CHAPTER 17 (http://www.eauc.hk/show.asp?id=318) MARKETING DEBATEHas TV Advertising Lost Power?

Long deemed the most successful advertising medium, television advertising has received increased criticism as being too expensive and, even worse, no longer as effective as it once was. Critics maintain that consumers tune out too many ads by zipping and zapping and that its difficult to make a strong impression. The future, claim some, is with online advertising. Supporters of TV advertising disagree, contending that the multisensory impact of TV is unsurpassed and that no other media option offers the same potential impact. Take a position: TV advertising has faded in importance versus TV advertising is still the most powerful advertising medium. Pro: Marketing managers must begin with an identified target market and the strategic direction of the brand before choosing the advertising program. The selection of TV advertising as the medium should be as a function of: the mission, money, message, media, and measurement. In addition, the marketing manager must understand where the product is in its product life cycle and how the hierarchy of effects affects his products. If these factors are known then the marketing manager can decide if informative advertising, persuasive advertising, reminder advertising, or reinforcement advertising is necessary. Television through its multisensory impact is the best medium for these advertising conditions. In addition to the products life cycle, the products market share and consumer base, competition and clutter, advertising frequency, and product substitutability affects decisions touse TV. Properly designed and executed TV programs can improve brand equity by vividly demonstrating product attributes and persuasively explaining consumer benefits, portraying user and usage imagery, brand personality, and other brand intangibles. Critics of TV advertising may be focusing on the messenger rather than on the message. Con: Consumers have changed. We are now into the fourth generation of consumers using TV as a marketing communications medium. The proliferation of new technologies has shifted the power to the viewer rather than the transmitter. Current generations receive information through numerous media channels: the Internet, cell phones, satellite, cable, radio, and others. The influence that TV once had to stimulate, interest, and build brand loyalty due to its exclusivity is gone. Today, buyers are more likely to review product performance on the Internet or to ask opinion leaders than they are to act because they saw a clever commercial. As a result, with the exception of certain product categories or product lines, TV advertising no longer reaches target consumers. More importantly, TV commercials do not reach opinion leaders who are increasingly influencing consumer-buying decisions on a greater scale. To reach this important group, companies must target messages through combinations of other media and product usage.

MARKETING DISCUSSION Pick a brand and go to the Web site. Locate as many forms of communications as you can find. Conduct an informal communications audit. What do you notice? How consistent are the

different communications? Student answers will differ depending upon their favorite Web sites.

Marketing Excellence: RED BULL

1) What are Red Bulls greatest strengths and risks as more companies (like CocaCola, Pepsi, and Monster) enter the energy drink category and gain market share? Suggested Answer: Red Bulls greatest strength has to be its integrated marketing communications mix and their ability to reach a select target market with success. A second strength is their integrated marketing communications mix that eschews traditional forms of mediamass media and print. Red Bulls greatest weakness will be its ability to reach their target market influencers, decision makers amongst increased advertising spend by the major beverage kings. (sense)

2) Should Red Bull do more traditional advertising? Why or why not?

Suggested Answer: Student answers will vary but good students will note that as a product moves through its product life cycle, advertising messages and media must adapt to meet the changing demographics and demands of its target market. So, as Red Bulls target market (young adults) age theyll be looking for their product in and through traditional media and traditional marketplaces featuring traditional media. 3) Discuss the effectiveness of Red Bulls sponsorships, for example Bull Stratos. Is this a good use of Red Bulls marketing budget? Where should the company draw the line?

Suggested Answer: Student answers will vary by opinion and good students will not that it would only take one fatality or disaster to negate all the good public opinion, and goodwill built up by Red Bulls sponsorships in the past. Recent newspaper stories have commented that Red Bull has pulled this Stratos stunt for the time being.

Marketing Excellence: TARGET 1) What has Target done well over the years in terms of its integrated marketing communications strategy? What should it do going forward? Suggested Answer: Short answer is that Target has done everything well in terms of an integrated marketing communications strategyits message is consistent, accessible to consumers, recognizable to consumers world-wide, strong sales promotions, public relations and publicity, events and experiences, interactive and word-of-mouth selling, and direct marketing. Target has developed an effective communication strategy by following the eight steps required: identify, determine objectives, design communications, select the channel, budget, mix, measure results, and manage the process. 2) How does Target compete against mammoth Walmart? What are the distinct differences in their IMC strategies? Suggested Answer: The differences between Walmart and Target lie in their target market distinctions. Targets target markets income, education, and lifestyles differ from Walmarts target market consumer. The differences in their IMC strategies are simple: Walmarts is focused on everyday low price and Targets is cheap chic. 3) Did Target do the right thing by tweaking its message to focus more on value and less on trends? Why or why not? Suggested Answer: Student answers will vary, but good students will probably state that Target had no choice but to respond to the economic climate and focus more on value and less on trends, because they were losing customers and market share to Walmart and other low price retailers, like Dollar General, etc.

