1. What is thecase studyabout, and is it a good idea to test market? The case study “ Getting the Most out of Advertising and Promotion”, is about testing the outcome of anadvertisementand promotion. Before advertisements and promotions were not something one would be able collect statistics on television promotions or the effect of advertisement, all was only a matter of faith. Marketing departments might have collected voluminous statistics on television show and coupon redemption, and once they collected that information, they measure everything to compare the costs of marketing with total sales.
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This procedure did not take care of the most important measurement. What a business owner wants to know, what is most important to them is the incremental sales of the product over and above those that would have happened without the advertisement and promotion. This case study is about the new kind of marketing data. It is data correlated information on actual consumer purchases. This information is, “ available from universal product code scanners used in supermarkets and drugstores”. (Magid, M. Abraham & Leonard M. Lodish , 1990 p. 2) This information is linked to the information on the kind of television advertising those consumers receive or the frequency and type of promotion events they see. With this source of data, managers began to notice the potential it has to create great opportunities for new marketing productivity. In order for the managers to take advantage of this, they needed to develop new strategic marketing plans. Before all of this was available to marketers, there was no true measurement for advertisement and promotion. Without having a true measurement, “ marketing managers had to rely on many false assumptions”. (Magid, M.
Abraham & Leonard M. Lodish, 1990 p. 13) they were assumptions that were unexamined, for example, “ those who believed advertising works also tend to assume that in all cases, more of it is better than less. ” (p. 13) Another assumption was that advertising takes a long time, many months or, sometimes, even years to increase sales. “ A popular rule of thumb is that if increased advertising spending does not generate enough sales to pay for the incremental expense within a year, then a company shouldn’t implement the advertisement”. (p. 13) Advertising is not about just boosting sales, but it serves an important function. . If I were to construct a test market today, how would I go about doing so? Test market is not only a tool to measure the effectiveness in advertisement and promotions but it can also avoid costly mistakes to a marketing manager. Companies are spending thousands if not millions of dollars each year to advertise online, but that is not to say that it is being spent wisely ensure that thismoneyis not being wasted on ineffective advertising programs is to continuously evaluate the effectiveness of the chosen programs and to ensure that these programs are achieving their intended purpose.
Evaluating the effectiveness of the chosen programs is not all about money; it also gives market managers the opportunity to analyze the non-tangible effects of the chosen program. For example, if a company chooses to go with a pop-up advertising program, they can evaluate its return on investment by comparing its click-through to the amount of money invested in building it.
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However that is not the extend of it; a good evaluation program will be able to analyze the consumer’s reaction to that program, its effects on the company’s image or its effectiveness in comparison to a banner ad program. On a Pamorama online article, it is stated that Facebook, Twitter, YouTube are the best strategic marketing practices. It is said that they are the Big 3 ofsocial mediaand they are important avenues for building brand engagement and influence. They grow brand awareness, foster brand advocacy, and generate leads and sales.
This is also another way to measure effectiveness References Dyer, Pam. (2012, August 5). Facebook, Twitter, YouTube: Strategic Marketing Best Practices. Retrieved October 23, 2012 from, http://bx. businessweek. com/measuring-advertising-effectiveness/view? url= http%3A%2F%2Fwww. pamorama. net%2F2012%2F08%2F05%2Ffacebook-twitter-youtube-strategic-marketing-best-practices%2F Magid, M. Abraham & Leonard M. Lodish. (1990 May-June). Getting the Most Out of Advertising and Promotion. Harvad College, p. 12-18.