Advertising Concepts and Types
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Questions and Answers

What is advertising?

Nonpersonal promotional communication about goods, services, or ideas that is paid for by the firm identified in the communication.

What are the three main objectives of advertising?

  • To reach target audiences, measure campaign effectiveness, and maximize return on investment
  • To create a positive image, build customer loyalty, and enhance brand reputation
  • To inform, persuade, and remind consumers (correct)
  • To increase brand awareness, generate leads, and drive sales

What is the purpose of informative advertising?

To develop initial demand for a product.

What is the purpose of persuasive advertising?

<p>To increase demand for an existing product.</p> Signup and view all the answers

What is comparative advertising?

<p>A marketing strategy where a company's product or service is presented as superior when compared to a competitor's.</p> Signup and view all the answers

What is reminder advertising?

<p>A type of advertising that seeks to keep the product before the public in an effort to reinforce previous promotional activity.</p> Signup and view all the answers

What is reinforcement advertising?

<p>A type of advertising that aims to reassure customers that they made the right choice when purchasing a product, and to help them get the most out of it.</p> Signup and view all the answers

What is the purpose of institutional advertising?

<p>To enhance a company's image rather than promote a particular product.</p> Signup and view all the answers

What is advocacy advertising?

<p>A marketing strategy primarily used by nonprofit organizations and private groups to sway public opinion in support of a particular cause or message.</p> Signup and view all the answers

What is native advertising?

<p>A type of advertising that aims to match the media it's placed in. (ex. YouTube ads)</p> Signup and view all the answers

What is an advertising campaign?

<p>A collection of coordinated advertisements that share a single theme.</p> Signup and view all the answers

What are the five steps in developing and implementing an advertising campaign?

<p>Identify the target audience, define objectives, create advertisements, choose advertising tools, measure the effectiveness of the advertising (A)</p> Signup and view all the answers

What are the two key advertising metrics?

<p>Frequency and reach.</p> Signup and view all the answers

What is frequency in advertising?

<p>A count of how often a consumer is exposed to a promotional message (TV ad, online ad, billboard, etc).</p> Signup and view all the answers

What is reach in advertising?

<p>The percentage of the target market that has been exposed to a promotional message (TV ad, online ad, billboard, etc) at least once during a specific time period.</p> Signup and view all the answers

What is a rational appeal in advertising?

<p>Uses logical arguments to attempt to make the viewer think about the product and its benefits to better understand why purchasing or using the product is a good decision.</p> Signup and view all the answers

What is puffery in advertising?

<p>Advertising that makes broad, exaggerated, or boastful statements about a product or service that are subjective rather than fact.</p> Signup and view all the answers

What is sales promotion?

<p>A set of nonpersonal communication tools designed to stimulate quicker and more frequent purchases of a product.</p> Signup and view all the answers

What are coupons?

<p>Documents that entitle the customers who possess them to a discount on the product.</p> Signup and view all the answers

What are cents-off promotions?

<p>Sales promotions that offer a customer a discount from the regular price of a product.</p> Signup and view all the answers

What are rebates?

<p>Sales promotions that allow consumers to recoup a specified amount of money after making a single purchase.</p> Signup and view all the answers

What are sweepstakes?

<p>Sales promotions based on chance, such that entry is the only requirement to win.</p> Signup and view all the answers

What are loyalty programs?

<p>Sales promotions that allow consumers to accumulate points or other benefits for doing business with the same company or a group of companies.</p> Signup and view all the answers

What is a buying allowance?

<p>A trade sales promotion that offers buyers a price reduction for each unit purchased during a specific period.</p> Signup and view all the answers

What is a scan-back allowance?

<p>A payment made by a manufacturer to a retailer for each unit of a product sold at a reduced price during a specific time period.</p> Signup and view all the answers

What is a merchandise allowance?

<p>A trade sales promotion where a manufacturer offers a buyer free merchandise or payment in exchange for promoting their products in-store.</p> Signup and view all the answers

What is a dealer loader?

<p>A promotional item or incentive given to a retailer by a manufacturer to encourage them to stock and actively promote a product.</p> Signup and view all the answers

What are employee sales promotions?

<p>Promotional incentives designed to increase sales for a product or brand.</p> Signup and view all the answers

What is public relations?

<p>Nonpersonal communication focused on promoting positive relations between a firm and its stakeholders.</p> Signup and view all the answers

What is the purpose of annual reports?

<p>Annual reports provide a forum for the organization to share with its stakeholders what it has achieved over the past year. They present the firm with an opportunity to highlight financial successes as well as charitable and philanthropic work that portray the organization in a positive light.</p> Signup and view all the answers

What is the purpose of speeches in public relations?

