Download Promotions

Promotions
Dr. Mary
Wolfinbarger
Marketing 300
Promotion
 Marketing
activities used to
communicate positive, persuasive
info about an organization, its
products and its activities to a target
audience
 Purpose: to directly or indirectly
create sales, influence consumers.
To whom does promotion
communicate?
 Consumers/potential
consumers
 Interest groups/regulatory agencies
 Current/potential investors
 Society in general
 Company employees
Integrated Marketing
Communications
A
planning concept recognizing the
added value in integrating promo mix
elements
 Purpose: to provide clarity,
consistency and maximum
communications impact.
– Explosion of communication choices
made this more necessary
– Technology made it more possible
Promotion Mix
 Advertising
 Personal
Selling
 Sales Promotion
 Public Relations
Advertising
A
paid form of non-personal
communication about an
organization and/or its products to a
target audience through a mass
medium.
Media
 TV
 Newspapers
 Radio
 Magazines
 Internet
 Billboards
 Etc….
Advantages
 Can
reach large mass audiences/
small niches
 Usually cost efficient per person
reached
 Repetition of messages
Disadvantages
 Absolute
dollar outlay may be high
 Response to ads (except retail ads)
are slow
 Advertising less persuasive than
personal selling
Direct Marketing
 Often
included in advertising
 Advantage: communicate directly
with prospects
 Can tailor messages for prospects
 Messages can be longer/more
complex
 Can target best prospects
Direct Marketing
 Biggest
Disadvantage:
Cost per person reached expensive
(except for Internet email!)
Direct Marketing
 Generate
inquiries about prod.
 Generate purchase
 Gain trial
 Increase usage
 Enhance prod image w/ well-defined
target audience
Direct Marketing
 Gather
information
 Build ongoing relationships with
customers
The Internet as An Advertising/
Direct Selling Medium
 Point
of sale ability (look and buy)
 Potential for “mass customization” of
ad messages
 Advertising messages can be
interactive and/or updated
continuously
Advantages of Internet as
Selling Medium
 Primary
form of online advertising
(as of 2005): search (Google,
Yahoo!, MSN)
– Easy to measure effectiveness of search
advertising
 Banner
Ads are now called Display
Ads
 The use of “rich media” in ads is
increasing
Advantages of Internet as
Selling Medium
 Other
forms:
– sponsorship
– ads in podcasts
– ads embedded in online games (Massive
Inc.)
– viral games and videos
– YouTube (sponsored and unsponsored)
– Ad portals? veryfunnyads.com
– Widgets
 Mobile
Advertising, Mobile search
Advantages of Internet as an
Advertising Medium
 Buyers
often visit search engines and
other web sites when in “purchase
corridor”
 Can change creative approach
quickly
 Click-through rates, page views,
conversion rates easily tracked
(“clickstream” data also)
Blogs/Social Networks/Discussion
Groups
 Robert
Scoble’s book: Naked
Conversations
– Marketing junk is resisted (read “Flogs”)
– Authenticity is expected
 (well,
with the exception of satirical blogs such
as fakesteve.com)
 Pretending
to be someone you’re not
may bring negative attention
– Still, there is some “seeding” of discussions
and some underground activity
Blogs/Social Networks/Discussion
Groups
 Internet
buzz is not independent of
other marketing mix variables
– Advertising and other promotions increase
buzz
 Read
“Five Rules of Underground
Marketing”
 http://www.clickz.com/showPage.html?
page=3624847
 What are the 5 rules?
Personal Selling
 Face
to face communication with
buyers to inform and persuade them
to buy
Personal Selling
 On
average, companies spend more
money/yr on personal selling than
other elements of promo mix
Personal Selling
Major Advantage:
 More persuasive
 Major Disadvantage
 Costly per individual reached
Personal Selling
Objectives:
 Finding Prospects
 Converting
Prospects to Customers
 Maintaining
Customer Satisfaction
Personal Selling
 Personal
selling most likely for new,
complex, and/or expensive products
 The web now does some personal
selling tasks
– For example, Apple has a 20 minute
sales presentation for the iPhone on its
site
– Cadillac has a site called
mycadillacstory.com where celebrities
and others post cadillac-related videos
(soft sell, but it’s selling)
Sales Promotion
A
direct inducement, offering added
