outside research firms

to conduct surveys and provide other information

Types of Outside Marketing Research Firms

Types of Outside Marketing Research Firms

Limited-service Research Suppliers These supply a specific type of data, often to

all major marketers. Syndicated Research (Nielsen TV ratings) Standardized Research (Gallup & Robinson

ad recall pre-testing studies) Full-service Research Suppliers

Focus Groups and Surveys “Starting from scratch” research projects

Limited-service Research Suppliers These supply a specific type of data, often to

all major marketers. Syndicated Research (Nielsen TV ratings) Standardized Research (Gallup & Robinson

ad recall pre-testing studies) Full-service Research Suppliers

Focus Groups and Surveys “Starting from scratch” research projects

How big is the World of Event Marketing? How big is the World of Event Marketing?

The World of Event Marketing


Sports sponsorship $13.01 billion Sports sponsorship $13.01 billion




Entertainment, tours, attractions $1.93 billion Entertainment, tours, attractions $1.93 billion





Causes $1.70 billion Causes $1.70 billion Festivals, fairs and annual events $825 million Festivals, fairs and annual events $825 million






$18.9 billion!

Causes $1.70 billion Causes $1.70 billion


That all adds up to... That all adds up to...


The Arts $891 million The Arts $891 million Festivals, fairs and annual events $825 million Associations and Memberships $550 million

2012 Sponsorship Spending, Sponsorship.com



Provides opportunities for: Sampling of product Widespread publicity in media Unique connection w. target market

Cause marketing: A special type of event marketing Example: Children’s Miracle Network

Provides opportunities for: Sampling of product Widespread publicity in media Unique connection w. target market

Cause marketing: A special type of event marketing Example: Children’s Miracle Network



A $16 billion business Company Brand or Logo

Pens, hats, key rings, etc “Business Gifts”

Higher priced items Many uses:

Sales lead generation, trade shows, awareness building, employee morale, etc.

A $16 billion business Company Brand or Logo

Pens, hats, key rings, etc “Business Gifts”

Higher priced items Many uses:

Sales lead generation, trade shows, awareness building, employee morale, etc.

The World of Promotional Products

The World of Promotional Products

Who isThe Person

Who Helps Pull All of This Together?

Who isThe Person

Who Helps Pull All of This Together?

The MarCom Manager

The MarCom Manager

Relatively new position - result of “IMC.” Title/function more common on West Coast

Evolving as marketers’ needs evolve

Need to understand all forms of “IMC” “Jack-of-all-trades” promotional skills

Emphasis will vary by industry High-tech = PR emphasis

Packaged goods = Sales promotion emphasis

Beverages = event and sports marketing emphasis

Relatively new position - result of “IMC.” Title/function more common on West Coast

Evolving as marketers’ needs evolve

Need to understand all forms of “IMC” “Jack-of-all-trades” promotional skills

Emphasis will vary by industry High-tech = PR emphasis

Packaged goods = Sales promotion emphasis

Beverages = event and sports marketing emphasis

Increased pressure for short-term revenue Dynamic growth in most areas

Sales Promotion - up 20% Direct Marketing - up 15%

Increased focus on existing customer “LTV” More loyalty programs More targeted programs More Customer Relationship Management

Increased pressure for short-term revenue Dynamic growth in most areas

Sales Promotion - up 20% Direct Marketing - up 15%

Increased focus on existing customer “LTV” More loyalty programs More targeted programs More Customer Relationship Management

The Future of Marketing Services


New Technologies Interactive and Information Technology The Internet affects everybody! Virtually everyone will practice some form of direct or highly

targeted marketing with Internet response. New Companies

Start-ups - need IMC from ground up Start-ups will be internal as well as external

Example: Tadcast, a new startup company Create product placement for online videos Sponsors contest for best video about (Coca-Cola’s) new Honest Tea -

get the most hits on YouTube. MediaPost News, Jan. 15, 2009

New Technologies Interactive and Information Technology The Internet affects everybody! Virtually everyone will practice some form of direct or highly

targeted marketing with Internet response. New Companies

Start-ups - need IMC from ground up Start-ups will be internal as well as external

Example: Tadcast, a new startup company Create product placement for online videos Sponsors contest for best video about (Coca-Cola’s) new Honest Tea -

get the most hits on YouTube. MediaPost News, Jan. 15, 2009



Economics of Scale Large Mega-agencies will have more resources Large marketers will want more programs

Competition All marketing services activity will increase Competition between services will also increase

More Diversity Not just in population, but marketing approach Managing all of this will be a huge challenge!

Economics of Scale Large Mega-agencies will have more resources Large marketers will want more programs

Competition All marketing services activity will increase Competition between services will also increase

More Diversity Not just in population, but marketing approach Managing all of this will be a huge challenge!



In Conclusion…In Conclusion…

Can Make Your Mark in MarCom.

Can Make Your Mark in MarCom.

YouYou

Questions & DiscussionQuestions & Discussion

Sales Promotion Direct Marketing Public Relations Marketing Research Event Marketing Promotional Products

Sales Promotion Direct Marketing Public Relations Marketing Research Event Marketing Promotional Products

Independent companies that buy media time and space for advertisers

Originally, an alternative to the media department of a full-service ad agency

Evolved as media choices proliferated and media buying became more complicated

Now mega-agencies have “unbundled” their media departments to create competing media buying services

Independent companies that buy media time and space for advertisers

Originally, an alternative to the media department of a full-service ad agency

Evolved as media choices proliferated and media buying became more complicated

Now mega-agencies have “unbundled” their media departments to create competing media buying services

The World of Media Buying Services


The Pioneer: Dennis Holt builds Western into #1 The Pioneer: Dennis Holt builds Western into #1



Bought by Interpublic Merged with Initiative Becomes model for all agencies

Bought by Interpublic Merged with Initiative Becomes model for all agencies

The World of Media Agencies

The World of Media Agencies

WPP combines Ogilvy and JWT Media Departments to form MindShare

Leo Burnett turns their Media Department into StarCom

Unbundling continues…

WPP combines Ogilvy and JWT Media Departments to form MindShare

Leo Burnett turns their Media Department into StarCom

Unbundling continues…

Chapter Seven Marketing Services Making Your Mark in MarCom. Making Your Mark in MarCom.

Documents

sale n

world of sales promotion

shortterm sales n

n marcom services

marcom manager n

advertising n deals

project managers n

trade promotions n point