Introduction to Advertising & Sales Promotion

1. Introduction to Advertising & Sales Promotion

2. Bill Bernbach on Persuasion "The truth isn't the truth until people believe you, and they can't believe you if they don't know what you're saying, and they can't know what you're saying if they don't listen to you, and they won't listen to you if you're not interesting, and you won't be interesting unless you say things imaginatively, originally, freshly”.

3. David Ogilvy on Selling “In the modern world of business, it is useless to be a creative, original thinker unless you can also sell what you create”.

4. Agenda • What is Communication? • What is Promotional Mix? • What is Advertising? • Advertising’s Evolution • Roles & Functions • Key Players • Types of Advertising • Characteristics of Effective Advertising • Current Trends • What is Sales Promotion?

5. Definition of Communication Communication refers to the act, by one or more persons, of sending and receiving messages that are distorted by noise, occur within a context, have some effect and provide some opportunity for feedback.

6. Intrapersonal Communication You talk with yourself Interpersonal Communication You talk with others Small Group and Organizational Communication You interact with others, solving problems, developing new ideas, and sharing knowledge and experiences Public Speaking/Communication Through Public Speaking/Communication, others inform and persuade you Mass Communication Through Mass Communication you are entertained, informed, and persuaded by the mediator Types of communication

7. Elements of Communication Source Encoder Receiver Decoder Source Encoder Receiver Decoder Effect Channels Effect Messages Noise

8. Communication Context All communication takes place in a context that has at least 4 dimensions Physical It is tangible or concrete environment in which communication takes place. Room,Park etc Cultural Communicators’ Rules, Norms, Beliefs and attitude Social-psychological Status relationships among the participants, the roles, the cultural rules of the society. Temporal Time of the day as well as time in history when communication takes place

9. Sources-Receivers Each person involved in communication is both a Source (or speaker) and a receiver (or listener) Source-Receiver Encoding-Decoding Encoding Act of producing message. Example writing or speaking Decoding Act of receiving messages. Example reading or listening Messages Communications messages take many forms We send and receive messages through any one or any combination of sensory organs. Verbal oral or written Non-verbal other than oral or written, Clothes you wear, the way you talk, shake hands, nod your head, comb your hair, sit and smile---all send messages.

10. Communication Channel It is the medium through which the message passes Vocal Channel Speak and listen Visual Channel See Olfactory Channel Smell odors Tactile Channel Touch Feedback Messages Messages sent back to the speaker reacting to what is said. Verbal and/or non-verbal Feedback has 5 dimensions Positive or Negative Person-focused or Message-focused Immediate or Delayed Low Monitoring (spontaneous and honest) or High Monitoring (saddarati bayan) Supportive or Critical

11. Feedforward Messages • Verbal and/or non-verbal • It is information you provide before sending your primary messages revealing • something about the message to come. • Preface of the book • The opening paragraph of a chapter • Movie Previews • Magazine Covers • Introduction in Public speeches • Teaser ads

12. Communication Effects Communication has always some effect on one or more persons involved in the communication act. Type of effects Intellectual or Cognitive Effects You may gain knowledge or learn how to analyze, synthesize, or evaluate something Affective Effects You may acquire or change your attitudes, beliefs, emotions, and feelings. Psychomotor Effects You may learn new bodily movements as well as verbal or non-verbal behaviors

13. Noise Noise is a disturbance in communication that distorts the message. Noise may be Physical Others talking in the background Psychological Preconceived ideas Semantic Misunderstood meanings

14. 5 general purposes • To discover • One of the major purposes of communication concerns personal discovery. • Discover yourself • Discover others (interpersonal encounters) • Discover External world • To Relate • One of our strongest motivations is to establish and maintain close relationship with • others. • Make or break Personal relationship • Make or break Social relationship The purpose of Communication

15. To help • Therapist, counselors, teachers, parents, and friends who often communicate to help • We use this function of communication when: • We constructively criticize • Express empathy • Work with others to solve a problem • Listen attentively and supportively to a public speaker • To Play • We spend a great of our communication behavior on play. • Communication as play includes motives of pleasure, escape and relaxation • We hear comedians and friends largely because it is fun, enjoyable and exciting. • To persuade • The mass media exist largely to persuade you to change your attitudes and behaviors

16. Definition of Marketing An organizational function and set of processes for creating, communicating and delivering value to customers and for managing customer relationship in ways that benefit the organization and its stake holders.

