MKTG30010 ADVERTISING AND PROMOTIONS

MKTG30010

ADVERTISINGANDPROMOTIONS

LECTURENOTES

2017Semester2

2

TableofContentBaseProcesses

Lecture1: AdvertisingLandscape–IntroductiontoIMCLecture2: Social,EthicalandRegulatoryIssuesofIMCLecture3&4: TheCommunicationProcessLecture5: InfluencingConsumerBehaviour

PlanningforIMCLecture6: StrategyI–ObjectivesandBudgetingLecture7: StrategyII–SegmentationLecture8: StrategyIII–PersuasionTacticsLecture9: CreativeStrategyI–PlanningandDevelopmentLecture10&13: CreativeStrategyII–MessageStrategiesLecture14: MediaStrategy

IMCTools&DisciplinesLecture15: StorytellingLecture17: MeasuringtheEffectivenessoftheIMCProgramLecture16: IMCMix–TraditionalMediaLecture18: IMCMix–Social,DigitalandInteractiveMediaLecture19: IMCMix–PublicRelationsLecture21: IMCMix–DirectMarketingandPersonalSellingLecture22: IMCMix–SalePromotion

**XLecture11,12&20:GuestLectures(OnlyrelevantforAssignment2–OperaAustraliaandPublicis)

26

Lecture10&13:CreativeStrategiesII–MessageStrategiesA. TheMessageStrategy

1. Definition:a. “Themajorsellingideashouldemergeasthestrongsingularthingyoucansayaboutyour

productorservice,orevenyourbrand.Thiswouldbetheclaimwiththebroadestandmostmeaningfulappealtoyourtargetaudience”

b. Thespecificmessagetobedisseminatedinthecurrentcampaignbasedonthecircumstancesandobjectives=keymessage

2. Howtogenerateagoodmessagestrategy?a. Relevantforconsumer

i. Understandtargetconsumers(demographics,psychographics,consumerinsight)b. Basedonaproducttruth

i. Functionalcharacteristicsii. Brandimage/personality/addvalue

c. Distinctvsthecompetition(ifpossible)i. Understandrealcompetitor(inthesamecategory,competingforourtime,money

orattention)ii. Standapartfromthecompetitoràpointofdifference

B. Whatiscreativity?

1. AdvertisingCreativitya. Theabilitytogeneratefresh,uniqueandappropriateideasthatcanbeusedassolutionsto

communicationsproblems2. Creativestrategy

a. Determiningwhattheadvertisingmessagewillsayorcommunicate3. Creativetactics

a. Determininghowthemessagestrategywillbeexecuted

C. 8Keycreativemessagestrategies1. GenericStrategy

Definition Astraightproductorbenefitclaimthatcouldbemadebyanycompanythatmarketsabrandinaparticularcategory.Thereisnoassertionofcompetitivesuperiority.

Whentouse Companyhasadominantmarketpositionàonlycanbeapplicabletoabsolutecleardominantleaderinindustry

Benefits • Companybenefitsmostfromanincreaseinprimarydemand• Makesthebrandsynonymouswiththeproductcategory• Unusualbutpowerful

Examples • AppleiPods,iPads…• HeinzKetchup• Campbell’ssoupuses‘soupisgoodfood’sloganinsteadof

‘Campbell’ssoup…’àwhenyousaysoup,youimmediatelythinkofCampbell’ssoup

2. Pre-emptivestrategyDefinition Anadvertisermakesageneric-typeclaimbutwithanassertionof

competitivesuperiority(eventhoughcompetitors’productsareequal).

27

Whentouse • Usedwheretherearefewfunctionaldifferencesbetweencompetingalternatives

• Veryfunctionalgoodsànotmuchdifference

Benefits • Pre-emptiveclaimprecludescompetitorsfromusingasimilarline• Usefulingrowthmarketswherethereislittlecompetitive

advertisingExamples • Visineeyedrop’s‘Visinegetstheredout’àinfacteveryeyedrop

brand‘gettheredout’butVisinenowhasthestrongestassociationtoit

• ‘Soupisgoodfood’à‘Campbell’ssoupisgoodfood’

3. USP(UniqueSellingPropositionstrategy)Definition Superiorityclaimbasedonauniqueproductattributethatrepresentsa

meaningful,distinctiveconsumerbenefit(i.e.thereisaphysical,functionalpointofdifferentiation)

