UA An Integrated Marketing Strategy for ABC Taxis Essay

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Advertising
© Ekaterina VoinovaiStock/Thinkstock
Learning Objectives
Upon completion of this chapter the student will be able to:
•• Describe the types of advertising and the advantages and disadvantages of advertising.
•• Discuss the roles of the target market, objectives, and the budget in the advertising plan.
•• List the types of advertising and creative strategies used when developing advertising plans.
•• Explain the Five W’s of media planning and define common media terms.
•• Describe the media planning process including selection of media and development of a
media plan.
Pre-Test
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Pre-Test
1. The purpose of advertising is to
a) give the correct target audience the most effective message at the best price possible.
b) communicate with research-specified target market segments in a personal manner.
c) effectively market and sell unique products at the highest profit margins possible.
d) efficiently communicate a message about a company or product through the use of
unpaid publicity.
2. Most of the money in an advertising budget is used for
a) production costs.
b) advertising agency salaries.
c) media planner salaries.
d) media buys.
3. Which type of advertising strategy is most often associated with humor?
a) Brand imaging
b) Brand positioning strategy
c) Affective strategy
d) Resonance strategy
4.
refer(s) to the number of people a media buy reaches in the primary target
audience, combined with the frequency.
a) Gross rating points (GRPs)
b) Targeted rating points
c) Ratings
d) Cume
5. What helps determine where to place ads in order to reach the largest audience at the
lowest cost?
a) Key media problem
b) Media vehicles
c) Media kit
d) Media objectives
Answers
1. a) give the correct target audience the most effective message at the best price possible. The
correct answer can be found in Section 4.1
2. d) media buys. The correct answer can be found in Section 4.2
3. c) Affective strategy. The correct answer can be found in Section 4.3
4. b) Targeted rating points. The correct answer can be found in Section 4.4
5. a) Key media problem. The correct answer can be found in Section 4.5
Introduction
Chapter 4
Introduction
Pepsi MAX ran an ad that showed NASCAR driver Jeff Gordon disguised as a geek. He went to a
car dealership and chose a flashy sports car to test drive and then took the salesperson on a wild
ride that scared him. The salesperson was so upset that he wanted to get police involved. Viewers
thought the video was hilarious and spread the word for others to watch. While this video ad campaign may have appeared to be an amateur video, a lot of thought and planning occurred prior to
the launch of this campaign. The video on YouTube was very successful with over 36 million views
(The top 20 most-shared video ad campaigns for March 2013—pranks & hoaxes 2013).
Pepsi MAX Test Drive
This video shows the popular ad featuring NASCAR driver, Jeff Gordon:
http://www.youtube.com/watch?v=Q5mHPo2yDG8
In this chapter we discuss planning for advertising, one of the executions of an IMC plan. The IMC
plan will have numerous subplans that call for the execution of IMC tactics (marketing communications mix). Keep in mind that not all companies include advertising in their IMC mix. Some
companies may for example, include only public relations, direct marketing, and personal selling.
The IMC mix is determined by looking at objectives, strategy, and budget.
IMC planners typically develop their subplans simultaneously and then the plans are added to the
overall IMC plan. What does this mean? This means that IMC professionals develop the overall
IMC plan with input from subject experts in each of the tactical areas, which include advertising,
personal selling, sales promotion, public relations and publicity, direct marketing, electronic and
Internet marketing, and branding.
For smaller businesses the overall IMC plan may be developed by the same person. In that case,
the individual responsible for the plan’s development must create and execute all the tactical areas.
In this case, the IMC professional typically begins with the advertising plan, adding the sales plan
and then inserting other areas such as the sales promotion plan, the direct marketing plan, the
electronic/social media plan, the public relations and publicity plan, and the brand plan. Plans
developed for the tactical executions follow the same format as the overall IMC plan.
Once the marketing plan and budget are reviewed, the development of the IMC program begins.
A plan must be developed for each of the IMC tactical areas. Each tactical area contains the same
components (objectives, strategy, execution, and budget). So the advertising plan would include
advertising objectives, advertising strategy, advertising execution(s) (message, media, and advertising tactics), and the budget.
