Multimedia Marketing/Marketing.iso/market/chapter7.4p

Text File | 1996-08-22 | 16KB | 329 lines

SECTION 7.4  Overall Advertising Strategy

INSTRUCTIONS Try to determine how you would go about developing an advertising
strategy for a company. Then pursue this section for more insights.

EXAMPLE

Most people think of advertising as a tool that is employed by
traditional marketers, such as food processors and over-the-counter
drug producers. But professionals also make extensive use of this
tool. A dental center, for example, launched three new offices with
a quarter million dollar media blitz. The dental center, which already
operated one successful office in a mall, rented space from a department
store and planned to expand to additional department store facilities.

The campaign featured an animated 30 second TV advertisement, focusing
on women and family members, which ran during early morning and
evening time periods. The firm also used print and billboard support
and direct mail to department store credit card customers. The
dental centers plan to introduce still more offices in department
stores in the future, backed up by large advertising campaigns.

DETAILS

Advertising is a very important promotion medium. In the United States,
organizations spend over ,120 billion annually for this activity.
In general, though, companies allocate less than two percent of their
sales dollars to advertising, which is a modest fraction of their
total marketing costs.

Advertising is by no means a tool only for large companies. To the
contrary, organizations of virtually every size use it in some way.
Advertising is not  a tool reserved just for business. Governmental
organizations, charities, political candidates, and other nonprofits
utilize this vehicle.

Marketers should set specific goals for advertising. These serve as
focal points around which budgets can be formulated and also provide
a means of evaluating performance. To develop realistic goals, managers
are forced to critically examine what they know and what they do not
know about their intended customers, how well past advertising efforts
performed so that needed corrections can be made, and what types of
messages are needed.

Rather than general statements, such as "increase sales", it is best
if the stated advertising goals are specific about both the time
involved and audience cognitions. The following illustrate several
possible concrete advertising goals:

. "An increase in target brand awareness from 30 to 35 percent in
   three months."
. "A shift in the proportion of target customers having a preference
   for our brand  from 12 to 14 percent by Christmas."
. "A reduction from 50 to 40 percent of all target customers who
   do not know that our landscaping service costs less than our
   competitors in the same area by this coming March.

Besides attainability, an important criterion for judging the
reasonableness of advertising goals is their compatibility with
the company's overall promotion objective. Because one of its
objectives is promoting a high-quality image for its brand, a
producer of barbeque grills states "available at better stores" in
its advertising.

Further, experienced marketers try to design advertising goals so
that they augment other personal communication promotional efforts,
especially personal selling To illustrate, a large food and other
consumer products conglomerate uses advertisements to create name
recognition for the parent company, making it easier for sales
representatives to place the company's new products in retail stores.

PROBLEM 1

Which of the following is not a useful advertising goal for an
appliance store:

A. "To make a large proportion of homeowners in the community aware
   of our liberal returns policy."
B. "To increase our market share by five percent within three months."
C. "To increase the number of visitors to our mall location by ten
    percent by January."
D. "To raise traffic count in two of our stores by seven percent
    by December.


WORKED

"To make a large proportion of homeowners in the community aware of
our liberal returns policy" is not a useful adverising goal for
an appliance store. It is not sufficiently specific. It does not
delineate what is meant by "the community". Does this include just
the closely-surrounding area or some larger region? Further, the
goal is not quantitative. It refers to "a large proportion, but does
not indicate what is meant by "large". Further, the goal does not
include a time frame. Just when is the increased awareness supposed
to materialize? These deficiencies are substantial and it is
difficult to see how such a goal could provide much guidance to the
managers of the store.

ANSWER  A
INSTRUCTIONS Try to determine how you would go about developing an advertising
strategy for a company. Then pursue this section for more insights.

EXAMPLE

Most people think of advertising as a tool that is employed by
traditional marketers, such as food processors and over-the-counter
drug producers. But professionals also make extensive use of this
tool. A dental center, for example, launched three new offices with
a quarter million dollar media blitz. The dental center, which already
operated one successful office in a mall, rented space from a department
store and planned to expand to additional department store facilities.

