MARKETING UNIT 4

Roles of advertising agency - - - -

- copywriting - artwork - technical production - formulation of the media plan

Stages of advertising campaign 1. Identify and analyze the target audience 2. Define advertising objectives 3. Create an advertising platform 4. Determine advertising appropriation 5. Develop a media plan 6. Create an advertising message 7. Execute campaign 8. Evaluate advertising effectiveness

1. Identify and analyze the target audience 2. Define advertising objectives 3. Create an advertising platform 4. Determine advertising appropriation 5. Develop a media plan 6. Create an advertising message 7. Execute campaign 8. Evaluate advertising effectiveness

---% commission paid by the media from which it makes purchases, firms can obtain some agency services at low or moderate costs.

15%

Chantel, a resident of Denver, Colorado, decided to open up her own fine jewelry store. To do so, she used her life savings and a loan from the bank. Chantel was able to open up a store with sufficient inventory. She markets the jewelry as the "finest jewelry in the West." The most popular item Chantel sells is a rose gold bracelet that sells for $550. During one month, Chantel's fixed costs are $6,000. Her variable costs average about $400.Refer to Scenario 19.1. How many rose gold bracelets would Chantel have to sell to break even? a. 24 b. 40 c. 37 d. 50 e. 54

40

•When an organization uses an ------ agency, the firm and the agency usually develop the advertising campaign jointly •Ordinarily, a firm relies on the ----- for copywriting, artwork, technical production, and formulation of the media plan

Advertising agency

------ ------- - The creation and execution of a series of advertisements to communicate with a particular target audience

Advertising campaign

•------- - The manner in which a salesperson contacts a potential customer

Approach

The ------ is the cost comparison indicator for magazines; it shows the cost of exposing 1,000 people to one advertisement

CPM Cost Per Thousand

------ ------ - Pricing the basic product in a product line low, while pricing related items higher

Captive pricing

•------- advertising - Compares the sponsored brand with one or more identified brands on the basis of one or more product characteristics •------- advertising - Advertising used to remind consumers about an established brand's uses, characteristics, and benefits •------- advertising - Advertising that assures users they chose the right brand and tells them how to get the most satisfaction from it

Comparative Reminder Reinforcement

------- ------ - Charging different prices to different buyers for the same quality and quantity of product

Differential pricing

An important issue in pricing decisions is whether to use a single price or different prices for the same product

Differential pricing

An ------- demand is one in which the change in quantity demanded due to a change in price is large. An ------- demand is one in which the change in quantity demanded due to a change in price is small.

Elastic demand Inelastic demand

The difference between ----- and ----- sales is simple: ------ sales refers to salespeople who sell products or services to customers remotely, such as over the phone and internet. ------ sales refers to selling products or services in person, which requires traveling to meet with customers or teams face-to-face

Inside Outside

Advertising that promotes organizational images, ideas, and political issues

Institutional advertising

Coordination of promotion and other marketing efforts for maximum informational and persuasive impact on customers

Integrated marketing communications

--------- stage- Advertising plus personal selling and sales promotion is used to generate awareness for both business and consumer products •----- and----- stage- •Consumer products require heavy emphasis on advertising •Business products often call for a concentration of personal selling and some sales promotion •------ stage- •Marketers decrease all promotional activities, especially advertising

Introduction Growth and maturity Decline

---- ----- - A plan that specifies the media vehicles to be used and the schedule for running advertisements •The ----- ------ primary goal is to reach the largest number of people in the advertising target that the budget will allow •----- ------ must decide which kinds of media to use

Media plan

•The three most common kinds of sales support personnel: •------ salespeople - Support salespeople usually employed by a manufacturer, who assist the producer's customers in selling to their own customers •------ salespeople - Salespeople involved mainly in helping a producer's customers promote a product •------ salespeople - Support salespeople who give technical assistance to a firm's current customers

Missionary Trade Technical

------- advertising - Digital advertising that matches the appearance and purpose of the content in which it is embedded

Native advertising

Setting the base price for a new product is a necessary part of formulating a marketing strategy