Once the individual plans are in place, it’s up to the chief marketing officer (CMO) or the chief
marketing communications officer (CMCO) to integrate all of the plans into one cohesive plan.
Once the plan is developed and in place, the plan is executed. At this point all the IMC mix strategies are integrated, the ads are produced, the media time and space purchased, and a system for
evaluation and control is put into place. The evaluation and control function is to make sure all
objectives are being met and to evaluate the effectiveness of the overall IMC plan. If things aren’t
Types of Advertising, Advantages and Disadvantages, and the Advertising Plan
Chapter 4
going “according to plan,” the IMC head must create systems and tasks that allow for the control
of the program with methods of making changes to the overall plan built into the evaluation and
control function.
To better understand each of the tactical areas in the IMC plan we have devoted a chapter to each.
We begin with the advertising area.
4.1  Types of Advertising, Advantages and Disadvantages, and
the Advertising Plan
Welcome to the world of advertising. Advertising is one of the tools considered for the development of the integrated marketing communications program. Once the IMC mix is determined,
most of the integrated marketing communications planning is done simultaneously by professionals in each of the content areas (advertising, sales promotions, public relations, and the other
areas). When not done simultaneously, advertising is typically the first content area of IMC that
gets planned. Once the advertising is developed, other areas of IMC are integrated into the basic
advertising plan to create the overall IMC plan.
It’s the job of the IMC manager to make sure each of the areas of IMC is totally integrated
in a seamless fashion. Saying this is easy; trying to integrate with elements of synergy is a bit
harder. In this chapter we will explain the components of a basic advertising plan. The plan will
include the media recommendations as well as the creative recommendations for all advertising
communication.
Although advertising was defined in Chapter 1, let’s take a closer look. When you tell someone
you work in marketing, the first thing that typically comes to that person’s mind is advertising or
selling. Advertising is not selling or marketing. Rather, advertising is a tactic used by marketers
to communicate with their various stakeholders and other audiences (Ogden and Rarick, 2010).
Advertising has the following characteristics:
a) The purpose of advertising is to provide the best possible selling message to the right target audience at the best possible price.
b) Advertising is paid. Therefore, advertisers have full control of the content and media
placement of the advertisements.
c) Advertising is a nonpersonal way of communicating to a large audience.
There are two forms of advertising: institutional advertising and product advertising. Product
advertising is a form of advertising that focuses on the end user. Its purpose is to communicate
with large numbers of end users. End users will be made aware of an idea, product, or service. The
advertising typically focuses on the consumer wants and needs that are satisfied by the product
or service.
Institutional advertising promotes a company or organization instead of a specific product or
service. Institutional advertising is used to build or enhance an image or reputation, promote
goodwill, advocate a philosophy, or create awareness of an organization. When an organization
promotes a point of view or philosophy it is called advocacy advertising, a subset of institutional
advertising. Institutional and advocacy advertising overlap with public relations. The difference is
that a company must pay for institutional and advocacy advertising while a company may not pay
for some public relations efforts.
Types of Advertising, Advantages and Disadvantages, and the Advertising Plan
© Feng Yu/iStock/Thinkstock
▲▲Classified advertising is an example of product advertising.
Chapter 4
PRNewsFoto/Kenneth Cole Productions, Inc.
▲▲This is an example of advocacy advertising, a type of institutional advertising. Kenneth Cole Company is making a social
statement about voting in the primary elections.
Advantages and Disadvantages of Advertising
There are several advantages to using advertising as part of a company’s IMC mix. It is advertising’s job to inform, persuade and remind consumers about business and organizational products
and other offerings. Advertising can be used to educate people. The government often uses advertising to educate people on health and social issues such as the importance of getting a flu shot.
Advertising also helps people with their day-to-day shopping experiences by informing shoppers
about sales.
Another advantage of advertising is its ability to reach
a mass audience. For example, over 100 million people
watched the Superbowl in 2012. The ads that played during the game were discussed and were rewatched on
social media. Advertising can be used to drive immediate responses (sales, traffic, likes) from consumers.
