Download what is promotion?

CHAPTER 16
Using
Effective
Promotions
McGraw-Hill/Irwin
Copyright © 2015 by the McGraw-Hill Companies, Inc. All rights reserved.
WHAT IS PROMOTION?
•Promotion
–Communication about an organization and its products that is
intended to inform, persuade, or remind target market members
–There are several ways in companies can communicate to target
market members
–Promotion is NOT just advertising!!!
•The Promotion Mix
–The particular combination of promotion methods a firm
uses to reach a target market
1) Advertising
2) Public Relations
3) Personal Selling
4) Sales Promotion
•Integrated Marketing Communications (IMC)
–Coordination of all promotion efforts for maximum
informational and persuasive impact on customers, and to
communicate a unified impression about a product
–Goal = Consistent Messages to Customers
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PROMOTION
in an ORGANIZATION
LO 16-1
Promotion Mix -- The combination of promotional tools an organization
uses. The traditional mix includes:
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INTEGRATED MARKETING
COMMUNICATION (IMC)
•
LO 16-1
Integrated Marketing Communication (IMC) -- Combines the promotional tools into one
comprehensive strategy. IMC is used to:
-
Create a positive brand image.
-
Meet the needs of consumers.
-
Meet the strategic marketing and promotional goals of the firm.
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CLASSIC CAMPAIGNS
LO 16-1
Brilliant Marketing Ideas
Campaign
Company
Why it’s Cool
A Diamond is Forever
De Beers
Since 1939, it’s been tapping
into our emotions.
Marlboro Man
Marlboro
He’s the most successful trade
character ever.
Does she… or doesn’t she?
Clairol
The birth of the “shock ad” in
1957.
1984
Apple
The uncommercial didn’t
explain the product.
Source: Entrepreneur, www.entrepreneur.com, accessed November 2014.
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ADVERTISING in the FIRM
•
Advertising -- Paid, non-personal
communication through various media by
organizations and individuals who are in
some way indentified in the message.
•
Media may include television, direct mail,
radio, internet/digital, magazines,
newspapers, billboards (outdoor), social
media, product placements, etc.
•
Television remains the #1 advertising media
•
Major goals of advertising:
-
Inform
-
Persuade
-
Remind
LO 16-2
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IMPACT of ADVERTISING
LO 16-2
• Total advertising expenditures
exceed $215 billion yearly.
• Consumers benefit because
production costs of TV
programs, radio programs,
newspapers and magazines are
paid for by advertisers.
• Marketers choose ad media
that will reach the target market.
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ADVERTISING EXPENDITURE by
MEDIA in $ MILLIONS
LO 16-2
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MAJOR CATEGORIES of
ADVERTISING
LO 16-2
Category
What it is
Retail (Location)
From retail stores to consumers…Advertising that focuses on attracting
customers to a fixed location like a department store or a grocery store
Trade
From manufacturers to wholesalers and retailers
B2B
From manufacturers to other manufacturers
Institutional
Product (Brand)
Creates a desirable image for an organization or industry…Advertising that
focuses on creating a positive image toward an organization or an entire
industry as opposed to a specific product.
Ex. “Got Milk?” sponsored by California Milk Processing Board
Creates a desirable image for a product or service…Used to promote a specific
product’s uses, features, and benefits. This is the type of advertising we most often
see.
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MAJOR CATEGORIES of
ADVERTISING
LO 16-2
Category
What it is
Advocacy
Supports a particular view of an issue
Comparative
Compares competing products…Advertising that compares a
brand’s characteristics with those of other established brands. You
have probably seen toothpaste, pain relievers, and detergents
compared.
Interactive
Customer-oriented ads that allows customers to choose information
to receive
Online
Computer ads featured on different sites
Mobile
Ads that reach consumers on cell phones
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TYPES OF ADVERTISING APPEALS
The 5 Appeals of Product Advertisements
1) Humor
2) Informational
3) Sex
4) Emotional (ex. Fear/Heartfelt)
5) Celebrity
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MATCH GAME
LO 16-2
Match the Company with the Slogan
• “Everybody doesn’t like something, but nobody
doesn’t like ___________.”
