Discussion 1ResourcesRead/review the following resources for this activity:Arens & Schaefer: Chapters 6, 7Minimum of 1 reliable resources for initial post IntroductionYou will examine different company advertising plans and target audience strategies. As consumers it is important to understand why the company targets certain populations and how the product appeal influences our emotions. Initial Post Instructions (350 words)Think of an advertised product or service that is targeted specifically to your demographic or lifestyle. How effective is the advertiser at getting into your head and figuring out what you think and how best to influence you? If you were an account planner for that product or service, could you have done a better job? What would you have done differently? Discussion 2ResourcesRead/review the following resources for this activity:Arens & Schaefer: Chapters 6, 7Minimum of 1 reliable resources for initial post IntroductionCompanies develop elaborate plans to capture and retain market share. The role of the customer is vitally important for additional revenue, but also for public image. Companies strive to embrace IMC to help build long-term customer relationships.Initial Post Instructions (350)Select a local business (e.g. a retailer, restaurant, bank, hospital, movie theater, etc.) and recommend several relationship marketing tactics. Describe how that business could use IMC to enhance its customer relationships.Chapter Six
Account Planning and
Research
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
Learning Objectives
• Learning Objective 6.1: Describe the role of account
planners in advertising agencies.
• Learning Objective 6.2: Discuss how research can help
advertisers select target markets, media vehicles, and
advertising messages.
• Learning Objective 6.3: List the basic steps in the marketing
research process.
• Learning Objective 6.4: Compare the common methods
used in qualitative and quantitative research
• Learning Objective 6.5: Justify the pretesting and
posttesting of advertising messages.
• Learning Objective 6.6: Identify issues that can affect the
accuracy and usability of quantitative research.
©McGraw-Hill Education.
Account Planner
• Individual at an advertising agency primarily
responsible for account planning
• Represents the consumer
• Focuses the creative process on nurturing a
relationship between consumer and brand
©McGraw-Hill Education.
Marketing Research
• Systematic gathering, recording, and analysis of
information to help managers make marketing
decisions
• Identifies consumer needs and market segments
• Helps develop new products
• Helps devise marketing strategies
• Assesses the effectiveness of marketing activities
©McGraw-Hill Education.
Advertising Research
Systematic gathering and analysis of
information to facilitate the development or
evaluation of advertising strategies, ads and
commercials, and media campaigns
©McGraw-Hill Education.
Exhibit 6.1 – Categories of Research in Advertising
Development
Advertising
Strategy
Research
Creative
Concept
Research
Pretesting
Posttesting
Timing
Before creative
work begins
Before agency
production
begins
Before finished
artwork and
photography
After campaign
has run
Research
problem
Product concept
definition
Target audience
selection
Media selection
Message-element
selection
Concept testing
Name testing
Slogan testing
Print testing
TV storyboard
pretesting
Radio commercial
pretesting
Advertising
effectiveness
Consumer attitude
change
Sales increases
Techniques
Consumer attitude
and usage studies
Media studies
Qualitative
interviews
Free-association
tests
Qualitative
interviews
Statementcomparison tests
Consumer juries
Matched samples
Portfolio tests
Storyboard test
Mechanical
devices
Psychological
rating scales
Aided recall
Unaided recall
Attitude tests
Inquiry tests
Sales tests
©McGraw-Hill Education.
Advertising Strategy Research (1 of 2)
Helps to define the product concept or to assist in
the selection of target markets, advertising
messages, or media vehicles
Product concept: bundle of values that encompasses
both utilitarian and symbolic benefits to the
consumer
Target audience selection: study of primary users of
product category to understand demographics,
geographics, psychographics, and purchase behavior
©McGraw-Hill Education.
Advertising Strategy Research (2 of 2)
Media research: systematic gathering and analysis of
information on the reach and effectiveness of media
vehicles
Message element selection: studying consumers’
likes and dislikes in relation to brands and products
to determine which message elements might prove
most successful
©McGraw-Hill Education.
Pretesting and Posttesting
Pretesting
Posttesting
Testing the effectiveness of an
Testing the effectiveness of an
advertisement for gaps or
advertisement after it has
flaws in message content
been run to develop useful
before recommending it to
guidelines for future
clients, often conducted
advertising
through focus groups
©McGraw-Hill Education.