<p>Speeches provide an avenue for members of an organization to market their message directly to a group in a longer-form speech.</p> Signup and view all the answers

What are blogs in the context of public relations?

<p>A social media tool through which individuals can share their thoughts and knowledge with the public.</p> Signup and view all the answers

What are brochures in the context of public relations?

<p>Brochures are typically intended to inform and/or engage with the public. Either paper or online, they provide a forum for educating the public about a firm, its mission, or a specific cause.</p> Signup and view all the answers

What is event sponsorship?

<p>Event sponsorship involves firms paying to sponsor, host, or support a cultural, sport, or charitable activity.</p> Signup and view all the answers

What is a press release?

<p>A written statement that a company sends to the public and press to share significant information about a newsworthy event or topic.</p> Signup and view all the answers

What is publicity?

<p>Disseminating unpaid news items through some form of media to gain attention or support.</p> Signup and view all the answers

What is offline publicity?

<p>Offline publicity includes more traditional print media such as magazines, journals, and newspapers.</p> Signup and view all the answers

What is image repair theory?

<p>Image repair theory is a communication strategy that enables an organization to protect its reputation when a crisis or business disruption strikes. The theory emphasizes the importance of addressing a crisis effectively to mitigate reputational damage.</p> Signup and view all the answers

What is crisis communication?

<p>A communication strategy that enables an organization to protect its reputation when a crisis or business disruption strikes.</p> Signup and view all the answers

What is personal selling?

<p>A two-way flow of communication between a salesperson and a customer that is paid for by the firm and seeks to influence the customer's purchase decision.</p> Signup and view all the answers

What is relationship selling?

<p>Building a trusting relationship with a customer over multiple sales interactions.</p> Signup and view all the answers

What is motivation in the context of personal selling?

<p>The basis of a continued commitment to working toward a goal.</p> Signup and view all the answers

What are some characteristics of successful salespeople?

<p>All of the above (D)</p> Signup and view all the answers

What are the steps of the personal selling process?

<p>All of the above (D)</p> Signup and view all the answers

What is prospecting?

<p>The search for potential customers - those who need or want a product and fit into a firm's target market.</p> Signup and view all the answers

What is the pre-approach?

<p>Part of the personal selling process that involves identifying specific information about a prospect.</p> Signup and view all the answers

What is the presentation?

<p>A forum to convey the organization's marketing message to the prospect.</p> Signup and view all the answers

What are objections?

<p>Concerns or reasons customers offer for not buying a product.</p> Signup and view all the answers

What is closing in the context of personal selling?

<p>The point at which the salesperson asks the prospect for the sale.</p> Signup and view all the answers

What is follow-up?

<p>The sales step in which a salesperson follows up after the sale to ensure customer satisfaction and repeat business.</p> Signup and view all the answers

What is a summarization close?

<p>The salesperson summarizes all of the benefits of the product and how it meets the needs of the buyer prior to asking for the order.</p> Signup and view all the answers

What is a trial close?

<p>A sales technique that assesses a buyer's readiness to make a purchase by asking for their opinion instead of a decision.</p> Signup and view all the answers

What is an assumptive close?

<p>Entails asking the prospect to consider choices concerning delivery, warranty, or financing terms under the assumption that a sale has been finalized.</p> Signup and view all the answers

What is sales management?

<p>The manager's responsibility for formulating and implementing a sales plan used to deploy salespeople to interact with customers.</p> Signup and view all the answers

What are captive salespeople?

<p>Salespeople who work directly for a sales firm.</p> Signup and view all the answers

What are independent sales representatives?

<p>Salespeople who do not work directly for the firm, but rather represent various firms and products on a contractual basis. Also known as manufacturer's reps.</p> Signup and view all the answers

What is a sales team?

<p>A group of salespeople and possibly other employees who act collectively to sell to a customer</p> Signup and view all the answers

Define sales goals/objectives.

<p>Sales goals are important to sales managers and the overall organization. The revenue generated by selling products is the engine that drives the activities of most firms. Thus, setting realistic sales expectations, and then attaining them, has an impact on all functions of the firm. Sales goals are the basis of firm planning, which includes such things as forecasting production levels, employment needs, logistics systems, and capital investments. Specific to sales, revenue and growth goals help sales managers determine many elements of their sales plan, including salesperson quotas, compensation, and sales force size.</p> Signup and view all the answers

What is territory management?

<p>Determining the effective way to utilize the salespeople, based on some sort of territory strategy, leading to what territories the salespeople will serve.</p> Signup and view all the answers

What is the geographic approach to territory management?

<p>The geographic approach typically places salespeople within an exclusive territory.</p> Signup and view all the answers

What is the product approach to territory management?

<p>Involves salespeople who sell a particular product or set of products.</p> Signup and view all the answers

What is the customer approach to territory management?