17. What is Marketing Mix? • The tools available to a business to gain the reaction it is seeking from its target market in relation to its marketing objectives • The major marketing management decisions can be classified in one of the following four categories: • Product • Price • Place (distribution) • Promotion • These variables are known as the marketing mix or the 4 P's of marketing. They are the variables that marketing managers can control in order to best satisfy customers in the target market.

18. The firm attempts to generate a positive response in the target market by blending these four marketing mix variables in an optimal manner. Product The product is the physical product or service offered to the consumer. In the case of physical products, it also refers to any services or conveniences that are part of the offering. Product decisions include aspects such as function, appearance, packaging, service, warranty, etc. Price Pricing decisions should take into account profit margins and the probable pricing response of competitors. Pricing includes not only the list price, but also discounts, financing, and other options such as leasing.

19. Place Place (or placement) decisions are those associated with channels of distribution that serve as the means for getting the product to the target customers. The distribution system performs transactional, logistical, and facilitating functions. Distribution decisions include market coverage, channel member selection, logistics, and levels of service. Promotion Promotion decisions are those related to communicating and selling to potential consumers. Since these costs can be large in proportion to the product price, a break-even analysis should be performed when making promotion decisions. It is useful to know the value of a customer in order to determine whether additional customers are worth the cost of acquiring them.

20. 4Ps are marketing tools and communication about these 4Ps i.e. Marketing communication is called promotion and so advertising is marketing communication tool.

21. PROMOTION Communication activities that inform potential consumers about the existence of goods, services, or ideas and persuade them to buy

22. THE BEST BLEND • PROMOTIONAL MIX: The most effective combination, or blend, of the marketing communication channels that a business uses to seen its messages to consumers

23. IMPORTANCE OF PROMOTIONAL MIX • Plays a key role in obtaining and keeping customers • Enables businesses to communicate effectively with consumers • Informs potential consumers about the existence of goods and persuades them to buy

24. Promotion and Promotional Mix • Promotion is persuasive communication • companies rely on promotion to inform people about their products and services • companies use promotional techniques to enhance their public image and reputation and persuade people that their products are valuable • goals of promotional activities is summarized by the phrase AIDA

25. AIDA • Attract Attention to product • Build Interest in product • Create Desire for product • Ask for Action • Exposure • Awareness • Knowledge • Preference • Trial • Repurchase

26. Product Promotion • businesses use product promotion to convince prospects to select its products or services instead of a competitor’s brands • explains • major features and benefits of the product or service • where it is sold • advertise sales • introduce new offerings

27. product promotion also helps companies foster good relations with existing customers, thereby enhancing their loyalty

28. Institutional Promotion • used to create a favorable image for a business • help the business advocate for change • take a stand on trade or community issues ** do not directly sell a product or service these activities do foster a favorable image for the company

29. Promotional Mix AdvertisingNon-personal Presentation by an Identified Sponsor Personal SellingPersonal Presentations by a Firm’s Sales Force Sales PromotionShort-term Incentives to Encourage Sales Public RelationsBuilding Good Relations with Various Publics by obtaining Favorable Unpaid Publicity Direct MarketingDirect Communications With Individuals to obtain an Immediate Response

30. What is Advertising? Origin • Latin root AD VERTER • To turn towards • To attract attention

31. Definition Advertising is a paid, mediated form of communication from an identifiablesource, designed to persuade the receiver to take some action, now or in the future

32. Elaboration • Paid • Mediated form of communication • Identifiable source • Designed to persuade • The receiver • Take some action, now or in the future See. Think. Do as 1.

