Marketing communications:
A European Perspective
Chapter 1 – Integrated marketing
What is integrated communications?
 Definition: New way of looking at the whole as a flow of information from
indistinguishable sources  trying to reach a synergetic effect and obtain a seamless and
homogeneous communications effort
 Good communications practice
 Includes various instruments from the communications mix
 Leads to more homogeneous and effective communications effort
What is marketing? What is the marketing mix?
 The process of creating and exchanging value to satisfy the individual and
organizational objectives
o Planning and executing the conception, pricing, promotions and distribution of
ideas, goods and services
 Marketing tools - The 4 P’s
o Product  has 3 layers: core product – tangible product – augmented product
o Price  official list price + discounts, incentives, price cuts for attractiveness
o Place product to consumers: Distribution channel and cooperation with firm
o Promotion  instruments to communicate with stakeholders to promote
product
 When implementing marketing mix, remember consistency and synergy
o Consistency: all instruments must work together and not conflict to be
consistent = brand name is built
o Synergy: instruments must reinforce each other
What is communications mix?
 The tools and instruments for building communication
 Types of instruments (SEE FURTHER CHAPTERS)
o Advertising
o Brand activation:
o Sales promotions

o Sponsorship
o Public Relations
o Point-of-purchace communications
o Trade fairs
o Direct marketing communications
o E-communications
 Marketing communications try to influence consumers by conveying a message by
either personal or mass communications

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o Personal communications: addressed individually to people and direct
o Mass communication: spread to the masses with unidentifiable audience
Instruments may be differentiated between theme/image communications and action
communications
o Theme/image (above-the-line) com: tells something about the offered services
and products or the brand  lead to 15% commission fee + mass media
o Action (below-the-line) com: influencing buying behavior of consumers and
persuades to buy product

How do integrated communications differ from classic communications?
 Classic communications saw every instrument as a separate division that seldom
integrated with each other.
 Integrated communications take every aspect into consideration and therefore obtain
seamless communications effort
How does culture influence marketing communications?
 Cultural difference if the most important factor to impact international marketing

communications
 Because of different culture, values and beliefs, consumers will respond differently to
marketing communication
 Be aware of the self-reference criterion: we tend to unconsciously refer everything to
our own cultural values
 Two ways of handling cross culture marketing: standardization or adaption
o Standardization: same campaign in all countries
o Adaption: changes in the campaign depending on the cultural identity
 Glocalisation: Think global but act local
What is corporate communications?
 The visualization of the corporate identity
How do corporate strategy, culture and personality influence corporate identity?
 Corporate culture is the deeper level of basic assumptions and beliefs that are shared
by the members in an organization  Scheins three levels of culture  the third is the
corporate personality level
 Corporate identity is embedded into strategy, culture and personality
o Long-term strategic objectives will determine and shape the desired coreporate
personality; the mission will reflect the wanted personality and culture of the
organization while positioning reflects priorities
o Culture and personality cannot be changed overnight while corporate strategy
will always be based on the persistent elements of the corporate personality
 Corporate identity is summed up as
o The set of meanings that a company allows itself to be known and through
which it allows people to describe, remember and relate to it
o “what the company is, what it does, and how it does it”
o Visible through the corporate symbolism
 Corporate communications is based on and has to be consistent with the corporate
identity

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What is the difference between corporate image and corporate identity?
 Corporate image is how the stakeholder perceives the organization’s presentation of
itself  result of the impressions and experiences of each stakeholder group
o Corporate identity resides in the organization – corporate image resides in the
head of the stakeholders
o They are not always aligned, so there may be an image gap
 Corporate reputation is the evaluation or esteem in which an organization’s image is
held
 The value of a good corporate image
o Gives company authority and makes the foundation for success and continuity
o Consumers want the products, services and goods as the good reputation gives
an emotional surplus, which is a long-term competitive advantage
o Good for companies where consumers are not deeply involved in product
category
o Surplus of goodwill
o Attracts new people crucial for success e.g. investors, analysts, employees etc.
What are the levels of integration and what are the barriers?
 Awareness and Image integration: convey same image and brand through all tools
 Functional integration: integrate all tools onto one marketing com. Department
 Co-ordinated integration: coordinate tools and PR-function
 Consumer-based integration: integrate it all into one system with consistent,
harmonious message to all potential consumers
 Stakeholder-based and Relationship management integration: integrate corporate
communication and marketing com efforts into one to reach all stakeholders
Another level-model
 Mission, proposition, concept, execution
Barriers
 Functional specialization in companies

 Existing structures in the organization
 Turf war and ego problems
 Lack of internal communication
 Perceived complexity of planning and co-ordination
 Functional specialization in communication agencies

Chapter 2 - Branding
What is a brand?
 A name, term, sign, symbol or design intended to identify the goods or services of an
organization and to differentiate them from the competitors
 Brand mark is an element of a brand that cannot be spoken e.g. symbol
 A good brand name is easy to say, spell and recall and should differentiate the product
from the competitor
 Has to be language and culture neutral to avoid strange connotations in new markets

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Three types of brands
o Manufacturer brands (developed and marketed by manufacturers)
o Own-label brands (developed and marketed by wholesalers/retailers)
o Generic brands (brandless products)

Characteristics of successful brands
 They are differentiated and distinctive
 Positioned on quality and added value (Superior product quality is necessary)
 Innovation to adapt to consumer tastes and lead competition
 Full support and commitment from management and employees – every brand contact

matters
 Long-term, consistent communications support is necessary to hold consumers
attention and seem trustworthy
Brand strategies
 Not important to put a brand on everything
 A brand is a vehicle for differentiating a product from the competition
 Line and brand extension
 Corporate branding: name of company is used for all its products
 Multibranding: different brands are used for products or product ranges in same
product category e.g. Procter & Gamble
 Dual branding strategies: endorsement branding (two names, one is quality),
ingredient branding(basic ingredient is mentioned next to brand name), co-branding
(two brands on one product)
What is line- and brand-extension?
 Line extension: Sticking to existing product categories and using the same brand name
for new products in a product category
 Brand extension: when an existing brand is used to market products in a different
product category
What are the benefits and disadvantages of these versus multibranding? What are the
implications?
 Benefits
o LE: Larger variety, stronger position, use of favorable image and effective
communication investments
o BE: limiting risk of failure of product introductions, using image and reputation,
more effective than new brand introductions
 Disadvantages
o LE: brand loses clear positioning, risk of cannibalization, harm to parent brand,
confusion among consumers about ideal product
o BE: brand image may be unsuited, risk of brand dillution
What is a brand portfolio and what functions can the brands serve?

