Chapter 16: Advertising, Sales Promotion and Public Relations

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Chapter 16:
Advertising,
Sales Promotion, &
Public Relations
LEARNING
OBJECTIVES:
 Define the roles of
ADVERTISING, SALES
PROMOTION & PUBLIC
Relations in promotion mix.
 Describe the major decisions
involved in developing an
advertising program.
 Explains how SALES
PROMOTION CAMPAIGNS
are developed and
implemented.
 Explain how companies use
PUBLIC RELATIONS to
communicate with their
publics.
Mohammed Bien M. Kulintang, R.N.
Davao Doctors College Inc.
Masters of Arts in Nursing
Major in Clinical Management

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ADVERTISING
 Any paid form of non-personal presentation and promotion of ideas, goods, or
services by an identified sponsor.
 Countries in Mediterranean Sea
 Romans – painted walls to announce gladiator fights
 Phoenicians – painted pictures promoting their wares on large rocks
along parade routes.
Advertising
 Used mostly by business firms.
 In CHINA, the nation’s largest advertisers are the local fast moving
consumer goods (FMCG) firms – they account for 80% of all the
advertising expenses.
 It is also used by a wide range of not-for-profit organizations,
professionals, and social agencies that advertise their causes to various
target publics throughout Asia.
 In JAPAN, the government, educational institutions, and medical
services account for 4.9% of all advertising in the major media.
 It is a good way to inform or persuade other people or mainly the
consumers.
Marketing Management
 They are responsible in developing an advertising program.
MAJOR ADVERTISING DECISIONS:
The four important decisions when developing an advertising program
1. SETTING ADVERTISING OBJECTIVES
 Based on the past decisions about the target market, positioning, and
marketing mix, which define the job that advertising must do in the total
marketing program.

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 A specific communication TASK to be accomplished with a specific
TARGET AUDIENCE during a specific period of TIME.
 It can be classified by primary purpose.
Possible advertising objectives:
a. INFORMATIVE OBJECTIVE
Used heavily when introducing new products by telling the market
about it.
Suggesting new uses for a product.
Informing the market of a change price.
Explaining how the product works.
Describing available services
Correcting false impressions
Reducing consumer’s fears
Building a Company Image
b. PERSUASIVE ADVERTISING
Becomes more important as competition increases. Here, the
company’s objective is to build selective demand.
Some persuasive advertising has become COMPARATIVE
ADVERTISING in which a company directly or indirectly compares its
brand with other brand.
Building brand preferences.
Encouraging switching to your brand.
Changing customer’s perception of product attributes.
Persuading costumer to purchase now.
Persuading customer to receive a sales call.
Note:
In many Asian countries, direct COMPARATIVE ADVERTISERS
are either banned by law or discouraged. You can only say “COMPARED
TO OTHER BRANDS”.
c. REMINDER ADVERTISING
It is important for mature PRODUCTS – it keeps consumers thinking
about the product
Reminding consumer that the product may be needed in the near
future.
Reminding consumer where to buy.
Keeping it in customer’s mind during off – seasons.
Maintaining its top – of – mind awareness.
2. SETTING THE ADVERTISING BUDGET
 After determining its advertising objectives, the company next sets its
advertising budget for each product.
 Brand’s advertising budget often depends on its stage in the product life
cycle.
a) New products

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 Needs larger budget to build awareness and to persuade
consumers to try the products
b) Mature products
 Requires lower budget as a ratio to sales.
 Market share also impacts on the amount of advertising needed: because
building the market or taking share from competitors requires larger
advertising spending than does simply maintaining current share, low –
share brands usually need more advertising spending as a percentage of
sales.
 Also, brands in market with many competitors and high advertising clutter
must be advertised more heavily to be noticed above the noise in the
market.
 Undifferentiated brands – those that closely resemble other brands in
their product class (beer, soft drinks, laundry detergents) – may require
heavy advertising to set them apart.
 When the products differ greatly from competitors, advertising can be
used to point out the differences to consumers.
 How does a company know if it spending the right amount?
Some critics charge that large consumer packaged – goods
firms tend to spend too much on advertising. They claim that, on
the hand, the large consumer companies use lots of image
advertising without really knowing its effects.
Business to business marketers generally under-spend on
advertising. They just tend to rely too heavily on their sales
forces to bring in orders. They underestimate the power of
company and product image in pre-selling to industrial customer
awareness and knowledge.
3. DEVELOPING ADVERTISING STRATEGY
 In the past, companies often viewed media planning as secondary to the
message – creation process.
 It has two major elements:
1) Creating advertising MESSAGES
2) Selecting advertising MEDIA
1. Creating the Advertising Messages
 No matter how big the budget, advertising can succeed only if
commercials gain attention and communicate well. Good advertising
messages are especially important in today’s costly a cluttered
advertising environment.
 Just to gain and hold attention, today’s advertising messages must
be better planned, imaginative, more entertaining and more
rewarding to consumers.