Advertising is also a great tool to help create or maintain
brand or company awareness. Brand loyalty is almost
always a goal of good advertising. Advertising can also
initiate customer feedback, both positive and negative.
For example, many advertisers remove ads when their
customers find the ads offensive or in poor taste.
The primary disadvantage of advertising is the cost. While
advertising reaches a large audience, which can reduce
the cost per contact, the out-of-pocket expense is very
high. High costs can prohibit smaller businesses from
advertising. Another disadvantage is clutter. There are
many estimates on how many advertisements a person is
exposed to on a daily basis. Depending on the source, the
figure can be as high as 6,000. A more realistic figure is
provided by Marah Creative (www.marahcreative.com), a
digital design firm out of Portland Oregon, which states
that 287 advertisements a day is a more reasonable figure
Advertising Archive/Courtesy Everett Collection
▲▲This is an example of advertising used to inform people on antibiotic misuse. What other advertisements have
you seen that inform the public?
Types of Advertising, Advantages and Disadvantages, and the Advertising Plan
Chapter 4
(Koller, 2011). Even with the more conservative estimate, people can’t escape advertising. Clutter
means there is more competition to get noticed by consumers. Many consumers may not notice an
advertisement because it gets lost in the clutter.
Advertising can also hurt a brand when there is poor execution. Abercrombie & Fitch came under
criticism for its line of shirts that featured unflattering stereotypes of Asians. Although the company pulled the shirts, many felt the company was racist for selling the shirts in the first place.
Advertising has also been criticized for promoting materialism, especially in children. According
to a study of Dutch children, “Ads exacerbate kids’ desire for material things, and this desire gradually leads them to equate consumer goods with happiness and success” (Jacobs, 2013). Table 4.1
summarizes the advantages and disadvantages of advertising.
Related to poor execution are ethical considerations. While ethics was covered in Chapter 2, it’s
worthwhile to mention the importance of ethics when developing advertising strategy and tactics.
Current laws define rules and regulations and help guide ethical decisions. For example, laws make
it illegal to sell cigarettes and alcohol to minors. Often when vulnerable populations such as children or the economically disadvantaged are targeted, the organization’s values and ethics are put
to the test. The usage of sexual images to sell products is also a gray area, which many believe can
border on unethical behavior. While there are self-regulatory bodies in the advertising industry,
such as the Advertising Self-Regulatory Council (www.asrcreviews.org), it’s often up to consumers
to make sure companies are accountable for advertising messages. Social media gives consumers a
platform to voice concerns.
Table 4.1 Advantages and disadvantages of advertising
Advantages
Disadvantages
• Ability to inform, persuade, remind, and educate
customers about a product, company, brand, event,
or cause
• High total cost
• Capacity to reach a large audience
• Clutter
• Drives customer response
• Builds brand recognition and loyalty
• Initiates customer feedback
• Small companies may not have resources to use
advertising
• Can damage brand if poor execution
• Can be misleading
• Reputation for adding to a materialistic society
The Advertising Plan
The development of an effective advertising program is contingent on the development of an outstanding advertising plan. The advertising plan focuses on issues involved in the development and
execution of messages aimed at targeted customers. The advertising plan is built in much the same
way as the overall IMC plan; however, the focus is on advertising alone.
There are numerous steps in the development of the advertising plan. This written document is
used as a guide by advertisers in the development of the overall communication program. Prior
to developing the plan, an advertiser wants to have as much information as possible. Additionally,
the planner must understand the internal and external marketing environments that may have an
impact on the advertising’s effectiveness. It is also important to make sure that the plan is integrated in a seamless way with other areas of the marketing plan. Figure 4.1 depicts the steps in
advertising plan development.
