Advertising Management

• Analysis, Planning, & Decision Making

activities of the advertiser
• Overall managerial direction & financial
support for
– development of advertising
– purchase of media time and space
Framework of Advertising Planning &
Decision Making
Situation Analysis

Marketing Programme

Integrated Mar. Com. Plan

Advertising Plan

Implementation
 Process starts with an analysis of the
Brand’s external & internal environment
Market analysis

Competitor analysis

Brand Analysis- SWOT

Marketing Programme

Advertising Plan

Implementation
 The Role of Advertising emerges from the
Marketing Programme

Situation Analysis Determines the role of each

elements of the marketing
mix including Marketing
Communications

Indicates how all elements

will be coordinated to
support and synergise with
IMC & Advertising plan each other

Implementation
 The Advertising Plan Includes…

Situation Analysis

Marketing Programme
Setting Objectives -
(Segmentation-positioning)

Message – strategy & tactics

Media – strategy & tactics

Implementation and
Coordination (synergy
Implementation
with other IMC tools)
Framework of Advertising & Decision Making

Situation Analysis

Marketing Programme

IMC /Advertising Plan

Facilitating Agencies

Social, legal & other

constraints
 The Communications Mix–Audience Contact Points

Point
Point of
of Public
Public
Publicity
Publicity Packaging
Packaging
Purchase
Purchase Relations
Relations

Internet/
Internet/ Direct
Direct
Interactive
Interactive
Media
Media Response
Response
Marketing
Marketing
Communication
Communication Sales
Direct Sales
Direct Mail
Mail Promotion
Promotion

Broadcast
Broadcast
Print
Print Media
Media Outdoor
Outdoor Events
Events
Media
Media
 Earlier Approach to Marketing Communications

Sales
Publicity Promotion
Point of
Purchase

Media Packaging
Special Adver-
Events tising Direct
Response
Public
Relations
Interactive
Direct Marketing
Marketing
 Integrated Approach to Marketing Communications

Sales Direct
Packaging
Promotion Response

Media
Point of
Purchase Adver-
Public
tising Relations
Publicity

Interactive
Marketing Direct
Special
Marketing
Events
 MARKETING COMMUNICATIONS PLANNING

Marketing
Marketing Plan
Plan Review
Review

Situation
Situation Analysis
Analysis
Communications
Communications Process
Process
Analysis
Analysis
Budget
Budget Development
Development
METHODS
Program
Program Development
Development

Integration
Integration &
& Implementation
Implementation
Monitoring,
Monitoring, Evaluating,
Evaluating,
Controlling
Controlling
 Integrated Marketing Communications Planning Model

Review of Marketing Plan

Promotional Program Situation Analysis
Analysis of the Communications Process

Budget Determination

Develop Integrated Marketing Communications Programs

Sales PR/ Personal Direct Internet/

Advertising
Promotion Publicity Selling Marketing Interactive

Advertising Sales PR/ Personal Direct Internet/

Promotion Publicity Selling Marketing Interactive
Objectives Objectives Objectives Objectives Objectives Objectives

Message Sales PR/ Personal Direct Internet/

Promotion Publicity Selling Marketing Interactive
Strategy Strategy Strategy Strategy Strategy Strategy

Integration & Implementation of Marketing Communications Strategies

Monitor, Evaluate & Control Promotional Program
 Major Components of an
Advertising Plan
• Objectives
• Target Selection
• Message Strategy
• Message Tactics
• Media Strategy
• Media Tactics
 The Role of Advertising….
Advertising plan in context of the Marketing Plan

The Advertising Plan must support and synergize with:

• the elements of the Marketing Mix
• and other elements of the Communication Mix
How does Advertising work ?