New Product pricing

------- -------- Setting prices below those of competing brands to penetrate a market and gain a significant market share quickly

Penetration pricing

Which of the following focuses on a product category rather than a specific brand? a. Product advertising b. Pioneer advertising c. Competitive advertising d. Advocacy advertising e. Comparative advertising

Pioneer advertising

•Before contacting acceptable prospects, a salesperson finds and analyzes information about each prospect's: •Specific product needs •Current use of brands •Feelings about available brands •Personal characteristics

Preapproach

---- - The value paid for a product in a marketing exchange

Price

------ is the amount that consumers will be willing to pay for a product. Marketers must link the price to the product's real and perceived value, while also considering supply costs, seasonal discounts, competitors' prices, and retail markup.

Price

•------ is a key element in the marketing mix because it relates directly to the generation of total revenue

Price

•------—as an ingredient in the marketing mix—often is coordinated with promotion

Price

------- competition - Emphasizing price as an issue and matching or beating competitors' prices - caution is price wars ------- competition - Emphasizing factors other than price to distinguish a product from competing brands

Price Nonprice

What happens if revenue and cost remain constant? a. Fixed costs could be kept at a minimum b. Prices could be set for maximum profits c. Costs could be significantly reduced d. Marginal revenue would always exceed marginal cost e. The breakeven point would be much lower

Prices could be set for maximum profits

Advertising that promotes the uses, features, and benefits of products

Product advertising

------- ------ ------ - Establishing and adjusting prices of multiple products within a product line

Product line pricing

------ ----- is a form of advertising that strategically locates products or product promotions within entertainment media to reach the product's target market

Product placement

•------- ------- - Fees set by people with great skill or experience in a particular field

Professional pricing

•------- - Developing a database of potential customers

Prospecting

Personal selling process - - - - - - -

Prospecting Preapproach Approach Making the Presentation Overcoming objections Closing the sale Following up

•------ ------- - Pricing that attempts to influence a customer's perception of price to make a product's price more attractive

Psychological pricing

------- ------- - Communication efforts used to create and maintain favorable relations between an organization and its stakeholders

Public relations

•------ - The percentage of consumers in the target audience actually exposed to a particular advertisement in a stated period •------ - The number of times these targeted consumers are exposed to the advertisement

Reach Frequency

•----- ------- Pricing a product at a moderate level and displaying it next to a more expensive model or brand

Reference pricing

Advertising objectives should be stated clearly, precisely, and in measurable terms, and should specify a time frame Objectives can be defined on the basis of: ------ and -------

Sales and communication

•----- ------ - An activity and/or material intended to induce resellers or salespeople to sell a product or consumers to buy it

Sales promotion

•----- ------- is an activity or material that acts as a direct inducement, offering added value or incentive for the product to resellers, salespeople, or customers •Examples include: •Free samples •Games •Rebates •Sweepstakes •Contests •Premiums Coupons

Sales promotion

------- ----- ----- - Setting one price for the primary target market and a different price for another market

Secondary Market Pricing

------- ------- - The group of people at whom advertisements are aimed

Target audience

---------------- - Personal informal exchanges of communication that customers share about products, brands, and companies

Word of mouth communications

Which of the following contrasts the promoted brand with one or more identified competing brands on the basis of one or more product characteristics? a. Comparative advertising b. Pioneer advertising c. Institutional advertising d. Product advertising e. Competitive advertising

a. Comparative advertising

Which of the following most likely constitutes buzz marketing? a. McDonald's used chalk to draw out a giant professional-looking drawing of french fries complete with the McDonald's logo on the boardwalk of a big city. b. McDonald's engages in its annual "Monopoly" consumer game in which consumers receive monopoly board game stickers that come with the food they order. c. McDonald's posts a sign outside of its restaurants advertising a new lunch special. d. McDonald's is considering updating its slogan to appeal to a younger demographic of consumers. e. McDonald's partners with Farmville to feature a "McDonald's Farm" as part of the social media game for a limited time.

a. McDonald's used chalk to draw out a giant professional-looking drawing of french fries complete with the McDonald's logo on the boardwalk of a big city.