Whentouse • Mostusefulwhenpointofdifferencecannotbereadilymatchedbycompetitors

• Rarelyseenbecausethereareveryfewproductmarketsthathaveaplayerthattrulyfunctionally,meaningfullydifferent

Risks Mayforcecompetitorstoimitateorchoosemoreaggressivestrategy

Examples • EtihadAirwaywillhavea“flyingnanny”onlong-haulflights.• GolfTDI:1,400kmwithoutrefueling

4. BrandimagestrategyDefinition • Messageinvolvespsychologicalpointofdifferenceratherthan

physicaldifferentiation(usuallysymbolic)àdifficulttoofferphysicaldifferentiationbutmorelonglasting

• Psychologicaldifferentiationàsymbolicrepresentationofbrand

Whentouse • Usedwhencompetingbrandsthataresosimilaritisdifficulttofindorcreateauniqueattribute

• Mostcommonlyappliedcreativestrategiesforbrands

Howtouse • Thecreativitysalesstrategyisbasedonastrong,memorablebrandidentitythroughimageadvertising,leadingtoatransformationaladvertisingàgivingthebrandapersonality

• Itusesclassicalconditioning:paringaconditionedstimulus(i.e.brandname)withanunconditionalstimulus(i.e.peripheralcue)tocreateaconditionedresponse

Examples • Cigarettebrandstargetdifferentsegmentse.g.VirginiaSlimtargetsfemale,Cameltargetsolderjazzpeople,Marlborotargetsaman’smanlikecowboy,drinkbeeràbrandpersonality

• Pepsiusecelebrityendorsing(ToolofPersuasion:liking)àclassicalconditioningàcokedoesn’tusecelebrityendorsesbecauseitisTHEcoke(i.e.genericstrategy)whilePepsiisthefollower

55

Lecture22:IMCMix–SalesPromotionA. Definitionandmechanismsofsalespromotion

1. Definitionofsalespromotiona. Adirectinducementthatoffersextravalueoranincentivefortheproducttothesalesforce,

distributorsortheultimateconsumerwiththeprimaryobjectiveofcreatinganimmediatesale

b. Moveproductstodistributionchannelse.g.periodicsalesinfashionbrands2. Scopeofsalespromotion

a. Targetatconsumersàconsumerpromotionsb. Targetatretailers/wholesalersàtradepromotions

3. Whydoesitworkwithconsumers?a. Lawofmicroeconomics

i. Lowerpricesàincreaseindemandii. Almostallsalespromotionsrestongivingawaymorevalue/utility–evenifitisnot

apparentatafirstlook4. Salespromotionisbecomingincreasinglypopularamongmarketers

a. Estimatesarethatmarketersspendbetween60and75%oftheirbudgets(!)onsalespromotion,withtheremainderbeingallocatedtomediaadvertising

b. Morethan$6billionisspentonpromotionsmarketingannuallyinAustraliac. Growthinsalespromotionisexpectedasmarketersbecomemoreadeptatusingviral

marketing,emailandotheropt-incommunicationtechnologiesi. Salespromotionattachedwithdirectmarketing

5. Concernsofsalepromotionsa. Salespromotionisadouble-edgedsword:canworkveryeffectivelyintheshortrun–but

canalsohurtbrandequityinthelongrunb. Whilemarketersacknowledgetheimportanceofsalespromotiontogenerateimmediate

sales,theyareequallyconcernedaboutitslong-termeffectonbrandequityi. Longtermsalesàprice-qualityassociationi.e.ifpriceistoolow,qualityisbad

c. Somearguethatsalespromotionincreasescomeattheexpenseofbrandequityandthateverydollarwhichgoesintosalespromotionratherthanadvertisingdevaluesthebrand

i. Customersaretrainedtoexpectsales

6. Solution:a. usesalespromotionssparingly

i. Salespromotionsasscarcitymessagescomein2types:Ø- limitedtime(availableforapredefinedperiod)�- limitedquantity(first100customersonly)

ii. Scarcitymessagestypicallyacceleratethepurchase,creatingahigherwillingnesstobuyandalowerpropensitytolookfurther

iii. Scarcitymayalsoguardagainstconsumeraddictiontopromotions- Longtermloyalty,Xtraincustomerstoexpectsales

b. Usesalespromotionsstrategicallyi. i.e.integratedintotheIMCprogramhelpingbuildbrandequityii. Itisagoodstrategicsalespromotionifitcanbuildlong-termbrandequitye.g.

