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COMM 131 Sessions 15-16 Textbook Notes

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COMM 131

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WEEK 10 Chapter 12 Pg. 458-475 Advertising -mass-media mostly used by consumer-product companies -marketing management must make 4 important decisions when developing advertising program: 1. Setting Advertising Objectives: -advertising objectives: a specific communication task to be accomplished with a specific target audience during a specific period of time. The overall advertising goal is to help build customer relationships by communicating customer value Objectives based on past decisions about the target market, positioning, and the marketing mix, defines what advertising should do in the total marketing program -information advertising: used in introducing a new product or brand to the market. Objective: to build primary demand by communicating benefits. May have educational purposes -persuasive advertising: important as competition in the product category increases; used to build selective demand. -comparative advertising: company directly/indirectly compares its brands with one or more other brands. -reminder advertising: for mature products, to maintain customer relationships and keep consumers thinking about the product -overall goal: help move consumers through the buying product. 2. Setting The Advertising Budget: -advertising budget: the dollars and other resources allocated to a product or company advertising program a. Affordable Method: setting the advertising budget at the level management thinks the company can afford -used by small businesses, start with total rev, deduct expenses and capital outlays, then devote some of the remaining funds to advertising -ignores the effect of advertising on salespromotion as last priority, long-range market planning is difficult to do, result in under spending b. Percentage of Sales Method: setting the promotion budget at a certain percentage of current or forecasted sales, or as a percentage of the unit sales price -easy to use; dependent on the relationships among promotion spending, selling price and profit per unit -wrong to view sales as the cause of promotion rather than the resultno justification -based on availability of funds rather than on opportunities c. Competitive Parity Method: setting the promotion budget to match competitors’ outlays -based on industry average -support: competitors’ budget=wisdom; helps prevent promotion warsneither point is valid because companies differ, and no evidence of promotion war prevention d. Objective and Task Method: developing the advertising budget by defining specific objectives, determining the tasks that must be performed to achieve these objectives and estimating the cost of performing these tasks. The sum of these costs is the proposed advertising budget -advantage: forces management to spell out its assumptions about the relationship between dollars spent and promotion results -difficult to use: hard to figure out which tasks achieve stated objectives 3. Developing Advertising Strategy: -advertising strategy: the strategy by which the company accomplishes its advertising objectives. It consists of two major elements: creating advertising messages and selecting advertising data a. Creating the Advertising Message: advertising can only succeed if it gains attention and communicates well; especially important in today’s costly and cluttered advertising environment i. Breaking Through the Clutter: can’t force-feed the same old ad messages -better planned, more creative, more entertaining and more emotionally engaging ii. Merging Advertising and Entertainment: experimenting with forms that are merged with entertainment -product placement: products placed in TV shows, movies, etc. -money for the show + advertising for the company iii. Message Strategy: to decide what general message will be communicated to the audience -ideally follow the company’s broader positioning and customer value strategies -develop a compelling creative concept: the compelling ‘big idea’ that will bring the advertising message strategy to life in a distinctive and memorable way -advertising appeals should be meaningful, believable, and distinctive iv. Message Execution: must find the best approach, style, tone, words, and format for executing the message -tone: positive tone -must use memorable and attention-getting words -format makes an impact and in its cost -execution styles: 1. Slice of Life: ‘typical’ people using the product in a normal setting 2. Lifestyle: how product fits in a particular lifestyle 3. Fantasy: fantasy around the product or its use 4. Mood or image: build a mood or image around the product/service such as beauty, love, intrigue, few claims except through suggestion 5. Musical: show people or cartoon characters singing about the product 6. Personality symbol: create a character that represented the product 7. Technical expertise: shows expertise in making the product 8. Scientific evidence: presents surveys or scientific evidence that the brand is better or better liked 9. Testimonial evidence or endorsement: features a highly believable or likable source endorsing the product v. Consumer-Generated Messages: capitalize on consumer videos -hold contests or develop brand websites that invite consumers to submit ad message ideas or videos -can be dangerous to give consumers so much creative control -low cost, fresh perspectives, etc. b. Selecting Advertising Media: -advertising media: types of media and media vehicles through which advertising messages are delivered to their intended audience -4 major steps i. Deciding on Reach, Frequency, and Impact: -reach: measure of the percentage of people in the target market who are exposed to the ad campaign during a given period of time -frequency: measure of how many times the average person in the target market is exposed to the message -media impact: qualitative value of a message exposure through a given medium -generally choose media that will engage consumers vs just reaching them ii. Choosing among media types: major types are television, internet, newspaper, direct mail, magazine, radio and out-of-home -consider a medium’s impact, message effectiveness, and cost iii. Selecting Media Vehicles: -media vehicle: the specific media within a general media type -buy media space (CPMs)  consider the cost of producing ads for different media iv. Deciding on Media Timing: how to schedule the advertising over the course of a year -choose the pattern of advertising: -continuity: scheduling ads evenly within a given period -pulsing: scheduling ads unevenly over a given time periodadvertise heavily for a short time to build awarenesscan be same impact as continuity but lower cost 4. Evaluating Advertising Effectiveness and Return on Advertising Investment: -return on advertising investment: the net return on advertising investment divided by the cost of the advertising investment -should regularly evaluate two types of advertising results: communication effects and sales and profits effects 5. Other Advertising Considerations: -address 2 additional questions: a. Organizing for Advertising: different companies=different way of organizing -advertising agency: a marketing services firm that assists companies in planning, preparing, implementing and evaluating all or portions of their advertising programs. Pg. 362-391 What is a Price? -price: the amount of money charged for a product or a service, or the sum of the values that customers exchange for the benefits of having or using the product or service. -one of the most important elements determining a firm’s market share and profitability -Only element in the marketing mix that produces revenue, most flexible, direct impact on the firm’s bottom line Major Pricing Strategies -price falls between one that is too hig
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