16 CHAPTER Advertising and Public Relations Chapter Objectives

16 CHAPTER Advertising and Public Relations Chapter Objectives 1 Identify the three major advertising objectives and the two basic categories of advertising. 2 List the major advertising strategies. 3 Describe the process of creating an advertisement. 4 Identify the major types 7 Explain the roles of crossof advertising appeals and promotion, public discuss their uses. relations, publicity, and ethics in an organization’s List and compare the 5 promotional strategy. major advertising media. Outline the organization 6 of the advertising function 8 Explain how marketers assess promotional and the role of an effectiveness. advertising agency.

CHAPTER 16 Advertising and Public Relations ADVERTISING • Advertising Paid, non- personal communication through various media about a business firm, not-forprofit organization, product, or idea by a sponsor identified in a message that is intended to inform or persuade members of a particular audience. TYPES OF ADVERTISING • Product advertising Nonpersonal selling of a particular good or service. • Institutional advertising Promotion of a concept, an idea, a philosophy, or the goodwill of an industry, company, organization, person, geographic location, or government agency.

CHAPTER 16 Advertising and Public Relations OBJECTIVES OF ADVERTISING • Informative advertising Promotion that seeks to develop initial demand for a good, service, organization, person, place, idea, or cause. • Persuasive advertising Promotion that attempts to increase demand for an existing good, service, organization, person, place, idea, or cause. • Reminder advertising Advertising that reinforces previous promotional activity by keeping the name of a good, service, organization, person, place, idea, or cause before the public. • Advertisers coordinate advertising objectives with the product’s stage in the product life cycle.

CHAPTER 16 Advertising and Public Relations ADVERTISING STRATEGIES • Advertising is a means of bringing buyers and sellers together. • Marketers often combine several strategies to meet their objectives. COMPARATIVE ADVERTISING • Comparative advertising Advertising strategy that emphasizes messages with direct or indirect promotional comparisons between competing brands. • Market leaders seldom acknowledge competing brands. CELEBRITY TESTIMONIALS • Use of celebrity spokespeople for products. • Can build brand equity but can hurt brand if celebrity is hit by scandal.

CHAPTER 16 Advertising and Public Relations RETAIL ADVERTISING • Includes all advertising by retail stores that sell goods or services directly to the consuming public. • Cooperative advertising Strategy in which a retailer shares advertising costs with a manufacturer or wholesaler. INTERACTIVE ADVERTISING • Involves two-way promotional messages transmitted through communication channels that induce message recipients to participate actively in the promotional effort. • Changes balance between marketers and consumers.

CHAPTER 16 Advertising and Public Relations ADVERTISING MESSAGES • Advertising campaign Series of different but related ads that use a single theme and appear in different media within a specified time period. ADVERTISING APPEALS • Appeals can provide information or appeal to emotion. • Fear appeals—imply or state that incorrect buying decisions could lead to bad consequences. • Humor seeks to create positive mood related to good or service. • Ads based on sex can be attention-getting, but they boost recall only if the appeal is appropriate to the type of product.

CHAPTER 16 Advertising and Public Relations DEVELOPING AND PREPARING ADS • Goals: • Gain attention. • Inform and/or persuade. • Lead to purchase or other desired action. • After idea conception, ad must be refined from rough sketch to finished layout. CREATING INTERACTIVE ADS • Lively, engaging content. • Use of advertising in games, or advergames. • Banners are the most common form of online advertisement. • Use of pop-ups is declining; adware seen as disreputable.

CHAPTER 16 Advertising and Public Relations MEDIA SELECTION Broadcast Television Cable Television Radio Newspaper Direct Mail Magazines- Consumer/Business Outdoor Internet

CHAPTER 16 Advertising and Public Relations MEDIA SCHEDULING • After selecting media, marketers determine the most effective timing and sequence for a series of advertisements. • Influenced by seasonal sales patterns, repurchase cycles, and competitors’ activities. • Measure effectiveness in three ways: • Reach—the number of people exposed to an advertisement. • Frequency—the number of times an individual is exposed to an advertisement. Minimum of three exposures is recommended. • Gross rating point—the product of the reach times the frequency.

CHAPTER 16 Advertising and Public Relations ORGANIZATION OF THE ADVERTISING FUNCTION • Organizational arrangements vary from company to company. • Usually organized as a staff department reporting to a vice president of marketing. • Major tasks include advertising research, design, copywriting, media analysis, and in some cases, sales and trade promotion. ADVERTISING AGENCIES • Advertising agency Firm whose marketing specialists help advertisers plan and prepare advertisements. • May offer creativity and objectivity that is difficult to maintain in an internal department.

CHAPTER 16 Advertising and Public Relations PUBLIC RELATIONS • Firm’s communications and relationships with its various publics, including customers, employees, stockholders, suppliers, and government agencies. • Serves broad objectives by enhancing prestige and image of all parts of the organization. • PR department is link between the firm and the media. • Nonmarketing public relations—a company’s messages about general management issues. • Marketing public relations (MPR)—narrowly focused public relations activities that directly support marketing goals. • Publicity Nonpersonal stimulation of demand for a good, service, place, idea, person, or organization by unpaid placement of significant news regarding the product in a print or broadcast medium.

CHAPTER 16 Advertising and Public Relations CROSS-PROMOTION • Cross-promotion Promotional technique in which marketing partners share the cost of a promotional campaign that meets their mutual needs. • Provide greater benefits in return for both partners. • Example: Cingular Wireless promoting artists such as Coldplay, Gwen Stefani, and Alicia Keys. • Cingular sells more ringtones because it features these artists. • Artists gain greater exposure.

CHAPTER 16 Advertising and Public Relations MEASURING PROMOTIONAL EFFECTIVENESS • Promotional prices vary widely. • Because of expense, advertising professionals must demonstrate how promotional programs contribute to increased sales and profits. MEASURING ADVERTISING EFFECTIVENESS • Media research—assesses how well particular medium delivers message, where and when to place the message, and the size of the audience. • Message research—tests consumer reactions to an advertisement’s creative message. • Pretesting—assessing an advertisement’s likely effectiveness before it is completed. • Posttesting—assessing advertisement’s effectiveness after it has appeared.

CHAPTER 16 Advertising and Public Relations MEASURING PUBLIC-RELATIONS EFFECTIVENESS • Count media placements, conducting public opinion polls. • Conduct focus groups, interview opinion leaders, before-and-after polls. EVALUATING INTERACTIVE MEDIA • Hits—user requests for a file. • Impressions—number of times a viewer sees an ad. • Click-throughs—user clicks ad for more information. • View-through—measure response over time.

CHAPTER 16 Advertising and Public Relations ETHICS IN NONPERSONAL SELLING ADVERTISING ETHICS • Advertising to children, advertising alcohol, and the use of cookies on Web sites are all areas of ethical controversy. • Puffery—exaggerated claims of a product’s superiority or the use of subjective or vague statements that may not be literally true. • Uniform Commercial Code distinguishes puffery from specific, quantifiable statements. ETHICS IN PUBLIC RELATIONS • Issues include performing services for companies that produce unsafe products. • Public Relations Society of America’s Code of Professional Standards prohibits promoting products or causes widely known to be harmful.