 It is the set of all brands and brand lines that a company possesses
o Maximize market coverage to reach all consumers
o Minimize overlap between brands and avoid self-competition

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Ensure some overlap to avoid gap (Cannibalization is necessary to some
degree)
o Every brand in portfolio should add value for the company
The functions of the brands in the portfolio
o Bastion brand: most profit, premium price strategy, high level of psycho-social
meaning, high-performing brands
o Flanker brand: similar price-profit ratio as bastion brand, high psycho-social
meaning, smaller niche
o Fighter brand: lower price, situated between bastion and discount, lower
quality than flanker and bastion
o Prestige brands: high-quality, luxury brands, small segment looking for status
and psycho-social meaning
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What are brand equity and its main components?
 Brand equity is used to indicate value of a brand – distinction between consumer brand
equity and financial brand equity
 CBE: consumer- and marketing-related components of Brand equity (Figure 2.4.)
o Deep/broad brand awareness: knowing characteristics, attributes, identity
o Performance: the extent to which the product meets consumers’ needs/wants
o Imagery: fulfills psychological and social needs of consumer

 Brand personality: human personality traits applicable to and relevant
for brands
 BPS’ dimensions  sincerity, excitement, competence,
sophistication, ruggedness
 BF dimensions  responsibility, activity, aggressiveness,
simplicity, emotionality
 Brand feelings: consumers’ emotional response to brand
o Brand loyalty: Figure 2.5., the consumer’s commitment to a brand
 Brand community is the specialized non-geographically bound
community  structured of social relationships among brand users
o Other assets: distribution, shelf space, patents/trademarks
 FBE: financial value of brand for company
o Calculated from financial analysis, market analysis, brand analysis and legal
analysis
o The higher branding index or importance of brand for a company, the more
branding strategy and brand support will be important for the economic
success Table 2.2
o Brand strength score is also very important for the brand valuation system
 Table 2.3
How does marketing communications influence brand equity?
 Marketing communications are the voice of the brand
o Informs, persuades and reminds consumers of the brand essence, to engage
consumers in dialogue and to build relationships = loyalty
o Can help and harm brand

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Brand-building activities: high-advertising spending, investing in CSR, corporate image
building, wisely used PR, consistency and cohesion of corporate identity and corporate
image
Brand harming activities: frequent price promotions, price cuts, immediate material
incentives, junk mail, misunderstood/ambiguous campaigns

Chapter 3 – How marketing communications work
Hierarchy-of-effects and its contributions and shortcomings
 Assumes that things have to happen in a certain order and that the early effects form
necessary conditions in order for the later effects to occur.
 Think-feel-do sequence
o Cognitive stage: mental process leading to awareness and knowledge
o Affective stage: emotional responses occur which are associated with the brand,
forming attitudes
o Conative stage: undertaking actions
 Low-involvement: consumers may buy the product and decide afterwards how they
feel about it
 Experiential: affenative-conative-cognitive
 Foot-Cone-Belding grid: an integration of different sequence models (Figure 3.1.)
think
feel
high
Think-feel-do
Feel-think-do
Cars, furniture, loans
Jewelry, perfume, fashion
low
Do-think-feel

Do-feel-think
Detergents, food, toilet paper Sweets, soft drinks, ice cream
 Rossiter-Percy grid is an alternative with high-low involvement and transformational
or informational buying motives
o Transformational: positive motivations
o Informational: reducing/reversing negative motivation
 The advantages of HOE model is that it recognizes the importance of brand awareness
o Strive for TOMA
 Shortcomings: lack of empirical support, not allowing interactions between different
stages is unlikely  not very effective or relevant model
Attitude formation and change. What does the ELM explain?
 Attitudes are the personal overall evaluation of an object, person etc.
o Measurement of like or dislike towards a particular brand
 Consists of three components (Affective, cognitive, behavioral)
 Communication models regarding attitude formation and change can be classified
along two dimensions: way of formation and level of elaboration of message
 In relation to FCB-grid, the involvement dimension is extended to the following:
o Motivation: willingness to engage influenced by consumer needs and goals
 Consumer needs are either functional, symbolic or hedonic and can also
be classified as approach/promotion and avoidance/prevention goals
o Ability: resources needed to achieve particular goal