• “We bring good things to life.”
• “It takes a licking and keeps on ticking.”
• “With a name like _________, it has to be good.”
• “Good to the last drop.”
• “Betcha can’t eat just one!”
• “Because you’re worth it.”
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IT’S a DOG’S LIFE
LO 16-2
Famous and Not-so-Famous Dogs in Advertising
Pooch
Company
Nipper
RCA
Tige
Buster Brown Shoes
Chihuahua
Taco Bell
Spuds McKenzie
Bud Light
McGruff
The Crime Dog
Duke
Bush’s Beans
Bullseye
Target
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ADVERTISING TRENDS
•
•
•
•
•
•
Online advertising
Social media
Mobile marketing
Product placement
Infomercials
Global advertising
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POPULAR ADVERTISING MEDIA
LO 16-2
• TV advertising is still the dominant media.
• Digital Video Recorders (DVRs) challenge TV
advertising because viewers can skip ads.
• Product Placement -Advertisers pay to put
their products into TV
shows and movies where
the audience will see
them.
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NOT QUITE the NFL…
LO 16-2
Sport
Cost
Why?
Equestrian
$15,000+
The demographic skews to highincome females.
Bowling
$20,000+
It’s shown on television and
lower cost than other televised
sports.
Surfing
$25,000+
The young market is responsive
to guerrilla marketing.
$50,000+
A popular sport in Europe and
Asia and great for global
companies.
Women’s Golf
Source: Inc., www.inc.com, accessed November 2014.
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INFOMERCIALS and
ONLINE ADVERTISING
LO 16-2
• Infomercial -- A full length TV
program devoted exclusively to promote
a particular product.
• Online ads are attempts to get potential
customers to a web site to learn about a
product.
• Interactive Promotion -- Allows
marketers to open a dialogue between
buyers and sellers and let them work
together to create a beneficial
exchange.
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INFOMERCIAL HALL of FAME
LO 16-2
The Biggest Hits Over the Past 40 Years
• Veg-O-Matic
• Ginsu Knives
• The Clapper
• Thigh Master
• George Foreman Grill
• Bowflex
Source: Fortune, www.fortune.com, accessed November 2014.
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PAY-PER-TWEET
• Celebrities can earn large sums
of money just buy mentioning a
product or site in their tweets.
• Do you think it is ethical for
celebrities to get paid to tweet
pre-written ads that appear to be
their own personal comments?
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WHAT’S in YOUR OREO?
• To Americans, an Oreo is the same cookie
we’ve been enjoying for over 100 years.
• But Kraft has taken Oreos global which has led
to different variations.
• In China they enjoy green
tea Oreos while Argentina
has banana with dulce de
leche.
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GLOBAL ADVERTISING
LO 16-2
• Requires marketers to
develop a single product
and promotional strategy to
implement worldwide.
• Problems can arise in global
markets with using one
advertising campaign in all
countries - especially bad
translations.
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PERSONAL SELLING
LO 16-3
• Personal selling is paid, personal communication
between buyer and seller.
• Direct communication between a firm’s sales force and
potential buyers to make a sale and to build good
customer relationships.
• Most expensive part of the promotional mix as a
salesperson deals with one buyer at a time
• Preferred with high-value, custom-made, or
technically complex products
• Salespeople need to listen to customer
needs, help reach a solution and do
everything possible to make the
transaction as simple as possible.
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STEPS in the SELLING PROCESS
LO 16-3
1. Prospect and qualify
2. Pre-approach
3. Approach
4. Make a presentation
5. Answer objections
6. Close the sale
•
Trial Close -- A statement or question that
moves the process toward the purchase.
7. Follow up
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PROSPECTING and QUALIFYING
in SELLING
LO 16-3
• Prospecting -- Researching potential buyers and
choosing those most likely to buy.
• Qualifying -- Making sure
customers have a need for a
product, the authority to buy
and the willingness to listen
to a sales message.
• Prospect -- A customer
who meets the qualifying
criteria.
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BUY THIS!
LO 16-3
Successful Selling Strategies
• Know your competition
• Understand your customer’s business
• Differentiate your product or service
• Sell to the people most likely to buy
• Build relationships
• Put the right people in the right selling spots
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WHOOPS!
