promotional concepts and strategies chapter 17. the promotional mix section 17.1
TRANSCRIPT
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Promotional Concepts and Promotional Concepts and StrategiesStrategies
Chapter 17
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THE PROMOTIONAL THE PROMOTIONAL MIXMIX
Section 17.1
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Promotion in Promotion in MarketingMarketing
Promotion is persuasive communication.
Promotional techniques to enhance their public image and reputation, and to persuade people to value their products.
Goals of promotional activities is AIDAA – first AttractI – then build InterestD – DesireA – finally ask for Action
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Promotion in MarketingPromotion in MarketingA business uses product promotion
to convince prospects (potential customers) to select their goods or services instead of a competitors brand.
Promotional activities include: ◦ Explain major features and benefits◦ Identify where it is sold◦ Advertise sales◦ Answer customer questions◦ Introduce new offerings
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Promotion in Promotion in MarketingMarketing
Institutional promotion is a promotional method used to create a favorable image for a business, help it advocate change, or take a stand on trade or community issues
Promotional activities include◦Website maintenance
Does not directly sell a certain product
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The Promotional MixThe Promotional Mix
Examples of Each Different Type of Promotion
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The Promotional MixThe Promotional MixPromotion in Marketing
Companies and nonprofit organizations rely on
promotion.
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Types of Promotion in the Types of Promotion in the Promotional MixPromotional Mix
(A combination of 5 basic types of (A combination of 5 basic types of promotion)promotion)Personal selling
AdvertisingDirect marketingSales promotionPublic relations
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1. Personal Selling1. Personal SellingGenerate direct
contact with prospects and customers
Examples include: personal meetings, in-home demonstrations, e-mail and telephone correspondence
Most expensive forms of promotion
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
PersonalSelling
The Promotional Mix
Direct contact
Expensive
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2. Advertising2. AdvertisingA form of non-personal
promotionTo promote ideas,
goods, or services in a variety of media outlets
Examples include billboards, business cards, brochures, Internet, magazines, newspapers, phone directories, grocery store receipts, radio, TV, sports arenas, cars and buses, restaurant menus and web sites.
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
PersonalSelling
Advertising
The Promotional Mix
Direct contact
Expensive
Advertising iseverywhere
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3. Direct Marketing3. Direct MarketingA type of promotion that
companies use to address individuals directly and not through a third party medium (such as TV, radio, or the internet)
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Direct MarketingDirect MarketingDirect Mail
◦ Sent via standard mail to a home or business
Telemarketing ◦ Customers are called on the phone and
asked directly for goods or servicesE-marketing
◦ Any promotion delivered via the Internet (e-mail, mobile apps, social media, search engine marketing (paid search), web site optimization
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Social MediaSocial MediaElectronic media that allows
people with similar interests to participate in a social network◦Facebook◦MySpace◦YouTube◦LinkedIn◦Twitter
Helps businesses reach prospective customers
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Direct MarketingDirect MarketingGoals of direct marketing are to
generate sales or leads for sales representatives to pursue
Gives recipients an incentive to respond by visiting a store or Web site, calling a toll-free number, returning a form, or sending an e-mail
Targeted customers receive special offers or incentives, such as money-off coupon
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Direct MarketingDirect MarketingAllows businesses to engage in one-
way communicationCongress passed the CAN-SPAM Act
of 2003◦Act requires senders of unsolicited
commercial e-mail to give recipients a way to opt out of e-mails
◦Prohibits the use of deceptive subject lines and headers
◦Requires businesses to provide valid return addresses on e-mails.
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
PersonalSelling
AdvertisingDirect
Marketing
The Promotional Mix
Direct contact
Expensive
Advertising iseverywhere
E-marketing
Telemarketing
Social media
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4. Sales Promotion4. Sales PromotionAccording to AMA,
sales promotion represents all marketing activities – other than personal selling, advertising and public relations – that are directed at business or retail customers to boost sales.
