Lesson 6.2 The Promotional Mix ─ Advertising

Lesson 6.2The Promotional Mix─Advertising Goals • List the many forms of advertising • discuss advantages and disadvantages of each type of advertising Chapter 6

Promotional Mix • Promotional Mix: strategy created by adopting a blend of some, if not all, of the types of promotion available

Five Types of Promotion in Promotional Mix • Personal selling • Advertising • Direct Marketing • Sales Promotion • Public Relations Product Promotion Activities Institutional Promotion Activities

To succeed as a business, your customers need to know about your business AND the products/services you offer Goal of Promotion = AIDA Attract Attention, Build Interest, Build Desire and get customer’s to Act

Advertising As part of the Promotional Mix

Advertising • Advertising a paid form of communication sent out by a business about a product or service • very important for small and/or new businesses • Purpose: Communicates with potential customers details about your products and services and why customers should buy from you Chapter 6

Advertising • Advertising should clearly communicate your message and image • If low price is your message, highlight this in ads • Large companies hire advertising agencies – costly • Small business usually handle their own

Type of Advertising What are some types of Advertising you can think of? • Student contributions:

Type of Advertising What are some types of Advertising you can think of?: • Online • Television • Radio • Newspaper • Direct Mail • Magazine • Outdoor • Transit • Social Networking

Online Advertising • Online advertising still new – uses different guidelines than print • Graphics, photos, layouts, text and design must be professional for a positive impact • used when customers extend beyond the local (home town) market • Cost effective way to promote products • Can interact with customersvia chat rooms, blogs, and e-newsletters

Common types of online advertising • Banner ad – graphic image in a box across the top or down side of web page • FloatingAd – ad that moves across the screen or floats above the page content • WallpaperAd – ad that changes the background of the page being viewed • TrickBanner – banner ad that looks like a dialog box with buttons appearing as an error message or alert • Pop-UpAd – new window that opens in front of the current window with an ad • Pop-UnderAd – new window that loads behind the current window and appears when user closes the active window

Charging for Online Advertising • Cost per Mil (CPM) • the advertiser is charged based on the exposure of the message to a specific audience • priced per thousand viewers reached with the message • Cost Per click (CPC) • the advertiser is charged based on the number of user clicks on the advertisement • viewers respond to the ad by clicking on the hyperlink within the ad • Cost per Action (CPA) • the advertiser is charged when a user takes an action to complete a form • advertisers prefer this type of charge for banner ads

Disadvantages of Online Advertising • your marketing materials are available for anyone in the world to copy (logos, images, trademarks, ect.) • Viewers perceive it as SPAM mail – ignore it • utilize software to block promotions

Television Advertising • Most Effective way to reach a large number of people quickly • Can communicate through sight and sound • Can be creative, entertaining, and informative • Two types: • Commercials - last less than a minute • Infomercials - last ½ hour or more and provide in-depth coverage about a specific product • Most costly form or advertising Chapter 6

Commercial Example

Infomercial • Include price, contact number, and buy now deals! • Usually on Paid programming channels • ½ or more in length

Television Advertising Fees • Fees include: • length of time of the commercial • the costs of producing the commercial • National advertising most expensive • Local TV offers affordable rates for small businesses • Example: • $250 for a 1 minute commercial that cost you $2000 to produce. You plan to air it 30 times. How much does the commercial cost? • $200* 30 = $7500 + $2000 = $9,500

Disadvantages of Television Ads • it is very expensive • difficult to make changes once the ad is complete • Viewers are annoyed and use time to get snacks, use restroom, or have a DVR

Super bowl TV Ads • reaching more than 90 million viewers • spectacular and innovative in most cases • Highly anticipated even before the game • Typically costs millions of dollars for 30 seconds • 2013 record high for cost? • $4 million for a 30 second ad • Best of 2012

2013 “Funniest” Commercials

Radio Advertising • less expensive than television advertising • listener demographics are more specific than television • easier to reach target audience • Ex: rock stations target teenagers/young adults • Fees: • pay for air time • pay for production costs Chapter 6

Disadvantages of Radio Advertising • the message is purely audio • a visual of the product is not shown • listeners may forget what they hear • listeners may tune out during commercials • May need to hire someone to create an ad Chapter 6

Lesson 6.2 The Promotional Mix ─ Advertising