Steps in the Research Process
1. Situation analysis and problem definition
2. Secondary research
3. Refinement of research objectives
4. Primary research
5. Interpretation and reporting of findings
©McGraw-Hill Education.
Situation Analysis, Problem Definition, and
Secondary Research (1 of 2)
Analyzing the situation and defining the problem:
• Marketing information system (MIS): set of procedures
for generating an orderly flow of pertinent information
for use in making marketing decisions
Conducting secondary research:
• Secondary research: exploring a problem by reviewing
secondary data and interviewing a few key people with
the most information to share
©McGraw-Hill Education.
Situation Analysis, Problem Definition, and
Secondary Research (2 of 2)
Primary data: research information gained directly
from the marketplace
Secondary data: information that has previously
been collected or published
• Internal secondary data can be gathered from company
records.
• External secondary data can be gathered from the
government, market research companies, trade
publications, and computerized databases.
©McGraw-Hill Education.
Establishing Research Objectives
A concise statement of the research problem and
objectives should be formulated.
• Statement must be specific and measurable
• Decision point must be clear and the questions must be
related and relevant
Research results should provide the information
required to decide on a new positioning strategy.
©McGraw-Hill Education.
Conducting Primary Research
Primary research: collecting data directly from the
marketplace using qualitative or quantitative
methods
• Qualitative research: uses small, nonrandom samples
to explore behavior, perceptions, needs, and
motivations of a target audience
• Quantitative research: uses larger, representative
samples to quantify hypotheses and measure market
variables
©McGraw-Hill Education.
Exhibit 6.3 – Differences Between Qualitative
and Quantitative Research
Qualitative
Quantitative
Main techniques for gathering
data
Focus groups and in-depth
interviews
Surveys and scientific samples
Kinds of questions asked
Why? How so? In what way?
How many? How much?
Role of interviewer
Critical: interviewer must build
rapport with research participants.
She must think on feet and frame
questions and probes in response to
whatever respondents say. A highly
trained professional is advisable.
Important, but interviewers need
only be able to read scripts. They
should not improvise. Minimally
trained, responsible employees are
suitable.
Questions asked
Questions vary in order and phrasing
from group to group and interview
to interview. New questions are
added, old ones dropped.
Should be exactly the same for each
interview. Order and phrasing of
questions carefully controlled.
Number of interviews
Fewer interviews tending to last a
longer time.
Many interviews in order to give a
projectable scientific sample.
Kinds of findings
Develop hypotheses, gain insights,
explore language options, refine
concepts, help explain survey results,
provide diagnostics on advertising
copy.
Test hypotheses, prioritize factors,
provide data for mathematical
modeling and projections.
©McGraw-Hill Education.
Basic Methods of Qualitative Research
Projective techniques: asking indirect questions to consumers to
understand their underlying feelings, attitudes, opinions, needs, and
motives
Intensive techniques: probing the deepest feelings, attitudes, and
beliefs of respondents through direct questioning
• In-depth interview (IDI): uses planned but loosely structured
questions
• Focus group: six or more people discuss the product or marketing
situation for an hour or more
Ethnographic research (or ethnography): trying to understand
behavior and culture by going out and talking to people wherever they
are, while they’re doing whatever it is they do
©McGraw-Hill Education.
Basic Methods of Quantitative Research
Observation method: monitoring people’s actions
• Typically performed by large, independent marketing companies
• Universal Product Code (UPC): identifying series of vertical bars
with a 12-digit number present on consumer packaged goods
Experimental method: altering the stimulus received by a test group
and comparing the results with a control group
• Used primarily for new products and new campaigns
• Test market: isolated geographic area used to test the
effectiveness of a product or campaign, prior to a national rollout
Survey: getting people’s opinions in person, by mail, on the telephone,
or via the Internet
©McGraw-Hill Education.