Objectives are to: Increase sales Inform potential
customers about new products
Create positive business or corporate image
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Sales PromotionSales PromotionExamples include
◦ Coupons◦ Money-off Promotions◦ Competitions◦ Product Samples◦ Point-of-Sale Displays
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
PersonalSelling
AdvertisingDirect
MarketingSales
Promotion
The Promotional Mix
Direct contact
Expensive
Advertising iseverywhere
E-marketing
Telemarketing
Social media
Coupons
Money-offpromotions
Product samples
Displays
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5. Public Relations and 5. Public Relations and PublicityPublicityPR activities enable an organization
to influence a target audiencePR campaigns try to create influence
general opinions and create a favorable image for a person, organization or a company, its products, or its policies
Goal is to encourage media relations with reporters
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Public Relations: New Public Relations: New ReleasesReleasesMost important media toolAn announcement that is sent to
the appropriate media outletsPublicity is one tactic that public
relations professionals usePublicity is freeNot controlled by the business
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Public Relations: Using Social Public Relations: Using Social MediaMediaBusinesses interact with customersGet feedback on the company and
its products and servicesProvide businesses with a way to
obtain opinions and speak directly with potential and existing customers
Potential to reach prospective customers is tremendous
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PublicityPublicityInvolves bringing news or
newsworthy information about an organization to the public’s attention.◦Known as placement
Can be used to make public aware of certain people, specific products or services, efforts by nonprofit agencies, political issue
Publicity is free
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
PersonalSelling
AdvertisingDirect
MarketingSales
PromotionPublic
Relations (PR)
The Promotional Mix
Direct contact
Expensive
Advertising iseverywhere
E-marketing
Telemarketing
Social media
Coupons
Money-offpromotions
Product samples
Displays
News releases
Social media
Publicity
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The Concept of Promotional The Concept of Promotional MixMixWhat is Promotional Mix?Combination of strategies and
cost-effective allocation of resources
Identify target market to measuring the results
Strategies complement one another
Elements of the mix must be coordinated
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
Types of Ads
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Promotional BudgetPromotional Budget
Roles of marketing dept
Determines promotional mix
Establishes the budget
Allocates resources
Coordinates the campaign
Supervises outside resources
Measures the results
Determining the budget can be difficult
It is the % of sales
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The Push-Pull ConceptThe Push-Pull Concept
Push Policy Manufacturer
pushes product to the retailer
Involves personal selling and sales promotion – trade shows
Pull Policy Directs promotion
towards consumers
Create consumer interest and demand
Involves advertising to consumers – premiums & samples
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The Promotional MixThe Promotional MixTypes of Promotion in the Promotional Mix
Put the number of users and nonusers in the appropriate spaces on the graphic organizer. Why or why not do you use these sites?
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The Promotional MixThe Promotional MixThe Concept of Promotional Mix
Discuss the Six Steps of the
Promotional MixDevelop a
Promotional Mix
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TYPES OF TYPES OF PROMOTIONPROMOTION
Section 17.2
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Sales Promotion definitionSales Promotion definitionIncentives that
encourage customers to buy products or services
Build brand awareness
Encourage customers to try new products
Increase purchases by current customers
Reward customer loyalty
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Types of PromotionTypes of PromotionSales Promotions
Sales promotions are usually supported by
advertising activities that include trade promotions
and consumer promotions.
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Trade promotionsTrade promotionsSales promotion activities designed to
get support for a product from manufacturers, wholesalers, and retailers
More money is actually spent on promoting to businesses than to consumers
Good business ethics require that trade promotional payments and awards be offered in uniform manner.
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Types of PromotionTypes of PromotionSales Promotions
Trade Promotions
Promotional Allowances
Cooperative Advertising
Slotting Allowances
Sales Force Promotions
Trade Shows and Conventions
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Types of Trade PromotionsTypes of Trade Promotions1. 1. Promotional AllowancesPromotional Allowances
Represent cash payments or discounts given by manufacturers to wholesalers or retailers for performing activities to encourage sales
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2. Cooperative Advertising2. Cooperative Advertising
Manufacturer supports the retailer by helping to pay for the cost of advertising it product locally
Known as cooperative advertising
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3. 3. Slotting AllowancesSlotting AllowancesA cash premium paid by
a manufacturer to a retailer to help the retailer cover the costs of placing the manufacturer’s product on the shelves
Range from a few thousand dollars to several million dollars per product
Also pay retailer’s discount specials, charge for store shelves, penalties for poor sales, store advertising and display costs
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4. 4. Sales Force Sales Force PromotionsPromotions
Awards given to dealers and employees who successfully meet or exceed a sales quota
Sales force promotions vary, but can include bonuses or prizes such as merchandise awards or travel awards.
