Download Promotions - Cengage Learning

Chapter 16: Promotional Planning for
Competitive Advantage
Prepared by Amit Shah, Frostburg State University
Designed by Eric Brengle, B-books, Ltd.
Copyright 2010 by Cengage Learning Inc. All Rights Reserved
1
Learning Outcomes
LO1
Discuss the role of promotion in the
marketing mix
LO2
Describe the communication process
LO3
Explain the goal of promotion
Copyright 2010 by Cengage Learning Inc. All Rights Reserved
2
Learning Outcomes
LO4
Discuss the elements of the promotional mix
LO5
Discuss the AIDA concept and its relationship
to the promotional mix
LO6
Discuss the concept of integrated marketing
communications
LO7
Describe the factors that affect the
promotional mix
Copyright 2010 by Cengage Learning Inc. All Rights Reserved
3
The Role of Promotion in the
Marketing Mix
LO1
Discuss the role of
promotion in the marketing mix.
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4
The Role of Promotion
Promotions –
Communications by
marketers that informs,
persuades, and reminds
potential buyers of a
product in order to influence an
opinion or elicit a response.
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5
The Role of Promotion
Promotional Strategy - A plan for the
optimal use of the
elements of promotion: advertising,
public relations, personal selling, and
sales production.
Competitive Advantage - One or more
unique aspects of an organization
that cause consumers to patronize
that firm rather than competitors.
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6
The Role of Promotion
in the Marketing Mix
Overall Marketing
Objectives
•
•
•
•
Marketing Mix
Product
Place
Promotion
Price
Promotional Mix
•
•
•
•
Advertising
Public Relations
Sales Promotion
Personal Selling
Target Market
7
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Competitive Advantage
High product quality
Rapid delivery
Low prices
Excellent service
Unique features
8
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LO1
Review Learning Outcome
The Role of Promotion in the Marketing Mix
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9
Marketing Communication
LO2
Describe the
communication process.
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Communication
The process by
which we exchange or share
meanings through a common
set of symbols.
http://www.mcdonalds.com
Online
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11
Marketing Communication
Categories of
Communication
Interpersonal
Communication
Mass
Communication
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12
Marketing Communication
As Senders
As Receivers
 Inform
 Develop messages
 Persuade
 Adapt messages
 Remind
 Spot new
communication
opportunities
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13
The Communication Process
Noise
Sender
Encoding
Message
Message
Channel
Decoding
Message
Receiver
Feedback
Channel
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The Impact of Blogging
Corporate Blogs- Sponsored by
a company or one of its brands
and maintained by one or more
of the company’s employees.
Noncorporate BlogsIndependent and not associated
with the marketing efforts of any
particular company or brand.
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15
LO2
Review Learning Outcome
The Communication Process
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16
The Goals of Promotion
LO3
Explain the goal of promotion.
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Goals of Promotion
Informing
PLC Stages:
Introduction
Early Growth
PLC Stages:
Growth
Maturity
Reminding
PLC Stages:
Maturity
Target
Audience
Persuading
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Informing
Informative Promotion

Increase awareness

Explain how product works

Suggest new uses

Build company image
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Persuading
Persuasive Promotion
 Encourage brand switching
 Change customers’ perceptions of
product attributes
 Influence immediate buying decision
 Persuade customers to call
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Reminding
Reminder Promotion
 Remind customers that product
may be needed
 Remind customers where
to buy product
 Maintain customer awareness
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21
The Promotional Mix
LO4
Discuss the elements of the
promotional mix.
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22
The Promotional Mix
Combination of promotion tools
used to reach the target
market and fulfill the organization’s
overall goals.
• Advertising
• Public Relations
• Sales Promotion
• Personal Selling
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23
Advertising
Any form of impersonal
(one-way) paid
communication in
which the
sponsor or
company is identified.
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Advertising Media
Traditional
Advertising Media








Television
Radio
Newspapers
Magazines
Books
Direct mail
Billboards
Transit cards
New
Advertising Media