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 e.g. lack of resources
o Opportunity: extent to which situation enables the goal
 e.g. does the supermarket have the detergent we want to buy
Elaboration Likelihood Model (ELM) presents the effects of the MAO factors
 If MAO is high, consumers engage in central-route processing (willing to elaborate onn

information, evaluate arguments and find offer in infromation
 If MAO is lower, consumers engage in peripheral route processing
 Assumes that under different MAO conditions, both arguments and affect give rise to
peripheral and central processing  Leads to Table 3.2 with the six types in the
marketing communications model
High elaboration likelihood, cognitive
 Expectancy-Value model: relevant product attributes, brand possession of attributes,
evaluation of attributes  brand attitude is represented by the sum of products of
brand belief and attribute evaluations
o Theory of Reasoned Action is an extension, provides link between attitude and
behavioral intention (determined by subjective norms)
o Subjective norm: beliefs regarding what different reference groups consider
socially desirable behavior
o Social sensitivity: consumer’s need to behave accordingly to norms
 TPB: behaviors that people cannot control
o Perceived behavioral control: the perceived ease of performing the behavior and
it is assumed to reflect past experience as well as anticipated impediments and
obstacles
 Self-generated persuasion: the consumer motivates him or herself
Low elaboration likelihood, cognitive
 The consumer is forced to concentrate on peripheral cues
 Heuristic evaluation/satisfying choice process: when consumers do not have time to
compare available brands on relevant attributes, they may infer from high prices that
the brands are high-quality brands = positive attitude
 Peripheral cues are used as heuristic cues to evaluate quality of message and to form a
general evaluation of the brand.
 Table 3.5 summarizes ad characteristics that can be used as heuristic cues
High elaboration likelihood, affective
 Central processing of affective elements is predominant
 Affect-as-information Model: consumers may use feelings as source of information to

form overall evaluation of a product in an informed deliberate manner
 Pre-requisite is that when people inspect feelings to judge brand, they do not inspect
their moods but their feelings in response to the brand.
 Feelings are not assigned a heuristic or peripheral role
Low elaboration likelihood, affective
 Includes models of peripheral processing
 Attitude towards the ad transfer (AAD)

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o Brand attitude and purchase intention was influenced by the attitude to the ad
o Ad likeability might be important factor because of ability to attract attention
and facilitate information processing
o Dual mediation model: empirical support for the Aad transfer. Evaluation of the
as hos immediate and indirect effect on brand attitude via brand cognitions
Feelings transfer: ad-evoked feelings are transferred to the attitude towards the ad
o Has significant influence
Emotional conditioning can be considered an extreme case of feelings transfer, based
on Pavlov’s classic conditioning theory
o Emotional conditioning can alter brand choice when no initial strong preference
have been formed and when brand choice is made under cognitive load
Mere exposure can result in a positive stimulus evaluation
o When consumers are confronted too often with a particular message there is no
longer any learning opportunity  may create a wear-out as consumers get

bored.

High elaboration likelihood, behavioral
 Post-experience models assume central-route processing of prior brand experiences,
meaning consumers are motivated, willing and able to think of previous experiences
and take them into account
o Brand experience: often neglected by most researchers but it is clear that brand
satisfaction will have an impact on the next purchase
 Post-experience model: assumes there are relations between current purchase and
previous purchase/experiences  studies show significant influence between the two
 Perception-experience-memory model: explains the role of marketing communication
in the first buys and other roles for the first purchase.
o Advertisings main function is framing perception, which can affect consumers’
expectation, anticipation and interpretation.
o Enhancing sensory and social experience will affect the brand trial evaluation
on attributes or the weight of the advertised attributes
o Role of post-experience com is organizing memory and interpret experiences
Low elaboration likelihood, behavioral
 In this case well-thought-trough processing is less likely and consumers concentrate on
elements of previous brand experience to form attitude and purchase intention
 Ehrenberg’s reinforcement model: awareness leads to trial and trial leads to
reinforcement – product experience is the dominant variable and advertising
reinforces habits, experience and attitudes
 Routinised response behavior model: large number of product experiences can lead to
routinized response behavior e.g. toilet paper, toothpaste, mineral water etc.
Causes of irritation and consequenses
 Advertising may evoke negative feelings and these are discussed below
 Figure 3.9 explains different sources of irritation
 Elements that are severely annoying are


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o Overdramatised situations, unsympathic characters, uncomfortable situation,
brand comparison, information-orientated appeals, satire, provocation and
eroticism.
Wear in/Wear out effect
o Repetition is sometimes regarded annoying and create negative attitudes
o After repeated exposures, the ad responses become more positive and a
phenomenon called wear-in steps in
o After a number of exposures wear out occurs and negative responses show up
again
Contradictory hypotheses: Superiority of the pleasants hypotheses
o Negative evoked feelings have a negative influence on ad- and brand-related
responses
The law of extremes theory: people don’t like the ad but it doesn’t infect the brand

Advertising and brand confusion
 Brand confusion: when consumers are confused about the communication for a brand
and mistakes it for another
 Product confusion: attributing stimulus to the wrong product category e.g. a consumer
thinks a certain ad is for a bank, but it is an ad for an insurance company
 How to avoid it
o Limited information

o Differentiate and avoid the degree of overall similarity of strategy
o Set the right campaign budget as it is related to brand confusion
o Same with GRP and share of voice
o Involve consumers so they do not mistake your brand for another

Chapter 4 – Target groups
Stages in the segmentation-targeting-positioning process
 SWOT analysis (internal and external analysis of the market)
 Segmentation leads to homogeneous sub-group – the variables lead to segmentation
profiles – segment attractiveness is evaluated (table 4.1)
 This makes way for targeting (focusing on a group or more) – aiming communication
objectives, strategies and tactics at the groups – the promotional mix depends on the
target markets
 Defining a unique and relevant position for the product in the mind of the target group
– Positioning – finding, sustaining, defending the position and image of the product –
differentiates the product from the competitors
How can markets be segmented and how does it influence marketing communications?
 Segmentation is the process of dividing consumers into homogeneous groups through
variables or criteria
 Based on general factors that can be measured objectively and straightforwardly
o Demographics and geographics
 Generations: baby boomers, generation x, generation y

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o Psychographics and lifestyle segmentation – social class, lifestyle, personality
 Better at predicting consumer behavior and how people organize their

lives and spend time/money
o Behavioral segmentation – Occasion, loyalty status, user status, user rate
 Potential users should be convinced through advertising, building
awareness and attitude, trial promotions and in-store communications to
establish relationship
 Existing users should be maintained through relationship building
advertising and loyalty promotions
 Loyalty: loyal consumers should be maintained though advertising and
loyalty promotions; switchers should be persuaded through sales
promotions
Communications should change based on the segmentation as the different consumers
have different backgrounds and experiences of themselves, when they need and want
and how they want to be perceived

