SUBMITTED BY:
Christel Anne Estabaya
Chapter 08: INTEGRATED MARKETING COMMUNICATIONS:
ADVERTISING AND SALES PROMOTION
TOPICS
01 The Promotion Mix
02 Integrated Marketing Communications
03 Advertising: Planning and Strategy
04 Advertising Decisions
05 Sales Promotion
PROMOTION
TWO BASIC CATEGORIES:
1. Personal Selling
2. Nonpersonal Selling
 Includes all demand creation and demand maintenance activities of the firm
 It is mass selling and includes:
(1) Advertising
(2) Sales Promotion
(3) Publicity (free advertising)
01 THE PROMOTION MIX
PROMOTION MIX
 Refers to the combination and types of promotional effort the firm puts forth during a specified
period
Product is NEW
► Promotional effort will probably rely heavily on advertising, sales promotion, and publicity in order to:
1. make potential buyers aware of the product;
2. inform these buyers about the benefits associated with the product;
3. convince buyers the product possesses high value; and
4. entice buyers to purchase the product
Product is MORE ESTABLISHED BUT IS STABILIZE SALES ON WEAK SEASON
► Promotional mix will most likely contain short-term incentives (sales promotion) for people to buy the
product immediately
Product is HIGHLY TECHNICAL AND NEEDS A LOT OF EXPLANATION
► Promotional mix will probably contain more personal selling, so that potential buyers can ask
questions
3 BASIC FACTORS WHEN DEVISING PROMOTION MIX
1. The role of promotion in the overall marketing mix
2. The nature of the product
3. The nature of the market
02 INTEGRATED MARKETING COMMUNICATIONS
Goal of Integrated Marketing Communications
► Develop marketing communications programs that coordinate and integrate all elements of promotion
so that the organization presents a consistent message
► Seeks to manage all sources of brand or company contacts with existing and potential customers
► Potential buyers generally go through a process of:
1) Awareness
2) Comprehension
3) Conviction
4) Ordering
03 ADVERTISING: PLANNING AND STRATEGY
Advertising
► Seeks to promote the seller’s product by means of printed and electronic media
► Justified that messages can reach large numbers of people and inform, persuade, and remind them
about the firm’s offerings
 Management Perspective
► Advertising is a strategic device for maintaining or gaining a competitive advantage in the
marketplace
 Manufacturers and Resellers Perspective
► Advertising budgets represent a large and growing element in the cost of goods and services
Factors to Takes into Account in Advertising Budgets (Marketing Plan)





Nature of the product, including life cycle
Competition
Government regulations
Nature and scope of the market
Channels of distribution




Pricing strategy
Availability of media
Availability of funds
Outlays for other forms of promotion
Objectives of Advertising
 Generalist Viewpoint
► Primarily concerned with sales, profits, return on investment, and so forth
 Specialist Viewpoint
► Represented by advertising experts who are primarily concerned with measuring the effects of
specific ads or campaigns
 Middle View
► Might be classified as more of a marketing management approach
► Understands and appreciates the other two viewpoints but, in addition, sees advertising as a
competitive weapon
Objectives for Advertising Focus on:




