© 2010 South-Western, a part of Cengage Learning All rights reserved. PowerPoint Presentation by Charlie Cook The University of West Alabama Eighth Edition Other Advertising Media CHAPTER 14 1. Explain why postal mail advertising is an efficient and effective ad medium. 2. Understand p-mail’s five distinctive features compared to mass forms of advertising. 3. Appreciate the role of database marketing, data mining, and lifetime-value analysis. 4. Appreciate branded entertainment and brand placements in various venues (movies, TV, etc.). 5. Appreciate the value of yellow-pages advertising. Chapter Objectives After reading this chapter you should be able to: © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–2 6. Recognize the growth and role of video-game advertising (advergaming). 7. Understand the role of cinema advertising. 8. Appreciate the potential value of various “alternative” ad media. Chapter Objectives (cont’d) After reading this chapter you should be able to: © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–3 © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–4 Framework for Various Forms of “Other” Advertising Table 14.1 • Direct Advertising via Postal Mail • Brand Placements in Movies, in TV Programs, and Elsewhere • Yellow-Pages Advertising • Video-Game Advertising (Advergaming) • Cinema Advertising • Potpourri of Alternative Ad Media © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–5 Direct Advertising via Postal Mail Direct Advertising via Postal Mail • Postal Mail (P-mail) Advertising Postal Mail (P-mail) Advertising  Is any advertising matter the postal service delivers to Is any advertising matter the postal service delivers to the person whom the marketer wishes to influence. the person whom the marketer wishes to influence.  Letters, postcards, programs, calendars, folders, catalogs, Letters, postcards, programs, calendars, folders, catalogs, videocassettes, blotters, order blanks, price lists, and videocassettes, blotters, order blanks, price lists, and menus. menus. • Why Use P-mail Why Use P-mail  Less expensive than television advertising Less expensive than television advertising  Better targeting of messages to desired prospects Better targeting of messages to desired prospects  Easier identification of prospects who purchased Easier identification of prospects who purchased advertised product advertised product  Favorable attitudes of consumers toward mail ads Favorable attitudes of consumers toward mail ads © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–6 Illustrations of Successful P-mail Illustrations of Successful P-mail Campaigns Campaigns Caterpillar 414E Industrial Loader Campaign (B2B) Stacy’s Pita Chip Campaign (Consumer Packaged Good) The Saab 9–5 Campaign (Consumer Durable Good) Highly Successful Direct Mail Campaigns © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–7 P-mail’s Distinctive Features P-mail’s Distinctive Features Measurability Targetability Efficiency Flexibility Accountability © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–8 What Functions Does P-mail Accomplish? What Functions Does P-mail Accomplish? • P-mail Campaigns Can: P-mail Campaigns Can: 1. 1. Increase sales and usage from current customers Increase sales and usage from current customers 2. 2. Sell products and services to new customers Sell products and services to new customers 3. 3. Build traffic at a specific retailer or Web site Build traffic at a specific retailer or Web site 4. 4. Stimulate product trial with promotional offers and incentives Stimulate product trial with promotional offers and incentives 5. 5. Generate leads for a sales force Generate leads for a sales force 6. 6. Deliver product-relevant information and news Deliver product-relevant information and news 7. 7. Gather customer information that can be used in building a Gather customer information that can be used in building a database database 8. 8. Communicate with individuals privately to minimize the Communicate with individuals privately to minimize the likelihood of competitive detection likelihood of competitive detection © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–9 The Special Case of Catalogs The Special Case of Catalogs • Effects of Catalogs Effects of Catalogs  Two-thirds of recipients visit cataloguer’s web site Two-thirds of recipients visit cataloguer’s web site  Sales to catalog recipients are 150% greater Sales to catalog recipients are 150% greater  Catalog recipients buy more items and spend more Catalog recipients buy more items and spend more money money • Advantages of Using Catalogs Advantages of Using Catalogs  Saves time Saves time   No fear for security No fear for security  No shopping pressure No shopping pressure   Ease of purchasing Ease of purchasing  Comparable goods Comparable goods   Attractive guarantees Attractive guarantees © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14–10 Growth in Catalog Marketing Growth in Catalog Marketing Waning interest in catalogs Increased cost of catalog marketing Third-class postal rates increases Factors in the Slowdown in the Growth Rate of Catalog Marketing [...]