Pretesting Methods
Direct questioning: a method designed to elicit a full range of
responses to the advertising, effective for testing alternative
advertisements in early stages of development
Central location tests: type of pretesting in which videotapes of test
commercials are shown to respondents on a one-to-one basis, typically in
shopping center locations
Clutter tests: method in which commercials are grouped with
noncompetitive control commercials and shown to prospective customers
to measure their effectiveness in gaining attention, increasing brand
awareness and comprehension, and causing attitude shifts
©McGraw-Hill Education.
Challenges of Pretesting
There is no best way to pretest advertising variables.
Respondents’ answers may not reflect their real
buying behavior.
Respondents may do the following:
• Assume the role of expert or critic
• Invent opinions to satisfy the interviewer
• Be reluctant to admit they are influenced
• Vote for the ads they think they should like
©McGraw-Hill Education.
Posttesting Methods
Attitude tests: measure the effectiveness of an advertising
campaign in creating a favorable image for a company, its
brand, or its products
Recall tests: determine the extent to which an advertisement
and its message have been noticed, read, or watched
Inquiry tests: tabulate consumer responses to an ad for
information or free samples
Sales tests: compare sales performance before and after a
campaign
©McGraw-Hill Education.
Challenges of Posttesting
Recall tests:
• Only measure what respondents noticed and remembered
• Fail to measure whether they intend to buy the product
Inquiry tests:
• May not reflect a sincere interest in a product
• May take months to complete
Sales tests:
• Affected by competitors’ activities, seasons, and the weather
• Costly
• Time-consuming
©McGraw-Hill Education.
Interpreting and Reporting the Findings
Technical jargon should be avoided.
Descriptions of the methodology, statistical analysis,
and raw data should be confined to an appendix.
Report should do the following:
• State the problem and research objective
• Summarize findings and draw conclusions
• Be discussed in a formal presentation and make
recommendations for management action
©McGraw-Hill Education.
Validity and Reliability
Validity: to be valid, test must reflect the true status
of the market
Reliability: to be reliable, test must be repeatable,
producing the same result each time it is
administered
©McGraw-Hill Education.
Sampling Methods
Sample: portion of the population selected to
represent the appropriate targeted population
• Probability samples: give all members of target
population an equal chance of being selected for the
study
• Nonprobability samples: do not provide every unit in
the population with an equal chance of being included
Universe: entire target population
©McGraw-Hill Education.
Constructing a Questionnaire
Questionnaires must be pretested.
Effective survey questions have focus, brevity, and
clarity.
Types of questions:
• Open-ended
• Dichotomous
• Multiple choice
• Scale
Testing questionnaires on a small subsample helps
detect any confusion, bias, or ambiguities.
©McGraw-Hill Education.
Data Tabulation and Analysis
Collected data must be validated, edited, coded, and
tabulated.
Answers must be checked to eliminate errors or
inconsistencies.
Data must be summarized.
©McGraw-Hill Education.
Collecting Primary Data in
International Markets
There are no economies of scale.
Translating questionnaires to the local languages is a
difficult task.
Some cultures view strangers suspiciously and do
not wish to share personal details.
Internet can be used to cut costs and save time.
©McGraw-Hill Education.
Advertising
Chapter 6
The End
The End
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
Chapter Six
Account Planning and
Research
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
Learning Objectives
• Learning Objective 6.1: Describe the role of account
planners in advertising agencies.
• Learning Objective 6.2: Discuss how research can help
advertisers select target markets, media vehicles, and
advertising messages.
• Learning Objective 6.3: List the basic steps in the marketing
research process.
• Learning Objective 6.4: Compare the common methods
used in qualitative and quantitative research
• Learning Objective 6.5: Justify the pretesting and
posttesting of advertising messages.
• Learning Objective 6.6: Identify issues that can affect the
accuracy and usability of quantitative research.
©McGraw-Hill Education.
Account Planner
• Individual at an advertising agency primarily
responsible for account planning
• Represents the consumer
• Focuses the creative process on nurturing a
relationship between consumer and brand
©McGraw-Hill Education.
Marketing Research
• Systematic gathering, recording, and analysis of
information to help managers make marketing
decisions
• Identifies consumer needs and market segments
• Helps develop new products
• Helps devise marketing strategies
• Assesses the effectiveness of marketing activities
©McGraw-Hill Education.