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 Two steps in creating effective advertising messages.
a. Message Strategy
The effective advertising message is to decide what general
messages will be communicated to consumers – to plan a
message strategy. And it begins with identifying consumers
benefits.
The purpose of advertising is to get consumers to think about or
react to the product or company in a certain way.
MS Statements tends to be plain, straightforward outlines of
benefits and positioning points that advertiser wants to
stress.
The advertiser must next develop a compelling creative concept
or big idea – that will bring the message strategy to life in a
distinctive and memorable way.
 At this stage, simple message ideas become great ad
campaigns. The creative concept may emerge as
visualization, a phrase or a combination of two. It will also
guide the choice of specific appeals to be used in an
advertising campaign.
Advertising Appeal should have three characteristics.
 Meaningful – pointing out benefits that make the product
more desirable or interesting to consumers.
 Believable – the consumer must believe that the product or
service will deliver the features.
 Distinctive – they should tell how the product is better than
the competing brands.
b. Message Execution
The advertiser now has to turn big ideas into an actual ad
execution that will capture the attention and interests of the target
market. The creative people must find the best style, tone, words
and format for executing the message.
Message can be presented in different execution styles.
 Slice of Life – this style uses one or more “typical” people
using the product in normal setting.
 Lifestyle – this style shows how a product fits in with a
particular lifestyle and among Asian consumers, they have an
unlimited appetite for American and European lifestyles.
Example: California Fitness Center, a foreign named fitness
center that aims to promote a healthy western Lifestyle.
 Fantasy – this style creates a fantasy around the product or
its use. For instance, many ads are built around dream
themes.

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 Mood or Image – this style builds a mood or image around
the product, such as beauty, love or serenity. No claim is
made about the product except for suggestions. Across
Asia, hotel and tourism ads create such moods that target at
busy professionals working throughout the region.
 Musical – this style shows one or more people or cartoon
characters singing about the product. Example: Coca-Cola,
they used their own jingle (I’d Like to Teach the World to Sing)
before but now they’re using pop music.
 Personality Symbol – this style creates a character that
represents the products. The character might be animated
(Garfield the Cat, Jollibee) or real (the Marlboro man).
 Technical Expertise – this style shows the company’s
expertise in making the product. To convey some technical
expertise, celebrities are used.
 Scientific Evidence – this style presents survey or scientific
evidence that the brand is better or better liked than one r
more other brands. Example: Colgate vs. Other brands.
 Testimonial Evidence or Endorsement – this style features
a highly believable or likable source endorsing the product. It
could be ordinary people saying how much they like a given
product or a celebrity presenting the product.
 The advertiser also must choose a tone for the ad. P&G always
uses positive tone: its ads say something very positive about its
products. They usually avoid humour that might take attention
away from the message.
 They must also use memorable and attention getting WORDS
in the ad. Example: instead of saying “BMW is a well engineered
automobile”, they use more creative and higher impact phrasing
like “BMW: The ultimate driving Machine”.
 Format – makes a difference in an ad’s impact. It has elements
and these must effectively work together.
 Illustration – first thing the reader notices – it must be strong
enough to draw attention.
 Headline – must effectively entice the right people to read the
copy.
 Copy – the main block of text in the ad – must be simple but
strong and convincing.
2. Selecting Advertising Media
 There are MAJOR STEPS in media selection.
2.1Deciding on Reach, Frequency, and Impact