Advertising is
‘persuasive communication’
The Advertisement Communication Process
Perception Process
Message Message

Source Receiver Destination

Media Word
Of
Mouth
The Persuasion
Process of Awareness/
Advertising familiarity
(The Advertising Brand
Exposure Model) Benefit /
Information
Through Creating
Image / Brand Purchase
various
advertising Personality Attitude Behavior
effects Associating Feelings
with Brand

Linkage of Brand with

peers/experts/group
norms /culture

Reminder / Brand trial

inducement
 DECISION PROCESS

Problem Information Evaluation of Purchase

Recognition Search Alternatives Decision

Post –
Purchase
Evaluation
RELEVANT PSYCHOLOGICAL PROCESS
Motivation Perception Attitude Integration
Formation Process

Learning
Process
 Cognitive Stage
Cognition = Knowledge
• Knowing
• Perceiving
• Conceiving ideas about the product.
• basic information a consumer needs to know

LEARN
 Affective Stage
Affections/Emotions
• likes or dislike
• preference – liking / dislike
• Attitude towards the product - for / against

FEEL
 Behavior Stage

• Try the product / Reject outright

• Purchase / Reject
• Develop Loyalty / Just a trial / Remain neutral

DO
 Consumer Response Models
• Exposure and Familiarity Model (Repeated
Exposure Model
• AIDA Model
• Hierarchy of Effects
CONSUMER RESPONSE MODELS
 AIDA MODEL
• Design & Development of Advertising - AIDA
formula
• Effectiveness of advertising = message received +
message accepted
• An effective advertisement has to -
• (i) Attract Attention
• (ii) Secure Interest
• (iii) Build Desire for the product
• (iv) Obtain Action.
 Hierarchy Of Effects Model
• 6 steps towards purchase
• Awareness & Knowledge – Cognition
• Liking & Preference - Affection
• Conviction & Purchase- Behavioral
 Awareness Teaser campaigns, Pioneering ads,
Jingles/ slogans
Internet banners
Knowledge Announcements
Informative ads

Liking Descriptive ads

Image/ celebrity
Demonstration of benefits

Preference Competitive ads

Persuasive copy
Comparative ads, Testimonials

Conviction Direct-action retail ads

Point-of-purchase ads
Price deal offers
Purchase Reminder ads
Informative “why” ads
 Advertising and Movement Toward Action

Point of purchase
Conative Purchase Retail store ads, Deals
Realm of motives. “Last-chance” offers
Price appeals, Testimonials
Ads stimulate or direct
desires. Conviction
Competitive ads
Affective Preference Argumentative copy
Realm of emotions.
Ads change attitudes and “Image” copy
Status, glamour appeals
feelings Liking
Announcements
Descriptive copy
Cognitive Knowledge Classified ads
Slogans, jingles, skywriting
Realm of thoughts.
Ads provide information Teaser campaigns
and facts.
Awareness
 Information Processing Model
• Cognitive Stage
– Presentation
– Attention
– Comprehension
• Affective Stage
– Yielding
– Retention
• Behavior Stage - Behavior
 The Concept of Involvement
Possible Results
Involvement Variables of Involvement
Consumer Evoking Counter-
Factors Involvement with
Arguments
Ads
Product Induce Purchase
/Message Product Relative
Factors /Service Importance of
Situational Purchase Class
Factors Decisions Perceived
Difference in
Product Attributes
Particular Brand
Price Amount of Preference
Information
Time
Search
Spent
Type of Decision
Standard Learning Hierarchy
Low Involvement Learning
 Three Orders Model of
Information Processing
• Degree of Involvement
• Differentiation of Product
 Three Orders Model of
Information Processing
Level of Involvement

HIGH LOW

H Standard Learning Model

I
G LEARN – FEEL - DO
Perceived H Low Involvement Model
Level Of
Product LEARN – DO – FEEL
Differentiatio L
n O DO – FEEL - LEARN
W
 FCB Model

• Involvement
• Thinking- Feeling
 FCB Model
THINKING FEELING

H INFORMATIVE (thinker)
I
G Car, House, Furnishing, New Products
Involvement H Model:- Learn - Feel – Do (Rational)
Test :- Recall Diagnostics
Media:- Long Copy Format, Reflective
Vehicles
Creative:- Specific Information, Demonstration

L
O
W
 FCB Model
THINKING FEELING

AFFECTIVE (feeler)
H
I Jewellery, Cosmetics, Designer Clothing
G Model:- Feel – Learn – Do (Emotional)
Involvement H Test :- Attitude Change, Emotional
Arousal
Media:- Large Space, Image Specials
Creative:- Executional Impact

