CLEP Principles of Marketing Study Notes

Cost per thousand cpm is the cost of reaching one

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Cost per Thousand (CPM ) is the cost of reaching one thousand prospects through a given media vehicle. Multiplying Reach times Frequency is how media planners calculate Gross Rating Points. Gross Rating Points are calculated by multiplying Reach , which is the percentage of a target audience exposed to an ad, times Frequency, which is the average number of times each of the people targeted were exposed. The "total weight " of advertising delivered during a certain time period is determined by calculating the Gross Rating Points. The Gross Rating Points (GRP) indicates the "total weight" of advertising delivered over a certain time period. Marginal revenue is the change in total revenue that occurs when a firm sells an additional unit of a product. The marginal revenue between selling 5 units at $7 each, and 6 units at $6 each is $1. The Marginal Revenue in this case is one dollar. Selling 5 units at $7 each equals $35 in revenue. Selling 6 units at $6 each equals $36 in revenue. By selling that one additional unit, the marginal revenue gained was $1 . Creative Platform - overall concept and theme for an advertising campaign. Themes may emphasize performance characteristics and the brand's competitive advantages. Ads emphasizing the firm are typically intended to improve the image of the company. Pretests - Evaluations performed before an advertising campaign begins. One of the big types of pretests is known as a consumer jury , which involves asking a number of actual or potential buyers of an advertised product to judge an advertisement. A consumer jury involves getting a group of potential customers together and asking them to judge parts of an advertisement before the campaign begins. This is usually done to try to evaluate the effectiveness of one or more elements of the message in the advertisement. To measure advertising effectiveness during an advertising campaign, a marketer uses inquiries, which may be in the form of coupons or a form request. Can be evaluated before, during, or after a campaign. The method used during a campaign typically involves "inquiries ." For example, several advertisements may have coupons attached, and the advertisement that results in the most coupons returned would be determined to be the best. Posttest - Evaluating advertising effectiveness after an advertising campaign. Evaluation on an advertising campaign performed after it is over. Depending on what the objectives were, these tests can include surveys , or a measurement of change in sales or market share, or recognition and recall tests. Publicity is a type of promotion which can be influenced by a firm, but not controlled. Type of nonpersonal communication in news story form, about an organization or its products that is transmitted through a mass medium at no charge. Types of publicity include news releases, feature articles, and press conferences. Publicity can be good or bad. Fo rm of promotion which often has greater credibility among consumers because it appears to be more objective--it is primarily informative, not persuasive. Publicity often has greater credibility among consumers because
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