Segment profiles and requirements
 They have to be attainable, measurable and lead to homogeneous sub-groups
 Figure 4.2
The most important targeting strategies and selection of target groups
 Market concentration is used when the company chooses a segment and tries to
become the market leader
 Market differentiation involved direction efforts to different segments with different
strategies
 Undifferentiated marketing is using the same strategy in all segments
 There are five basic types of targeting strategies
o Concentration on one segment and a marketing mix for it – good for building
expertise and obtaining learning effects  very dependent on single segment
and vulnerable
o Selective specialization: choosing an attractive number of segments that all
seem profitable but have no syngergy
o Product specialization where company concentrates on selling one product to

different segments
o Market specialization where company concentrates on one market and sells
different products
o Full market coverage: selling to all consumer groups with all the products they
need
 The right targeting group is assessed through size and growth; structural
attractiveness, objectives and budgets of the company; and stability of the market.
o Porters five forces is a model used to assess the right market segment
Positioning strategies and consequences
 Positioning is differentiating your product or brand from the competitors in the mind
of the consumer
 There are 6 questions to answer in order to position yourself
o What position do we already have in the consumers mind?

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o What position do we want?
o What companies are obstacles for us to establish that position?
o Do we have enough marketing budget to occupy and hold the position?
o Do we have the guts to stick with one consistent positioning strategy?
o Does our creative approach match our positioning strategy
Mapping the market is a way to look for a gap which can be filled (Figure 4.3)

Positioning strategies are then applied with a focus
o Product attributes or benefits: unique selling proposition, making the product
or brand special for the target market
o Price/quality: offering the same or better quality at a lower price than
competitors
o Use or application: emphasis on specific use or application of product (e.g.
Kellogs snack packages rather than breakfast)
o Product class: alternative to positioning against other brand
o Product user: associating product with specific users
o Competitor: comparative advertising of the brand competitors
o Cultural symbols: refers to brand personalities or branding devices
Underpositioning is where the company fails to make a clear differentiation with
competitors
Overpositioning it, reduces the number of interested consumers
Confusing positioning would confuse consumers and they would not know what the
company stood for

How to develop positioning strategy
 Table 4.5 shows the seven steps to develop a positioning strategy
o Identification of competitors
o Assessment of the consumers’ perception of competitors
o Determination of positions of competitors
o Analysis of consumers preferences
o The positioning decision
o Implementation of the positioning
o Monitoring the position
Repositioning
 Introducing a new brand
 Change an existing brand
 Changing beliefs with regard to own brand benefits

 Companies may attempt to change beliefs in regards to benefits of competitors
 The importance of attributes may be changed
 New attributes can be added to the perceptual map of consumers

Chapter 5 – Objectives
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It is crucial for the planning process to set main communication objectives that decide
the direction of right communications and the media mix

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The communication goals have to fit with the marketing objectives as market share,
estimated return figures or market penetration
The marketing objectives contribute to the overall company goals

When is it useful to stress category needs and wants in marketing communication?
 Marketing communications objectives can be divided into three categories
o Reach goals: reaching consumers effectively and efficiently
o Process goals: conditions establish before communications can be efficient
o Effectiveness goals: the effectiveness of the two other goals
 The DAGMAR model have stressed the current stage of the buyer or potential consumer
in the purchase process
o Model that defines communication goals as hierarchy-of-effects
 The communication objectives are guidelines for everyone who is involved in campaign
development and realization

 A brand should fit within category needs and wants
o These are the existence of one or more of the buying motives and the perfeption
of the product category as a good means to meeting these motives
 Category needs must be used as a primary communications objective when innovating
o The difference between an innovation and the ‘new category’ and knows
categories should be stressed
o Creating category awareness is also appropriate as a goal when non-category
users are addressed
o Category wants can be omitted, refreshed or used in market communications in
the different situations described above
When is brand recall rather than brand recognition a more important goal?
 Brand awareness can be defined in two ways
o Top-of-mind brand awareness is the awareness that occurs when you are forced
to remember a brand and remember a certain one first e.g. Coca Cola
o Brand recall or unaided awareness: In an unaided context people may recall
several brands spontaneously  less repetition/smaller investments needed
 appropriate when consumers are at store and need a certain product
o Brand recognition or aided awareness: Recognizing a brand from logo, package,
color, etc.
 Appropriate when purchase decision is at the store
 Brand recognition is stimulated by showing the same logo, colors and formats
(repetition)  radio advertising is not appropriate
 Brand recall is stimulated by repeating association between category and the brand
o Sign off slogans
 Dual awareness is sometimes required for consumers to limit their search
 Brand knowledge means that consumers are aware of the most essential brand
characteristics, features and benefits
Stimulation of purchase intention as an objective
 Brand attitude is practical when the consumer has to choose between multiple brands


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o It is the perceived value of a brand to the consumer and it should be maintained
to keep consumers loyal and satisfied
o Changing the brand attitude is very difficult and it might be better to modify it
and repositioning by appealing to different buying motivations
The purchase intention of the consumer can also be enhanced but should not be
stressed in communications of the brand will seem too pushy
When perceived buying risks are high the intention to buy is a necessary mediating
step between favorable brand attitude and purchase
o Need for generating purchase intention and trial is present
o Use advertising and sales promotions
Purchase facilliation is assuring buyers there are no barriers hindering product or
brand purchase e.g. marketing mix tools  need for communication
o Point-of-purchase communications may facilitate purchase
Purchase is the main marketing objective
o Short-term solutions are sales promotions
o Direct response advertising may be evaluated by generated sales