L
O
W
 FCB Model
THINKING FEELING

H
I
G
Involvement H

L HABIT FORMATION (doer)

O
W Food, Household items
Model:- Do - Learn – Feel (Responsive)
Test :- Sales
Media:- Small Space Ads, 10 sec spots, Radio,
POP
Creative:- Reminder
 FCB Model
THINKING FEELING

H
I
G
Involvement H

SELF-SATISFACTION (reactor)
L
O Cigarettes, Liquor, Candy
W Model:- Do – Feel – Learn (Social)
Test :- Sales
Media:- Billboards, Newspapers, POP
Creative:- Attention
 Elaboration Likelihood Model –
Routes to attitude change
Central Route Peripheral Route
• Consciously & diligently • Attitudes are changed
consider the information without active thinking
• Careful consideration • Associate the brand with
• Thinking about pros and positive or negative aspects
cons or executional cues from the
ad
• Accept shortcuts to
conclude brand is superior
 Elaboration Likelihood Model
Advertisement
Peripheral
No cue present?
Motivated to
Process Yes
Information ?
Yes No
Ability to
Process
Information ?
Yes Peripheral Route of
Processing
Central Route of Processing
 ELM – Implications
• Ad Medium – broadcast media – P
• Involvement or Motivation – less – P
• Knowledge level – less – P
• Comprehension
• Distraction
• Emotion
• Need for cognition
 Take-away
• In low involvement situations, it may be
more appropriate to create ads that raise
awareness and change brand attitudes
through executional liking and credibility
• In high involvement situations it may be
better for ads to provide strong “reasons
why” brand is superior
 Cognitive Response Approach
• Cognitive Thoughts
– Counter Arguments vs. Support Arguments
• Managing CA and SA
– Repetition
– Difference from previously held belief
– Strength of argument
– Nature of emotion being felt
 Recall & Persuasion
• Recall leads to persuasion in a low
involvement situation
• Recall - necessary but not sufficient
condition for persuasion
• Recall -Awareness – message content -
persuasion
 MARKETING COMMUNICATIONS PLANNING

Marketing
Marketing Plan
Plan Review
Review

Situation
Situation Analysis
Analysis
Communications
Communications Process
Process
Analysis
Analysis
Budget
Budget Development
Development
METHODS
Program
Program Development
Development

Integration
Integration &
& Implementation
Implementation
Monitoring,
Monitoring, Evaluating,
Evaluating,
Controlling
Controlling
 Integrated Marketing Communications Planning Model

Review of Marketing Plan

Promotional Program Situation Analysis
Analysis of the Communications Process

Budget Determination

Develop Integrated Marketing Communications Programs

Sales PR/ Personal Direct Internet/

Advertising
Promotion Publicity Selling Marketing Interactive

Advertising Sales PR/ Personal Direct Internet/

Promotion Publicity Selling Marketing Interactive
Objectives Objectives Objectives Objectives Objectives Objectives

Message Sales PR/ Personal Direct Internet/

Promotion Publicity Selling Marketing Interactive
Strategy Strategy Strategy Strategy Strategy Strategy

Integration & Implementation of Marketing Communications Strategies

Monitor, Evaluate & Control Promotional Program
 Process starts with an analysis of the
Brand’s external & internal environment
Market analysis

Competitor analysis

Brand Analysis- SWOT

Marketing Programme

Advertising Plan

Implementation
 The Role of Advertising emerges from the
Marketing Programme

Situation Analysis Determines the role of each

elements of the marketing
mix including Marketing
Communications

Indicates how all elements

will be coordinated to
support and synergise with
IMC & Advertising plan each other

Implementation
 The Advertising Plan Includes…

Situation Analysis

Marketing Programme
Setting Objectives -
(Segmentation-positioning)

Message – strategy & tactics

Media – strategy & tactics

Implementation and
Coordination (synergy
Implementation
with other IMC tools)
Framework of Advertising & Decision Making