<p>Organizes the territory around the customer. May divide customers based on size, amount spent, or type.</p> Signup and view all the answers

What is the combination approach to territory management?

<p>Utilizes multiple types of territory strategies to organize the sales force.</p> Signup and view all the answers

What is sales implementation?

<p>How the sales plan is practiced by the sales force through recruitment, compensation design, and sales force motivation.</p> Signup and view all the answers

What is salary?

<p>The component of compensation that's fixed.</p> Signup and view all the answers

What are incentives?

<p>The component of compensation that's variable.</p> Signup and view all the answers

What is intrinsic motivation?

<p>The innate desire to complete a task or engage in an activity.</p> Signup and view all the answers

What is a compensation plan?

<p>A system of policies and procedures for calculating the wages and salaries in an organization.</p> Signup and view all the answers

What is sales control?

<p>The practice of aligning sales results with the greater objectives of the organization.</p> Signup and view all the answers

What is sales assessment?

<p>The act of evaluating the sales performance of an organization and its sales force.</p> Signup and view all the answers

What is customer relationship management (CRM)?

<p>The process by which companies get new customers, keep the customers they already have, and grow the business by increasing their share of customers' purchases.</p> Signup and view all the answers

What is a touchpoint?

<p>Any point at which a customer and the company come into contact.</p> Signup and view all the answers

What are the steps of the CRM process?

<p>Identify current customers, understand how customers interact with the firm, gather specific customer information, store and analyze information, use data to build customer relationships (A)</p> Signup and view all the answers

What is share of customer?

<p>Measures the quantity of purchase dollars each customer spend on the company's products rather than the number of customers.</p> Signup and view all the answers

What is customer equity?

<p>A ratio that compares the financial investments a company puts into gaining and keeping customers to the financial return on those investments.</p> Signup and view all the answers

What is customer focus?

<p>Measures how well a CRM program prioritizes customers based on each customer's profitability.</p> Signup and view all the answers

What is lifetime value?

<p>The total profit a customer brings to a company during the time that the individual or firm is a customer.</p> Signup and view all the answers

Flashcards

Advertising

Nonpersonal communication about goods, services, or ideas paid for by the identified firm.

Advertising Objectives

Goals for advertising, typically to inform, persuade, or remind consumers.

Informative Advertising

Advertisements aiming to build initial demand for a product.

Persuasive Advertising

Advertisements focused on increasing demand for an existing product.

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Comparative Advertising

Marketing strategy showcasing a product's superiority over competitors.

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Reminder Advertising

Advertisements aiming to keep a product in the public's mind.

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Reinforcement Advertising

Advertisements reassuring customers about their purchase.

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Institutional Advertising

Advertisements focused on enhancing a company's image, not a specific product.

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Advocacy Advertising

Advertisements promoting a cause or message, often by nonprofits.

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Native Advertising

Advertisements seamlessly blending with the surrounding content.

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Advertising Campaign

A coordinated set of ads with a shared theme.

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Advertising Metrics

Measures used to evaluate advertising effectiveness, including frequency and reach.

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Frequency

The number of times a consumer is exposed to an ad.

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Reach

The percentage of the target market exposed to an ad at least once.

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Rational Appeal

Advertising using logic and benefits to persuade viewers.

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Emotional Appeal

Advertising aiming for an emotional response from viewers.

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Puffery

Exaggerated or subjective statements about a product.

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Sales Promotion

Non-personal communication tools to stimulate quick purchases.

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Coupons

Documents offering discounts to customers.

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Samples

Trial portions of a product to encourage purchase.

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Premiums

Rewards for purchasing a specific product.

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Contests

Sales promotions requiring skill to win.

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Sweepstakes

Sales promotions based on chance, entry is the only requirement.

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Loyalty Programs

Programs rewarding customers for repeat business.

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Public Relations (PR)

Non-personal communication focused on building positive relationships with stakeholders.

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Annual Reports

Documents sharing a company's achievements with stakeholders.

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Blogs

Online platforms for sharing thoughts and knowledge.

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Event Sponsorship

Companies supporting events for branding and promotion.

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Press Release

Written statements sharing information with the public and press.

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Publicity

Disseminating unpaid news items through media for attention.

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Personal Selling

Two-way communication between salesperson and customer focused on influencing a purchase decision.