LO 16-3
Sales Slip-Ups
• Not feeling the customer’s pain
• Making money is the only goal
• Seeing sales as just a job
• Getting upset during the presentation
• Failing to properly prepare or over-preparing
• Not being yourself
• Neglecting the relationship
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USING PUBLIC RELATIONS in
PROMOTION
•
•
LO 16-4
Public Relations is the ongoing effort to create “non-sales”,
positive relationships with all of a firm’s different
stakeholders.
The management function that establishes and maintains
mutually beneficial relationships between an organization
and its stakeholders.
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PUBLIC RELATIONS TOOLS
LO 16-4
• Controlled messages
• Corporate, advocacy, and public service
advertising and corporate reports publishing
• Semicontrolled messages
• Messages are placed on Web sites, in chat
rooms, and on blogs
• Sponsorships
• Uncontrolled messages
• Publicity
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PUBLICITY
LO 16-4
• Publicity -- Any information
about an individual, product or
organization that’s distributed to
the public through the media and
is not paid for or controlled by the
seller.
• Advantages of Publicity:
- Free
- Reaches people who would not
look at an advertisement
- More believable than advertising
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DISADVANTAGES of PUBLICITY
LO 16-4
• No control over whether the
media will use a story or when
they may release it.
• It can be good or bad.
• Once a story has been run, it is
not likely to run again.
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SALES PROMOTIONS
LO 16-5
• Sales Promotion -- The promotional tool that stimulates consumer
purchasing and dealer interest by means of short-term activities.
Consumer Sales Promotion
Stimulate immediate sales
• Premiums
• Contests/Games/Promo Items
• Samples
• Coupons
• Rebates
• Point of Purchase Displays
Trade (B2B) Sales Promotion
Stimulate wholesalers and retailers
to push specific products
• Special Deals
• Allowances
• Trade Shows
• Contests
• Sweepstakes
• Special Events
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SALES PROMOTION TECHNIQUES
LO 16-5
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SOME KEY
CONSUMER PROMOTIONS
LO 16-5
• Coupons
• Demonstrations
• Sampling
• Sweepstakes
• In-store Displays
• Contests
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CLIP THESE
LO 16-5
Most Visited U.S. Coupon Clearing Sites
• Coupons, Inc
• EverSave
• RetailMeNot
• CouponCabin
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USING WORD-of-MOUTH
PROMOTION
LO 16-6
• Word-of-Mouth Promotion -- People tell others
about products they have purchased.
• Word-of-Mouth is important for products like:
- Restaurants
- Daycare and Eldercare
- Car Repair Shops
- Hair Stylists
- Hotels
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WHAT ARE COMPANIES
YELPING ABOUT?
• Many companies have a website, Facebook page
or some online presence.
• However, on review sites like Yelp, they cannot
control their public image.
• The Federal Trade Commission has received over
2,000 complaints about Yelp.
• Companies can respond to reviews. But often the
damage is already done.
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EMERGING
PROMOTIONAL TOOLS
LO 16-6
• Viral Marketing -- Paying
customers to say positive things
on the Internet or setting up
multiple selling schemes whereby
consumers get commissions.
• People who promote through
viral marketing often receive
SWAG which can include free
tickets, shirts, and other
merchandise.
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BLOGS, PODCASTS,
and E-MAILS
LO 16-6
• Blogs are a great way to interact with customers
and improve the company’s website ranking.
• Podcasting -- A way to distribute multimedia files via
the Internet.
• Email promotions increase brand awareness
among commercial suppliers.
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MOBILE MEDIA
LO 16-6
• Marketers make use
of smartphones to
text customers about
product offers and
other company
information.
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PUSH, PULL, AND PICK
PROMOTIONAL STRATEGIES
LO 16-6
• Push Strategy -- Producers use advertising,
personal selling, sales promotion, and other tools to
get their products stocked on shelves.
• Pull Strategy -- Directs heavy advertising and sales
promotions efforts towards consumers and gets the
public to request their products from retailers.
• Pick Economy -- Refers to consumers who pick out
their products from online outlets.
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