Download PHMY 529 Promotion and Communication

MKTG 504 - Promotion and
Communication
“Are you looking for a 25’’
color TV for $275? Here it
is.”
Dr. Dennis Pitta
University of Baltimore
PROMOTION
Promotion = Communication
which INFORM potential consumers
and PERSUADE them of the
WANT SATISFYING benefits of
products and services.
THE COMMUNICATION PROCESS
Involves:
Sender ( the advertiser)
Message
Medium
Audience
and maybe
Feedback
Marketing Communications
Should start with an audience -
the consumer!
PROMOTION MIX
- DESCRIPTION -
- NAME -
Paid
Nonpersonal
Advertising
Paid
Personal
Personal Selling
Nonpaid
Nonpersonal
Publicity
Nonpaid Personal
Word of Mouth
_______________________________________________
Plus Everything Else
Sales Promotion
DESCRIPTION
NAME
PAID
NONPERSONAL ADVERTISING
PAID
PERSONAL
PERSONAL
SELLING
NONPAID NONPERSONAL PUBLICITY
NONPAID PERSONAL
Word of Mouth
Everything else
SALES
PROMOTION
PROMOTION MIX
CHARACTERISTICS
EXPENSE PER
EXPOSURE
LOW
EFFECTIVENESS
PER EXPOSURE
LOW
Personal Selling
V. HIGH
HIGH
Publicity
V. LOW
MOD. HIGH
Word of Mouth
V. LOW
V. HIGH
Sales Promotion
MODERATE
Advertising
HIGH
ADVERTISING
Any PAID form of NONPERSONAL
presentation and promotion of ideas,
goods, and/or services by an
IDENTIFIED SPONSER.
Examples: Let Your Fingers Do the
Walking; McDonalds’...
PERSONAL SELLING
DIRECT INTERACTION between parties - an
oral presentation in conversation with one
individual acting as a ‘selling agent’.
Example: Avon Representatives, Checkout
person, you in an interview.
PUBLICITY
Any form of commercially significant news
about an organization, good, service, idea
that is published by a mass medium and
that is NOT paid for by a sponsor.
Examples: Ebert (without Siskel), gourmet
critics...
PUBLIC RELATIONS:
Publicity
Institutional Advertising
PUBLICITY: Traditional Media
Radio
TV
Newspaper
Magazines
Organization Newsletters
Events (e.g., Holiday celebrations...)
...
PUBLICITY: NEW MEDIA
Internet Home Pages
Internet Press Release Sources
WORD OF MOUTH (ADVERTISING)
Any form of interaction between individuals
in which, neither party represents a
‘seller’.
Examples: a restaurant recommendation
from a friend, a colleague’s evaluation of a
movie, a neighbor’s statements about a
university.
SALES PROMOTION
Sales Promotion = The promotional
technique which emphasizes: Coupons,
Rebates, Premiums, Contests,
Sweepstakes, Trading Stamps, Free Gifts,
Samples, Point of Purchase Promotions,
Trade Shows.....
Sales Promotion is The Group of
Activities Which Aim At:
STIMULATING CONSUMER PURCHASES
ENHANCING DEALER EFFECTIVENESS
INCREASING SALESPERSON
EFFECTIVENESS
Choose the MIX of PROMOTIONAL methods
to achieve communication objectives.
ADVERTISING
Major Decisions:
HOW MUCH TO SPEND?
ADVERTISE TO WHOM?
WHAT TO SAY?
WHEN (AND WHERE) TO SAY IT?
HOW TO DETERMINE ITS EFFECTS?
BUDGETING FOR ADVERTISING
FIVE METHODS
ALL YOU CAN AFFORD*
% OF SALES*
UNITS OF SALES*
COMPETITIVE PARITY*
OBJECTIVE AND TASK METHOD***
* = STUPID
*** = GREAT
OBJECTIVE AND TASK METHOD
OF BUDGETING
SET OBJECTIVES AND
DETERMINE THE ADVERTISING
TASKS ( THE HIERARCHY OF
EFFECTS) NECESSARY TO ACHIEVE THEM
EXAMPLE OF ADVERTISING
HIERACHY OF EFFECTS
ACTION
CONVICTION
COMPREHENSION
AWARENESS
EXPOSURE
EXAMPLE OF ADVERTISING
OBJECTIVES
ACTION
CONVICTION
COMPREHENSION
AWARENESS
EXPOSURE
+
+
+
+
+
1% (the goal)
11%
22%
56%
100%
EXAMPLE OF ADVERTISING
OBJECTIVES used for budgeting
ACTION
CONVICTION
COMPREHENSION
AWARENESS
$55, 000 EXPOSURE
+
+
+
+
+
1%
11%
22%
56%
100%
ADVERTISING TO WHOM?
CHOOSING A TARGET AUDIENCE IS CRITICAL.
MEDIA AFFECT THE ABILITY TO REACH MARKET.
TV: MUCH WASTED EXPOSURE.
MAGAZINES: MORE SPECIFIC COVERAGE - LESS
WASTE.
DIRECT MAIL: MOST SPECIFIC - LEAST WASTE
WHAT TO SAY?
MESSAGE RESEARCH IS A SCIENCE
START WITH THE AUDIENCE
USE: REPETITION, NOVELTY, CONTRAST,
HUMOR
MESSAGE RESEARCH REQUIRES TESTING.
WHEN AND WHERE TO SAY IT?
MEDIA RESEARCH INVOLVES WHEN AND
WHERE THE TARGET AUDIENCE EXPOSES
ITSELF TO YOUR MESSAGE.