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Study Notes

Advertising

  • Definition: Non-personal promotion of goods, services, or ideas, paid for by the identified firm.
  • Objectives: Inform, persuade, and remind consumers about product features and benefits.
  • Types:
    • Informative: Develops initial demand for a product.
    • Persuasive: Increases demand for an existing product.
    • Comparative: Presents a company's product as superior to a competitor's.
    • Reminder: Keeps the product in the public eye to reinforce previous promotion.
    • Reinforcement: Reassures customers they made the right choice and maximizes product use.
    • Institutional: Enhances company image, not a specific product.
    • Advocacy: Used by NGOs and groups to sway public opinion.
    • Native: Advertising that blends with the media it appears in (e.g., YouTube).
  • Advertising Campaign: Coordinated advertisements with a shared theme.
  • Campaign Development Steps:
    1. Identify target audience.
    2. Define objectives.
    3. Create advertisements.
    4. Choose advertising tools.
    5. Measure effectiveness.
  • Metrics: Frequency (number of exposures) and reach (% of target market exposed at least once).
  • Appeals:
    • Rational: Logical arguments to convey product benefits.
    • Emotional: Aimed at evoking feelings (happiness, fear, etc.).
  • Puffery: Exaggerated, subjective claims about a product.
  • Ethics: Broader ethical considerations in advertising.

Sales Promotion

  • Definition: Tools stimulating quicker and more frequent purchases.
  • Examples:
    • Coupons: Documents offering discounts.
    • "Cents off": Price reductions.
    • Rebates: Money recouped after purchase.
    • Samples: Trial portions of the product.
    • Premiums: Free/discounted products as rewards.
    • Contests: Skill-based competitions.
    • Sweepstakes: Chance-based contests.
    • Loyalty Programs: Points or benefits for repeat business.
    • Trade Promotions:
      • Buying Allowance: Price reduction for purchased units.
      • Buy-Back Allowance: Encourages restocking.
      • Scan-Back Allowance: Payment for reduced price sales.
      • Merchandise Allowance: Free merchandise/payment for promoting products.
      • Dealer Loader: Promotional item encouraging product stocking and promotion.
    • Employee Sales Promotion: Incentives for increased sales.

Public Relations

  • Definition: Non-personal communication to foster positive relationships with stakeholders.
  • Tools:
    • Annual Reports: Highlight accomplishments and positive aspects.
    • Speeches: Direct communication to groups.
    • Blogs: Share knowledge in a public forum.
    • Brochures: Inform and/or engage the public, educating about firm, missions, or causes.
    • Event Sponsorship: Supporting cultural, sporting, or charitable events.
    • Press Releases: Inform the public and press about newsworthy events.
    • Publicity: Disseminating unpaid news (print or online).
    • Image Repair Theory: Strategies to restore public perception after a crisis (denial, reducing offensiveness, etc).
    • Crisis Communication: Protecting reputation during crises.

Personal Selling

  • Definition: Two-way communication between a salesperson and a customer to influence purchase decisions.
  • Types:
    • Relationship Selling: Building ongoing trusting customer relationships.
  • Salesperson Characteristics: Good personality, optimism, resilience, customer focus, communication, adaptiveness.
  • Sales Process Steps:
    1. Prospecting/Qualifying.
    2. Preapproach.
    3. Approach.
    4. Presentation.
    5. Handling Objections.
    6. Closing the Sale.
    7. Follow-up.
  • Prospecting: Identifying potential customers.
  • Preapproach: Gathering information about prospects.
  • Approach: Meeting prospect, learning needs/wants.
  • Presentation: Communicating the product's benefits.
  • Objections: Customer concerns/reasons for not buying.
  • Closing: Asking for the sale.
  • Follow-up: Ensuring customer satisfaction and repeat business.
  • Closing Techniques:
    • Summarization Close
    • Trial Close
    • Assumptive Close

Sales Management

  • Salespeople: Captive, Independent, Inside, Outside.
  • Sales Goals/Objectives: Revenue, growth; drive business activities.
  • Territory Management:
    • Geographic approach, Product approach, Customer approach, Combination approach.
  • Sales Implementation: Recruitment, Compensation, Sales Force Motivation.
  • Compensation: Salary (fixed), Incentives (variable).
  • Sales Control: Aligning sales results with organizational objectives.
  • Sales Assessment: Evaluating organizational and sales force performance.

CRM (Customer Relationship Management)

  • Definition: Gaining, keeping, and growing customers through increased share of purchases.
  • Process:
    1. Identify current customers.
    2. Understand customer interactions.
    3. Gather customer information.
    4. Store and analyze information.
    5. Use data to build relationships.
  • Share of customer: Quantity of purchase dollars from each customer.
  • Customer equity: Financial investment return ratio.
  • Customer focus: Prioritizing customers based on profitability.
  • Lifetime value: Total profit from a customer throughout the relationship.
  • Cooperative advertising: Shared costs of advertising campaigns between companies.

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Description

Explore the fundamentals of advertising, including its definition, objectives, and various types such as informative, persuasive, and comparative. This quiz will test your knowledge on advertising campaigns and their development steps.

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