The campaign featured an animated 30 second TV advertisement, focusing
on women and family members, which ran during early morning and
evening time periods. The firm also used print and billboard support
and direct mail to department store credit card customers. The
dental centers plan to introduce still more offices in department
stores in the future, backed up by large advertising campaigns.

DETAILS

A useful guideline to advertising strategy is the "two-step flow of
communications". This concept holds that opinion leaders in reference
groups can be turned into a company's unpaid sales force. The way it
works is by influencing opinion leaders through directed advertising,
who in turn, talk up the products to others in their reference groups.
A health and beauty products manufacturer has successfully used the
two-step flow idea for a brand of shampoos by stating in its
advertisements: "You tell two friends, and they'll tell two friends,
and so on and so on.

At one time, marketers believed that opinion leaders would be mainly
the upper class--the rich and famous financiers, bankers, executives,
famous lawyers, writers of best selling books, and the like. However,
research has shown that these tend not to be the opinion leaders.
Rather, opinion leaders are often friends and acquaintances of the
consumer--people that he or she interacts with every day. Further,
opinion leaders tend to have skills that are valued by the consumer.
Thus, in a group of bird-watchers, the opinion leader is likely to
be the one who is most successful in sighting large numbers of rare
birds.

PROBLEM 2

In a group of women, the opinion leader, when it comes to matters
pertaining to cooking, is likely to be:

A. The most attractive woman.
B. The woman with the best speaking skills.
C. The woman with the most education.
D. A middle age woman in a group of younger people.

WORKED

In a group of women, the opinion leader, when it comes to matters
pertaining to cooking, is likely to be the middle age woman in a
group of younger people. This individual, due to her station in
life, probably has more experience in cooking than most or all of
her younger counterparts. Further, many young women today are very
busy with their careers and have not taken the time to develop
cooking skills to the extent that past generations have. They
probably will appreciate the advice and assistance of someone who
was brought up at a time when girls and women were highly trained
by their mothers to excel in this role.

ANSWER  D
INSTRUCTIONS Try to determine how you would go about developing an advertising
strategy for a company. Then pursue this section for more insights.

EXAMPLE

Most people think of advertising as a tool that is employed by
traditional marketers, such as food processors and over-the-counter
drug producers. But professionals also make extensive use of this
tool. A dental center, for example, launched three new offices with
a quarter million dollar media blitz. The dental center, which already
operated one successful office in a mall, rented space from a department
store and planned to expand to additional department store facilities.

The campaign featured an animated 30 second TV advertisement, focusing
on women and family members, which ran during early morning and
evening time periods. The firm also used print and billboard support
and direct mail to department store credit card customers. The
dental centers plan to introduce still more offices in department
stores in the future, backed up by large advertising campaigns.

DETAILS

Interpersonal interaction can be stimulated in  subtle ways.
Firms can stimulate personal influence by:

1. Providing opinion leaders with items on attractive terms.
2. Designing advertisements to feature conversations between those
   readily identified as leaders (such as movie stars and sports
   figures) and others.
3. Developing advertising that is high in conversation value, that is,
   worth talking about.

Opinion leaders are typically early adopters of a product or idea.
Once Identified, messages may be directed to them to get them to
spread the word to the  majority of adopters. Identifying opinion
leaders is not a simple task, since they tend to be product specific
and differ over time. Nevertheless, gaining their help through the
two-step process can well be worth the effort.

After the goals have been developed, management should define the
target audience. This process parallels that of defining a target
market, as the members of the target market and audience are generally
one and the same. Demographic and lifestyle variables are useful for
this purpose. An airline, for instance, has targeted its advertising
at frequent travelers, featuring comfort and prestige, to upper-
income achievers--people who are upwardly mobile.

