Part Seven
Promotional Decisions
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Chapter 18
Integrated Marketing
Communications
Objectives
• Describe nature of integrated marketing
communications
• Examine process of communication
• Understand role/objective of promotion
• Explore elements of promotion mix
• Examine major methods of promotion
• Describe factors affecting choice of promotional
methods
• Understand word-of-mouth communication and how
it affects promotion
• Examine criticisms/defenses of promotion
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Goals
• Consistent message
• Coordinate/manage promotional efforts
• Synchronization of promotional elements
• Use more precisely targeted promotional tools
• Use of database marketing
• Protect consumer privacy
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The Communication Process
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Coding a Meaning
• Communication channel - medium that carries
coded message
• Decoding process - converting signs and
symbols into concepts and ideas
• Noise - reduces communication’s clarity and
accuracy
• Feedback - receiver’s response to decoded
message
• Channel capacity - limit on volume of information
a channel can handle effectively
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Role And
Objectives Of Promotion
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Create Awareness
Stimulate Demand
Encourage Product Trial
Identify Prospects
Retain Loyal Customers
Facilitate Reseller Support
Combat Competitive Promotional Efforts
Reduce Sales Fluctuations
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Promotion
Communication to build and maintain
relationships by informing and persuading
one or more audiences.
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Maximize Benefits
Promotional Efforts
• Proper planning
• Implementation
• Coordination
• Control of communication
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Information Flows In IMC
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Possible Objectives Of Promotion
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Create Awareness
• Awareness is crucial to initiating product
adoption process
• Increase awareness of brands, product
features, image-related issues, or
operational characteristics
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Stimulate Demand
• Primary - demand for a product category
rather than a specific brand
– Pioneer promotion – informs consumers
about a new product
• Selective - demand for a specific brand
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Encourage Product Trial
• Free samples
• Coupons
• Test drives
• Limited free-use offers
• Contests
• Games
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Encouraging product
trial through a free offer
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Retain Loyal Customers
• Cheaper than acquiring
new ones
• Frequent-user
programs
• Special offers
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Combat Competitive
Promotional Efforts
• Does not increase sales or market share
• Prevents lose of sales and market share
• Used in extremely competitive consumer
markets
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Reduce Sales Fluctuations
• Minimize seasonal
variations in
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Sales
Production
Inventory levels
Personnel needs
Financial resources
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• Become more efficient
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Promotion Mix
A combination of promotional methods used
to promote a specific product.
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Four Possible
Elements Of A Promotion Mix
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Advertising
• A paid nonpersonal communication about
an organization and its products
transmitted to a target audience through
mass media
• Reaches large target market and small,
precisely defined segment
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Disadvantages Of Advertising
• Absolute dollar outlay high
• Rarely provides rapid feedback
• Difficult to measure effect on sales
• Less persuasive than personal selling
• Limited time exposure
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Personal Selling
A paid personal communication that seeks
to inform customers and persuade them to
purchase products in an exchange situation
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Personal Selling
vs. Advertising
• Specific communication aimed at
one/several individuals
• Higher cost
• Greater impact on customers
• Immediate feedback
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Types Of Interpersonal
Communication
• Kinesic - movement of head, eyes, hands,
leg, or torso
• Proxemic - varying physical distance in
face-to-face
• Tactile - touching
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Public Relations
• Broad set of communication efforts used
to create/maintain favorable relationships
between organization and stakeholders
• Focuses on stakeholders other than
customers
• Affects short-term sales/profits and longterm survival
• Can be unfavorable
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PR Tools
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Nonpersonal communication
Annual Reports
Brochures
Event Sponsorships
Sponsorship of Socially Responsible
Programs
• Press Release/Conference/Feature
Articles
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Sales Promotion
• Acts as direct
inducement
• Offering added value
• Incentive
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• Examples
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Free Samples
Games
Rebates
Sweepstakes
Contests
Premiums
Coupons
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Product Categories With
Greatest Use Of Coupons
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Selecting Promotion
Mix Elements
• Promotional Resources, Objectives, and
Policies- affect promotional methods and
types selected
• Characteristics of the Target Market
• Characteristics of the Product
• Costs and Availability of Promotional
Methods
• Pull and Pull Channel Policies
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Target Market Characteristics
• Help dictate methods included in
promotion mix
• Market size determines composition of mix
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Product Characteristics
• Business products
– personal selling
– sales promotion
• Consumer products
– Convenience = advertising
– Durables = personal selling
• Both = public relations
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Product Life Cycle Stage
• Introduction = advertising
• Growth/Maturity
– Consumer = advertising
– Business = personal selling
and sales promotion
• Decline = reduction of
all promotional activities
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Distribution Intensity
• Intense = advertising, sales promotion
• Selective = vary
• Exclusive = personal selling
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Costs And Availability
Of Promotional Methods
• National Advertising/Sales Promotion =
high expense but lower cost per individual
is lower
• Internationally = may have restricted
availability
• Unavailability of sales force = less
personal selling
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Push and Pull Channel Policies
• Push policy – promoting a product only to
the next institution down the marketing
channel
• Pull policy – promoting a product directly
to consumers to develop strong consumer
demand that pulls products through the
marketing channel
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Push vs. Pull
Promotional Strategies
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Personal And Electronic
Word-Of- Mouth Communication
• Word-of-Mouth – personal informal exchanges
customers share with one another about
products, brands, and companies
• Buzz marketing – an attempt to gain acceptance
of product by word-of-mouth
• Viral marketing – strategy to get Internet users to
share ads and promotions with their friends
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Criticisms And
Defenses Of Promotion
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Promotion deceptive?
Does promotion increase prices?
Does promotion create needs?
Does promotion encourage materialism?
Does promotion help customers without
costing too much?
• Should potentially harmful products be
promoted?
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