IKEA’sfreecotforbabiesborn9monthsfromtoday

56

B. ConsumerPromotions1. Processforconsumerpromotions

a. Salespromotionobjectives

i. E.g.immediatesales/trialsàsamplingii. E.g.enhancingIMC/buildingbrandequity/strengthencustomerrelationshipànot

price-orientedstrategies2. Typesofsalespromotions

a. Samplingi. Anymethodusedtodeliveranactualortrialsizedproducttoconsumersii. 85%ofmanufacturersusesamplingtogeneratetrialandleveragechannelsupport

- reduceriskofpurchaseforcustomersàeffectiveforproductlaunche.g.tastetestinginsupermarket,facecreamsampleonmagazine

- reciprocityàfeelguiltyifyoudon’tbuyaftergiventheopportunitytotryitthroughsamples

iii. Shouldbetargeted,ratherthanmass-distributedØiv. Particularlyeffectiveiftheconceptisdifficulttocommunicatebyadvertisingalonev. Vehicles:theuseofinnovativedistributionmethods,whereappropriate

b. Couponsi. Apromotionaldevicethatrewardsconsumersuponitsredemptiongenerallyinthe

formofcents-offsavingsorfreemerchandise- Discriminatepeoplewithcouponsfromthosewithout

ii. UncommoninAustraliabutcommonintheUSiii. Mail-deliveredcoupons

- Marketersusetointroducenewproducts- Canreach95percentofhomes- 75percentofrespondentspreferredtoreceiveinformationonnewproducts

bymailc. Premiums

i. Anofferofanitemofmerchandiseorserviceeitherfreeoratalowcostthatisanextraincentiveforcustomers

ii. E.g.freegiftsforpurchase,esp.cosmeticcompaniesàadded-valuewithouttouchingtheprice

iii. Advantages- Canintroducenewbrands�Ø- IncreasesPoint-of-PurchasedisplayexposureØ- Enhancesbrandequity(unlikeCoupons)Ø- Rewardsexistingusersi.e.loyalty/encouragesrepeatpurchases(Long-term

strategicbenefits)

57

d. Price-offsi. Atemporaryreductioninthepriceoftheproduct(typically10-25%off)ii. Advantages

- Rewardsexistingusers(receivediscountdirectly)- Temporarilyincreasesmarketshare�Ø- Loadscustomersupwithyourproduct

iii. Ifusedtomuch,it’llharmbrandequity- E.g.Myerusestoomuchprice-offsàcheapensMyer’simagevs.DavidJones;

expectasalessoXbuyyetàstillagapbetweenMyerandDavidJonese. Bonuspacks

i. Extraquantitiesofaproductgiventoconsumersatnoextracostii. Advantages

- Alternativetoprice-offdealsØ- Loadscustomersàreduceslikelihoodofcompetitor’ssalespromotionafter

yoursØ- Rewardsbrandloyalty

f. Contestsi. Apromotioninwhichparticipantsmustactaccordingtotherulesofthecontestand

mayormaynotberequiredtosubmitproofs-of-purchaseii. Advantages

- Reinforcesbrandimage- Goodforsegmentation�- Generateschannelenthusiasmàincreasescustomers’demandastheywant

towin- Strengthenbrandrelationship�àRewardhighvaluecustomers- Doesn’tdamagetheprice-qualityassociation

iii. Applicableforluxurybrandsiv. UsewithsocialmediamarketingàGoodforinteractionandbrandengagement

g. Brandedgamesi. Thesecreateanddevelopdeeperandongoingconsumerengagementandtocreate

aconversationii. Itcanalsoencouragetrialandeitherpurchaseorrepurchaseiii. Similartocontentmarketing

h. Point-of-purchase(POP)Displaysi. Theuseofvariousin-storedisplaystosellproducts

- Specificallyplanned=knowwhichbrand- Generallyplanned=knowwhichcategorybutdkwhichbrand- Substitute=brandXranoutofstockàbrandY- Unplanned=didn’tthinkaboutà60%!!

ii. E.g.banner,pop-up,point-of-purchasedisplay