value or incentive for the product, to
resellers, salespersons, or
consumers.
Sales Promo
 25
yrs ago, % of spending on
advertising was 70%
 In recent years, about 25%
 Shift largely been to trade promo
 (But, the advertising pie has grown
as well)
Sales Promo
Why the shift?
– Ad clutter
– VCRs (zipping)
– Channel surfing (zapping)
– Various recessions
Sales Promo
Why the shift?
– Marketplace factors
– similarity between goods
– short term focus of managers
– consumer expectations
– private label competition
Common Objectives of Sales
Promotion
 Short
term sales stimulation
– Induce trial
– Retain current customers/increase
usage
– Reinforce advertising efforts
– Build trade support for campaign
– Motivate sales force
Comments on Sales Promo
“We’re in a very interesting phase in
[sales] promotion. On one hand, we
have had the meteoric advances of
promotion understanding and
consumer intelligence brought about
by scanners and database
management. Then on the other
hand, we see the …. Success of
Batman glasses at Taco Bell --
Comments on Sales Promo
--over 4 million given away-- and we
realize that it’s the same type of
promotion America used to court
movie goers on Saturday afternoons
in the 1930s. It surely shows how
human nature doesn’t change.”
--William Robinson, Promotional Marketing
Two types:
 Consumer-oriented
(pull)
 Trade-oriented (push)
Consumer Promotions
 Samples
 Coupons
 Premiums
 Contests
and Sweepstakes
 Price Discounts
Trade Promotions
 Trade
allowances
 Dealer contest
 POP
 Co-operative advertising
 Trade shows
 Collateral materials
 Price Discounts
Main Issue in Sales Promo
 What
is the long term impact on
brand equity? (especially with price
discounting)
Main Issue in Sales Promo
Short term bribe point of view:
 Buyers purchases on special deals
often become less brand loyal
Main Issue in Sales Promo
Long term sales building view:
 Helps achieve shelf placement/ instore display,thus increasing visibility
 Consumers have little time to notice
ad messages; sales promo get
attention.
Main Issue in Sales Promotions
Ideally:
 Sales promo results in short term
sales with long term equity building.
 Both objectives needed in a
competitive market.
More Comments on Sales
Promotions
“For years, sales promotion meant MDF
funds (Market Development Funds, an
innocuous word for slush money to pay
off retailers for promoting your
product), giant displays and tacky
potholders. But now the industry has
grown up…Marketers are looking to
promotions to build their brand’s sales
to insure a future for their brand’s
tomorrow.”
--William Robinson, Promotional
Publicity
 Non-personal
communication in news
story form, regarding an organization
and/or its products, transmitted
through a mass medium at no
charge.
 The story is free; PR people are not
Public Relations
 Brings
advantage vs. advertising -more credibility
 Little control over message content
or timing
 PR takes great coordination/effort
Types of Publicity
 News
Release
 Feature Article
 Press Conference
 Letters to the Editor
 Editorial
 Special Events
Integrated Marketing
Communications and PR
 Complements
event sponsorship &
trade shows
 New products with special angles can
be supported by PR
 Marketing campaigns with a special
“hook” are newsworthy
PR Objectives
 Informing
buyers how to select,
buy or use your product
 Dispelling negative info about
brand
 Build store traffic
 Support event sponsorships, trade
shows, other promo activities
 Persuade target audience to
purchase brand
Goals and Tasks of Promotion
Informative Promotion

Increase awareness

Explain how product works

Suggest new uses

Build company image
Goals and Tasks of Promotion
Persuasive Promotion
 Encourage brand switching
 Change customers’ perceptions of
product attributes
 Influence immediate buying decision
 Persuade customers to call
Goals and Tasks of Promotion
Reminder Promotion
 Remind customers that product
may be needed
 Remind customers where
to buy product
 Maintain customer awareness
The AIDA Concept
Action
Desire
Interest
Attention
Conative (doing)
Affective (feeling)
Cognitive (thinking)
Different promotional methods are better at different parts of
AIDA – also we can evaluate an entire marketing
communication effort by evaluating the success we are
having with consumers at each step of the model.