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Chapter 3:
PROMOTION
and
IMC PLANNING
and
STRATEGY
3.1
The Promotion Plan
A PROMOTION PLAN IS:

Direct Extension of Firm’s Marketing Plan

A Specification of the Analysis, Strategy, and Tasks of the Promotional
Effort
 Needed to Conceive and Implement an Effective Promotional Effort
SIX MAJOR ELEMENTS OF A PROMOTIONAL PLAN ARE:






Executive Summary and Overview
Situation Analysis
Objectives
Budgeting
Strategy
Evaluation
3.2
Introduction
Stages in the
Promotional Plan
Situation Analysis
Objectives
Budgeting
Strategy
Execution
Evaluation
3.3
The Promotion Plan (con’t)
EXECUTIVE SUMMARY & OVERVIEW

Executive Summary-States Most Important Aspects of the Plan
 Overview-What is to be Covered in the Plan in General Terms
SITUATION ANAYLSIS

Marketers and Agencies Lay Out Most Important Factors Defining the
Situations Facing the Firm, and Include:
 Demographic Trends
 Historical Context
 Industry Analysis
 Market Characteristics
 Type of Consumer
 Geographic Considerations
 Competition
3.4
The Promotion Plan (con’t)
SITUATION ANAYLSIS (con’t)
 Product Characteristics
 Category
 Convenience Goods
 Shopping Goods
 Specialty Goods
 Stages in Product Life Cycle
 Characteristics of the Firm
 Push vs. Pull Strategy
 Funds Available
 Size of Sales Staff
 Extent of Firm’s Product Line
3.5
The Promotion Plan (con’t)
SITUATION ANALYSIS (con’t)
 Characteristics of the Distribution
 Intensity of Distribution
 Intensive Distribution
 Selective Distribution
 Exclusive
 Length of Trade Channel
 Types of Trade Partners
3.6
A Situation Analysis Needs to
Consider the Type of Trade
Partners that Will be Promoting
The Marketer’s Brand
3.7
The Promotion Plan (con’t)
OBJECTIVES

Lays the Framework for Executions in Promotional Campaign and
Identifies Goals of a Marketer in Concrete, Measurable Terms
 Create & Maintain Image for Brand
 Increase Customer Awareness & Curiosity about a Brand
 Change Consumers’ Beliefs & Attitudes about a Brand
 Belief – Knowledge & Feelings Accumulated about a Brand
 Attitude is Overall Evaluation of Brand Based on
Knowledge/Emotions
 Influence Purchase Intentions
 Stimulate Trial Use
 Convert One-Time Users to Repeat Customers
 Switch Consumers from Competing Brands
 Encourage Brand Loyalty
 Stimulate More Frequent Use
 Increase Sales
3.8
Creating Awareness and Curiosity is a
Common Promotional Objective
The Promotion Plan (con’t)
OBJECTIVES – KEY TERMINOLOGY
Brand Image
 Brand Awareness
 Top-of-the-Mind Awareness
 Beliefs
 Attitude
 Purchase Intent
 Trial Usage
 Repeat Purchase
 Brand Switching
 Brand Loyalty
 Increasing the Frequency of Use

3.10
The Promotion Plan (con’t)
COMMUNICATIONS vs. SALES OBJECTIVES
 Increase Awareness of Brand Name to 40% of All Consumers in
Western US
 Create Trial Use by 15% of all Teenagers 13-15
 Communicate Superior Brand Performance Features to Target
Audience with Series of Advertisements over Next Six Months
CHARACTERISITICS OF WORKABLE PROMOTIONAL
OBJECTIVES

Establish Quantitative Benchmark
Specify Measurement Methods & Criteria or Success

Specify a Time Frame

3.11
The Promotion Plan (con’t)
BUDGETING - METHODS
 Percentage-of-Sales Approach
 Unit-of-Sales Approach
 Share of Market/Share of Voice
 Funds Available
 Objective & Task
3.12
The Promotion Plan (con’t)
BUDGETING FOR ADVERTISING
 Marketing Research
 Message Research
 Production Costs: Production Companies, Talent,
Site Costs
 Media Costs
 Agency Commissions/Fees
 Account Personnel Travel Expenses
3.13
The Promotion Plan (con’t)
BUDGETING FOR SALES PROMOTION
 Coupon Value and Dealer Handling Charges
 Contest and Sweepstakes Material and Charges
 Brochures and Collateral Material
 Trade Shows & Exhibits
 Trade Channel Partner Meeting & Entertainment
 Premiums
 Point-of-Purchase Materials
 Trade Allowances
 Trade Incentives
 Trade Training Programs
 Refunds/Rebates
3.14
Premiums—Like This One
Offered by Jell-O—Must be
Factored into Budget Planning
for Promotion
3.15
The Promotion Plan (con’t)
BUDGETING FOR DIRECT MARKETING



Uses a Simple Cost-Based Method
Exact Bids Obtained - Printing, Sorting, Bundling &
Mailing for Print Campaigns
Bids Obtained for Telemarketing, Infomercial or Catalog
Selling from External Facilitators
3.16
Budgeting for Direct Marketing
Needs to Consider the Cost of
Printing and Mailing Materials
3.17
The Promotion Plan (con’t)
BUDGETING FOR WEBSITES & BANNER ADS
 Costs for Web Sites - $30K to $100K
 Costs for Banner Ads - $10 CPM to $30 CPM
3.18
The Promotion Plan (con’t)
BUDGETING FOR PUBLIC RELATIONS

Most Difficult of All Budgets to Set - Most
Expensive Public Relation Occurs During Crises

Most PR Firms Work on Retainers - Set on an
Annual Basis
3.19
The Promotion Plan (con’t)
BUDGETING FOR PERSONAL SELLING
 Recruiting Costs
 Training Costs
 Travel Expenses
 Promotional Material - Samples, Catalogs, Product
Brochures
 Salaries & Benefits
 Incentive Programs - Bonuses & Rewards
3.20
The Promotion Plan (con’t)
STRATEGY

Mechanism by which Something is Done
 Account Planner Assists in Strategy
 Works in Advertising Agency & Synthesizes all
Relevant Audience Research to Formulate
Promotional Strategy
3.21
The Promotional Plan (con’t)
EVALUATION

Marketer Determines How Promotional Program
has Performed - Factor by Factor
 Main Basis for Evaluation - Communications and
Sales Objectives Set for the Program
 Chapter 15 - Measuring the Effectiveness of
Promotion & IMC - Will Cover in Detail
3.22
Evaluation of the IMC Program Will Include the Effect
on Sales of Various Promotional Tools
IMC Management & Planning
STRATEGIC PLANNING OF IMC IS DIFFERENT FROM
TRADITIONAL USE OF MULTIPLE PROMOTIONAL TOOLS

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Outside-in Approach
IMC Management Planning Requires Comprehensive
& Detailed Knowledge
 Customers
 Prospects
Knowledge about Customer & Prospects
IMC Management Plan - Built Around Brand Communications
Control of IMC Management & Planning - Centralized
 Firms Appointing IMC or Marcom Managers
3.24
IMC Management & Planning (con’t)
MODEL OF IMC MANAGEMENT & PLANNING
 IMC Model Considers Complete Process
 Uses Promotion to Communicate to Target Markets
 Effectively Deploys Promotional Tools
 Corporate & Marketing Plans - Understood and
Adopted as Part of IMC Plan
 Databases - Help Identify & Profile Target Markets
 Promotional Objective - Dictate Mix of Promotional
Tools to Pursue for each Target
3.25