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Reach – is a measure of the percentage of people in the target
market who are exposed to the ad campaign during a given period
of time.
a. Example: The advertiser must reach 70% of the target market
during the first 3 months of the campaign.
Frequency – is a measure of how many times the average person
in the target market is exposed to the message.
a. Example: The advertiser might want an average exposure
frequency of three.
Media Impact – the qualitative value of a message exposure
through a given medium
a. Example: for products that need to be demonstrated, messages
on TV may have more impact than messages on radio because
television users sight and sound. The same message in one
magazine may be more believable than in other.
 In general, the more reach, frequency and impact the advertiser
seeks, the higher the advertising budget will have to be.
2.2 Choosing Among Major Media Types
Different types of messages may require different media type.
a) Fashions are best advertised in color magazines and
automobile is best demonstrated on television.
b) A message announcing a major sale tomorrow will require radio
or newspaper; a lot of technical data might require magazines,
direct mailings, or online ad and Website.
Cost – is another major factor in media choice. The media planner
looks both at the total cost of using a medium and at the cost per
thousand exposures – the cost of reaching 1,000 people using the
medium.
Profiles of Major Media Types
Medium Advantages Disadvantages
Newspaper Flexibility; timeliness; good local
market coverage; broad capability;
high believability
Short life; poor reproduction
quality; small pass – along
audience
Television Good mass – market coverage; low
cost per exposure; combines sight,
sound, and motion; appealing to the
senses
High absolute costs; high clutter;
fleeting exposure; less audience
selectivity
Direct Mail High audience selectivity; flexibility;
no ad competition within the same
mediums; allows personalization
Relatively high cost per exposure;
“junk mail” image
Radio Good local acceptance; high
geographic and demographic
selectivity, low cost
Audio only, fleeting exposure; low
attention (“the half – hard”
medium); fragmented audiences
Magazines High geographic an demographic
selectivity; credibility and prestige;
high quality reproduction; long – life
and good pass – along the
readership
Long ad purchase lead time; high
cost; no guarantee of position
Outdoor Flexibility; high repeat exposure; low
cost; low message competition; good
Little audience selectivity; creative
limitations

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positional selectivity
Internet High selectivity; low cost; immediacy;
interactive capabilities
Small, demographically skewed
audience; relatively low impact;
audience control exposures
Three media benefiting greatly from the shift are outdoor
advertising, cable television, and digital satellite television
systems.
 Outdoor Advertising – provides an excellent way to reach
important local consumer segments at a fraction of the cost
per exposure of other major media.
 Cable Television & digital satellite system – allow narrow
programming formats such as all sports, all news, nutrition,
arts, gardening, cooking, travel, history, and other target
select groups. Advertisers can take advantage of such
“narrowcasting” to “rifle in” on special market segments
rather than use the “shotgun” approach offered by network
broadcasting.
2.3 Selecting Specific Media Vehicles
Media planner must now compute the cost per thousand persons
reached by a vehicle.
The media planner must also consider the costs of producing ad
for different media. Whereas newspaper ads my cost very little to
produce, flashy television ads may cost millions.
In selecting media vehicles, the media planner must balance
media cost measures against several media impact.
o First – the planner should balance costs against the media
vehicle’s audience quality.
o Second – the media planner should consider audience
attention.
o Third – the planner should assess the vehicle’s editorial quality
– TIME and the Asian Wall Street Journal are more believable
and prestigious than a local business magazine.
2.4 Deciding on Media Timing
The advertiser must also decide how to schedule the advertising
over the course of a year.
The firm can vary its advertising to follow the seasonal pattern, to
oppose the seasonal pattern, or to be same all year. Most firms do
some seasonal advertising. Some do only seasonal advertising.
Finally, the advertiser has to choose the pattern of the ads.
 Continuity – means scheduling ads evenly within a given period.
 Pulsing – means scheduling ads unevenly over a given time.
Recent advances in technology have had a substantial impact on
the media planning and buying functions. Today, computer