33. Illustration Paid Mediated Identifiable Source To persuade Take action

34. Objectives of Advertising • Provide informationWhat the consumer needs to know • Provide incentives to buyTell them why • Reminds and Re-enforcesRepetition

35. Functions of Advertising • Create awareness of products & brands • Provide product and brand information • Create brand image • Persuade / Convince people • Provide incentives to take action • Provide brand reminders • Reinforce past purchases & brand experiences

36. Key Concepts • Strategy Methodology of meeting objectives and addressing the market in the most effective manner. Strategy is the logic and planning that gives the advertisement direction and focus • Creative Idea Grab your attention and sticks to your memory • Creative Execution What makes the ad memorable? • Effective & Efficient Media Use Effective ads are well executed, that means that details such as photography, setting, printing and production values are all fine-tuned What & Who How When & Where

37. Advertising Effectiveness Strategy Creative Idea Execution Media Sound Strategy + Great Creativity = Effective Advertising

38. Introduction to Advertising

39. Evolution of Advertising • Prehistoric Era • Age of Print • Industrial Revolution & Consumer Society • Modern Advertising Era • Age of Agencies • Creative Era • Accountability Era

40. Written Ad offering whole gold coin for runaway slave Political & trade graffiti on Pompeii walls 500 B.C. 3000 B.C. Pre-historic Era Printed Handbills First printed ad in English tacked on London church doors Volney B. Palmer becomes the 1st ad sales agent (Boston) 1st print ad in London’s Weekly Relations News London Gazette offers 1st advertising supplement 1st US newspaper to carry ads 1st use of the term Advertising 1841 1472 1655 1662 1704 1622 Mid 1400s Age of Print Timelines

41. Albert Lasker pioneers ‘Reason-Why’ copy J. Walter Thompson forms JWT (1st account executive) 1st Ad censor appointed by Scripps-McRoe League of NPs John Powers pioneers copywriting; focuses on news 1st Truth in Advertising Act passed E. E. Calkins & R. Holder develop image copy Printer’s Ink, 1st US publication for advertising profession Start of celebrity endorsement with Pepsi (Barney Oldfield) 1904-40s 1864 1908 1888 1890s 1912 1880s 1903 Industrial Revolution & Consumer Society 1st branded items such as Baker’s Chocolate appears in stores Studies on the attention-getting & persuasive qualities of advertising 1900 1850s Modern Advertising Era Timelines

42. Timelines IMC, niche marketing, interactive media, mass customization… 1st ad testimonials by movie stars appear 1st Radio ad solves radio’s financing needs Rosser Reeves develops USP concept TV becomes leading advertising medium Internet is the fastest growing ad medium since TV 1920s 1940s-50s 1950s 1922 90s-2000s 2000s Age of Agencies Accountability Era American Association of Ad Agencies formed Mega mergers take place worldwide Ogilvy develops research-based image advertising & storytelling D.D. B. ‘Think Small’ campaign for VW / Visa’s ‘We try harder’ Leo Burnett creates brand icons and inherent drama Bill Bernbach focuses on art of persuasion 1980s-90s 1917 1960s 1960s 1960s 1960s Creative Era

43. Advertising in Pakistan • 1947 to 1950s • Few foreign-based agencies • Press only available medium • Stunted growth of commerce & industry • Press ads from 50s • 1960s onwards • Radio Pakistan launched commercial services • State-owned PTV launched in Lahore in 1964 • 1979 PIA Ad • 1980s • Strict censor laws on broadcast media • Memorable Pakistani TV Ads

44. Advertising in Pakistan • 2000 onwards • PEMRA issued licenses to several satellite channels • Adspend increasing 25% annually (2007) • Consumerism on the rise

45. Roles of Advertising • Marketing • Communication • Economic • Societal

46. Promotion Advertising Personal selling Sales Promotion Direct Marketing PR Collateral Price Place Product List price Discounts Allowances Payment period Credit terms Location Transport Coverage Channels Inventory Features Style Brand name Packaging Services Marketing Mix Marketing & Communication Role • Marketing Mix • Mass communicate to to connect buyers & sellers

47. Economic Role • Economy grows  Advertising flourishes • 2 perspectives on how advertising creates economic impact • Informational role • Persuasion role

48. Societal Role • Adds to our Aesthetic sense • New products and information • Helps us create self-image & express ourselves through the things we use/wear • Has both negative & positive effects