chapter 13 pr, regulations & sponsorhips
TRANSCRIPT
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Public Relations, Regulations and Sponsorship Programs13•Public relations
–Role of public relations–Social responsibility
•Regulating marketing communication
–Federal Trade Commission–Industry regulations
•Sponsorship marketing
Chapter Overview
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Sponsorships and Causes
• What do you think about the WWF and the companies that sponsor it?
• Should companies be involved in sponsoring sporting events, rodeos and music events?
• Should companies contribute or participate in social causes such as the American Cancer Society?
• Would you switch brands based on causes the company or brand supports?
• How do you feel about the naming of sports stadiums by companies?
13Discussion Slide
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• Monitor internal and external publics.• Provide positive information to each
public that reinforces the IMC plan.• React quickly to any shift by any of the
publics from the desired position.
F I G U R E 1 3 . 1
Public Relations Functions
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• Employees• Unions• Management• Shareholders• Channel
members• Customers
• Media• Local community• Financial community• Special-interest
groups• Government
F I G U R E 1 3 . 2
Stakeholders of Public Relations
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Employees need to be aware of what is being said in advertisements and on the Internet.
Motorola’s Web site
Http://www.motorola.com
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Public Relations Events
• Altruistic activities• Cause-related marketing• Benefits of supporting causes
• Additional customers• Increased profits• Goodwill• Better relations with governmental
agencies• Green marketing
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Cause-Related Marketing
• Support of a social cause through financial transactions with the firm’s customers.
• Cause-related marketing studies:• 83% of consumers have a more positive image of
companies that support causes the customer cares about.
• Most Americans believe companies should have a positive impact on environment and community.
• 76% willing to switch to a brand that supports a cause they believe in if price and quality perceived equal.
• National vs local causes• Impact greater if the firm can utilize its products in
the social cause.
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YWCA Web site: http://www.ywca.org
• Improve public schools (52%)• Dropout prevention (34%)• Scholarships (28%)• Cleanup environment (27%)• Community health education (25%)
F I G U R E 1 3 . 3
Causes Consumers Prefer
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McDonald’s reminded the public of its support for the Olympics with a series of advertisements.
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• Corporate newsletters• Internal communications• Media news releases• Stockholder correspondence• Annual reports• Special events
F I G U R E 1 3 . 6
Public Relations Tools
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Regulating Marketing Communications
• Unfair and deceptive marketing practices• Lanham Act (1947)
• An advertisement or communication is deceptive or misleading if:• A substantial number of people or “typical
person” is left with false impression or misrepresentation.
• The misrepresentation induces people or the “typical person” to make a purchase.
• Deception vs puffery
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• Federal Trade Commission (FTC)• Food & Drug Administration (FDA)• Federal Communications Commission (FCC)• US Postal Service (USPS)• Bureau of Alcohol, Tobacco and Firearms
(BATF)
F I G U R E 1 3 . 7
Governmental Regulatory Agencies
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Federal Trade Commission(FTC)
• Created in 1914 by passage of Federal Trade Commission Act.
• Original intent was to enforce anti-trust laws.• FTC authority expanded in 1938 with Wheeler-Lea
Amendment.• Given power to stop unfair and deceptive
advertising practices.• Granted FTC access to courts to enforce their
decisions.
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How an FTC investigation begins
• Consumers• Businesses• Congress• Media
Complaints can be lodged by any of the following
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FTC Actions
• Consent order• Administrative complaint• Cease and desist order• Full commission hearing• Appeal to U.S. Court of
Appeals• Corrective advertising order• Trade regulation ruling
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FTC Criteria• Is the typical person misled by the
marketing communication?• Does the marketing communication lead
the typical person to make a purchase or pursue some other type of activity?
• Is the claim mere puffery or does it have to be substantiated?
• Is the claim substantiated by competent or reliable evidence?
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To substantiate its claim that Kleenex is softer the company conducted touch tests involving consumers.
Substantiating that Kleenex is “made with 24% more cottony, soft fiber,” as the ad claims, would require some type of lab test.
Click image to enlarge.
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• Better Business Bureau• National Advertising Division
(NAD)• National Advertising Review
Board (NARB)
F I G U R E 1 3 . 8Industry Regulation
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Sponsorship Marketing Objectives
• Enhance company image.• Increase firm visibility.• Differentiate a company or brand.• Showcase specific goods or
services.• Develop a closer relationship with
current and prospective customers.
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Event Marketing and SponsorshipsUnited States
Source: “Event Marketing/Sponsorships,” Public Relations Society of America
Sports Marketing$3.84 billion
65%Entertainment Tours$650 million (11%)
Festivals & Fairs$558 million (9%)
Causes$535 million (9%)
Arts & Cultural Events$354 million (6%)
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Event Marketing and SponsorshipsCanada
Source: “How Big is the Canadian Sponsorship Pie?” The Sponsorship Report (Http://www.sponsorship.ca/p-issues-howbig.html)
Sports (45%)
Cultural Events (20%)
Education (10%)
Health (10%)
Humanitarian (10%)Environment (2.5%)
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What is the likelihood that a fan will buy a sponsor’s product?
• NASCAR 72%• Tennis 52%• Golf 47%• NBA 38%• NFL 36%
Source: “Event Marketing/Sponsorships,” Public Relations Society of America (Http://www.prsa.org/ppc/68022.html)
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INTEGRATED LEARNING EXPERIENCESTOP
• Performance Research• Http://www.performanceresearch.com
• IEG Sponsorship• Http://www.sponsorship.com
• BDS Sponsorships, Ltd. (Europe)• Http://www.sponsorship.co.uk
Firms specializing in helping businesses maximize their sponsorship investments.
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Sponsoring Individuals
• Name recognition 68%• Current popularity 56%• Overall image 53%• Character 51%
Source: “Event Marketing/Sponsorships,” Public Relations Society of America
What attributes do sponsors look for in endorsing an individual such as Tiger Woods?
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To Maximize Event Marketing
• Determine objective.• Match event with customers,
vendors and employees.• Cross-promote event.• Include company in all event
advertising and brochures.• Track results.• Evaluate the investment following
the event.
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Event Marketing