CHAPTER 18

Marketing Debate: Should Marketers Test Advertising?

Advertising creatives have long lamented ad pretesting. They believe that it inhibits their creative process and results in much sameness in commercials. Marketers, on the other hand, believe that ad pretesting provides necessary checks and balances as to whether an ad campaign is being developed in a way so that it will connect with consumers and be well-received in the marketplace. Take a position: Ad pretesting in often an unnecessary waste of marketing dollars vs. ad pretesting provides an important diagnostic function for marketers as to the likely success of an ad campaign. Pro: Most advertisers try to measure the communication effect of an adthat is, its potential effect on awareness, knowledge, or preference. They would also like to measure the ads sales effect. Communication-Effect Research called copy testing seeks to determine whether an ad is communicating effectively. Marketers should perform this test both before an ad is put into media and after it is printed or broadcast. Many advertisers use posttests to assess the overall impact of a completed campaign. If a company hoped to increase brand awareness from 20 percent to 50 percent and succeeded in increasing it to only 30 percent, then the company is not spending enough, its ads are poor, or it has overlooked some other factor, giving them valuable information at a reasonable cost. Con: Pretest critics maintain that agencies can design ads that test well but may not necessarily perform well in the marketplace. Proponents of ad pretesting maintain that useful diagnostic information can emerge and that pretests should not be used as the sole decision criterion anyway. Widely acknowledged as being one of the best advertisers around, Nike is notorious for doing very little ad pretesting. MARKETING DISCUSSION What are some of your favorite TV ads? Why? How effective are the messages and creative strategies? How are they building brand equity? Student answers will differ depending upon their favorite TV commercials but all answers should cover the major points of this chapter.

Marketing Excellence: COCA-COLA 1) What does Coca-Cola stand for? Is it the same for everyone? Explain. Suggested Answer: Because Coke believed early on that to gain worldwide acceptance, it needed to connect emotionally and socially with the masses and be at arms length with everyone. Coco-Cola must understand and recognize that refreshment means different things to different people around the world. One of Cokes strengths is how well it weaves the soft drink, Coke, into peoples definitions of refreshment no matter where in the world they live. 2) Coca-Cola has successfully marketed to billions of people around the world. Why is it so successful? Suggested Answer: Coke has created a highly-current, uplifting global campaign that translates well into different countries, languages, and cultures. Cokes advertising has primarily focused on the products ability to quench thirst. 3) Can Pepsi or any other company ever surpass Coca-Cola? Why or why not? What are Coca-Colas greatest risks? Suggested Answer: Student answers will vary based on their personal opinions and tastes. Cokes greatest risks have to be the managing of its mass communications strategy and reaching the brands target marketit is so massive that the right media and marketing message is critical.

Marketing Excellence: GILLETTE 1) Gillette has successfully convinced the world that more is better in terms of number of blades and other razor features. Why has that worked in the past? Whats next? Suggested Answer: The companys impressive marketing knowledge and campaigns have helped it reach an international level of success. Gillette uses one global marketing message around the world and is closely aligned with sports and sports figures worldwide. 2) Some of Gillettes spokespeople such as Tiger Woods have run into controversy after becoming endorsers for the brand. Does this hurt Gillettes brand equity or marketing message? Explain. Suggested Answer: In the long-run these spokespeople should not hurt the brands equity due to the extensive use of sport figures world-wide, and the integrated marketing

communication strategyaligning itself with not only sport figures but musicians, video games, and movies/videos. 3) Can Gillette ever become as successful at marketing to women? Why or why not? Suggested Answer: Yes, the strategies, tactics, and communication message used to market to me, Gillette can begin to market to womenwomen who buy personal care products for their man!

