Download Chapter 14 - 1 - B-K

Marketing Management
Chapter 14 - 1
Promotion and Pricing Strategies
1-1
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Integrated Marketing Communications
● Promotion—communication link between
buyer and seller that performs the function of
informing, persuading, and influencing a
purchase decision.
– Focusing on Primary Demand
– Focusing on Selective Demand
1-2
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
● Promotional Campaign to Stimulate
Primary Demand
1-3
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Components of the Promotional Mix
1-4
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Five Major Promotional Objectives
1-5
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
The Promotional Mix
● Promotional Planning
– Increasing complexity and sophistication of
marketing communications requires careful
planning to coordinate strategies
– Product Placement
– Guerrilla Marketing
1-6
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising
● Types of Advertising
– Product Advertising—consists of messages
designed to sell a particular good or service
– Institutional Advertising—involves messages
that promote concepts, ideas, philosophies, or
goodwill for industries, companies, organizations,
or government entities
– Advocacy Advertising (Cause Advertising):
promotes a specific viewpoint on a public issue as
a way to influence public opinion and the
legislative process
1-7
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Boys & Girls Clubs
of America
Institutional
Advertising:
Shaquille O’Neal
Promotes Goodwill
for the Boys and
Girls Clubs of
America
1-8
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising
● Advertising and the Product Cycle
– Informative Advertising— to build initial demand
for a product
– Persuasive Advertising— to improve the
competitive status of a product, institution, or
concept,
 Comparative Advertising
– Reminder-oriented advertising— to maintain
awareness of the importance and usefulness of a
product, concept, or institution
1-9
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Use of Persuasive Advertising by the U.S. Army
1-10
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
● Comparative
Advertising
1-11
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising
● Advertising Media
– Must choose how to allocate advertising
budget
– All media offer advantages and
disadvantages
– Must consider cost and which media is
best suited for communication
1-12
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising Media
1-13
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising
● Advertising Media
– Newspaper
– Television
– Radio
– Magazines
– Direct Mail
– Outdoor Advertising
– Online and Interactive Advertising
– Sponsorship
● Advantages/disadvantages, examples
1-14
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Advertising
● Advertising Media
– Other Media Options
 Infomercials: 30-minute programs that
resemble regular TV programs, but are
devoted to selling goods or services
 Other Media options include:
– Ads in movie theaters
– Ads on airline movie screens
– Printed programs, Subway tickets
– Turnpike toll receipts
– Automated teller machines
– Naming stadiums and arenas
– Naming statistics on sports shows
– Naming trivia questions on sports shows
1-15
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Sales Promotion
● Sales promotion — non-personal marketing
activities other than advertising, personal
selling and public relations that stimulate
consumer purchasing and dealer
effectiveness.
– Potential advantages:
 Short-term increased sales
 Increased brand equity
 Enhanced customer relationships
1-16
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Sales Promotion
● Consumer-Oriented Promotions
– Premiums—items given free or at a
reduced price with the purchase of another
product.
– Coupons offer small price discounts
– Rebates offer cash back to consumers
– Sample—a gift of a product distributed by
mail, door-to-door, in a demonstration, or
inside packages of another product
– Games, Contests, and Sweepstakes
– Promotional Products (Specialty
advertising)
1-17
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Sales Promotion
● Trade-Oriented Promotions
– Point-of-purchase (POP) advertising—
displays or demonstrations that promote
products when and where consumers buy
them
 Takes advantage of many shoppers’
tendencies to make purchase decisions
in the store
– Trade shows—promote goods or services
to intermediaries
1-18
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Personal Selling
● Personal selling—interpersonal promotional process
involving a seller’s face-to-face presentation to a
prospective buyer.
● Sales Tasks
– Order Processing—involves identifying customer
needs, pointing them out to customers, and
completing orders
– Creative Selling— skillful proposals of solutions
for the customer’s needs
● Missionary Selling— specialized salespeople
promote goodwill among indirect customers, often by
assisting customers in product use
1-19
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Personal Selling
● The Sales Process
– Seven Steps in
the Sales
Process
1-20
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.
Discussion
● In small groups
– pick a product
– develop 3 promotional schemes for it
 who are you targeting
 why do you think it will be effective
● Pick a product that needs to be sold face-toface
– what approach would you use?
– what would you do at each step of the
sales process?
1-21
Copyright © 2005 by South-Western, a division of Thomson Learning, Inc. All rights reserved.