... customer  Cut direct costs a distribution channel © 2010 South-Western,forpart of  Reduce marcom costs Cengage Learning All rights reserved 14 13 Table 14. 2 Customer Lifetime-Value Analysis Note: Discount rate assumes an interest rate of 20 percent: D = (1 + i)n © 2010 South-Western, a part of Cengage Learning All rights reserved 14 14 The Use of Databases (cont’d) • Database Mining  The computerized... 2010 South-Western, a part of Cengage Learning All rights reserved 14 22 Potpourri of Alternative Advertising Media • Alternative Media Examples  Post-it notes  Back covers of comic books  Stadium cup holders  Skywriting  Sides of garbage trucks  Human body  Restroom space  Labels on fruits and vegetables © 2010 South-Western, a part of Cengage Learning All rights reserved 14 23 Figure 14. 1 3M’s... South-Western, a part of Cengage Learning All rights reserved 14 23 Figure 14. 1 3M’s Post-it Notes as an Advertising Medium © 2010 South-Western, a part of Cengage Learning All rights reserved 14 24 Figure 14. 2 A Football Stadium’s Cup Holders as an Advertising Medium © 2010 South-Western, a part of Cengage Learning All rights reserved 14 25 Closing Advice to Advertisers • Contact brand users wherever and whenever... 25-to-49 age category  Are college educated © 2010 South-Western, a part of  Have household incomes of $60,000 and up Cengage Learning All rights reserved 14 19 Yellow-Pages Advertising (cont’d) • Distinguishing Features of Yellow-Pages Advertising  Ads actively sought by consumers  Quality of ad placements determined by ad size and long-term participation of advertisers  Creative limits on ad... the form of videotapes, CD-ROMs, or DVDs  Appears to be both more effective and less expensive than print advertising delivered via direct mail  Research shows customers are less likely to throw away these mailings than a brochure or other printed material © 2010 South-Western, a part of Cengage Learning All rights reserved 14 11 The Use of Databases • Benefits of an Up-to-date Database  Directs... South-Western, a part of Cengage Learning All rights reserved 14 18 Yellow-Pages Advertising • Yellow Pages  Is an online and print ad medium for both local and national advertisers that 60% of consumers use weekly to:  Save time when they are seeking a product or service supplier and are prepared to make a purchase Save energy and money  Find information quickly  • Typical Users  Are in the 25-to-49... participation of advertisers  Creative limits on ad format and for entire year  Annualized method of purchasing ad space © 2010 South-Western, a part of Cengage Learning All rights reserved 14 20 Video-game Advertising (a.k.a Advergaming) • Market Characteristics  In-game advertising totaled $400 million in 2008  Paid advertising to total nearly $2 billion by 2011  60+ million gamers by 2009 • Users... Creates long-term relationships with customers  Enhances advertising productivity  Provides the capability to calculate the lifetime value of a customer or prospect © 2010 South-Western, a part of Cengage Learning All rights reserved 14 12 The Use of Databases (cont’d) • Customer Lifetime Value  Is valuing each present or prospective customer is viewed not as an address but as a long-term asset... behavior variables) contained in a firm’s databases • Database Manipulation and Mail Targeting  R-F-M system of point values  Recency of a customer’s purchase  Frequency of a customer’s purchases  Monetary value of a customer’s purchases © 2010 South-Western, a part of Cengage Learning All rights reserved 14 15 The Use of Databases (cont’d) • RFM System in Application  Testing effectiveness:   ... cells Take a representative random sample from each cell Distribute a catalogue, brochure or other p-mailing Provide sufficient time for sampled customers to respond Determine response rate and average expenditure per cell Project these statistics to full membership Based on response-rate and average-expenditure and with knowledge of the cost of distributing the mailing, calculate whether this mailing . Features Measurability Targetability Efficiency Flexibility Accountability © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14 8 What Functions Does P-mail Accomplish? What Functions Does P-mail Accomplish? • P-mail Campaigns Can: P-mail Campaigns. material. material. © 2010 South-Western, a part of Cengage Learning. All rights reserved. 14 12 The Use of Databases The Use of Databases • Benefits of an Up-to-date Database Benefits of an Up-to-date Database  Directs. 2010 South-Western, a part of Cengage Learning. All rights reserved. 14 6 Illustrations of Successful P-mail Illustrations of Successful P-mail Campaigns Campaigns Caterpillar 414E Industrial