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5. 5. Trade Shows and Trade Shows and ConventionsConventions
Showcase a particular line of products
Introduce new products, encourage increased sales of existing products & meet customers and partners in distribution
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Consumer PromotionsConsumer Promotions
Sales strategies that encourage customers and prospects to buy a product or service
Consumer promotions support advertising, personal selling and public relations efforts
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Types of Consumer Types of Consumer PromotionsPromotions1. 1. CouponsCoupons
Certificates that entitle customers to cash discounts on goods or services
Placed inside product packages or in newspapers / magazines
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2. 2. PremiumsPremiums
Low-cost items given to consumers at a discount or for free
Designed to increase sales by building product loyalty & attract new customers
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2. Premiums2. PremiumsFundamental concept behind
premium marketing is that people will be more motivated to buy a product when they are offered an added value gift in exchange
Three types of premiums◦Factory Packs◦Traffic Builders◦Coupon Plans
Drawback – customers think premiums are disposable
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Types of PromotionTypes of PromotionSales Promotions
Three Different Types of Premiums and Descriptions
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2. Premiums2. PremiumsFactory Packs, or in-packs, are free
gifts placed in product packages or as a container premium◦Popular with cereal manufactures
Traffic Builders – low cost premiums such as pens, key chains, pocket calendars, and coffee mugs◦New store or special event
Coupon Plans – ongoing programs offering a variety of premiums in exchange for labels or coupons obtained from a product◦Ex – Send 3 soup labels in to manufacturer
to receive a cookbook
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3. 3. DealsDeals
Deals or price packs offer short-term price reductions that are marked directly on the label or package
Deal might “bundle” two-related products together, such as free wing chair with purchase of sofa
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4. 4. IncentivesIncentivesAre higher-priced
products, awards, or gift cards that are earned and given away through contests-games of skill; sweepstakes-games of chance; and rebates.
Create customer excitement & increase sales
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5. 5. Product SamplesProduct Samples
A free trial size of a product sent through the mail, distributed door-to-door, or given away at retail stores and trade shows
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6. 6. SponsorshipSponsorship
Company pays a fee for the right to promote itself and its products or services at or on a set location
Negotiate the right to use logos and names on retail products
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7. 7. Promotional Tie-Ins, Promotional Tie-Ins, Cross-Promotion, Cross-Cross-Promotion, Cross-SellingSelling
Cross-promotion and cross-selling campaigns
Activities include sales promotional arrangements between one or more retailers or manufacturers
They product mutually beneficially results
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8. 8. Product PlacementProduct PlacementA consumer promotion that
involves using a brand-name product in a movie, television show, sporting event, or even in a commercial for another product
+
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9. 9. Loyalty Marketing Loyalty Marketing ProgramsProgramsAlso called
frequent buyer programs, reward, or frequent shopper programs reward customers by offering incentives for repeat purchases
Frequent flyer promotions
Customer loyalty means that customers are so satisfied with a brand or retailer that they continue to buy that brand or patronize that retailer
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10. 10. Online Loyalty Online Loyalty MarketingMarketing
Online versions of loyalty marketing programs
Internet search engine award points
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11. 11. Point-of-purchase Point-of-purchase displaysdisplays
Displays designed primarily by manufacturers to hold and display their products
High traffic area and promote impulse purchases
Kiosks – web based or display screens that customers can use to interact with sales staff
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Types of PromotionTypes of PromotionSales Promotions
Examples of Each Type of Consumer Promotion
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Types of PromotionTypes of Promotion
Examples of Different Types of Sales Promotions