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software applications called media optimizers allow media
planners to evaluate vast combinations of television programs and
prices. Such programs help advertisers to make better decisions
about which mix of networks, programs and hours of the day will
yield the highest reach per ad dollar.
 The creative department first created good advertisements, and
then the media department selected the best media carrying these
advertisements to desired target audiences.
 In some cases, an advertising campaign might start with a great idea
followed by the choice of appropriate media. In other cases
however, a campaign might begin with a good media opportunity
followed by advertisements designed to take advantage of the
opportunity.
 Example: Absolut Vodka. Media planners work with creative to
design ads targeted to specific media audiences. “Absolute
Singapore”, “absolute Manila”, absolute Beijing”, absolute Tokyo”.
4. EVALUATING ADVERTISING
 The advertising program should evaluate both the communication effects
and the sales effects of advertising regularly.
 Measuring the communication effects of an ad – copy testing – tells
whether the ad is communicating well.
Copy testing can be done before or after an ad is printed or
broadcast. Before the ad is placed, the advertiser can show it to
consumers, ask how they like it and measure recall or attitude
changes resulting from it.
 What sales are caused by an ad that increases brand awareness by 20%
and brand preference by 10%?
 It is the sales effect of advertising are often harder to measure that
the communication effects. Sales are affected by many factors such
besides advertising – such as product features, price and
availability.
 One way to measure the sales effect of advertising is to compare the past
sales with past advertising expenditures. Another way is through
experiments. More complex experiments could be designed to include
other variables, such as difference in the ads or media used.
5. OTHER ADVERTISING CONSIDERATIONS
 In developing advertising strategies and programs, the company must
address two additional questions. First, how will the company organize its
advertising – who will perform which advertising takes? Second, how will
the company adapt its advertising strategies and programs to the
complexities of international markets?
a. Organizing for Advertising
Advertising Agency

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 A marketing services firm that assists companies in planning,
preparing, implementing and evaluating all or portions of their
advertising programs.
 How does and advertising agency work?
 Advertising Agencies were started in the mid – to – late 1800s by
salespeople or brokers who worked for the media and received a
commission for selling advertising space to companies.
 As times passed, salespeople started to help customers prepare
their ads. Eventually, they formed agencies and grew closer to the
advertisers that to media.
 Today’s agencies employ specialists who can often perform
advertising tasks better than can the company’s own staff.
Agencies also bring an outside point of view to solving the
company’s problems, along with lots of experience from working
with different clients and situation.
 Thus, even the company nowadays uses advertising agencies even
if they have already a strong advertising department.
b. International Advertising Decisions
International advertisers face many complexities not encountered by
domestic advertisers. The most basic issues concern the degree to which
global advertising should be adapted to the unique characteristics of
various country markets.
Some large advertisers have attempted to support their global brands with
highly standardized worldwide advertising, with campaigns that work as
well in Bangkok as they do in New York.
Standardization produces many benefits – lower advertising costs,
greater global advertising coordination, and a more consistent worldwide
image.
Global advertisers face several special problems. For instance, advertising
media costs and availability differ vastly from country to country. Many
countries have extensive systems of laws restricting how much a company
can spend on advertising, the media used, the nature of advertising
claims, and other aspects of advertising programs. Such restrictions often
require advertisers to adapt their campaigns from country to country.
Thus, although advertiser may develop global strategies to guide their
overall advertising efforts, specific advertising programs must usually be
adapted to meet local cultures and customs, media characteristics, and
advertising regulations.

