The Situation Analysis

1. The Situation Analysis Where we are Why we’re there What should we do now?

2. Why do we start here? Have to understand: Where your brand is Why you are there Where your competition is Why they are there What your possibilities are How to get there The Situation Analysis

3. The Situation Analysis I. Product Category Analysis • Product Category History (basic product history including recent category innovations, trends, etc.) B. Category Structure (list of sub-segments within your category e.g.: car segments, domestically produced goods vs. international goods, price segments. Divide the category the same way either the consumer or your client does. C. Historical Category Sales: 3-5 year charts showing sub-segments and category sales development with trends listed. D. Regionality of Category / Sub-segments Sales: Sales by region indexed to population. Category Development Index / Brand Development Index Analysis. E. Seasonality of Category / Sub-segments Sales: Monthly/quarterly sales over past 3 years showing seasonal variations. F. Pricing History of the Category / Sub-segments: segments, sales within segments, trends within segments. G. Distribution History of the Category / Sub-segments H. Category Promotional Spending 1) Advertising Spending 2) Sales Promotion Spending 3) Public Relations Activities 4) Personal Selling

4. The Situation Analysis II. Competitor Analysis A. COMPANY / BRAND B. Product 1) Product Construction: ingredients, quality, etc. 2) Packaging Analysis C. Sales 1) Sales Volume 2) Share of Market 3) Regionality / Seasonality D. Pricing Strategy E. Distribution Strategy 1) All Commodity Volume Distribution, CDI, BDI

5. The Situation Analysis F. Research Knowledge Summary (e.g.: brand awareness, advertising awareness, consumer’s views of the product, etc.) G) Promotion 1) Advertising a) Presumed Creative Strategy 1) current advertising 2) evaluation / implications b) Presumed Media Strategy 1) media spending 2) media plan: key elements, presumed strategies 3) SOV/SOM Analysis 4) evaluation / implications

6. The Situation Analysis 2) Sales Promotion a) Presumed Strategy b) promotional plans c) evaluation / implications 3) Public Relations a) Presumed Strategy b) PR plans c) evaluation / implications 4) Personal Selling a) Presumed Strategy b) Plans c) evaluation / implications

7. The Situation Analysis H. SWOT Analysis Summary 1) Strengths 2) Weaknesses 3) Opportunities 4) Threats I) Implications / Next Steps

8. “If you don’t know where you are going… you can never get there.”BRAND VISION

9. How to write a vision There are five basic parts; 1) Where are we today? (Background/current state of events) 2) Where do we want to be X years from now (vision/objective) 3) How are we going to get there? (Strategies) 4) What will be the result of us having reached our goal? (End benefit) 5) Steps to be taken in the next 6 months to move toward the vision. (Road map)

10. Part 1) Where are we today? This section includes a critical look at the following: a) Situation Analysis. b) Our evaluation of the quality of our work. c) Brand vitality / new business / new brand assignments. d) Quality of people. e) Revenue / profitability growth / decline and reasons.

11. Part 2) Where do we want to be in X years? This singular objective states how we and our client will measure our success.

12. Part 3) how are we going to get there? This section tells how we will focus our assets and energies to move from where we are to where we want to be. a) Evaluation. b) Quality of our Work. c) Personnel Quality, group “culture,” training. d) Areas of Leadership. e) Technology.

13. 4) Results of Success - What will this success mean for our client and for the agency. This should address the following: a) Sales b) Fulfillment of our company vision / mission. c) New brand assignments, new product assignments d) Annualized revenue growth. e) Ongoing account profitability.

14. 5) Next Steps: 6 months - You don’t eat an elephant all at once. Once you’ve defined very clearly where you want to go, and how you are going to get there, what specific next steps are you going to take for your region to begin along the path?

15. Let’s try it. 1) Where are we today? 2) Where do we want to be X years from now? 3) How are we going to get there? 4) What will be the result of us having reached our goal? 5) Steps to be taken in the next 6 months to move toward the vision.

16. Media: The Contact Points Choosing the right medium for your message.

17. Media: The Contact Points • Why is Media Important? • Your advertising can’t be successful if it’s not seen by the right people at the right time. • In a world with fewer and fewer real product differences, advertising is MORE important.

18. Media: The Contact Points • The Key to Success: • 100% Media Neutrality • You figure out where are the best times and places to reach your customer and that’s where you advertise.

19. Day in the life: Dunkin Donuts

20. What do you do in the morning?

21. Staying functionally neutral means understanding the difference between Attitudes & Behaviors • The difference between what people think (attitudes) and what people do (behaviors) • “Actions speak louder than words.” • Example:

22. Media Neutrality • Why is Media Neutrality a radical thought? • Clients like doing what has been done before (“proven successful”) • Clients like for their children to see their ads on TV • Agency people like making TV commercials more than packaging redesigns. • Cannes doesn’t give awards for matchbook covers or point of purchase displays.

