Prioritizing Media Paradise Kitchens was started by cofounders Randall F. and Le
ID: 343274 • Letter: P
Question
Prioritizing Media
Paradise Kitchens was started by cofounders Randall F. and Leah E. Peters to develop and market Howlin' Coyote Chili, a unique line of single-serve and microwaveable Southwestern/Mexican style frozen chili products. The Howlin' Coyote line of chili was first introduced into the Minneapolis-St. Paul market then quickly expanded to Denver and Phoenix.
To the Company's knowledge, Howlin' Coyote is the only premium-quality, authentic Mexican-style frozen chili sold in U.S. grocery stores. Its high quality has gained fast, widespread acceptance in its markets. Currently, Paradise Kitchens has introduced Howlin' Coyote frozen chilies to 15 of its planned 20 markets with plans to extend the brand into other categories of Mexican food products, such as tacos, enchiladas, and burritos.
Paradise Kitchens believes that its high-quality, high-price strategy has proven to be successful and now is contemplating adding a new product line to its offerings, Earth Coyote Organics (ECO). Earth Coyote Organics will be positioned as a healthier Mexican-style frozen food line made with certified organic ingredients.
Similar to the Howlin' Coyote product line, the ECO line will feature single-serve Southwestern/Mexican frozen dinner products seasoned with lime, garlic, and red chili spices, targeted at Hispanics and non-Hispanics living primarily in the southwestern regions of the United States. The price for the four initial ECO products will be above the Howlin' Coyote line as well as above the competitor's lines, utilizing a premium pricing strategy. Paradise Kitchens has chosen selective distribution for the new Earth Coyote Organics product line and has chosen its retail distribution partner.
With decisions on product, place, and pricing already ironed out, Paradise Kitchens must now make decisions about the promotional element of the marketing mix. With a solid IMC plan in place, the owners must now tackle the advertising plan.
Marketing managers must choose from many advertising options as they design a campaign to reach potential customers. Because there are so many media alternatives available including television, radio, newspapers, and magazines and multiple options within each of the media types, marketing managers often rely on CPM (cost per thousand impressions) to help monitor the efficiency of marketing expenditures.
While completing this activity, please refer to Appendix A in your textbook for additional information on Paradise Kitchens and Building an Effective Marketing Plan.
Read the case below and answer the questions that follow.
Advertising can be managed by following the three steps of the promotion decision process: developing, executing, and assessing the advertising program. As the firm develops an advertising program, it must accomplish a number of critical tasks: identifying the target audience, specifying the advertising objective, setting the advertising budget, designing the advertisement, and finally, selecting the right media.
Paradise Kitchens has defined the target audience for the Earth Coyote Organics product line as Hispanic and non-Hispanic individuals and married couples residing in the Southwestern and Western regions of the United States. This target audience is most likely to prefer the spicy, high-quality, convenient, organic frozen meals that will be the hallmarks of the Earth Coyote Organics line.
Paradise Kitchens needs to inform the target audience about its latest new product introduction. The owners have set aside $250,000 to be used as the advertising budget for the new product introduction. The product advertisements will be competitive in nature, with a goal of persuading customers that Earth Coyote Organics frozen dinners are healthier than competitors' offerings and are worth the premium price.
The elements of the advertising design are in place and thus the firm must now decide on the right media. This decision is often challenging for the firm as it tries to maximize the exposure of the message to the target audience while minimizing cost. A critical metric to guide advertising decisions is CPM, the cost of reaching 1,000 individuals of households with the advertising message in a given medium. You should calculate the CPM for each of the advertising media below to compare the relative expense of the five media choices.
Use your CPM calculations as you answer the questions provided.
1. Which of the five media types has the greatest overall reach?
Major city newspaper
National newspaper
Prime time national television commercial
Cable television commercial
Local PennySaver or Coupon Clipper magazine
2. Given the $250,000 budget for Earth Coyote Organics' new product introduction advertising campaign, ECO could achieve the greatest frequency in a calendar year using
a national newspaper.
a cable television commercial.
a prime time national television commercial.
the local PennySaver or Coupon Clipper magazine.
a major city newspaper.
3. A _______ has the lowest CPM (cost per thousand).
major city newspaper
local PennySaver or Coupon Clipper magazine
cable television commercial
prime time national television commercial
national newspaper
4. A _______ has the highest CPM (cost per thousand).
cable television commercial
local PennySaver or Coupon Clipper magazine
prime time national television commercial
major city newspaper
national newspaper
5. Utilizing national campaigns such as prime time national television commercials and national newspaper advertising would likely result in a significant amount of
high audience selectivity.
gross rating points.
wasted coverage.
cost per thousand.
frequency.
Estimated Audience Media Frequenc Type of Media Average Cost Coverage Prime time national television $125,000 per 30-second commercial commercial National 114,000,000 Da Cable television commercial (HGTV, Lifetime, Food Network, etc $10,000 per 30-second cormmercial Regional 125,000Dail National newspaper (USA Today, Wall Street Journal $190,000 per half-page ad National 2,000,000 Dail Local PennySaver, Coupon Clipper magazine $2,000 per half-page a Regiona 15,000 Weekl Major city newspaper (Dallas Morning News, LA Times 50,000 per half-page ac Regional 350,000 DailExplanation / Answer
Calculate CPM as below
CPM = 1000*Average cost / Estimated audience
1. Prime time national television commercial
This media has the greatest outreach with estimated audience @ 114,000,000 daily
2. a prime time national television commercial.
This media has the lowest CPM, and hence, with the given budget, it can reach frequency = 1000*250000/1.10 = 228,000,000
3. a prime time national television commercial.
As determined above, this media has the lowest CPM.
4. Major city newspaper
It has the highest CPM, i.e. 142.86
5. Frequency
Type of Media Average cost Estimated audience CPM Prime time National TV commercial 125000 114000000 1.10 Cable TV commercial 10000 125000 80.00 National newspaper 190000 2000000 95.00 Local Pennysaver, Coupon clipper magazine 2000 15000 133.33 Major city newspaper 50000 350000 142.86Related Questions
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