Satisfaction is important as consumers are more likely to repurchase products they like
so communications should be directed at existing consumers first
o Word-of-mouth communications
Brand loyalty should be maintained by following
o Advertising campaigns

Dagmar model and its shortcomings
 Defining Advertising Goals for Measured Advertising Research
 The people at each step of the DAGMAR model will decrease as expected in Figure 5.3
 The model is good because it has quantifiable measures for effectiveness such as
awareness, intermediate effects (indicators for future purchase) and image ratings are
introduced
 Criticism
o In practice awareness and image rating is associated with usage but sales
fluctuate sooner than the two
o Attitude changes follow behavioral changes
o “strong theory of communications”: no evidence of strong desire before
purchase
o “weak theory of marketing communications”:
AwarenessTrialReinforcement
Adaption of objectives in the introductory, growth, maturity and decline stage I the
product life cycle
 Introduction: teaching consumers about the brand/product and the fulfilled needs
o Main objectives are creating category need, brand awareness and brand
knowledge
o Differentiation is supposed to be clear and make the brand unique in relation to
its competitors and the differences should be translated into real benefits
 Growth: Consumers are aware of the brand and its attributes but other competitors
have entered the market


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o Objective is to defend the position against comparable attacks by creating brand
preference
Maturity: there is strong competition and the market is scarcely growing so
competitors steal market share from each other
o Communications focus is on increasing brand loyalty and onmaking consumers
less open to advantages of competitors
o Objectives are spontaneous brand awareness (TOMA), clear and unique brand
benefit, lower price, attention by small innovations, reinforcement of psychosocial meaning and defensiveness of the brand
Decline: products and brands decline and the manufacturers may decide to milk the
brand
o Using sales promotions e.g. prizes/lotteries
o If they decide to renew the life cycle they can do the following
 Communicate product change/adaption
 Draw attention to new applications or moments of use
 Increase frequency of use
 Attract new target groups

How can consumer choice situations influence communication objectives?
 There are six groups of variables that depend on the consumer choice situations
o Standard mass products
o Standard services
o Mail order products
o Impulse products

o Quality products
o Quality services
o International luxury products
o Special niche products
o Showroom products
o Products with new techniques
o Investment products
o Unsought products
 Figure 5.5. Explains the factors that affect the consumer choice situation
o You need your objectives to be aligned with the situation of the choices your
consumers have in order for them to purchase

Chapter 6 – budgets
What is the sales response model and why is it not easy to estimate?
 The sales response model depicts the relationship between size of budget and
communications efforts influence on sales
 Hypothesis on the model
o Sales behave in a microeconomic way and follow the law of diminishing returns

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When every potential buyers is reached they will have the choice to buy
or not buy and beyond the optimal point prolonged communications will
not change their minds
o The sales will create an S-shaped relation
 When level of effort is low, there is no communications effect. Even if
effort is zero there will be a certain level of sales and a minimum
investment is needed to increase sales – when the level is reached the
sales increase until a point where the sales will increase less

It is not easy because of
o Marketing communications are not the only marketing mix instrument
influencing sales  price, product line decision and changes in distribution
o Effective marketing mix implies synergy and interaction between various tools
o Communications efforts may have booth immediate short-term and long-term
effects on sales and market share
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Jones theory
 Traditional theories consider communications long-term investments in goodwill
 Jones proposed a challenging view:
o Claims that paradigms stating that sales are mainly influenced by accumulated
advertising campaigns of the past are mistaken
 Introduces STAS:
o Baseline for brand x is the share of brand X in the budget of families who have
not seen an ad for brand X in a weeklong period before purchase
o The simulated STAS is the share of the brand X in the budget of families exposed
to an ad at least once in the period.
o The difference is the STAS differential  expresses the immediate sales—
generating effect of an ad campaign
o 70% of ads were able to create an immediate advertising effect
o Only 46% of brands created a long-term effect, defined as an increase of market
share compared with previous years
 The first exposure of an ad causes the largest part of sales returns
 Long-term effects will only come when the ad is also effective in the short-term and
Jones does not believe in the sleeper effects of marketing communications
Budgeting methods used
 Marginal analysis: to invest resources as long as extra expenses are compensated by

higher extra returns
o invest in communications efforts as long as MR exceeds marginal
communications costs
o profit comes from difference between gross margin and communications
expenditures
o has the advantage of estimating effects of advertising on profits and derives
normative rule of optimal advertising efforts  is largely theoretical because of
problems in estimating sales response relation
 Inertia: keep budget constant year on year and ignore market changes and
opportunities

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Arbitrary allocation: Whatever the manager decides will be implemented
o Least appropriate as it is very subjective, lacks critical analysis and overall
strategy
o Used by small companies
Affordability: leftover resources after input costs are put into communications
o Used in small-medium sized companies

o Communications are considered a cost rather than an investment
o They are not part of the strategic plan or have any defined goals
o It will never lead to optimal budgeting because of lost opportunities
Percentage of sales: budgets are defined as a percentages of the projected sales in the
next year
o Can be estimated on the previous year or on the next year but neither will be
very accurate
o They could result in overspending or underspending in markets where these
investments are not needed or could’ve had a greater impact
o Decreaseing returns to sales would make the communications budget smaller
where it might be needed to create demand and push sales
Competitive parity: looking and copying competitors spendings
o Collective behavior of market will not skew much of the budget optimum
o Market will not be destabilized by over- or underspending
o Disadvantages are that it assumes that promotional spendings are the only
variable that influences sales – implies that resources are the same in the
competitors company and that they used an effective and efficient way to
calculate budget
Objective and task method:
o least arbitrary method  difficult method
o starts from objectives and resources needed for these and all needed
investments are added = the overall communications budget
o budgets would be evaluated every year, leading to improved decision-making
and more efficient budgeting in the future
o Table 6.3  used in smaller companies and business-to-business contexts