Situation Analysis

Marketing Programme

IMC /Advertising Plan

Facilitating Agencies

Social, legal & other

constraints
Executive Summary
 Situation Analysis
• Historical context
• Demographic trends
• Market Analysis
• Competitor analysis
• Product characteristics
• Characteristics of firm
• Brand SWOT
 Marketing Objectives
• 4Ps
• STP
• Brand image, equity, personality,
 Objectives
• Types of objectives
– Promotional objectives
– Brand image objectives
– Awareness objectives
– Attitude shifts
– Purchase intent – trial, repeats, more usage,
loyalty
 Objectives
• Quantitative benchmarks
• Measurement methods
• Criteria for success
• Time frame
 Budgeting
• Methods
• Amount
• Justification
• Break up for advtg, sales pro, DM, website
ads, PR, events, etc
 Strategy
• Clear and concise articulation of how the
plan will achieve its objectives
• Creative strategy
• Message strategy
• Media strategy
 Execution
• Copy Strategy
• Media Plan
• Integrated Marketing Communications used
 Evaluation
• Criteria
• Methods
• Consequences & contingencies
 Marketing Versus Communications Objectives

Marketing
Marketing Communications
Communications
Objectives
Objectives Objectives
Objectives

•• Stated
Stated in
in the
the firm’s
firm’s •• Derived
Derived from
from the
the
marketing
marketing plan
plan overall
overall marketing
marketing plan
plan
•• Through
Through thethe overall
overall •• More
More narrow
narrow than
than
marketing
marketing plan
plan marketing
marketing objectives
objectives
•• Quantifiable
Quantifiable -- sales,
sales, Vs. •• Based
Based onon particular
particular
market
market share,
share, ROI
ROI communications
communications taskstasks
•• Accomplished
Accomplished in in aa •• Designed
Designed toto deliver
deliver
given
given period
period ofof time
time appropriate
appropriate messages
messages
•• Realistic
Realistic && attainable
attainable •• Focused
Focused onon aa specific
specific
target
target audience
audience
 Many Different Factors Affect Sales

S ALES
SALE S

Advertising
Advertisin
Advertising
Advertisin Competitio
Competitio Product
Product
g
g&and
&
and Competition
Competition
n
n quality
quality
promotion
promotion
promotion

Distributio
Distributio The
The
Distribution
Distribution Technology
Technology Price
Price
n
n economy
economy
 ‘Sales’- A Meaningful Advertising
Objective??

Difficult to identify the impact of Advtg.on

‘Sales’
–‘Advtg. impact is felt over time
–Isolating ad impact from other elements
of the marketing mix is difficult
 New Customers

Immediate
Advertising Future Sales
Sales

Change Attitude /
Improve Image
 The Basis for Advertising
Objectives
Sales growth comes from
– New customers buying
– Old customers staying loyal
– Old customers consuming more
 Behavior Dynamics

N O
Not buying product E Buying
Other brands
Existing
customers

• Old customers staying loyal

• Increase Share of Requirements - more & frequent
usage
• Reducing Attrition & Price elasticity (price
sensitivity)
• New Customers
• Customers of other brands / categories
Marketing / Sales Strategies & Behavioral Objectives
Primary Demand -
Customers trying Trial
the category for the Purchase
first time

Secondary Demand-
New customers using Trial
other brands Purchase
Behavioral
Responses
Existing customers
Loyalty Loyalty that drive
Purchase

More consumption new Increased

uses, more usage usage / SOR
 Awareness/
familiarity

Brand Benefit
Information

Creating image /
personality
Persuasion Brand Purchase
Process of Associating feelings Attitude Behavior
with Brand
Advertising
Linkage of Brand with
peers/experts/group norms

Reminder / Brand trial

inducement

These Intervening Variables between Advertising & Action are

more effective Operational Advertising Objectives than Sales
 Awareness / Trial Purchase
Familiarity & Loyalty

Brand Benefit Trial Purchase &

Information Increased usage

Creating image
Loyalty
-personality /
Persuasion users
Process of Associating feelings
Loyalty
with Brand use
Advertising Purchase
Linkage with peers /
Loyalty
experts/group norms