Xuxez is a sports apparel retailer that targets the teen market. It has been having trouble reaching its target audience through traditional promotion. Readership of magazines and newspapers has declined among the teen market. Research also shows that when watching television, teenagers will often switch to a different channel whenever a commercial comes on. Xuxez decides to pay to have the main characters in the popular teen series Riverdale wear its newest line of sportswear during certain episodes. It hopes to familiarize viewers with its newest brand. Refer to Scenario 16.2. The type of promotional activity used is based on _______. a. characteristics of the target market b. characteristics of the product c. push and pull policies d. promotional resources, objectives, and policies e. costs and availability of promotional methods

a. characteristics of the target market

It has been about 10 years since the BP oil spill that rocked the Gulf of Mexico. BP has launched a number of campaigns to reestablish its credibility. If BP wanted to identify changes in public opinion impacting the firm, it should conduct _______. a. environmental monitoring b. an environmental audit c. an aided recall test d. a social audit e. a communications audit

a. environmental monitoring

Kimberly sees some jeans at Loft that are $100. She has bought blue jeans at Loft before but for not nearly as much. Kimberly looks at the jeans and cannot see much of a difference between these jeans and the ones she usually buys. Kimberly decides not to purchase the jeans. In this case, Kimberly made use of a(n) _______. a. internal reference price b. price discount c. external reference price d. allowance

a. internal reference price

Refer to Scenario 18.2. As the scenario describes Dell agrees to pay resellers certain amounts of money for providing promotional efforts like advertising or point-of-purchase displays. This is most likely a _______. a. merchandise allowance b. dealer loader c. free merchandise promotion d. cooperative advertising e. buy-back allowance

a. merchandise allowance

Stonybrook Organics—famous for its organic yogurt—came out with an advertisement that showed an idyllic setting of a cow resting comfortably in front of a barn. The headline read, "Grant a Farmer's Wish." The Stonyfield logo was at the top left. This is most likely to be what type of advertising? a. Pioneer advertising b. Institutional advertising c. Competitive advertising d. Comparative advertising e. Product advertising

b. Institutional advertising

OkCupid paid popular community site BuzzFeed to publish a post on its site. The post is titled "Here's How to Be Super Dateable, According to OkCupid." The post followed the BuzzFeed format but also included links to download the OkCupid app. Refer to Scenario 17.2. What type of advertising is OkCupid using? a. Pioneer b. Native c. Institutional d. Advocacy e. Comparative

b. Native

In recent years, sales promotion has increased at the expense of _______. a. personal selling b. advertising c. public relations d. buzz marketing e. trade promotion

b. advertising

Madeline works in the sales division of an office supply business. Most of her time is spent on the phone talking to current clients. Some of these customers consist of individual businesses, while others are retailers that will resell the office supplies. Most of Madeline's job involves taking reorders from their customers. Sometimes she also calls to ensure the products were delivered on time. Madeline is most likely a(n) _______ focused on _______. a. trade salesperson; current-customer sales b. inside salesperson; current-customer sales c. support salesperson; new-business sales d. missionary salesperson; new-business sales e. technical salesperson; current-customer sales

b. inside salesperson; current-customer sales

The campaign was so successful that Rick decided to host a special event to announce the winner. On the day of the event he invited the media to film the event. The CEO of the firm named the finalists and then called out the winner. This all occurred with much fanfare. An illustration of the proposed product with a short description was provided to reporters to publish in the paper. This campaign is an example of _______. a. advertising b. public relations c. sales promotion d. personal selling e. buzz marketing

b. public relations

Which of the following is a major goal of integrated marketing communications (IMC) in regard to its marketing messages? a. Flexibility b. Validity c. Consistency d. Profitability e. Reliability

c. Consistency

Which of the following is appropriate for stimulating primary demand? a. Reinforcement promotion b. Comparative promotion c. New introductory promotion d. Viral marketing e. Personal selling

c. New introductory promotion

Which of the following uses tools such as annual reports, brochures, event sponsorship, and sponsorship of socially responsible programs? a. Advertising b. Personal selling c. Public relations d. Sales promotion e. Proxemic communication