Factors influencing budgets
 Crisis situations
 Planning gap
 Organisational characteristics

 Economies of scale
 Contingencies
 Market share objectives
 Market potential
 Market size
 Economic recession
 Unexpected opportunities or threats
Budgets for new products

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The primary budgeting method for new products should be the objective-and-task
method
o Back ups are examining the industry advertising-to-sales ratio for the market
o Set a higher budget than the average in order to make an impact – doubling the
A/S ratio is considered a safe guideline
The market share of a brand entereing a category is expected to be on average 0,71
times the share of the previous entrant – for fast moving consumer products it is 0,92
Overcoming order-of-entry by later entrants is difficult and can only be achieved when
introducing a product of superior quality, by spending a lot more on advertising or by
making advertising of better quality’

Chapter 7 - Advertising
Types of advertising

 Advertising is any paid, non-personal communication through various media by an
identified company, NGO or individual
 It is used to inform and persuade consumers to buy a product or service
 There are different types of advertising
o Manufacturer advertising: comes from manufacturer that promotes its own
brands
o Collective advertising: when governments makes campaigns
o Retail advertising: when retailers advertise
o Co-operative advertising: when two units in the distribution chain develop an
advertising campaign together
o Idea advertising: promotion of idea
o Industrial advertising: when the intended receiver is another company, who
buys the products to use in its own production process
o Trade advertising: same as above but where the company buys products to
resell them
 Advertising can also be distinguished on the basis of the message
o Institutional advertising: government campaigns
o Selective advertising: promoting a specific brand
o Generic advertising: promotion of an entire product category e.g. Dutch cheese
o Theme advertising: building a reservoir of goodwill for a brand/product
o Action advertising: stimulates consumers to buy product immediately
 Advertising can also be distinguished on the basis of the medium
o Above-the-line advertising (Audio-visual and print)
o Below-the-line advertising (in-store and direct advertising)
The stages of ad campaign development
 Marketing strategy  advertising strategy  creative strategy  media strategy 
evaluation of alternatives  implementation  campaign evaluation
 In the advertising strategy you have three main focus points
o The target groups (Chapter 4)
o Objectives (Chapter 5)

o Message strategy

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You deal with the questions “To whom”, “why”, and “what”
The message strategy is the element that has to convince the consumers and this is
where the marketer has to understand the target group to be effective
o Some consumers perceive the car as a mere transportation device and they
should convinced through the brand attributes or benefits
o Others want to buy the car to maintain status so therefore communicating
lifestyle, an image or a products identity might be more suitable
o Research is done in order to understand consumers (Research insight p. 206)
Many stick to promoting one unique benefit (functional or non-functional)
o Unique selling proposition (USP) refers to the functional superiority
o Emotional selling proposition (ESP) refers to unique psychological association
to consumers  e.g. saying your product is a state of happiness
Qualitative research will give marketers insight to consumers

Is creativity in advertising important?
 Very important because it boils down to a proposition which makes it possible to
communicate a brand’s position in an original and attention-grabbing way
 ‘the selling power of a creative idea can exceed that of an ordinary idea by multiple of

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 The creative idea is ‘an original and imaginative thought designed to produce goaldirected and problem-solving advertisements and commercials’
What are the necessary elements in a creative brief?
 The creative brief is the document that forms the starting point for the advertising
agency
 It should contain following information
o target group
o advertising objectives
o message strategy
o information on the companys background and their product
o also inform of the market and competitors
 It is supposed to give information on the past, present and future and of the company
and the market environment
Execution strategies for rational approach and their effectiveness
 There are two types of creative appeals
o Emotional advertising appeals – conveying image and elicit affective response
o Rational advertising appeals – contains factually relevant cues that serve as
evaluative criteria
 Image communications use a lot of emotional appeal while action communications use
rational appeals
 Rational appeals a number of informational cues of the product and brand
o E.g. price, quality, performance, availability, special, taste, nutrition, packaging,
warranties, offers, independent research, company research, new ideas, safety,
components

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What are the advantages and disadvantages of comparative advertising?
 Rational appeals have certain formats

o Talking head: characters tell a story in their own words
o Demonstration: how the product works (benefits and attributes)
o Problem solution: how to solve or avoid a problem – combined with fear appeal
o Testimonial: ordinary people validating the product – detergents - believability
o Slice of life: product used in real-life setting of problem solving – relating to IRL
o Dramatisation: similar to slice of life, but dramatization builds up suspense and
leads to a climax – this is the difference between the two types
o Comparative ads: can be used to differentiate a brand from a competitor
 It is either direct (naming the competing brand) or indirect (argues the
superiority of the brand)
 Direct comparative ads lead to more positive brand attitudes than
indirect ones
o The disadvantages of comparative ads are that it may result in aggressive
behavior from the comparison brand and that it is misleading.
o Law suits may also rise and they are not appreciated in cultures where
comparison is perceived as bad
Humorous and erotic ad campaigns
 Emotional appeals are advertising that tries to evoke emotions in consumers rathers
than to make consumers think
 They contain many non-verbal elements, images, and emotional stimuli
 Humorous advertising is an appeal created with the intent to make people laugh
o Successful or unsuccessful
o It is one of the most used emotional techniques
o Humor attracts attention from the consumers to the brand and the ad
o Different types of humor can be used and target different target groups
 Cognitive humor
 Sentimental humor
 Satire
 Sexual humor
o Seems more appropriate for existing and familiar brands than new ones

 Humor related to product is more effective than unrelated
 Avoid using humor to build brand awareness
 Erotic advertising includes sexualized content e.g. nudity, physical contact, sexily
dressed persons, seductive facial expressions, sexually laden words/music
o They attract attention to the extent that more car crashes occur near erotic
billboards
o It reduces brand and message recall and has a negative impact on image
o The more intense the eroticism, the more negative responses to the ad become
o Erotic appeals related to products, the more positive responses are
o Lead to better memory, superior attitudes and purchase intent among lowinvolvement consumers - high-involvement consumers prefer non-sexual ads
What are fear appeals and are they effective?