Reminder / Brand trial

inducement

These Intervening Variables have a causal relationship between

Advertising & Sales
 Advertising Objectives
Reflect the Target Segment
The segment and sub-segment can be defined by –
• Behavioral measures – non-users, other brand users,
heavy / light / loyal users etc.
• Advertising response measures – unaware, not
convinced of key benefit, diffused / sharp image, etc
• Lifestyle - attitude & opinions, interests
• Benefits sought
• Demographic, psychographics, geographic basis -
more relevant for media decisions
 Characteristics of Objectives

Attainable
Attainable

Realistic
Realistic Measurable
Measurable
Objectives
Objectives

Not
Not Mutually
Mutually Specific
Specific
Exclusive
Exclusive
 MARKETING COMMUNICATIONS
OBJECTIVES
• Establish a Product Image
• Stimulate Interest
• Differentiate the Product
• Establish Customer
Relationships
• Establish, Modify, or
Reinforce Attitudes
• Establish Understanding
• Build Support &
Acceptance
• Increase Market Penetration
• Stimulate Demand
• Stimulate Impulse Buying
• Encourage Product Trial
• Develop Repeat Purchase
Behavior
• Increase Rate of
Consumption
• Influence Sales Volume
• Develop Sales Leads
‘Hierarchy of Effects’ Model - DAGMAR
Unaware

Aware
Cognitive
Comprehension & image
Affective
Attitude
Behavioral
Action

DAGMAR Approach – A communication task to be accomplished

amongst a defined audience, in a specified period of time
 Defining Advertising Goals for
Measured Advertising Results
• A specific task indicated clearly – to be
measurable
• A starting point set –Benchmark against which
goal achievement can be measured
• A Target Segment specified precisely
• The Time Period for achieving the desired
response indicated
• Written Goal
 Inverted Pyramid of Communications
Effects

90% Awareness
Co
gn

70% Knowledge
i
tiv
e

40% Liking
Af
fe

25% Preference
ct
iv
e

20% Trial
Co

5% Use
na
tiv
e
 Setting Objectives Using the
Communications Effects Pyramid
• Product: BKC Shampoo - Period: 6 months
• Obj 1: create Awareness in 90% target audience
(TA)
• Obj 2: create Interest in 70% of TA
• Obj 3: Positive feelings in 40% TA and
preference in 25%
• Obj 4: trial use from 20%
• Obj 5: 5% main regular use
 Examples of Advertising
Objectives
• Consumer Product
• target market: 100,000 prospects in the
northern sales region
• marketing objective: achieve high level of
product understanding in the target market
• advertising objective: persuade 15% of
targeted prospects to request a free sample
 Examples of Advertising
Objectives
• Business Product
• target market: 2,000 manufacturers who use
electrostatic coating processes
• marketing objective: increase market share
to 20%
• advertising objective: persuade 40% of
prospects to request product fact file
Common Promotional Objectives
• Create & Maintain Brand Image
• Increase consumer awareness, curiosity
• Change consumer beliefs & attitudes
• Influence purchase decision
• Stimulate trial purchase
• Convert one-time product users to repeat
purchasers
Common Promotional Objectives
• Switch consumers from competing brands
• Encourage brand loyalty
• Stimulate more frequent use
• Increase sales
Communication Objectives: Are stated in three parts:
• Target Audience
– Customers – brand loyal, favourable brand switchers
– Non-customers – new category users, other brand switchers, other
brand loyals
• Behavioural Objectives – what is the behaviour that you want this
communication to cause in your target audience
– Trial
– Repeat purchase
– Purchase related behaviour
– Repeat consumption
– Application
• Communications – the effect that you want your communication to have
on the target audience
– Create category need
– Brand awareness
– Brand attitude
– Brand purchase intention
– Purchase facilitation
 DAGMAR Difficulties
Legitimate Problems
 Response Hierarchy Problems
 Doesn't always define the
process people use to reach
purchase/use.
 Attitude - Behavior
Relationship
 Attitude change doesn't always
lead to change in actions or
behavior.
Questionable Objections
 Sales Objectives Are Needed
 Sales are all that really counts,
not communications objectives.
 Costly and Impractical
 The research and efforts cost
more then the results are worth.
 Inhibition of Creativity
 Too many rules and structure
curb genius.
 Challenges to DAGMAR
• Does not measure Sales
• Broad outline does not give enough details
(which hierarchical level)
• Measurement is a problem
• System noise – other factors affecting goal
• Model may not hold good in every situation
 IMC Objectives
1. To create & maintain an image for a
brand
2. To increase consumer awareness of and
curiosity about a brand
3. To change consumers’ beliefs or
attitudes about a brand
4. To influence the purchase intention for a
brand
5. To stimulate trial use of a brand
 IMC Objectives
6. To convert one-time product users into
repeat purchasers
7. To switch consumers from a competing
brand
8. To encourage brand loyalty
9. To stimulate more frequent use
10.To increase sales
Segmentation and Positioning
Segmentation is about deciding
which consumers the
Advertising should be targeted at
The Target Marketing Process
Identify markets with unfulfilled needs

