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FSU ADV 3008 - Test Three Notes and Examples

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ADV3008 Test Three Notes and ExamplesI LOVE SAVING MONEY-Advertising, Sales Promotion, and Public Relations all overlap and work together, they do not compete. -Sales Promotions are like a bribe and are short term driven. -Advertising is long term.-In Advertising what you’re buying does not change. You are building and expanding customer base.-Promotions wont help a bad product -Improper fading: pull offers too quickly-Overuse: More likely, so many coupons. Example: you never see a pizza without a special-Financial risk and inconvenience are the two biggest obstacles to product trial. -When purchase cycle is short you are less likely to forget the sample you tried. -Your competitors who are trying to get your customers can use coupons.-Home inventory is the amount of product you currently have at home. -Money refunds/rebates are used on high price products. -Redemption is a problem because you can get similar product on sale and you may forget. 30% of people don’t get the rebate. -Why would you do a rebate? The retailer doesn’t have to participate. I GET WHAT? I DON’T HAVE TO PAY FOR IT?-Value promotion example: Mountain Dew bottle cap code-Premium example: Makeup counters free gift-Good thing about premiums is that the brand name on product reinforces brand name.-Methods of distribution examples: In package is cereal, in store is cosmetic, and the package itself is a coke cup-Sweepstakes example: McDonalds Monopoly-Sweepstakes increase sales and excitement. -The lottery used to be run by organized crime-A raffle is an example of a lottery-Push: Manufacturer gives retailer more incentive to buy the product-Pull: Coupon-Point of purchase increases impulses… “Oh I did not know you sold this here”-Example of point of purchase: putting chips and salsa next to each other in a grocery displayI WANT YOU TO WANT ME-PR and advertising are complimentary -Advertising noise is the same as clutter-Recruiting example: US military -Special situation is short term, not all the time such as fundraising “Portion sold goes to…” and is based on sales of product-Other corporate advertising problems: Companies don’t invest as much, indirect benefit; don’t know how effective related to product adsSHOW ME THE MONEY-Can’t fix a bad product with advertising-Budget is set before situation analysis -Predetermined methods may lead to under spending because you chip away at residual for other costs and advertising is an afterthought -Percent of sales is not effective with new products because of no sales history and there is risk involvedAgency CompensationCommission: bill by jobFee: bill by hourOther: Unique, bonus, escalating commission, and retainerSHOP TILL YOU DROP-Immediacy: make room for more inventories -Regular price line advertising: most images oriented-Sales advertising is most common-Clearance advertising: “going out of business sale” -Cooperative Advertising benefits the manufacturer more than the retailerTRADE TALK-B2B example: Clothing sensor, cash registers-B2B products helps the business run smoothly -Consumer Media: 10%-Example of news can start with “Introducing…” FULL SERVICE-Service: Intangible Product-You don’t own anything-Task or work: Carwash, dentist-Use of a facility: Movies, hotel, and gym membership-Use of a product: movies from Netflix or itunes renting, rent a car-Service advertising is hard to advertise-Intangibles are more difficult to assess because you get an experience not an item-You may need more advertising and larger budgets-Service is more emotional-Advertising needs to be aggressive, you cannot resell movie seats later on- they are gone forever -Inability to Transport the Service example: hotel, can’t import more rooms for a night-Quality control: each McDonalds is a production center, advertising may create an image that service provider cannot meet because it doesn’t exist-A service can be in multiple categories of private sector services such as HR block-Example of Convenience private sector service: ATM, Drive through-Example of shopping private sector service: Mechanic, Hair stylist, doctor (Until you use the product you don’t know you will like it)-Social Marketing example: Public service announcement -Problems: Weak personal benefits “It wont happen to me”Limited personal satisfaction- don’t get much enjoyment because you don’t have a personal/emotional tieQuestionable demand: don’t have a lot of money to do market researchPsychic costs: non-financial costs associated with compliance (emotional)-Insufficient budgets: most important dependent on donations/grants (won’t get prime time media)THE END-There are other ways to look at advertising-Advertising has changed the desire from the product to the brand. For example: when asked what do you drive people say “corolla or ford” vs saying “car or suv”-Improves product by forcing innovations-Advertising brings in sales so the revenue it creates may offset the cost-If product is different they can charge a premium-Advertising may decrease price like in tablets-Product proliferation example: toothpaste, cerealIf you would like the last page of notes, e-mail [email protected] after

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