Creating Awareness
Aiding Comprehension
Developing Conviction
Encouraging Ordering
► In the long run and often in the short run, advertising is justified on the basis of the revenue it
produces
► Revenue in this case may refer either to sales or profits
► Actions taken by customers must encompass purchase and continued repurchases of the advertised
product
► Marketing managers must be aware that advertising not only complements other forms of
communication but is subject to the law of diminishing returns
04 ADVERTISING DECISIONS
Two (2) Key Decisions of Marketing Manager:
1. Deals with determining the size of the advertising budget; and
2. Deals with how the advertising budget should be allocated
► Today’s most successful brands of consumer goods were built by heavy advertising and marketing
investment
► They practice the art of discounting: cutting ad budgets to fund price promotions or fatten quarterly
earnings
The Expenditure Question
 Percent of Sales
− Firm simply takes a percentage figure and applies it to either past or future sales
 Per-unit Expenditure
− Fixed monetary amount is spent on advertising for each unit of the product expected to be sold
 All You Can Afford
− Advertising budget is established as a predetermined share of profits or financial resources
 Competitive Parity
− Advertising budget are based on those of competitors or other members of the industry
 The Research Approach
− Advertising budget is argued for and presented on the basis of research findings
 The Task Approach
− Management determines how much it will cost to accomplish each task and adds up the total
The Eight-M Formula
1.
2.
3.
4.
Management Question
Money Question
Market Question
Message Question
5.
6.
7.
8.
Media Question
Macroscheduling Question
Microscheduling Question
Measurement Question
The Allocation Question
► Deals with the problem of deciding on the most effective way of spending advertising dollars
Two (2) Related Tasks of a Successful Ad Campaign:
1. Say the right things in the ads themselves; and
2. Use the appropriate media in the right amounts at the right time to reach the target market
Message Strategy
► Advertising process involves creating messages with words, ideas, sounds, and other forms of
audiovisual stimuli that are designed to affect consumer (or distributor) behavior
Two (2) General Criteria
1. It should take account the basic principles of communication; and
2. It should be predicated upon a good theory of consumer motivation and behavior
Three (3) Elements of Basic Communication Process
1) Sender or source
2) Communication or message
3) Receiver or audience
Media Mix
Four (4) Interrelated Factors Limit the Number of Practical Alternatives:
1.
2.
3.
4.
Nature of the product
Nature and size of the target market
Advertising budget
Availability
Procedures for Evaluating Programs and Some Services Using the Procedures
 Specific
 Specific Advertising
 Motivational Impact
♦ Intention to buy
Advertisements
Objectives
♥ Recognition tests
♥ Recall tests
♥ Opinion tests
♥ Theater tests
♣ Awareness
♣ Attitude
♦ Market test
05 SALES PROMOTION
PROMOTION
► Sometimes used to refer to a specific activity, such as advertising or publicity
► Any identifiable effort on the part of the seller to persuade buyers to accept the seller’s information
and store it in retrievable form
SALES PROMOTION
American Marketing Association
 Media and nonmedia marketing pressure applied for a predetermined, limited period of time at the
level of consumer, retailer, or wholesaler in order to stimulate trial, increase consumer demand, or
improve product availability
Some Objectives of Sales Promotion
When Directed at Consumers
1.
2.
3.
4.
5.
To obtain the trial of a product.
To introduce a new or improved product.
To encourage repeat or greater usage by current users.
To bring more customers into retail stores.
To increase the total number of users of an established product.
When Directed at Salespeople
1. To motivate the sales force.
2. To educate the sales force about product improvements.
3. To stabilize a fluctuating sales pattern.
When Directed at Resellers
1.
2.
3.
4.
To increase reseller inventories.
To obtain displays and other support for products.
To improve product distribution.
To obtain more and better shelf space.
Push versus Pull Marketing
Push Strategies
► All activities aimed at getting products into the dealer pipeline and accelerating sales by offering
inducements to dealers, retailers, and salespeople
Pull Strategies
► Manufacturer relies mainly on product advertising or consumer sales promotions
Trade Sales Promotions
TRADE PROMOTIONS
→ promotions aimed at distributors and retailers of products who make up the distribution channel
Major Objectives of Trade Promotion
1)
2)
3)
4)
Convince retailers to carry the manufacturer’s products;
Reduce the manufacturer’s and increase the distributor’s or retailer’s inventories;
Support advertising and consumer sales promotions;
Encourage retailers to either give the product more favorable shelf space or place more emphasis on
selling the product; and
5) Serve as a reward for past sales efforts
Types of Dealer Sales Promotion
1)
2)
3)
4)
Point-of purchase displays
Contests
Trade shows
Sales meetings
5)
6)
7)
8)
Push money
Dealer loaders
Trade deals
Advertising allowances
Consumer Promotions
(1)
(2)
(3)
(4)
(5)
(6)
Inducing the consumer to try the product,
Rewarding the consumer for brand loyalty,
Encouraging the consumer to trade up or purchase larger sizes of a product,
Stimulating the consumer to make repeat purchases of the product,
Reacting to competitor efforts, and
Reinforcing and serving as a complement to advertising and personal selling efforts
Most Commonly Utilized Forms of Consumer Promotion Activities
1)
2)
3)
4)
Sampling
Price deals
Bonus packs
Rebates and refunds
5) Sweepstakes and contests
6) Premiums
7) Coupons
What Sales Promotion Can and Can’t Do
♦ Sales promotion is only one part of a well-constructed integrated marketing communications program
♦ There are several compelling reasons why sales promotion should not be utilized as the sole
promotional tool
Sales Promotion’s Inability to:
1)
2)
3)
4)
generate long-term buyer commitment to a brand in many cases;
change, except on a temporary basis, declining sales of product;
convince buyers to purchase an otherwise unacceptable product; and
make up a lack of advertising or sales support for a product