Advertising Research
Systematic gathering and analysis of
information to facilitate the development or
evaluation of advertising strategies, ads and
commercials, and media campaigns
©McGraw-Hill Education.
Exhibit 6.1 – Categories of Research in Advertising
Development
Advertising
Strategy
Research
Creative
Concept
Research
Pretesting
Posttesting
Timing
Before creative
work begins
Before agency
production
begins
Before finished
artwork and
photography
After campaign
has run
Research
problem
Product concept
definition
Target audience
selection
Media selection
Message-element
selection
Concept testing
Name testing
Slogan testing
Print testing
TV storyboard
pretesting
Radio commercial
pretesting
Advertising
effectiveness
Consumer attitude
change
Sales increases
Techniques
Consumer attitude
and usage studies
Media studies
Qualitative
interviews
Free-association
tests
Qualitative
interviews
Statementcomparison tests
Consumer juries
Matched samples
Portfolio tests
Storyboard test
Mechanical
devices
Psychological
rating scales
Aided recall
Unaided recall
Attitude tests
Inquiry tests
Sales tests
©McGraw-Hill Education.
Advertising Strategy Research (1 of 2)
Helps to define the product concept or to assist in
the selection of target markets, advertising
messages, or media vehicles
Product concept: bundle of values that encompasses
both utilitarian and symbolic benefits to the
consumer
Target audience selection: study of primary users of
product category to understand demographics,
geographics, psychographics, and purchase behavior
©McGraw-Hill Education.
Advertising Strategy Research (2 of 2)
Media research: systematic gathering and analysis of
information on the reach and effectiveness of media
vehicles
Message element selection: studying consumers’
likes and dislikes in relation to brands and products
to determine which message elements might prove
most successful
©McGraw-Hill Education.
Pretesting and Posttesting
Pretesting
Posttesting
Testing the effectiveness of an
Testing the effectiveness of an
advertisement for gaps or
advertisement after it has
flaws in message content
been run to develop useful
before recommending it to
guidelines for future
clients, often conducted
advertising
through focus groups
©McGraw-Hill Education.
Steps in the Research Process
1. Situation analysis and problem definition
2. Secondary research
3. Refinement of research objectives
4. Primary research
5. Interpretation and reporting of findings
©McGraw-Hill Education.
Situation Analysis, Problem Definition, and
Secondary Research (1 of 2)
Analyzing the situation and defining the problem:
• Marketing information system (MIS): set of procedures
for generating an orderly flow of pertinent information
for use in making marketing decisions
Conducting secondary research:
• Secondary research: exploring a problem by reviewing
secondary data and interviewing a few key people with
the most information to share
©McGraw-Hill Education.
Situation Analysis, Problem Definition, and
Secondary Research (2 of 2)
Primary data: research information gained directly
from the marketplace
Secondary data: information that has previously
been collected or published
• Internal secondary data can be gathered from company
records.
• External secondary data can be gathered from the
government, market research companies, trade
publications, and computerized databases.
©McGraw-Hill Education.
Establishing Research Objectives
A concise statement of the research problem and
objectives should be formulated.
• Statement must be specific and measurable
• Decision point must be clear and the questions must be
related and relevant
Research results should provide the information
required to decide on a new positioning strategy.
©McGraw-Hill Education.
Conducting Primary Research
Primary research: collecting data directly from the
marketplace using qualitative or quantitative
methods
• Qualitative research: uses small, nonrandom samples
to explore behavior, perceptions, needs, and
motivations of a target audience
• Quantitative research: uses larger, representative
samples to quantify hypotheses and measure market
variables
©McGraw-Hill Education.
Exhibit 6.3 – Differences Between Qualitative
and Quantitative Research
Qualitative
Quantitative
Main techniques for gathering
data
Focus groups and in-depth
interviews
Surveys and scientific samples
Kinds of questions asked
Why? How so? In what way?
How many? How much?
Role of interviewer
Critical: interviewer must build
rapport with research participants.
She must think on feet and frame
questions and probes in response to
whatever respondents say. A highly
trained professional is advisable.
