BUS 110 -STUDENT OUTLINE FOR UNIT 4

FALL 2008

Chapter 12 – Promotion

A. What is promotion? = anything a marketer does to help make us buy and keep buying; i.e. informing, persuading, reminding customers

1. Objectives in Promotion

a. Promotion is primarily for increased profit or sales

b. Secondary Objectives in Promotion

1. Provide information to consumers

2. Create Demand

a. Political ads

3. Establish brand recognition

4. Shift Inventories

5. Compete

B. A truly effective promotional strategy will use more than just advertising!

C. Types of Promotion

1. Public Relations (Publicity)

a. How can small, local businesses use publicity?

2. Sales Promotion

a. Cross-promotion, wherein sale of one product is tied to another

3. Personal Selling

4. Advertising

D. Why Advertise?

1. To increase the use of the product

2. Increase frequency of use of the product

3. To increase the variety of use

4. To increase the length of the buying season

5. To prevent brand substitutions.

6. To attract a new generation of consumers.

E. The Evolution of Advertising- generally parallels the evolution of mass communication

1. The Era of Industrialization (1800 to 1900)

2. Reason Why Era (1900 to 1920)

3. The "Roaring" '20s (1920 to 1930's)

4. Depression, War & Paranoia (1929 to 1950

a. Propaganda - most commonly appears in times of political crisis

5. The Television Era - Anything Goes (post 1950)

a. Subliminal Advertising

6. The Internet Era – 2000 on

Types of Ads

1. Brand familiarization

2. Habit-formation

3. Symbolism

4. Obligation

5. Repeated assertion

6. Celebrity testimonials

7. Emotional appeals

8. Competitive ads

9. Comparative ads

10. Institutional

11. Defensive ads

12. Corrective ads

13. Humorous Ads

14. Suggestive Ads (use of sex in advertising)

H. Cost of Advertising Media - based on the same factors regardless of media used

1. Amount of time\space used

2. Where ad located (time of broadcasting day = placement in print media)

3. How many will potentially see\hear the ad

4. In Print ads color vs. b\w

I. Advertising Media

1. Newspapers

2. Magazines

3. Radio

4. Television

5. Transit Media

6. Outdoor billboard

7. Advertising on the Internet

a. Types of Internet ads:

1. Classified advertising

2. Banners and buttons

3. Interactive Banner.

4. Interstitials (pop-up ads or intermercials)

5. Sponsorships are another type of Web advertising.

6. Keyword ads

J. Regulation of Advertising - Advertising is subject to both government regulation and industry self-regulation to prevent deceptive advertising or to limit the visibility of advertising. Advertising is heavily regulated in the United States, Canada, and a number of European and Asian countries.

1. Most advertising is protected under the free speech provisions of the First Amendment to the Constitution

2 .FTC- the main government regulatory agency for advertising is the Federal Trade Commission (FTC).

3. Products that can affect health receive special regulatory attention.

K. Advertising and Politics

1. there are no laws, government agencies, or any other official restraints that monitor the contents of political advertisements.

Chapter 13 - Personal Selling

A. What is personal selling?

1. Advantages & disadvantages

2. The stigma attached to selling

B. Motivating Sales Personnel

1. Compensation Methods = what are relative advantages and disadvantages of each method of compensation

a. Salary

b. Commission

c. Combination

d. Non-Monetary

C. Types of Sales Jobs (by function)

1. Order-Getters

2. Order-Takers

3. Support Personnel

a. Missionary Sales

b. Trade Sales

c. Technical Sales

Chapter 15 – Global Marketing

A. International Markets = most U.S. firms look at foreign markets as if they were market segments; thus must be analyzed in terms of culture, institutions, and behavioral patterns of buyers

B. Obstacles to Foreign Marketing

1. Environmental (Cultural) Considerations

2. Governmental Sanctions

a. Local Content Laws

b. Tariffs

c. Quotas

d. Embargos

C. Levels of Involvement in International Markets

1. Exporting

2. Licensing

3. Joint Ventures (with private concerns or with governments themselves)

4. Direct Ownership = most potential for profit, greatest risk!

D. Market Mix Strategies in Foreign Countries = developed after foreign market potential is evaluated; could include:

1. Change promotion only

2. Change product only

3. Change product and promotion

4. Invent new product

UNIT 4 CASE STUDIES

CASE STUDY – OHIO UNIVERSITY AND BAD PUBLICITY

Ohio University is a public 4-year college located in the southeastern corner of Ohio, near the border of neighboring West Virginia. Over a two year span, the university suffered through a series of public disasters that left the school’s reputation in tatters.

Here is a just a sampling of just some of the events that impacted the university.