c. Public relations

ACME Corp. has a promotion strategy that involves promoting its widgets through personal selling and sales promotion to the wholesalers that handle its products. Which channel promotion policy is ACME using? a. Pull policy b. Category management c. Push policy d. Exclusive policy e. Tying policy

c. Push policy

Which of the following companies is most likely to use nonprice competition rather than price competition? a. Amazon b. McDonald's c. Recreational Equipment, Inc (REI) d. Best Buy e. Walmart

c. Recreational Equipment, Inc (REI)

When Chantal raised the price of her rose gold bracelets by $75 to cover unexpected expenses, she was surprised to see that demand appeared to increase. She was making more sales at a higher price. This means the rose gold bracelets are _______. a. value conscious b. typical products c. inelastic d. elastic e. price conscious

c. inelastic

Which of the following is an example of public relations? a. Samsung creates a funny video that indirectly pokes fun at its competitor Apple. b. The Container Store focuses extensively on employee training to enhance customer service. c. Macy's sends out notices through its mobile app informing consumers of its super sale on July 4. d. Target puts up a placard with the names and photos of employees recognized for exceptional service. e. Patagonia posts communication in a magazine with the headline "Do Not Buy This Jacket."

d. Target puts up a placard with the names and photos of employees recognized for exceptional service.

The most critical copy in an advertisement is the _______. a. subheadline b. signature c. layout d. headline e. body copy

d. headline

PepsiCo launched a massive sustainability campaign involving water conservation and rain forest preservation. It wants to create an image of being a strong corporate citizen. After the campaign, PepsiCo wants to measure the extent to which its stakeholders view it as being ethical and socially responsible. It should therefore conduct a(n) _______. a. public relations audit b. environmental audit c. ethical audit d. social audit e. communications audit

d. social audit

Xuxez is a sports apparel retailer that targets the teen market. It has been having trouble reaching its target audience through traditional promotion. Readership of magazines and newspapers has declined among the teen market. Research also shows that when watching television, teenagers will often switch to a different channel whenever a commercial comes on. Xuxez decides to pay to have the main characters in the popular teen series Riverdale wear its newest line of sportswear during certain episodes. It hopes to familiarize viewers with its newest brand. Refer to Scenario 16.2. Based on the scenario, what is Xuxez's most likely objective for the promotion of its new brand? a. Retain loyal customers b. Combat competitive promotional efforts c. Facilitate reseller support d. Stimulate demand e. Create awareness

e. Create awareness

A major goal of integrated marketing communications is to send a consistent message to _______. a. ad agencies b. managers c. employees d. shareholders e. customers

e. customers

Digital advertising that matches the appearance and purpose of the content in which it is embedded is called _______. a. reinforcement advertising b. competitive advertising c. institutional advertising d. product advertising e. native advertising

e. native advertising

Word-of-mouth communication is most effective for _______ and _______. a. new-to-market products; inexpensive products b. long-time products; expensive products c. new-to-market products; convenience products d. declining products; expensive products e. new-to-market products; expensive products

e. new-to-market products; expensive products

A major benefit of personal selling over other promotional tools is -----

flexibility

product life cycle

introduction, growth, maturity, decline

---- ----- advertising is used less frequently today than in the past.

mass media

The advertising ----- consists of the basic issues or selling points that an advertiser wishes to include in an advertisement. "Style with a substance" is a basic selling point for the J.Crew Ludlow Suit collection.

platform

•Sales objectives: •Tell salespeople what they are expected to accomplish during a specified time period •Give the salespeople direction and purpose •Serve as standards for evaluating and controlling the performance of sales personnel •Should be stated in precise, measurable terms; specify the time period and geographic areas involved; and be achievable

•Sales objectives: •Tell salespeople what they are expected to accomplish during a specified time period •Give the salespeople direction and purpose •Serve as standards for evaluating and controlling the performance of sales personnel •Should be stated in precise, measurable terms; specify the time period and geographic areas involved; and be achievable