Internet
Banner ads
Viral marketing
E- mail
Interactive video
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25
Public Relations
The marketing function that evaluates
public attitudes, identifies
areas within the organization
that the public may be
interested in, and executes a program
of action to earn public understanding
and acceptance.
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26
The Function of Public Relations
• Maintain a positive image
• Educate the public about the company’s
objectives
• Introduce new products
• Support the sales effort
• Generate favorable publicity
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27
Personal Selling
A purchase situation involving
a personal, paid-for
communication between two
people in an attempt to
influence each other.
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Personal Selling
Traditional
Selling
Relationship
Selling
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29
Sales Promotion
Marketing activities– other than
personal selling, advertising, and
public relations– that
stimulate consumer buying
and dealer effectiveness.
http://www.nabiscoworld.com
Online
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30
Sales Promotion
Free samples
Contests
End
Consumers
Premiums
Trade Shows
Company
Employees
Vacation Giveaways
Trade Customers
Coupons
31
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Characteristics of the Elements
in the Promotional Mix
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32
LO4
Review Learning Outcome
Elements of the Promotional Mix
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33
Promotional Goals
and the AIDA Concept
LO5
Discuss the AIDA concept
and its relationship to
the promotional mix.
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34
The AIDA Concept
AIDA Concept (Attention, Interest,
Desire, Action)- Model that outlines
the process for achieving promotional
goals in terms of stages of consumer
Involvement with the message.
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35
The AIDA Concept
Action
Desire
Interest
Attention
Conative (doing)
Affective (feeling)
Cognitive (thinking)
36
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LO5
Review Learning Outcome
The AIDA Concept
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37
Integrated Marketing
Communications
LO6
Discuss the concept of
integrated marketing
communications.
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38
Integrated Marketing Communications
The careful coordination of
all promotional
messages to assure the
consistency of messages at
every contact point where a
company meets the consumer.
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39
IMC Popularity Growth
• Proliferation of thousands of
media choices
• Fragmentation of the mass market
• Slash of advertising spending in
favor of promotional techniques that generate
immediate response
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40
LO6
Review Learning Outcome
Integrated Marketing Communications
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41
Factors Affecting the Promotional Mix
LO7
Describe the factors that
affect the promotional mix.
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42
Factors Affecting the
Choice of Promotional Mix
Nature of the product
Stage in PLC
Target market factors
Type of buying decision
Promotion funds
Push or pull strategy
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43
Sales ($)
Stage in the Product Life Cycle
Maturity
Decline
Growth
Introduction
Time
Heavy use of
Preadvertising &
introduction
PR to build
Publicity, light awareness;
sales
advertising
promotion
for trial
Advertising,
PR, brand
loyalty;
personal
selling for
distribution
Ads decrease;
sales
promotion;
personal
selling;
reminder &
persuasive
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AD/PR
decrease;
limited
sales
promotion;
personal
selling for
distribution
44
Target Market Characteristics
Advertising
For…

Widely scattered
market

Informed buyers

Brand-loyal repeat
purchasers
Sales Promotion
Less Personal Selling
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45
Type of Buying Decision
Advertising
Routine
Sales Promotion
Neither Routine
nor Complex
Advertising
Public Relations
Personal Selling
Complex
Print Advertising
46
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Available Funds
•
Trade-offs with funds available
•
Number of people in target market
•
Quality of communication needed
•
Relative costs of promotional elements
47
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Push and Pull Strategies
PUSH STRATEGY
Manufacturer
promotes to
wholesaler
Wholesaler
promotes to
retailer
Retailer
promotes to
consumer
Consumer
buys from
retailer
Orders to manufacturer
PULL STRATEGY
Manufacturer
promotes to
consumer
Consumer
demands
product
from retailer
Retailer
demands
product
from wholesaler
Wholesaler
demands
product from
manufacturer
Orders to manufacturer
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48
LO7
Review Learning Outcome
Factors Affecting Promotional Mix
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49