1. November 2005 – Head football coach Frank Solich is convicted of DUI following his arrest late on a Saturday night. Officers said they found Solich passed out on the steering wheel of his car; and had difficulty rolling down the window or speaking clearly, but was smart enough to refuse a breathalyzer test

2. April 2006 – The Ohio News Network reported five separate breaches in the OU information system between April and June of 2006 affecting over 300,000 alumni, friends, faculty and staff.

3. August 2006 – Acting on allegations made by a former graduate student who discovered duplicated material while combing through past dissertations, the university was forced to take action against 39 mechanical engineering graduates. The results of the investigation were one revoked degree, 2 fired professors and 12 dissertation rewrites.

4. October 2006 – the Columbus Dispatch reported that seventeen OU football players had been arrested on a variety of charges such as misconduct, drug abuse, alcohol offenses and assaults in the year or so since Frank Solich took over as coach of the football team. To make matters worse, the newspaper went on to report that not one player had been suspended or missed a single game this year.

5. January 2007 - In a cost-cutting move, the university announced that 4 varsity sports would be cut, effective at the end of the 2007 season. The cuts took the number of university-sponsored sports down from 20 to 16, which is the minimum number of sports programs required to keep Division 1A standing with the National Collegiate Athletic Association.

6. February 2007 - the RIAA (Recording Industry Association of America) announced that Ohio University had received more legal notices from than any other university for allowing illegal file downloading by students. The total number of legal notices received by Ohio University increased markedly from 2005-2006, when, according to the RIAA, the school only received 232. However, this number shot up to 1,287 notices in 2006-2007, and in February earned OU a top seat on the RIAA’s most frequent recipient list.

7. May 30, 2007 - Ohio University professors delivered a new “no confidence” vote against President Roderick McDavis, with 77 percent saying they didn't support him. OU students delivered a no-confidence vote — with 78 percent saying opposing his leadership — three days prior to the faculty vote.

Although school officials claimed that alumni donations had increased and that admissions had simply become more selective, Ohio University’s undergraduate applicant pool for 2008 actually went down a fraction of a percentage. At the same time, other Ohio schools such as Ohio State University and Miami University registering increases in applications of over 20 percent.

Questions for Discussion:

1. How should Ohio University have handled each of these situations?

2. Ohio University already had image problems before all of these events took place, what steps should university officials take to try and effectively change the public’s perception of the university?

Unit 4 - International Marketing

Case Study - Crest Toothpaste and the Mexican Market

Over the years, American marketers have made all sorts of embarrassing blunders in trying to adapt successful U.S. promotional campaigns to sell a product overseas.

For example:

The Coors beer slogan "Turn it loose" was translated into Spanish as "Suffer from diarrhea."

Clairol introduced its "Mist Stick" curling iron in Germany to later find out that "mist" is German slang for manure.

Scandinavian vacuum manufacturer Electrolux used the following slogan in an American campaign: "Nothing sucks like an Electrolux."

The Salem cigarette tag line "Feeling Free" was roughly translated into Japanese to mean "feeling so refreshed that your mind seems to be free and empty."

An American T-shirt manufacturer printed shirts for the Latin market commemorating the Pope's visit to Miami. Instead of reading, "I saw the Pope" (el Papa), the shirts read, "I saw the potato" (la papa).

Pepsi's "Come alive with the Pepsi Generation" translated in Chinese to "Pepsi brings your ancestors back from the grave."

Perdue Chicken's slogan "It takes a strong man to make a tender chicken" was read by Spanish audiences as "It takes an aroused man to make a chicken affectionate."

Sometimes even when American companies have done everything “the right way” it has backfired.

Several years ago Proctor and Gamble attempted to market Crest Toothpaste in Mexico. P & G executives felt that Crest, long the industry sales leader in the United States, had developed such a strong brand name in this country that surely it would be successful in Mexico.

Proctor & Gamble set out then to establish Crest as a Mexican product. They set up a Mexican subsidiary, manufactured the product in Mexico, and even got the endorsement of the Mexican Dental Association on the package. A series of commercials were filmed depicting Mexican children coming home from the dentist with glowing reports on their checkup results. This same commercial theme demonstrating Crest's effectiveness as a tool against tooth decay and cavities had established Crest's dominance in the American market in the late 1950's. The product was a failure.

QUESTIONS FOR DISCUSSION:

1. Why do you think Crest failed to capture the Mexican market as it had in the United States?

2. What types of market research (in other words, what kinds of information would you need to know) should Proctor & Gamble have carried out in Mexico before trying to penetrate the market?

3. How would you attempt to sell Crest toothpaste in Mexico? Think about how you might change the name, package, ads, celebrity endorsers, etc.