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Warm advertising consists of elements evoking mild positive feelings e.g. love,
friendship, coziness. Affection and empathy
o It is a frequently used emotional appeal
o Leads to warmth on message, brand recall, recognition, more positive affective
response, positive brand and ad attitude  sometimes enhanced purchace
intention
o The target groups are female, emotional individuals and individuals with
cognitive empathy

Fear appeal advertising refers consumers to type of risk they might be exposed to and
can reduce by buying/not buying the advertised product
o Physical (body harm)  burglar alarm, toothpaste
o Social (being socially ostracized) deodorants, dandruff shampoo, mouthwash
o Time (spending time on unpleasant activity)  dishwasher
o Product performance (risk of competitors performing badly) vacuum
cleaners
o Financial (losing money)  insurance companies
o Opportunity loss (missing out on special opportunity)
Fear appeals are capable of sensitizing people to threats and of changing their behavior
o E.g. lowering alcohol consumption in students
Music is a way of creating an emotional response in the consumers by gaining
attention, creating a mood, sense of relaxtion/excitement etc.
o Fast music gains higher attention-gaining value but could distract the consumer

On the basis of what criteria would you select a celebrity?
 Celebrity endorsement is when a celebrity is used to improve effectiveness of the brand
and create the aspiration group effect
 It increases credibility and attractiveness because the celebrity is known, perceived to
be attractive and liked by the target group
o Be aware of using socially accepted standards and not too skinny or highly
attractive models to avoid damaging consumers self-image
o The endorsers personality, image and lifestyle should fit the brand
Components of culture and their influence on advertising
 Culture is composed of five major components
o Values and attitudes, Language, Religion, Gender roles, Sense of humor
 Verbal language: differences in pronunciation may create different meanings
o Translation may result in more space requirements
o The meaning of words might change e.g. hygge
o Non-verbal communication is very important

 Timing, special orientation, gestures, touch, colors and eye contact
 Values and attitudes: determining what is right and wrong, important and desirable
and how we behave.
o Different cultures have different values and attitude, so they emphasise different
communications appeals
 Religion: what is allowed to be said or shown in a marketing message – it influences the
value people attach to material goods and what can/cannot be consumed

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Sense of humor: it differs from country to country
Gender roles: they are different to a great extent from one country to another – e.g.
traditional gender roles in Malaysia, equality in Denmark

High- and low-context cultures
 A high-context communication is where most information is in the physical context and
internalized in the person, while little is in the coded, explicit, transmitted
 A low-context culture has emphasis on words instead of actions – it is easy to decode
the message and understand what is meant
 High-context cultures have a lot of focus on non-verbal communication, as words are
just part of one message while the real message is hidden in the body language and the
context – ambiguous and implicit
Which of Hofstedes dimensions can culture be distinguished as and what is their impact
on cross-cultural advertising?
 Five cultural dimension can be distinguished
o Individualism: loose or tight ties with people and their community

 Ads focusing on the individual could use rational and emotional
arguments while emotional arguments are important in collectivistic
cultures
o Power distance: the extent to which authority plays an important role
o Masculinity: Competitiveness, assertiveness and status are highly valued in
masculine cultures while feminine cultures caring for others and quality of life
are central values
 Competitive ads are good in masculine cultures but not in feminine
cultures
o Uncertainty: the extent to which people feel uncomfortable with uncertainty
and ambiguity and the need for structure/formal rules in their lives
o Long-term versus short-term orientation: pragmatic future-oriented thinking

Chapter 8 – Media Planning
Media planning process
 Media plan is a document specifying which media and vehicles will be purchased when,
at what price and with what expected results  figure 8.1
o Asses environment, describe target audience, sat media objective, selective
media mix, buy media
 Following efforts are important
o Category spending: what is the advertising spending in the product category,
how has it evolved? Increase, decrease or stable?
o Share of voice: what is the relative spending of the different competitors in the
product category? Also investigate share of market and its relation to share of
voice.
o Media mix: how does competitors divide their advertising spending across
media? Analyze the trend.

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Media objectives
 Media objectives are obtained from communications objectives
o Concrete, measurable and realistic  the characteristics for formulating them
are frequency, cost, reach, continuity, weight
 Frequency is how often the consumer will be exposed to the commercial/message
within a time period  must be kept at effective frequency  how often should a
consumer be presented or exposed to a message for effectivity
o Two-factor model explains it through an inverted-U relationship between level
of exposure and advertising effectiveness
 wear in (positive response) and wear out (later negative response)
o Signalling theory: consumers view repetition of message as signal of brand
quality
o Repetition might be beneficial because it increases the presence within the
consumers life
o Increases memorability, brand recall, believability of the ad and it functions as a
cure of brand quality as well as make attitudes accessible and raises consumers
confidence in the brand attitudes (resistant to attitude change)
o The Beta-coefficient analysis is used to calculate effectiveness
 Mn = 1-(1-beta)^n
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Reach and weight is who the message will reach and how wide  percentage who are
expected to be exposed and how much weight the commercial will have
o Useful reach of a medium vehicle: how many consumers from the target group
are likely to see the message
o Distinction can be made between gross and net reach when the message is
repeated in one or more media