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SALES PROMOTION
 Advertising and personal selling often work closely with another promotion tool,
sales promotion.
 Sales promotion is a short term incentives to encourage the purchase or sale of
a product or services. Whereas advertising and personal selling offer reasons
to buy a product of service, sales promotion offers to buy now. Example of sales
promotions are found everywhere.
A. Rapid Growth of Sales Promotion
 Sales Promotion tools used by organizations, including manufacturers,
distributors, retailers, trade associations and not – for – profit institutions. They
are targeted toward final buyers (consumer promotions), retailers and
wholesalers (trade promotion), business costumers (business promotions),
and members of the sales force (sales force promotion).
 Several factors have contributed to the rapid growth of sales promotion
(particularly in consumer packaged – goods market).
a. FIRST
 Inside the company, product managers face greater pressures to
increase their current sales, and promotion is an effective short –
run sales tool.
b. SECOND
 Externally, the company faces more competition and competing
brands are less differentiated.
c. THIRD
 Advertising efficiency has declined because f rising costs, media
clutter, and legal restraint.
d. FINALLY
 Consumers have become more deal oriented, and ever – larger
retailers are demanding more deals from manufacturers.
 In developing a sales promotion program, a company must first set sales
promotion objectives and then select the best tools for accomplishing these
objectives.
B. Sales Promotion Objectives
 Sales promotion objectives vary widely.
 Sellers may use consumer promotions – to increase short – term sales; to
help build long – term market share.
 Objectives for trade promotion includes the following; a.) getting retailers to
carry new items and more inventory, b.) getting them to advertise the product
and give it more shelf space, c.) getting them to buy ahead.
 Sale force include; a.) getting more sales force support for current or new
products or getting salespeople to sign up new accounts.
 Sales promotions are usually used together with advertising, personal selling
or other promotion mix tools. Consumer promotions must usually be
advertised and can be add excitement and pulling power to ads. Trade and
sales force promotion supports the firm’s personal selling process.

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 In general, rather than creating only short – term sales or temporary brand
switching, sales promotions should help to reinforce the product’s position and
build long – term costumer relationships.
C. Major Sales Promotion Tools
1. Consumer Promotion Tools
a. Sample
 A small amount of product offered to consumers for trial.
 Some samples are free; for others, the company charges a small
amount to offset its cost.
 The sample might be delivered door to door, email, handed in a
store, attached to another product or featured in an ad. Sometimes
it combined into sample packs which can then be used to promote
other products and services.
b. Coupons
 Certificate that gives buyers a saving when they purchase a
specified products
 It can stimulate sales of mature brand or promote early trial for new
brand.
c. Cash refund offers (REBATES)
 Offer to refund part of the purchase price of a product to consumers
who send a “proof of purchase” to the manufacturer
 It is somehow alike with coupon except that the price reduction
occurs after the purchase occurs.
d. Price packs (cents – off deals)
 Reduced price that is marked by the producer directly on the label
or package.
 Buy one Take one.
e. Premiums
 Good offered either free or at low cost as an incentive to buy a
product.
 Example: figurines outside the product of Jollibee. (Freebies)
f. Advertising Specialties
 These are useful articles imprinted with an advertiser’s name that is
given as gifts to consumers.
 Typical items include pens, calendars, key rings, matches, shopping
bags, t-shirts, caps, nail files and coffee mug. Such items can be
very effective.
g. Patronage Rewards
 These are cash or other rewards offered for the regular use of a
certain company’s products or services.
 Example: Airlines (Ticket promos), Petron (earn points)
h. Point – of – Purchase (POP) Promos
 Display and demonstration that takes place at the point of purchase
or sale.
i. Contest, Sweepstakes, Games

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 Promotional events that gives consumers the chance to win
something – such as cash, trips, or goods – by luck or through
efforts.
 Example: Raffle draws or Pageant.
2. Trade Promotions
 It can persuade resellers to carry a brand, give it shelf space, promote it
in advertising and push it to consumers.
a. Discount
 A straight reduction in price on purchase during a stated period of
time also called a price – off, off – invoice, or off – list.
b. Allowance
 Promotional money paid by manufacturers to retailers in return for
an agreement to feature the manufacturer’s products in some way.
 An advertising allowance compensates retailers for advertising
the product. A display allowance compensates them for using
special displays.
 Manufacturers may offer free goods, push – money, and specialty
advertising items.
3. Business Promotion Tools
 Companies spend billions of dollars each year on promotion to industrial
customers.
 These business promotion tools are used to generate business leads,
stimulate purchases, reward customers, and motivate salespeople.
 It uses tools utilized by consumer and trade promotions tools but with
this, it has an additional major business tools.
1. Conventions and Trade Shows
 A company organizes these things to promote their products.
2. Sales Contest
 It is a contest for salespeople or dealers to motivate them to
increase their sales performance over a given period.
 Sale contest motivate and recognize good company
performers, who may receive trips, cash prizes or other gifts.
 It works best when they tied to measurable and achievable
sales objectives (such a finding new accounts, reviving old
accounts, or increasing accountability profit).
D. Developing the Sales Promotion Program
 The marketer must take several other decisions in order to define the full
sales promotion program.
 First, the marketer must decide on the size of incentives. A certain minimum
incentives are necessary if the promotion is to succeed; a larger incentive will
produce more sales response.