23. Media: The Contact Points • Where is the best place to advertise the following? • Cottage cheese? • Delivery pizza in a college town • iPod • FUBU • New Arctic Monkeys CD • Socks • BMW X-3 • Honeymoon vacations • Athlete’s foot products • Life Insurance • New IKEA location

24. Media: Definitions that sound ickier than they really are • Stuff you actually need to know to sound smart: • Medium: singular • Media: plural • Define: • Media Objectives, Strategies, Tactics. • Reach • Frequency • GRP • TRP • CPM • CPP • SMRB & MRI • Day parts: early morning, daytime, early fringe, news, late fringe, prime, late night • strengths and weaknesses of different media • “Alternative Media” and “New Media” just mean we didn’t think of it before.

25. Media: The Contact Points • The eternal debate: • Which is more important: efficiency or effectiveness?

26. Media: The Contact Points • Efficiency • A GRP is a GRP is a GRP • Get as many as you can afford; it doesn’t matter where they are. • Media is a total commodity and should be bought like one. • Just focus on impressions; more than year ago for less money.

27. Media: The Contact Points • Effectiveness • The Fishing Channel vs. Desperate Housewives • Same impact? • Target your message to media your target cares about. • Which media do they use (National Enquirer) vs. which do they trust (NY Times)?

28. Media: The Contact Points • The answer? • Obviously both are important. • Start with your target and you’ll get the right answer.

29. Media: The Contact Points • What we really need is credible understanding of what a GRP is worth by medium. • DDB’s Consumer Aperture: what is the ideal time, place, circumstance where your target should see your ad? • Every agency has their own version.

30. Strengths High quality sight and sound Visual demonstration Creating an image Generate excitement Image transfer from show (e.g. Academy Awards, Super Bowl) Small to large audiences Weaknesses Fleeting message Channel clutter Commercial clutter TIVO & remotes :15 commercials increasing clutter Expensive production (up to $5MM) Medium Strengths & Weaknesses: Television

31. Strengths Specialized audiences Certain magazines are purchased because of the ads Life style and consumer passions Editorial prestige Superior color reproduction Ability to explain in detail Shelf-life and pass along readership Weaknesses Passive medium Have to buy a lot of them to get a very broad impact. Clutter (e.g. Vogue, In Style fall fashion issues) Medium Strengths & Weaknesses: Magazines

32. Strengths Very specialized audiences (Howard Stern vs. Rush Limbaugh vs. Radio Disney) Sense of immediacy Really good radio advertising is very memorable Weaknesses Local, not national Splintered audience Easy to change channels Lack of real audience data Hardly anyone can write really good radio advertising. Background medium Medium Strengths & Weaknesses: Radio

33. Strengths Credible Local Most widely used advertising medium in the US Excellent to announce news: e.g. sales Short closing dates Weaknesses Declining literacy rates in the US TV and Internet have sapped their hold on immediacy of news Lack of standardization still an issue for national advertisers. Medium Strengths & Weaknesses: Newspaper

34. Strengths Excellent reminder vehicles. Size of the message Transit: captive audience Weaknesses <3 seconds. Communications limitations Increasing clutter and bad postings Medium Strengths & Weaknesses: Outdoor and Transit

35. Strengths Targeted Room to say everything you want and need to. 100% focus on your advertising vehicle Testable Weaknesses What do you do with “junk mail?” Medium Strengths & Weaknesses: Direct Mail

36. Strengths Can do “anything” Basically not regulated Deliver tremendous detail and get a purchase Growing impact Traceable & relationship building Weaknesses Clutter, clutter, clutter Majority of computers still too slow Forget about most people 50+ Have to go seeking information for the most part Medium Strengths & Weaknesses: Internet

37. Strengths Very targeted Tremendous creative possibilities Excellent for local companies There when you need them Weaknesses Unlikely to get significant national impact. Medium Strengths & Weaknesses: Advertising Specialties

38. Media: The Contact Points • Professor Russell’s #1 Media Gripe: • Media strategy and planning are powerful competitive tools rarely used these days. • Clients overly concerned about efficiency. • Media not at the table when decisions are made. • No longer part of the advertising agency. • Creative elements dictated by Creative Department, Account Planning, Account Management, Clients & the janitor. • Almost never does the media group even have input. HUGE mistake.

39. Media: The Contact Points • Who is at fault? • Media Companies separating from their agencies. • Clients focusing on efficiency, efficiency, efficiency. • Creatives & Clients more interested in producing TV commercials for their egos than for the brand. • How do you solve this? • Get media back at the table! • E.g. LB Warsaw IKEA example. • Re-train clients to view media as creative. • Re-train creatives to share ownership of ideas. • Reward Creatives for media successes.