SOME MAGAZINES, TV PROGRAMS ARE
BETTER FOR REACHING WOMEN OR
MEN, YOUNG OR OLD.
WITH WHAT EFFECTS?
MEASURING ADVERTISING EFFECTIVENESS
PRETEST
PORTFOLIO TEST (AWARENESS, RECALL)
LAB TESTS
AFTER APPEARING IN THE MEDIA (POST TEST)
PERSONAL SELLING: Sales Tasks
ORDER GETTING TASKS: Focus on converting prospects to
customers or in getting customers to buy products they
have not purchased before.
ORDER TAKING TASKS: Focus on building repeat sales of
products that customers have purchased previously.
SALES SUPPORT TASKS: Facilitate order getting and order
taking.
THE PERSONAL SELLING
PROCESS
PROSPECTING
PREPARING THE PREAPPROACH
APPROACH
PRESENTATION
HANDLING OBJECTIONS
CLOSING THE SALE
POST SALE FOLLOW-UP
PROSPECTING
The process of searching for, identifying,
and qualifying potential customers.
Leads => qualified prospects
IF they can benefit from the product,
IF they can afford it,
IF they can make the buying decision.
SOURCES OF LEADS
INTERNAL: COMPANY RECORDS,
PERSONNEL
EXTERNAL: TRADE JOURNALS, PRESENT
CUSTOMERS, TRADE SHOWS.
PREPARING THE PREAPPROACH
Gathering specific information about the
prospect which will help in tailoring the
sales presentation to the prospects’
situation.
APPROACH
The manner chosen to gain access to the
prospect, establish rapport, and get the
prospect’s attention and interest.
PRESENTATION
There are various approaches:
Stimulus-Response Selling
Barrier Selling
Formulized Selling
*Need-Satisfaction Selling => recognizes
that the main reason people buy comes
from within the person, not from outside
stimuli.
HANDLING OBJECTIONS
Encouraging prospects to voice objections
provides FEEDBACK and helps the
salesperson deal with objections in a
positive fashion.
CLOSING THE SALE
The CLOSE involves asking the prospect for
an order. Closing is an art, and may take
many forms.
Types of Closing Techniques
Standing Room Only Close (It’s the Last
One)
Extra Inducement Close
Emotional Close
Silent Close
Alternative Decision Close (Either/Or)
POST SALE FOLLOW-UP
Important since it helps ensure:
customer satisfaction
goodwill
may lead to repeat business
SALES FORCE ISSUES
ORGANIZING THE SALE FORCE
TERRITORIAL SPECIALIZATION
PRODUCT SPECIALIZATION
TASK SPECIALIZATION
TASK MARKET SPECIALIZATION
RECRUITING AND SELECTING THE SALES
FORCE
TRAINING AND DEVELOPMENT OF THE
SALES FORCE
COMPENSATING THE SALES FORCE
STRAIGHT SALARY
STRAIGHT COMMISSION
COMBINATION PLANS
MOTIVATING THE SALES FORCE
That depends on their
strengths.
Two vital measures are:
1) the effectiveness of a
single exposure
and
2) the cost of a single
exposure
When do you use each
element?
ADVERTISING
Any PAID form of NONPERSONAL
presentation and promotion of ideas,
goods, and/or services by an
IDENTIFIED SPONSER.
Examples: Let Your Fingers Do the
Walking; McDonalds’...
Let’s look at ADVERTISING
A 30 second commercial aired on the
SuperBowl might cost $500,000.
If 50,000,000 people see it, it costs, $.01
or one penny per person exposed (LOW)
How many people run out and buy the
product? 5000? That is 1 in 1000 or .1%
of viewers (LOW SUCCESS RATE)
PERSONAL SELLING
DIRECT INTERACTION between parties - an
oral presentation in conversation with one
individual acting as a ‘selling agent’.
Example: Avon Representatives, Checkout
person, you in an interview.
Let’s look at PERSONAL SELLING
A single sales call by a salesperson costs
$750 (VERY HIGH EXPENSE PER
EXPOSURE)
If he or she sells one customer in 4 that is
a 25% success rate (HIGH SUCCESS
RATE)
PUBLICITY
Any form of commercially significant news
about an organization, good, service, idea
that is published by a mass medium and
that is NOT paid for by a sponsor.
Examples: Ebert (without Siskel), gourmet
critics...
Let’s look at PUBLICITY
A favorable restaurant review by a
restaurant critic costs nothing but
consistent good food (VERY LOW)
If 10% of the readers come to your
restaurant because of the review
(MODERATELY HIGH SUCCESS RATE)
WORD OF MOUTH (ADVERTISING)
Any form of interaction between individuals
in which, neither party represents a
‘seller’.
Examples: a restaurant recommendation
from a friend, a colleague’s evaluation of a
movie, a neighbor’s statements about a
university.
Let’s look at WORD OF
MOUTH advertising
A favorable restaurant comment by a
friend costs nothing but consistent good
food (VERY LOW)
If 50% of the friends come to your
restaurant because of the comments
(VERY HIGH SUCCESS RATE)
SALES PROMOTION
Sales Promotion = The promotional
technique which emphasizes: Coupons,
Rebates, Premiums, Contests,
Sweepstakes, Trading Stamps, Free Gifts,
Samples, Point of Purchase Promotions,
Trade Shows.....
So...
Choose the MIX of PROMOTIONAL methods
to achieve communication objectives.