Chapter 9:

Marketing Communication and

Promotional Strategy:

Advertising and Public Relations

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 Marketing Communication and
Promotional Strategy
Learning Objectives

• Objective 1: Define promotions and the role of

advertising.

• Objective 2: Describe the major decisions involved in

developing an advertising program.

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 Marketing Communication and
Promotional Strategy
Learning Objectives

• Objective 3: Define the role of public relations in the

promotion mix.

• Objective 4: Explain how companies use PR to

communicate with their publics.

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 Marketing Communication and
Promotional Strategy
Learning Objective 1
• Define promotions and the role of advertising in the
promotion mix
Learning Objective 2

• Describe the major decisions involved in developing an

advertising program.

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 Promotions

Promotion includes any communication by a business that:

• informs
• persuades
• reminds the target market

about any aspect of that company.

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 Elements of Promotional Mix

The main elements of their promotional strategy are:

• Advertising
• Public relations
• Personal selling, and
• Sales promotion

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 ....Cont’d

Customers of Calvin Klein mostly consist of the younger

generation in particular men and women between the age of
15-40. 12
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....Cont’d

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....Cont’d

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 Nike's ads showing NBA star LeBron James battling a
cartoon kungfu Master and the sacred feitians (Chinese
sacred women) has invoked great controversy in China.

China banned the ads, describing them as an insult to

the country's national dignity. The commercial, titled
"Chamber of Fear" was broadcast on local TV stations.

"The advertisement violates China's regulations on ads

and commercials which mandate that all
advertisements and commercials in China should
uphold national dignity and interests and respect the
motherland's culture.

The ad leaves the impression that American culture wins

against Chinese culture.

NBA - National Basketball Association 17

Advertising CHAPTER 1
2

Newspapers

Interactive
Magazines
Programmes

Radio Television
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Personal Selling CHAPTER 1
2

• A communication process in which sales associates help

customers satisfy their needs through face-to-face
exchanges of information.

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* Footfall refers to the number of people entering a shop or shopping area in a given time. 25
A maximum retail price (MRP) is a manufacturer calculated price that is the highest price that can be charged for a product. However, retailers may
choose to sell products for less than the MRP to draw more customers to their stores. 26
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Point-of-Purchase Promotion Defined. Point-of-sale displays (POS) are a specialized form of sales promotion found near, on, or
next to a checkout counter (the “point of sale”). They are intended to draw the customers' attention to products.
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Point-of-Purchase Promotion : a specialized form of sales promotion found near, on, or next to a checkout counter (the “point of sale”). They are intended to draw the customers' attention
to products.

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Free premiums are sales promotions that involve the consumer
purchasing a product in order to receive a free gift or reward. An example
of this is the 'buy a coffee and receive a free muffin‘.

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Planning the
Communication Program
CHAPTER 1
2

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Establish Objectives CHAPTER 1
2

• Communication objectives:
• Specific goals related to the communication mix’s
effect on the customer’s decision-making process
• Long-term: e.g. creating or altering a retailer’s brand
image
• Short-term: e.g. increasing store traffic

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Determine the Communication Budget CHAPTER 1
2

• Marginal Analysis Method

Based on the economic principle that firms should

increase communication expenditures as long as each
additional pound spent generates more than a pound
of additional contribution

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Objective-and-Task Method CHAPTER 1
2

• Determines the budget required to undertake specific

tasks to accomplish communication objectives

• Build a plan and make a business case

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Illustration of Objective and Task
Method for Setting a Communication Budget CHAPTER 1
2

Objective:
Increase 20% of target market (working women) who will know our store’s location and who
will purchase business attire from 25% to 50% over the next 12 months.

•Task – 480 of 30 seconds radio spots during peak commuting hours £12,000
•Task – Signages with store name near entrance to shopping centre £4,500
•Task – Display advertisement in 5 popular websites £500
•Task – Develop TV campaign to improve image and run 50 of 30 seconds commercials £24,000
•Task – Hold four ‘Dress for Success’ seminars, followed by wine and cheese party £8,000

Objective: Sell merchandises which still remain at the end of season

•Task – Special event £6,000

Total Budget £55,000

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Rule of Thumb Methods CHAPTER 1
2

• Affordable Budgeting Method – sets communication

budget by determining what money is available after
operating costs and profits are budgeted.

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Rule of Thumb Methods ....cont’d CHAPTER 1
2

• Percentage of Sales Method – communication budget is

set as a fixed percentage of forecasted sales.

• This method assumes the same percentage used in the

past is still appropriate for the retailer.

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Rule of Thumb Methods ....cont’d CHAPTER 1
2

• Competitive Parity Method – this communication budget is set so

that the retailer’s share of communication expenses equals its
share of the market.

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Allocate the Promotional Budget CHAPTER 1
2

• The retailer decides how much of its budget to allocate

to specific communication elements, merchandise
categories, geographic regions, or long- and short-term
objectives

High-assay principle: The retailer allocates budget to the

areas that will yield the greatest return.

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 Learning Objective 3

• Define the role of public relations in the promotion mix.

• Public Relations
• The Role and Impact of PR

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 Public Relations

Public relations involves building good relations with the company’s

various publics by obtaining favorable publicity, building up a good
corporate image, and handling or heading off unfavorable rumors,
stories, and events.

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 Public Relations

Press relations or press agency involves the

creation and placing of newsworthy
information to attract attention to a person,
product, or service.
Product publicity involves publicizing specific
products.
Public affairs involves building and maintaining
national or local community relations.

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 Public Relations

Lobbying involves building and maintaining relations with legislators and

government officials to influence legislation and regulation.

Investor relations involves maintaining relationships with shareholders and

others in the financial community.

Development involves public relations with donors or members of nonprofit

organizations to gain financial or volunteer support.

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• Lower cost than advertising

• Stronger impact on public awareness than advertising

• Has power to engage consumers and make them part of

the brand story

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 Advertising and Public Relations
Learning Objective 4

• Explain how companies use PR to communicate with

their publics.

• Major Public Relations Tools

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 News Speeches Special events

Corporate
Written identity Public service
materials activities
materials

Buzz marketing Social

networking

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