CHAPTER 12 MARKETING DEBATEWith Products, Is It Form or Function? The form versus function debate applies in many arenas, including marketing. Some marketers believe that product performance is the end all and be all. Other marketers maintain that the looks, feel, and other design elements of products are what really make the difference. Take a position: Product functionality is the key to brand success versus product design is the key to brand success. Suggested Response Pro: Consumers buy products to satisfy a need. A consumer uses products and decides on a product based upon their own consumption systemthe way the product is by the consumer (getting the product, using the product, and disposing of the product). Additionally, the customer value hierarchy (core benefit, basic product, expected product, augmented product, and potential product) enters into the decision-making process for a consumer. Therefore, a product must perform to an acceptable level according to the consumers perception of benefits in their customer value hierarchy. A low price, low function product, like a disposable razor must at least perform the task to which it was created. A more expensive product, an electric razor, must meet the function to which it was created, although these functions are at a higher level than the disposable razor. If either product does not perform to the consumers basic product definition then the product will be discarded and not re-purchased. Con: Products have unique characteristics and specific brand identifications that meet consumers needs that are not related to functionability. Such needs as status, selfactualization, and style appeal to a wide audience. For example, most automobiles will Chapter-by-Chapter Instructional Material perform the task of taking a person from point A to point B. However, it is the design of the automobile (specific make/type: i.e., sports car, luxury car) that appeals to the buyer. For many consumers style plays a more important role, for some, the only role in their buying decision. A well-designed product can also be a point-of-difference in the marketplace aiding consumer acceptance through its ease of use, durability, reliability, or packaging. A well-designed product can be a competitive advantage for smaller firms. Whatever, the design, however, the product must at least meet the consumers definition of a basic product. Once that definition is met, design can be a powerful marketing asset.

MARKETING DISCUSSION Consider the diverse means of differentiating products and services. Which ones have the most impact on your choices? Why? Student answers will differ according to the product/services chosen. However, student answers should encompass the following distinctions: Products differentiation includes: Form Features Performance quality Conformance quality Durability Reliability Repairability Style Services differentiation includes: Ordering ease Delivery installation Customer training Customer consulting Maintenance and repair Marketing Excellence: CATERPILLAR 1) What were some of the key steps that led to Caterpillars becoming the industry leader in earth-moving machinery? Suggested Answer: In terms of the concept of product, Caterpillar has re-invented its productfrom the physical product, to its services provided, to its research and development, to its local emphasis with its equipment, CAT today has a different line up of products than the CAT of old. Examples include: 56% of its business is in capital equipment and the remaining percentage in services. CAT is focused on high-tech machinery i.e.,: hybrid, and has divided its product strategy into three segments to meet the needs of its customers. 2) Discuss Caterpillars future. What should it do next with its product line? Where is the future growth for this company? Suggested Answer: Students answers will vary but good students will cite material from this chapter regarding the customer-value hierarchycore benefit, basic product, expected product, augmented product, and potential product to defend their positions on where Caterpillars future lies.

Marketing Excellence: TOYOTA 1) Toyota has built a huge manufacturing company that can produce millions of cars each year for a wide variety of consumers. Why was it able to grow so much bigger than any other auto manufacturer? Suggested Answer: Toyota has built a huge manufacturing company that can produce millions of cars each year for a wide variety of consumers and has products for different price points demanded by consumers. The firm is the master of lean manufacturing and continuous improvement. Its plants can make as many as eight different models at the same time, bringing huge increases in productivity and market responsiveness. Designing these different products means listening to different customers, building the cars they want, and then crafting marketing to reinforce each makes image. Toyota is integrating its assembly plants around the world into a single giant network. The plants will customize cars for local markets and shift production quickly to satisfy any surges in demand from markets worldwide. 2) Has Toyota done the right thing by manufacturing a car brand for everyone? Why or why not? Suggested Answer: Student answers will vary but one opinion is that yes, Toyota has done the right thing by manufacturing a car brand for everyone. It has been successful because has products for different price points demanded by consumers. And Toyota understands that each country defines perfection differentlyfor example in its Lexus Division. 3) No doubt Toyota will feel the impact of its massive recall for a long time. Did Toyota grow too quickly as Toyota suggested? What should the company do over the next year, 5 years, or 10 years? How can growing companies avoid quality problems in the future? Suggested Answer: Students answers will vary but to be consistent with this chapters Chapter-by-Chapter Instructional Material subject, student answers should refer to Toyotas need to keep their products selection and quality superior to their competition and to deliver to the consumer, the consumers definition of potential product.