It is important to learn as much as is practical about the audience:
its needs, when the needs arise, and the types of media that are most
likely to reach members during need arousal. This helps to develop
better messages and to select the most appropriate advertising
vehicles to reach the intended audience. The goals is to send
messages when the selective perceptions and exposures of audience
members are "tuned in".

PROBLEM  3
Which of the following would be useful to a bank in using the two-step
flow of communications to make advertising more effective"

A. Direct bank advertisements to consumers who have been very
   good customers in the past.
B. Direct bank advertisements to demographic categories that have
   extensively used banking services in the community.
C. Feature advertisements where community business leaders are
   visiting with bank customers.
D. Feature advertisements where groups of bank customers are conversing
   about pleasant experiences with the bank.

WORKED

A bank could effectively use the two-step flow of communications
concept by featuring advertisements where community business leaders
are visiting with bank customers. Business leaders tend to be
opinion leaders in the banking industry. Thus, consumers who are
looking for a bank could be swayed by the fact that the business
leaders have relationships with the bank. The advertisements could
impact upon the business leaders, as they see that they are portrayed
as opinion leaders and as supporters of the bank. Hence, this
advertisement could be effective in influencing both business leaders
and their followers.

ANSWER  C
INSTRUCTIONS Try to determine how you would go about developing an advertising
strategy for a company. Then pursue this section for more insights.

EXAMPLE

Most people think of advertising as a tool that is employed by
traditional marketers, such as food processors and over-the-counter
drug producers. But professionals also make extensive use of this
tool. A dental center, for example, launched three new offices with
a quarter million dollar media blitz. The dental center, which already
operated one successful office in a mall, rented space from a department
store and planned to expand to additional department store facilities.

The campaign featured an animated 30 second TV advertisement, focusing
on women and family members, which ran during early morning and
evening time periods. The firm also used print and billboard support
and direct mail to department store credit card customers. The
dental centers plan to introduce still more offices in department
stores in the future, backed up by large advertising campaigns.

DETAILS

It is necessary for the company to put together an advertising
budget. There are various ways of doing this, including assigning
some percentage of anticipated sales, setting an amount to create
a level of parity with competitors, basing the decision upon the
amount of funds available, and using the "task build-up" method.
This requires examining the advertising goals and then determining
how much money would be required to achieve these goals. This method
is the preferred one, since it is based directly upon goal achievement
through the advertising medium.

Cooperative advertising--where two or more firms combine their
efforts--is an important way to streach an advertising budget.
Most cooperative advertising takes place among companies vertically
related in a distribution channel. A milling company, for example,
offers its retailers an incentive to advertise its towels, sheets,
and bedspreads by reimbursing 50 percent of the related costs. While
many consumer product companies have similar programs, their
particular arrangements vary. Some reimburse 50 percent and others
a different percentage. The idea is to get the entire channel
supporting the promotion effort.

Besides streaching the budget, cooperative advertising offers several
advantages, including favorable media rate structures for ads placed
by a local firm (local retailers can place more ads for the same
budget), the fact that intermediaries are more likely to aggressively
support a product if they have shared in its promotional cost, and
retailers are in a better position to adjust messages to coincide to
local conditions and events, such as festivals, sporting events,
parades, and fairs.

PROBLEM 4

Which of the following is not an advantage of cooperative advertising,
for a toy producer:

A. Retailers are more likely to aggressively support the products
   of the producer.
B. Retailers are better positioned to adjust messages to local
   conditions.
C. Retailers can place more ads for the same budget.
D. The toy producer can control the content of cooperative ads better
   than ads that are not cooperative.

WORKED

A toy producer is likely to benefit from cooperative advertising
because retailers aggressively support its products, retailers are
better positioned to adjust messages to local conditions, and retailers
can place more ads with the same budget. The latter advantage requires
some explanation. Advertising media, such as newspapers and radio
stations, give lower rates for local than for non-local advertisers.
Retailers typically qualify as local, while manufacturers who are
located outside the community do not. The retailers receive a discount
on their advertising, then. By engaging in cooperative advertising,
non-local producers can benefit by receiving part of the discount.

ANSWER  D