Lecture3广告管理概览.ppt

Advertising&SalesPromotion,Lecture3AdvertisingManagementOverviewAndCampaignPlanning,71,Shimpchapter7Yeshinchapters4to8,Understandthemagnitudeofadvertisingandthepercentageofsalesrevenuecompaniesinvestinthismarcomtool.Appreciatethatadvertisingcanbeextraordinarilyeffectivebutthatthereisriskanduncertaintywheninvestinginthispractice.Recognizethevariousfunctionsthatadvertisingperforms.Exploretheadvertisingmanagementprocessfromtheperspectiveofclientsandtheiragencies.,ChapterObjectivesAfterreadingthischapteryoushouldbeableto:,2010South-Western,apartofCengageLearning.Allrightsreserved.,72,Understandthefunctionsagenciesperformandhowtheyarecompensated.Exploretheissueofwheninvestinginadvertisingiswarrantedandwhendisinvestingisjustified.Examineadvertisingelasticityasameansforunderstandingthecontentionthat“strongadvertisingisadepositinthebrandequitybank.”,ChapterObjectives(contd)Afterreadingthischapteryoushouldbeableto:,2010South-Western,apartofCengageLearning.Allrightsreserved.,73,IsAdvertisingRocketScience?,“Thetruthisthatadvertisingisharderthanrocketscience.Itsnewswhenarocketlaunchfails.Itsnewswhenanadcampaignlaunchsucceeds.”,2010South-Western,apartofCengageLearning.Allrightsreserved.,74,Introduction,AdvertisingDefinedApaid,mediatedformofcommunicationfromanidentifiablesource,designedtopersuadethereceivertotakesomeaction,noworinthefutureTypesofAdvertisingBusinesstoConsumer(B2C)BusinesstoBusiness(B2B),2010South-Western,apartofCengageLearning.Allrightsreserved.,75,2010South-Western,apartofCengageLearning.Allrightsreserved.,76,Figure7.1,ExampleoftheUseofHumorinB2BAdvertising,TheMagnitudeofAdvertisingthats$360,000,000,000!,2010South-Western,apartofCengageLearning.Allrightsreserved.,77,UnitedStates:$294billion($1,000perperson),Global:$360billion,UKAdSpendPatterns,UKadspendpatterns2008&2009:See,2010South-Western,apartofCengageLearning.Allrightsreserved.,78,2010South-Western,apartofCengageLearning.Allrightsreserved.,79,Table7.1,Top20SpendersinU.SAdvertising,2006($million),TheMagnitudeofAdvertising(contd),Advertising-to-SalesRatiosAdvertisingasapercentageofsalesrangesfromalowof1.3%toahighof29.9%Ratiostypicallyrangefrom2%to10%withanaverageof3.1%acrossmostB2CandB2BcategoriesCompetitionfromlargerfirmsforcessmallercompaniestohavehigherratiosPersonalcareproductsbasedonimagehavehighratios,2010South-Western,apartofCengageLearning.Allrightsreserved.,710,2010South-Western,apartofCengageLearning.Allrightsreserved.,711,Table7.2a,Advertising-to-SalesRatiosforSelectProductCategories,2010South-Western,apartofCengageLearning.Allrightsreserved.,712,Table7.2b,Advertising-to-SalesRatiosforSelectProductCategories,2010South-Western,apartofCengageLearning.Allrightsreserved.,713,Table7.2c,Advertising-to-SalesRatiosforSelectProductCategories,TheMagnitudeofAdvertising(contd),AdvertisingEffectsAreUncertainAdvertisingisnotjustacurrentexpensebutratherisaninvestmentAdvertisingshouldnotbemanagedasadiscretionaryvariablecostAdvertisingshouldnotbethefirstreductionwhenfinancialpressurescallforcost-cuttingmeasures.ConsistentinvestmentspendingisthekeyfactorunderlyingsuccessfuladvertisingStoppingadvertisingcancauseabrandtolosemarketmomentum,reducingitsequityandmarketshare,2010South-Western,apartofCengageLearning.Allrightsreserved.,714,AdvertisingFunctions,2010South-Western,apartofCengageLearning.Allrightsreserved.,715,AdvertisingFunctions,InformingMakingconsumersawareofnewbrands.IncreasingTOMA(TopofMindAwareness)Teachingnewusesforexistingbrands(calledusageexpansionadvertising)InfluencingGettingprospectivecustomerstotryadvertisedproductsandservices:CreatingprimarydemandBuildingsecondarydemand,2010South-Western,apartofCengageLearning.Allrightsreserved.,716,AdvertisingFunctions(contd),RemindingandIncreasingSalienceEnrichingthememorytraceforabrandsothatthebrandcomestomindinrelevantchoicesituationsIncreasingcustomersinterestinmaturebrandsandthelikelihoodofchoosingbrandsthatmighthaveotherwisenotbeenchosen.Influencebrandswitchingbyremindingconsumersthatthebrandisavailableandthatitpossessesfavorableattributes.,2010South-Western,apartofCengageLearning.Allrightsreserved.,717,2010South-Western,apartofCengageLearning.Allrightsreserved.,718,AdvertisingFunctions:AddingValue,AdvertisingFunctions(contd),UsingAdvertisingtoAssistOtherCompanyEffortsTodelivercouponsandsweepstakesToassistsalesrepresentativesTopre-sellafirmsproductsbyintroducingtheproductandlegitimizingsalespeoplesclaimsToaugmenttheeffectivenessofpricedeals,2010South-Western,apartofCengageLearning.Allrightsreserved.,719,2010South-Western,apartofCengageLearning.Allrightsreserved.,720,Figure7.2,TheAdvertisingManagementProcess,2010South-Western,apartofCengageLearning.Allrightsreserved.,721,StrategicAdvertisingAlternatives,2010South-Western,apartofCengageLearning.Allrightsreserved.,722,Table7.3,Top-10U.S.AdvertisingAgenciesinAdRevenue,2006,Top10Agencies,2010South-Western,apartofCengageLearning.Allrightsreserved.,723,AdvertisingFunctionAlternatives,In-HouseAdvertisingOperationNecessitatesemployinganadvertisingstaffandabsorbingtheoperationcostsUnprofitableunlessacompanydoesalargeamountofcontinualadvertising,2010South-Western,apartofCengageLearning.Allrightsreserved.,724,AdvertisingFunctionAlternatives,PurchaseServiceslaCarteAdvantagesUseservicesonlywhentheyareneededAvailabilityofhigh-calibercreativetalentPotentialcostefficienciesDisadvantagesLackcostaccountabilityFinancialinstabilityofsmallerboutiques,2010South-Western,apartofCengageLearning.Allrightsreserved.,725,AdvertisingFunctionAlternatives,Full-ServiceAdvertisingAgencyAdvantagesAccesstoin-depthknowledgeandskillsObtainingnegotiatingleveragewiththemediaCoordinatingadvertisingandmarketingeffortsDisadvantagesSomecontrolofadvertisingfunctionislostLargerclientsarefavoredoversmallclientsOccasionallyinefficientinmediabuying,2010South-Western,apartofCengageLearning.Allrightsreserved.,726,AdvertisingAgencyOrganization,2010South-Western,apartofCengageLearning.Allrightsreserved.,727,CreativeServices,DevelopadvertisingcopyandcampaignsCopywriters,productionpeople,andcreativedirectors,MediaServices,SelectingthebestadvertisingmediaMediaplannersdevelopoverallmediastrategyMediabuyersprocuretheselectedmedia,ResearchServices,Studyclientscustomersbuyinghabits,purchasepreferences,andresponsivenessFocusgroups,mallintercepts,acquisitionofsyndicatedresearchdata,AccountManagement,LinktheagencywiththeclientActasliaisonssothattheclientdoesnotneedtointeractdirectlywithseveraldifferentservicedepartmentsandspecialists,2010South-Western,apartofCengageLearning.Allrightsreserved.,728,AgencyCompensation,Orperhapsahybridofthese?,Ad-InvestmentConsiderations,IsTheMoneyInvestedinAdvertisingWarranted?Profit=RevenueExpensesRevenue=PriceVolumeVolume=Trial+Repeat,2010South-Western,apartofCengageLearning.Allrightsreserved.,729,Ad-InvestmentConsiderations:WhichPositionIsMoreAcceptable?,TheCaseforInvestingAdvertisingcanincreaseprofitabilitybyincreasingsalesvolume,enablinghighersellingprices,andthusincreasingrevenuebeyondtheincrementaladvertisingexpense.TheCaseforDisinvestingFirmschoosetoreduceadvertisingexpenseseitherwhenabrandisperformingwellorduringeconomicrecessioninthebeliefthatanexpensereduction,withallelseheldconstant,willresultinincreasedprofits.,2010South-Western,apartofCengageLearning.Allrightsreserved.,730,AdvertisingversusPricingElasticity,ElasticityAmeasureofhowresponsivethedemandforabrandistochangesinmarketingvariablessuchaspriceandadvertisingCalculatingelasticitycoefficientsforprice(EP)andadvertising(EA):EP=PercentagechangeinquantitydemandedPer