Determining market segmentation

Selecting market to target

Positioning through marketing strategies

Five-Step Segmentation Process
1. Group consumers according to their needs.
2. Group marketing actions, usually the products offered,
available to the organization.
3. Develop a market/product grid - relate the market
segments to the firm’s products and actions.
4. Select the product segments toward which the firm directs
its marketing actions.
5. Taking marketing actions to reach target segments.
 Bases for Segmentation
• Geographic Segmentation
– State - region - country - climate
• Demographic Segmentation
– Age, sex, income, education, occupation, social class
• Psychographic Segmentation
– AIOs, (Activities, Interests, Opinions)
– VALS (Values and Lifestyles)
– Personality traits
• Behavioristic Segmentation
– Usage, loyalties, use occasions
• Benefit Segmentation
– Types of specific needs or wants to be satisfied.
 Segmentation Approaches
– A Priori basis : the market is segmented before any data on the
market place is examined
• Age
• Income
• Usage
• Loyalty
• Geo-location
– Empirical Segmentation : created on the basis of differences in
• Attitude and benefits sought
• life-style - AIO
• culture
Approach Implementation
Both are used together but in different order
• A priori segmentation starts with variables such as
income etc and then examines attitudes and benefits

• Empirical segmentation starts with benefit

segmentation and then see how these clusters are
different in terms of demographics
 Selecting a Target Market
Segmentation Strategies
Determining how many segments to enter

 Undifferentiated Marketing – offering one product or service to the

entire market

 Differentiated marketing – competing in a number of segments with

separate marketing strategies for each

 Concentrated Marketing – focusing on one market segment

 Determining Which Market
Segments Offer the Most Potential
 Identify the group that is most likely to respond to the
brand offering
 Determine sales potential of the segment
 Determine opportunities for growth of the market segment.
 Analyze the competition in the segment (segments not
being served well by competition)
 Analyze the company’s ability to compete in the market
segment
 Decide how to compete in the market segment
Segmentation Decision Check List
 Can the size of the market segment be
measured?

 Is the market segment large and profitable

enough to serve? (large and growing in size)

 Is the segment identified accessible? Can it

be reached effectively and efficiently?

 Can effective marketing programs be

developed to attract and serve the segment
identified?
TM and Media Reach Approaches

– Controlled Coverage – using niche media to

reach only the desired segment e.g. trade
magazines

– Customer Selection – using mass media to

Reach is directed at mass audiences
 Positioning

It gives the consumer a clear idea

of what the Brand stands for
 The Positioning Process

Positioning Concept
The desired perception or
association management wants
target customers to have for a
firm and/or its products

Positioning Effectiveness Positioning Strategy

The combination of marketing
The extent to which management’s
positioning objectives are achieved
Market actions used to portray the
positioning concept to targeted
in the market target Target buyers

Positioning of the brand

The positioning of the brand by
the buyers in the market target
Positioning Strategy Development
Process - Background Analysis
1. Identify the competitors

2. Assess perceptions of competitors

3. Determine their positions

4. Analyze consumer preferences

5. Make the positioning decision

6. Monitor the position

 Product/Service and Brand
Positioning
Al Ries , Jack Trout - BASIC QUESTIONS TO ASK

1. What position, (if any) do we currently hold in the mind of

customers?