Important, but interviewers need
only be able to read scripts. They
should not improvise. Minimally
trained, responsible employees are
suitable.
Questions asked
Questions vary in order and phrasing
from group to group and interview
to interview. New questions are
added, old ones dropped.
Should be exactly the same for each
interview. Order and phrasing of
questions carefully controlled.
Number of interviews
Fewer interviews tending to last a
longer time.
Many interviews in order to give a
projectable scientific sample.
Kinds of findings
Develop hypotheses, gain insights,
explore language options, refine
concepts, help explain survey results,
provide diagnostics on advertising
copy.
Test hypotheses, prioritize factors,
provide data for mathematical
modeling and projections.
©McGraw-Hill Education.
Basic Methods of Qualitative Research
Projective techniques: asking indirect questions to consumers to
understand their underlying feelings, attitudes, opinions, needs, and
motives
Intensive techniques: probing the deepest feelings, attitudes, and
beliefs of respondents through direct questioning
• In-depth interview (IDI): uses planned but loosely structured
questions
• Focus group: six or more people discuss the product or marketing
situation for an hour or more
Ethnographic research (or ethnography): trying to understand
behavior and culture by going out and talking to people wherever they
are, while they’re doing whatever it is they do
©McGraw-Hill Education.
Basic Methods of Quantitative Research
Observation method: monitoring people’s actions
• Typically performed by large, independent marketing companies
• Universal Product Code (UPC): identifying series of vertical bars
with a 12-digit number present on consumer packaged goods
Experimental method: altering the stimulus received by a test group
and comparing the results with a control group
• Used primarily for new products and new campaigns
• Test market: isolated geographic area used to test the
effectiveness of a product or campaign, prior to a national rollout
Survey: getting people’s opinions in person, by mail, on the telephone,
or via the Internet
©McGraw-Hill Education.
Pretesting Methods
Direct questioning: a method designed to elicit a full range of
responses to the advertising, effective for testing alternative
advertisements in early stages of development
Central location tests: type of pretesting in which videotapes of test
commercials are shown to respondents on a one-to-one basis, typically in
shopping center locations
Clutter tests: method in which commercials are grouped with
noncompetitive control commercials and shown to prospective customers
to measure their effectiveness in gaining attention, increasing brand
awareness and comprehension, and causing attitude shifts
©McGraw-Hill Education.
Challenges of Pretesting
There is no best way to pretest advertising variables.
Respondents’ answers may not reflect their real
buying behavior.
Respondents may do the following:
• Assume the role of expert or critic
• Invent opinions to satisfy the interviewer
• Be reluctant to admit they are influenced
• Vote for the ads they think they should like
©McGraw-Hill Education.
Posttesting Methods
Attitude tests: measure the effectiveness of an advertising
campaign in creating a favorable image for a company, its
brand, or its products
Recall tests: determine the extent to which an advertisement
and its message have been noticed, read, or watched
Inquiry tests: tabulate consumer responses to an ad for
information or free samples
Sales tests: compare sales performance before and after a
campaign
©McGraw-Hill Education.
Challenges of Posttesting
Recall tests:
• Only measure what respondents noticed and remembered
• Fail to measure whether they intend to buy the product
Inquiry tests:
• May not reflect a sincere interest in a product
• May take months to complete
Sales tests:
• Affected by competitors’ activities, seasons, and the weather
• Costly
• Time-consuming
©McGraw-Hill Education.
Interpreting and Reporting the Findings
Technical jargon should be avoided.
Descriptions of the methodology, statistical analysis,
and raw data should be confined to an appendix.
Report should do the following:
• State the problem and research objective
• Summarize findings and draw conclusions
• Be discussed in a formal presentation and make
recommendations for management action
©McGraw-Hill Education.
Validity and Reliability
Validity: to be valid, test must reflect the true status
of the market
Reliability: to be reliable, test must be repeatable,
producing the same result each time it is
administered
©McGraw-Hill Education.
Sampling Methods
Sample: portion of the population selected to
represent the appropriate targeted population
• Probability samples: give all members of target
population an equal chance of being selected for the
study
• Nonprobability samples: do not provide every unit in
the population with an equal chance of being included
Universe: entire target population
©McGraw-Hill Education.
