Chapter 16a_Using Effective Promotions

Chapter 16
Using
Effective
Promotions
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
PROMOTION
in an ORGANIZATION
• Promotion Mix -- The combination of promotional
tools an organization uses. The traditional mix
includes:
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ADVERTISING
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ADVERTISING in the FIRM
• Advertising -- Paid, nonpersonal communication
through various media by
organizations and individuals
who are in some way
indentified in the message.
• Major goals of advertising:
- Inform
- Persuade
- Remind
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IMPACT of ADVERTISING
• Total advertising expenditures
exceed $241 billion yearly.
• Consumers benefit because
production costs of TV
programs, radio programs,
newspapers and magazines
are paid for by advertisers.
• Marketers choose ad media
that will reach the target
market.
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SOCIAL ADVERTISING
• Social media advertising
is growing so fast,
marketers can’t keep up.
• Starbucks has over 12
million followers on
Twitter.
• McDonald’s has over 7
million fans on Facebook.
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MATCH GAME
Match the Company with the Slogan
• “Everybody doesn’t like something, but nobody
doesn’t like ___________.”
• “It takes a licking and keeps on ticking.”
• “With a name like _________, it has to be good.”
• “Good to the last drop.”
• “Betcha can’t eat just one!”
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POPULAR ADVERTISING MEDIA
• TV advertising is still the dominant media.
• Digital Video Recorders (DVRs) challenge TV
advertising because viewers can skip ads.
• Product Placement -Advertisers pay to put
their products into TV
shows and movies where
the audience will see
them.
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INFOMERCIALS and
ONLINE ADVERTISING
• Infomercial -- A full length TV program devoted
exclusively to promote a particular product.
• Online Ads are attempts to get potential customers
to a web site to learn about a product.
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INFOMERCIAL HALL of FAME
The Biggest Hits Over the Past 40 Years
• Veg-O-Matic
• Ginsu Knives
• The Clapper
• Thigh Master
• George Foreman Grill
• Bowflex
Source: Fortune, www.fortune.com, accessed July 2011.
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MONITORING
AD EFFECTIVENESS
• Dr. Pepper posts messages
on Facebook and monitors
the results from their over
8.5 million fans.
• Richard Branson tweets his
customer base to maintain
two-way communication.
Photo Courtesy of: Brent Moore
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ADVERTISING GLOBALLY
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ADVERTISING EXPENDITURE by
MEDIA in $ MILLIONS
Rank
Media
Projected 2013
Spending
1
Direct Mail
$52.3
2
Broadcast TV
36.8
3
Newspaper
23.4
4
Cable TV
27
5
Radio
15.9
6
Yellow Pages
11.9
7
Consumer Magazine
9.1
8
Internet
25.3
Other
39.7
Total
241.4
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GLOBAL ADVERTISING STRATEGY
• Globalism requires
marketers to develop a
single product and
promotional strategy to
implement worldwide.
• Problems can arise in
global markets with using
one advertising campaign
in all countries - especially
bad translations.
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REGIONAL ADVERTISING STRATEGY
• Regionalism – specific
ads for each country or for
specific groups within a
country. (most effective)
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PERSONAL SELLING
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PERSONAL SELLING
• Personal Selling -- The face-to-face presentation
and promotion of a product, including the
salesperson’s search for new prospects and followup service.
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STEPS in the B2B SELLING PROCESS
1. Prospect and qualify
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PROSPECTING and QUALIFYING
in SELLING
• Prospecting -- Researching potential buyers and
choosing those most likely to buy.
• Qualifying -- Making sure
customers have a need for a
product, the authority to buy
and the willingness to listen to
a sales message.
• Prospect -- A customer who
meets the qualifying criteria.
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STEPS in the B2B SELLING PROCESS
2. Approach
3. Make a presentation
4. Answer objections
5. Close the sale
• Trial Close -- A statement or question that
moves the process toward the purchase.
6. Follow up
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STEPS in the B2C
SELLING PROCESS
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USING PUBLIC RELATIONS
in PROMOTION
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USING PUBLIC RELATIONS in
PROMOTION
• Public Relations (PR) -- Evaluates public
attitudes, changes policies and procedures in
response to the public, and executes a program of
action and information to earn public understanding
and acceptance.
• 3 steps of a good PR program:
1) Listen to the public
2) Change policies and procedures
3) Inform people that organization is responsive to their
needs
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PUBLICITY
• Publicity -- Any information about
an individual, product or
organization that’s distributed to
the public through the media and is
not paid for or controlled by the
seller.
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ADVANTAGES of PUBLICITY
• Free
• Reaches people who
would not look at an
advertisement
• More believable than
advertising
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DISADVANTAGES of PUBLICITY
• No control over whether the
media will use a story or when
they may release it.
• Once a story has been run, it is
not likely to run again.
• There is such a thing as bad
publicity.
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SALES PROMOTIONS
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SALES PROMOTIONS
• Sales Promotion -- The promotional tool that
stimulates consumer purchasing and dealer interest
by means of short-term activities.
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SOME KEY
CONSUMER SALES PROMOTIONS
• Coupons
• Demonstrations
• Sampling
• Sweepstakes
• In-store Displays
• Contests
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USING WORD-of-MOUTH
PROMOTION
• Word-of-Mouth Promotion -- People tell others
about products they have purchased.
• Word-of-Mouth is important for products like:
- Restaurants
- Daycare and Eldercare
- Car Repair Shops
- Hair Stylists
- Hotels
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EMERGING
PROMOTIONAL TOOLS
• Viral Marketing -- Paying
customers to say positive things on
the Internet or setting up multiple
selling schemes whereby
consumers get commissions.
• People who promote through
viral marketing often receive
SWAG which can include free
tickets, shirts, and other
merchandise.
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BLOGS, PODCASTS,
and E-MAILS
• Blog -- Short for web log; an online diary that looks
like a webpage, but is easier to create and update by
posting text, photos, videos, or links.
• Podcasting -- A way to distribute audio and video
programs via the Internet.
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MOBILE MEDIA
Marketers make use of cell
phones to text customers
about product offers and other
company information.
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PUSH and PULL PROMOTIONAL
STRATEGIES
• Push Strategy -- Producers use advertising,
personal selling, sales promotion, and other tools to
get their products stocked on shelves.
• Pull Strategy -- Directs heavy advertising and sales
promotions efforts towards consumers and gets the
public to request their products from retailers.
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PUSH, PULL, PROMOTIONAL
STRATEGIES
 Convince wholesalers and
retailers to stock and sell
 Producer uses trade
discounts, personal
selling, cooperative
advertising to convince
the intermediaries
 Idea is to push the
product through the
distribution system to the
stores
 Heavy advertisements and
sales promotion efforts
 Directed at consumers so
that they will request the
products from retailers
 Products are pulled down
through the distribution
system
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MANAGING THE PROMOTION MIX
 Large, homogeneous groups of
consumers are best reached
through ADVERTISING
 Large organizations are best
reached through PERSONAL
SELLING
 SALES PROMOTION motivates to
buy now
 PUBLICITY adds support and
creates a good impression
 WORD OF MOUTH is often the
most powerful promotional tool
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INTEGRATED MARKETING
COMMUNICATION (IMC)
• Integrated Marketing Communication (IMC) -Combines the promotional tools into one
comprehensive strategy. IMC is used to:
- Create a positive brand image.
- Meet the needs of consumers.
- Meet the strategic marketing and promotional
goals of the firm.
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