2. What position do we want to hold?

3. Whom do we have to compete against to establish this position?

4. Do we have the resources to occupy and hold the position?

5. Can we stay with one consistent positioning strategy?

6. Does our marketing and advertising match our positioning strategy?

 Positioning Strategy Approaches
Product/Service or Brands can be positioned by single
or multiple approaches:
– Product attributes or consumer benefit
– Price-quality
– Use or application
– Users
– Product class
– Cultural symbols
– Competitors
Positioning Decision – Check Points

Select and Evaluate the position

• An economic analysis
– Appeals to a large and growing segment
– Penetration possibilities – competitive edge to attack
competition
• Don’t be what you are not
• Monitor the position
 Positioning Decision
-Imperatives
– Segmentation commitment

– Stick with the Advertising that works

– Consider using symbols

Positioning Strategy Execution
– A relative concept that must indicate the
position of the brand vis-a-vis other brands -
differentiation

– It determines the nature of the elements of the

marketing mix

– Best communicated through Advertising

 Product Decisions
A product is a bundle of benefits or values
that satisfies the needs of consumers
 Product symbolism refers to what a product or
brand means to customers
 Product quality, branding, packaging, and
company name contribute to product image
 Branding:
• Brand name communicates attributes and meaning
• Advertising creates and maintains brand equity which
results from the image and/or impression of a brand
The Value of Strong Corporate and /or
Brand Identity
Strong corporate/brand equity:
 Creates more options for competing (particularly against
lower-priced competitors)
 Can facilitate brand and line extensions
 Allows companies to sell products/services at a premium
price and maintain larger profit margins
 Builds customer loyalty
 Makes it easier to withstand economic fluctuations and
marketing crises
 Makes customer response more inelastic to price increases
and elastic to price decreases
 Packaging
Traditional functions of packaging:
 economy, protection, storage
 Packaging has become increasingly important
because:
 self service emphasis of many stores
 buying decisions made at point-of-purchase
 often customers first exposure to product
Packaging is a way to communicate to consumers
 Pricing Decisions
 Price must be consistent with perceptions of the product
 Higher prices communicate higher product quality
 Lower prices often reflect bargain or “value” perceptions
 A product positioned as high quality while carrying a lower
price than competitors may confuse customers
 Price, advertising and distribution must be unified to create
the position for the product or service.
Distribution Channel Decisions
Channel decisions involve:
 Determining the type of channel system:
– Direct channels
– Indirect channels

 Selecting, managing and motivating marketing

intermediaries such as
– Wholesalers
– Distributors
– Brokers
– Retailers
 Push Versus Pull

Push Policy Pull Policy

Producer
Producer Producer
Producer

Wholesaler
Wholesaler Wholesaler
Wholesaler

Retailer
Retailer Retailer
Retailer

Consumer
Consumer Consumer
Consumer

Information Flow
 "Push" Techniques
 Point of sale displays, racks, stands
 Trade deals, special displays
 Dealer premiums, prizes, gifts
 Cooperative advertising deals
 Advertising materials, mats, inserts
 Push money or "spiffs"
 Collaterals, catalogs, manuals
 Trade shows, conventions, meetings
 "Pull" Techniques
 Sampling, free trial
 Coupons
 Premiums or gifts
 Contests, sweepstakes
 Price-off deals
 Refunds/rebates
 Frequency/loyalty programs
 Point-of-purchase advertising
 Marketing and Promotions Process Model
Marketing Target
Strategy and Marketing Planning Target Market
Marketing Program Development
Analysis Process
Promotion to
final buyer
Identifying Product Promotional
markets decisions decisions
•advertising
•direct
Ultimate
Competitive Pricing marketing
Market customer
analysis decisions •internet/
segmentation •Consumers
interactive
Promotion •Businesses
marketing
•sales to trade
Selecting Channel of
Target a target distribution promotion
•publicity Resellers
marketing market decisions
and public
Positioning relations
through •personal
Purchase
marketing selling
strategies