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 A marketer also must set conditions for participation. Incentives might be
offered to everyone or only to select groups.
 Marketer then decides how to promote and distribute the promotion
program itself. Each distribution methods involve a different level of reach
cost. Increasingly, marketers re blending several media into a campaign
concept. The length of promotion is also important. If too – short, many will
miss it as to if too – long, the deal will lose some of its “act now” force.
 Evaluation is also very important. The most common evaluation method is to
compare sales before, during and after a promotion.
 Consumer research would also show the kinds of people who responds to
the promotion and what they did after. Surveys can provide information on
how it affected their buying.
 It can also be evaluated through an experiment that varies factors such as
incentive value, length and distribution method.
PUBLIC RELATIONS
 Building goods with the company’s various publics by obtaining favourable
publicity, building up a good corporate image, handling or heading off
unfavourable rumors, stories and events.
 PR Department may perform any of the following functions:
a. Press Relations or Press Agentry
Creating and placing newsworthy information in the news media to
attract attention to a person, product or services.
b. Product Publicity
Publicizing specific products
c. Public Affairs
Building and maintaining national or local community relations.
d. Lobbying
Building and maintaining relations with legislators and government
officials to influence legislation and regulation.
e. Investor Relations
Maintaining relationships with shareholders and others in the
financial community.
f. Development
Public relations with donors or members of non profit organizations to
gain financial or volunteer support.
 Public relations used to promote brands, products, people, places, ideas,
activities, organization, and even nations.
A. The Role and Impact of Public Relations
 Public relations can have a strong impact on public awareness at a much
lower cost than advertising can. The company does not pay for the space or
time in the media. Rather, it pays for a staff to develop and circulate
information and to manage events.

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 Public relations involve many functions beyond product publicity including
public affairs, lobbying and investor relations.
 Public relations results can sometimes be spectacular. Scholastic sponsored
lo – cost sleepovers, games, and costume contests to whip up consumer
frenzy for the fourth instalment of its Harry Potter series.
 Despite its potential strengths, public relations often described as a marketing
stepchild because of its limited and scattered use. Marketing managers and
public relations practitioners do not always talk the same language. Many
public relations practitioners see their job as simply communicating. In
contrast, marketing managers tend to be much more interested in how
advertising and public relations affect brand building, sales and profit.
B. Major Public Relations Tools
 Public relations professionals use several tools.
1. News
One of the major tools.
PR professionals find or create favourable news about the
company and its products or people.
Sometimes news stories occur naturally and sometimes PR
person can suggest events or activities that would create news.
2. Speeches
Can also create product and company publicity.
Increasingly, company executives must field questions from the
media or give talks at trade associations or sale meetings and
events can either build or hurt the company’s image.
3. Special Events
Another common tool.
Ranging from news conferences, press tours, grand openings, and
fireworks displays to laser show, hot air balloon release,
multimedia presentations and star – studded spectaculars and
educational programs designed to reach and interest target
publics.
4. Mobile Marketing
Recent – travelling promotional tours that brings the brand to
consumers – has emerged as an effective way to build one – to –
one relationship with targeted consumers.
5. Written Materials
PR people can prepare this to reach the influence their target
markets.
These materials include annual reports, brochures, articles, and
company newsletters and magazines.
6. Audio Visual Materials
Such as films, slide and sound programs, video and
audiocassettes are being used increasingly as communication
tools.
7. Corporate Identity Materials

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It can also help create a corporate identity that the public
immediately recognizes.
Logos, stationery, brochures, signs, business cards, buildings,
uniforms and company cars and trucks – all become marketing
tools when they are attractive, distinctive and memorable.
8. Public Service Materials
Companies can improve public goodwill by contributing money
and time to this.
Company’s WEB can also be a good public relations vehicle.
Consumers and members of other publics can visit the site for
information and entertainment.