Stating the Target Market, Developing Objectives, and Creating the Budget
Chapter 4
Figure 4.1 Steps in creating an advertising plan
Steps 1 and 2
• State the target
market
• Develop the
advertising
communication
objectives
Steps 3 and 4
• Create the
advertising
budget
• Develop
advertising
strategies
(focus on the
creative
strategy)
Steps 5 and 6
• Include creative
execution
examples
• List the media
recommendations
Steps 7 and 8
• State the key
problem
• Develop
media
objectives
Steps 9 and 10
• Develop the
media strategy
• Develop the
media plan
In the following sections, we will examinef04.01_OMM651.ai
each of these steps in more detail.
› Learning Check
Reflect on your learning by answering the following questions:
1.
2.
3.
4.
What is the definition of advertising?
What is advertising’s purpose?
What are the types of advertising?
What are the advantages and disadvantages of advertising? Do you think the advantages outweigh the disadvantages? Why or why not?
5. What purpose does the advertising plan serve?
6. What are the components of an advertising plan?
4.2  Stating the Target Market, Developing Objectives, and
Creating the Budget
Putting together an effective advertising plan begins with stating the target market, developing
the advertising communication objectives, and creating a budget. In this section, we will examine
these first three steps.
State the Target Market and Define the Target Audience
Step one is to state the target market (TM). A description of the target market using one or more of
the four “ics” (geographics, psychographics, demographics, and behavioristics) is provided and can
typically be obtained from the company’s marketing plan. The target market description should be
used to drive the development of all of the tactical plans. Because it’s important for the IMC planner to know why the target market was chosen, it’s a good idea to include the TM rationale when
stating the target market.
Stating the Target Market, Developing Objectives, and Creating the Budget
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In this step the target audience is also determined. As you may recall from an earlier chapter, the
target market refers to those consumers toward whom the marketing plan is aimed. The target
audience, on the other hand, is the group of people toward whom the advertising plan is aimed.
Often the target audience is different from the target market because the company wants to reach
only a subset of the target market with the advertising plan.
It’s also helpful to include a typical customer profile in the target market and target audience statements. As stated in a previous chapter, a typical customer profile is a short statement that describes
the organization’s average customer. It is not uncommon to have more than one profile, especially
for firms that have high market expertise and are very good at market segmentation.
Develop the Advertising Communication Objectives
Objectives are very important to include in all IMC tactical plans. The advertising objectives will
drive the development of objectives for the other areas of execution. When developing the objectives keep these two questions in mind:
1. What is the advertising supposed to do? Does it support the IMC plan? Does it lead the IMC
campaign?
2. What impact is the advertising going to have on the TM? How is it integrated into the overall
campaign in order to achieve the overall IMC objectives?
Old Spice Advertisement
After watching the video, can you determine the target market for this commercial?
http://www.youtube.com/watch?v=Wu5jL-6Z_Js&list=PLoF_PWSjd6xXR5bEE8GXByeLbEhSbipZB
If you guessed men with an active lifestyle, you are correct.
Advertising objectives should flow from the overall marketing objectives. Because of that, we recommend a programmed approach to developing advertising objectives as described in the steps
below.
Step 1: State the Key Fact
The key fact is a simple statement that provides the planner information on the product or service
being offered, the advertising and marketing environment, competitors, and the target market.
The key fact should
• be written from a consumer perspective, thus the use of marketing and advertising research
to understand the consumer is an important aspect of the key fact;
• indicate why consumers purchase or do not purchase (if available) the product or service;
• be about one paragraph and written in consumer language;
• serve as a guide to the development of the rest of the objectives.
Hypothetical key fact example:
Toyota Camry is a mid-size vehicle known for safety and reliability. Families like the mid-size
car because it is affordable and has a sporty look. The car is dependable and long lasting with
great gas mileage that makes it appealing to the 35–54 age demographic.
Stating the Target Market, Developing Objectives, and Creating the Budget
Chapter 4
Step 2: Define the Key Problem
The key problem is the main problem that the advertising campaign will attempt to solve. Potential
problems include the following:
1. Awareness problem—consumers are unaware of the products and services offered.
2. Image problem—IMC practitioners want to change or modify a public image of a person,
product, or service.
3. Product or service problem—there may be qual…
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