Constructing a Questionnaire
Questionnaires must be pretested.
Effective survey questions have focus, brevity, and
clarity.
Types of questions:
• Open-ended
• Dichotomous
• Multiple choice
• Scale
Testing questionnaires on a small subsample helps
detect any confusion, bias, or ambiguities.
©McGraw-Hill Education.
Data Tabulation and Analysis
Collected data must be validated, edited, coded, and
tabulated.
Answers must be checked to eliminate errors or
inconsistencies.
Data must be summarized.
©McGraw-Hill Education.
Collecting Primary Data in
International Markets
There are no economies of scale.
Translating questionnaires to the local languages is a
difficult task.
Some cultures view strangers suspiciously and do
not wish to share personal details.
Internet can be used to cut costs and save time.
©McGraw-Hill Education.
Advertising
Chapter 6
The End
The End
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
Chapter Seven
Marketing, Advertising,
and IMC Planning
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
Learning Objectives
• Learning Objective 7.1: Describe the role and importance
of a marketing plan.
• Learning Objective 7.2: Distinguish between objectives,
strategies, and tactics in marketing and advertising plans.
• Learning Objective 7.3: Show what makes IMC planning
different from traditional methods.
• Learning Objective 7.4: Explain how to establish specific,
realistic, and measurable advertising objectives.
• Learning Objective 7.5: List the various approaches for
determining advertising budgets.
©McGraw-Hill Education.
Marketing Plan
Directs a company’s marketing effort.
• Assembles relevant facts about the organization, its
markets, products, services, customers, and
competition
• Forces all departments to focus on the customer
• Lists goals and objectives for specific periods of time
• Lays out precise strategies and tactics to achieve them
• Length and complexity varies depending on the size of
the company
• Ongoing activity; plan changes with the facts
©McGraw-Hill Education.
Effect of the Marketing Plan on IMC
The marketing plan does all of the following:
• Helps managers analyze and improve all company
operations
• Defines the role of advertising in the marketing
mix
• Enables better implementation, control, and
continuity of advertising programs
• Ensures efficient allocation of IMC dollars
©McGraw-Hill Education.
Exhibit 7.1 – Traditional Top-Down
Marketing Plan
©McGraw-Hill Education.
Situation Analysis
Factual statement of the organization’s current
situation and how it got there.
• Includes company history, growth, products and
services, sales volume, share of market,
competitive status, markets served, distribution
systems, past IMC programs, marketing
research studies, and more
SWOT analysis: uses the facts in the situation
analysis to point out strengths, weaknesses,
opportunities, and threats
©McGraw-Hill Education.
Marketing Objectives
Goals of the marketing effort expressed in terms of
the needs of specific target markets and specific
sales objectives.
• Derived from corporate objectives: goals of the company
stated in terms of profit or return on investment
• Need satisfying objectives: shift management’s view of the
organization from a producer of products or services to a
satisfier of target market needs.
• Sales target objectives: objectives that relate to a company’s
sales and may be expressed in terms of total sales volume;
sales by product, market segment, or customer type; market
share; growth rate of sales volume; or gross profit
©McGraw-Hill Education.
Marketing Strategy
Statement of how the company is going to achieve its
marketing objectives.
Steps involved:
• Defining the target markets through market
segmentation and market research
• Determining the strategic positioning: association of a
brand’s features and benefits with a particular set of
customer needs, clearly differentiating it from the
competition
• Determining the marketing mix for each target market
©McGraw-Hill Education.
Marketing Tactics
Specific short-term actions used to achieve
marketing objectives
©McGraw-Hill Education.
Exhibit 7.2 – Bottom-Up Marketing Plan
©McGraw-Hill Education.
Relationship Marketing
Creating, maintaining, and enhancing long-term
relationships with customers and other stakeholders
that results in exchanges of information and other
things of mutual value
Value: ratio of perceived benefits to the price of the
product
©McGraw-Hill Education.
The Importance of Relationships
Stakeholders: customers, employees, centers of influence,
stockholders, the financial community, and the press
Different stakeholders require different types of relationships.
