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Summary Activity 4.5.7 Answers
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Activity 4.5.7 Answers for IBM Textbook with ISBN 4
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Activity 4.5.7 – DOES ADVERTISING INCREASE SALES?1. Define the term ‘above-the-line promotion’.
‘Above-the-line promotion’ is a type of promotion a business uses that involves
payment to communicate with consumers.
2. Explain whether the promotional activity in the examples above are ‘above-the-
line’ or ‘below-the-line’ promotions.
The case study is an example of ‘above-the-line’ promotions because to use a TV
advertisement that features artists would require direct payment.
3. Analyze two reasons why the sales of Evian water might have declined despite the
apparent success of their online advertising.
One of the reasons may be the expensive price in which their products are sold at.
Though Evian emphasizes on offering high quality water, it may not seem worth the
money for consumers to pay such an expensive price just for water. This may be the
reason as to why their sales are decreasing, which is because consumers feel more
reluctant to buy the overpriced product.
Another reason may be due to the increase in competition, meaning there are more
competitors in the market. Considering that Evian sets the price of the water quite
high compared to many other water brands, may explain why they have lost market
share.
4. Evaluate the effectiveness of viral and social media marketing as methods
promoting a business’ products.
Viral and social media marketing refers to the method a business use for marketing
purposes where they make use of advertising that goes viral in the internet. As for
promotion, it refers to the use of various methods to inform or gain recognition from
consumers with an attempt to persuade them to buy. In this context, the use of viral
and social media marketing, which is a method of promotion, is being evaluated.
An advantage to using viral and social media marketing is the exposure a business
could receive in a short time. This is because majority of consumers make use of
social media on a daily basis, therefore the chances of attracting potential customers
are increased. For instance, if a business were to promote through posters, banners,
or television ads, only a certain group of people within their community will be
shown the ad. However, when using social media, automatically the target audience
expands to the global community.
Another advantage to using viral and social media marketing would be the low cost.
With the advancement of technology, promotion has become less costly especially
through social media which can be purchased and used for free. When compared to
any printing ads, which can be very costly, using social media is cheap yet can be
very effective in promoting a business. This, in turn, is advantageous for the business
as they can invest their capital on other aspects of the business or even save money.
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