 Gross reach is the sum of consumers that each individual medium
reaches, with no regard to the amount of times a single individual is
reaches
 Net reach is the sum of people reaches at least once
o Opportunity to see is the measure often used by media planners
 The average profitability of exposure that an average reached target
consumer has
o GPR is calculated by
 Multiplying reach and frequency for the differen media vehicles used
 Multiplying reach in percentage and opportunity to see
o Effective reach= the consumers expected to be exposed to the message at an
effective frequency level
Continuity
o Continuous schedule: continuous amount of money throughout campaign
period
o Pulsing schedule: certain level of advertising during whole campaign but some
times higher levels than others
o Flighting schedule: advertising is focused on few periods and not during the
whole campaign

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o To chose one of the three schedules, consider how long people will remember
the message
 Double spotting tactic
 Roadblocking
Cost

o CPT is cost per thousands and is calculated by dividing costs of medium by
medium’s audience
o Cost per thousand in target market is also interesting

On the basis of which criteria should a media plan be composed?
 To decide the media mix, quantitative, qualitative and technical criteria have to be
considered
 Quantitative (how many are reached, how often, how quickly will they be reached, can
the ad message be adapted to different regions, is the media effective during certain
periods, how selective is it?
o Medium selectivity: the extent that a medium is directed towards the target
group
o Represented by the selectivity index
 Qualitative (is the media capable of building brand image and brand personality, does it
have impact on audience, how involved is the audience with the media, is the audience
active or passive, do they pay attention to the messages)  can the vehicle add value, is
the quality of reproduction high, how much and what type of information can be
conveyed, how much exposure is needed for memorability, does media have
advertising clutter which distracts effective exposure
 Technical criteria: costs, problems with buying, media availability etc. etc.
Advantages and disadvantages of print and audio-visual media
 There are both physical/written media and audio-visual media
 Print media are: Newspapers, magazines, outdoor advertising, door-to-door
o Outdoor media is reaching for a short time, and the costs are moderate,
sometimes regional and other times national, often ignored
o Magazines: large reach (sometimes specific and selective), high-quality context
can be offered  image building, high involvement and credibility  adding
value, long message life
 Slow medium. Delay in reach, not flexible, high clutter = less effective
o Newspapers: flexible medium, use of top topicals = more attention, high

involvement, objective and informational context = credibility and high impact,
regional and national
 Limited selectivity, low quality of reproduction, transient medium
because of short message life
o Door-to-door: advertising periodic publications with local distribution and free
of charge. Local merchandisers, geographically flexible, high reach, low delivery
costs, promotional offers reach consumers
 Not selective, marginal involvement, doubtful reproduction
 New technology media: Television, radio, cinema

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o Television: high impact, passive medium, induces certain mood, context can add
value, reached in short period of time, regional approach, reveals different
lifestyles and personalities = selective
 High production cost, low effective reach, lifetime of message is short,
advertising clutter, more exposures are necessary to have an effect
o Radio: large reach, low production costs, dynamic medium, different people as
consumers, selective medium for specific groups
 Message has short lifetime, functions as background noise, low attention
paid to message
o Cinema: It benefits from audio-visuality of the message and has great impact on
audience. Increased as audience pay more attention to the message than in
other circumstances as there is no distraction. Value is added through mood,
expectations, surroundings and context. Positive processing of the message –
medium is selective to most young and upmarket audience = like cinema
advertising.
 Limited reach, slow frequency and speed, short lifetime, high production
costs.

Media context
 Advertising is always part of a context
o Receiver context: situational circumstances in which consumer is exposed
o Medium context: the characteristics of the content of the medium in which an ad
is inserted – as perceived by consumers
 Advertising clutter is almost inescapable and this makes the ads less effective
 Ad blocks have been created because consumers do not want to be interrupted
o Viewers experience more arousal and interest during programs than in between
 Intensity of context responses have two views
o The more intense context responses are, the less capacity for consumers to
process the ads
o The more intense response to contexts, the more attraction and arousal is
present which helps process the ads better

Chapter 9 – Advertising research
Four types of advertising research
o Strategic advertising research
o Pre-tests
o Post-tests
o Campaign evaluation research
Strategic advertising research
 Researching if the marketing communications are consistent with the overall
marketing objectives
 It overlaps with strategic marketing research
o Research should focus on product, market, environment
o Use desk research or qualitative data
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Communications audit: all internal and external communications are studies to assess
their consistency with the overall strategy and their internal consistency
o The consistency of the communications mix should be assessed vertically and
horizontally  strategy for products and instruments based on the analysis
Competitor communications strategy research: similar to above but with focus on
competitors to judge their strategies and define own target groups and positioning
Communications content research: helps communications creative generate ideas
about the content of new communications stimuli
Manamgement judgement test is used to evaluate the proposed ad executions

Pre-tests (before the ad is broadcast)
 Advertising stimuli are tested before the ad appears in media to select the best and
effective ad
 Three basic categories are distinguished
o Internal evaluation
 Pre-test checklists are used to make sure nothing important is missing
and that the ad is rounded and perfected – not every criteria is equally
important
 Readability analysis: the ad should be understood at first glance
o Communications effect: measured in sample group
 Physiological tests are where the reaction of the body to an ad is
measured
 Recall tests: portfolio test, the extent to which individual recalls an

ad/execution amid existing ads
 Limitation is that the memory of individuals is tested and it
doesn’t mean the ads are good.
 Direct opinion measurement tests: consumers see a number of ads and
has to rate them
 Theatre test: consumers invited to theater and tested
o Behavioural effects
 Trailer test: respondents recruited to experimental group and divided
into test group and control group
 Split-scan test: split cable and scanner technology generate data on the
effectiveness of the ad campaigns
Post-tests (effectiveness after the ad is broadcast once)
 Exposure
o Has to be measured
 Message processing
o Recognition test: sample of ads is presented to a consumer, who has to indicate
if he/she recognizes the ad
 Starch test: for print ads, consumers has what magazine they read and go
to a random page and questions are asked to each ad
o Recall test: consumers indicate which ads they remember having seen either
with help or no help
 Gallup-Robinson Impact test
 Day after recall test

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