Reasons to maintain relationships:
• Cost of lost customers
• Cost of acquiring new customers
• Value of loyal customers
Lifetime customer value (LCV): total profit value of a customer
to a marketer over the course of that customer’s lifetime
©McGraw-Hill Education.
Levels of Relationships
Basic transactional relationship. The company sells the product but does
not follow up in any way (Target).
Reactive relationship. The company sells the product and encourages
customers to call if they encounter any problems (Men’s Wearhouse).
Accountable relationship. The company phones customers shortly after
the sale to check whether the product meets expectations and asks for
product improvement suggestions and any specific disappointments. This
information helps the company to continuously improve its offering
(Acura dealership, local veterinarian).
Proactive relationship. The company contacts customers from time to
time with suggestions about improved product use or helpful new
products (Tupperware).
Partnership. The company works continuously with customers (and other
stakeholders) to discover ways to deliver better value (Nordstrom’s
Personal Shopper, Amazon).
©McGraw-Hill Education.
Exhibit 7.3 – Relationship Levels and Profit
Margins
©McGraw-Hill Education.
Jump to Appendix 1 long image
description
Integrated Marketing Communications
(IMC)
Building and reinforcing mutually profitable
relationships with the stakeholders and the general
public by developing and coordinating strategic
communications programs that enable them to have
constructive encounters with a brand through media
Synergy: effect achieved when the sum of the parts
is greater than that expected from adding together
the individual components
©McGraw-Hill Education.
Sources of Brand Messages
Planned messages: traditional marketing messages including
advertising, sales promotion, publicity, and personal selling; have the least
impact because they are seen as self-serving
Product messages: messages communicated by a product, its
packaging, price, or distribution elements; have a great impact
Service messages: messages resulting from employee interactions
with customers; typically have a greater impact than planned messages
Unplanned messages: messages that emanate from gossip, unsought
news stories, rumors, or major disasters; companies have little control,
but the message can dramatically affect customers’ attitudes
©McGraw-Hill Education.
Exhibit 17.5 – The Integration Triangle
©McGraw-Hill Education.
Jump to Appendix 2 long image
description
Advertising Plan
Plan that directs the company’s advertising effort
A natural outgrowth of the marketing plan, an advertising
plan analyzes the situation, sets advertising objectives, and
lays out a specific strategy from which ads and campaigns are
created.
Reviewing the marketing plan:
• Information from the situation analysis should be
organized into a SWOT analysis.
Setting advertising objectives:
• The tasks to be taken on by advertising must be
determined.
• Objectives should be specific, realistic, and measurable.
©McGraw-Hill Education.
Exhibit 7.5 – The Advertising Pyramid
©McGraw-Hill Education.
Advertising Strategy
Describes how to accomplish the advertising
objectives using two substrategies: the creative
strategy and the media strategy
• Creative strategy: serves as the creative team’s guide
for writing and producing an ad
• Media strategy: helps media planners determine how
messages will be delivered to consumers
©McGraw-Hill Education.
Allocating Funds for Advertising
Advertising is considered as a current business expense, but is
also a long-term investment.
Relationship of advertising to sales and profits:
• Increase in market share is related to the increase in marketing
budget in consumer goods marketing.
• Sales increase with additional advertising, but flatten and decline
at some point.
• The durability of advertising is brief; consistent investment is
important.
• Advertising expenditures below a minimum level will have no
effect on sales.
• There will be some sales even without advertising.
• Additional ad expenditures above saturation limits will do little to
increase sales.
©McGraw-Hill Education.
Methods of Allocating Funds (1 of 2)
Percentage-of-sales: based on a percentage of the
previous year’s sales, the anticipated sales for the
next year, or a combination of the two
Share-of-market/share-of-voice: based on
determining the firm’s goals for a certain share of
the market and then applying a slightly higher
percentage of industry advertising dollars to the
budget
©McGraw-Hill Education.
Methods of Allocating Funds (2 of 2)
Objective/task method: defines objectives and how
advertising is to be used to accomplish them
It has three steps:
1. Defining the objectives
2. Determining the strategy
3. Estimating the cost
©McGraw-Hill Education.
Advertising
Chapter 7
The End
©McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.
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