Greeting Cards
4
Concerning your last greeting card
purchase:
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What brand of greeting cards did you
purchase?
How many cards did you purchase?
Where did you purchase the card?
For what occasion did you make the
purchase?
General questions concerning
greeting cards:

Discussion Slide
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
How many cards do you purchase per
year?
Name five brands of greeting cards.
Do you use virtual cards?
Can you recall any advertisements for
greeting cards?
© 2007 by Prentice Hall
4-1
4
Promotions Opportunity
Analysis
Chapter Overview
1. Promotions opportunity
analysis process
2. Promotional efforts
3. Consumer market segments
4. B-to-B segmentation
programs
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4-2
Promotions Opportunity Analysis
1) Conduct a communications marketing
analysis.
2) Establish objectives.
3) Create a budget.
4) Prepare a promotional strategy.
5) Match tactics with strategy.
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4-3
Promotions Opportunity Analysis
Step 1
Conduct a Communication Market Analysis
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Competitors
Opportunities
Target markets
Customers
Product positioning
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4-4
Competitors
• Identifies major competitors.
• Identifies communication strategies
and tactics of each competitor.
Sources of information
•Secondary data
•Other people
•Primary research
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4-5
Opportunities
• Are there customers that the competition is
ignoring?
• Which markets are heavily saturated?
• Are the benefits of our products being
clearly articulated?
• Are there opportunities to build
relationships using a slightly different
marketing approach?
• Are there opportunities that are not being
pursued?
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4-6
Target Markets
• What benefits does each target market
want from the product?
• How can each target market be reached?
• What appeal works best for each target
market?
• What needs of the target market are not
being met by a competing firm?
• What is the demographic and
psychographic makeup of each target
market?
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4-7
Customers
Three Types of Customers
• Current company customers
• The competitors’ customers
• Potential customers who currently
do not purchase the product but
may become interested
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4-8
Product Positioning
• Is the perception created in the
consumer’s mind regarding the nature of
the company and its products relative to
the competition?
• Positioning is created by factors such as
product quality, prices, distribution, image,
and marketing communications.
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4-9
Positioning Approaches
 Attributes
 Competitors
 Use or application
 Price/quality
 Product user
 Product class
 Cultural symbol
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4-10
Promotions Opportunity Analysis
Step 2
Establish Communication Objectives
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Develop brand awareness
Increase good/service category demand
Change customer beliefs or attitudes
Enhance purchase actions
Encourage repeat purchases
Build customer traffic
Enhance firm image
Increase market share
Increase sales
Reinforce purchase decisions
© 2007 by Prentice Hall
4-11
FIGURE
4. 4
% of Total Marketing Budget
Communication Spending for Consumers
and B-to-B
60.0%
52.6%
50.0%
40.0%
30.1%
30.0%
20.0%
22.6%
19.6%
21.2%
11.3%
10.0%
11.9%
8.8%
4.1%
5.2% 5.3%
Radio
Magazine
7.2%
0.0%
Television
Newspaper
Telephone
Marketing
Direct Mail
Marketing Methodology/Media
Business-to-Business
Consumer
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4-12
FIGURE
4. 5
A Sale-Response Function Curve Combined with the
Downward Response Curve and Marginal Analysis
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4-13
Factors Impacting Relationship
Between Promotions and Sales
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The goal of the promotion
Threshold effects
Carryover effects
Wear-out effects
Decay effects
Random events
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4-14
Carryover effects are
important in
advertising products
such as boats.
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4-15
Promotions Opportunity Analysis
Step 3
Create a Communications Budget
Methods of Determining the Marketing Communications Budget
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Percentage of sales
Meet-the-competition
“What we can afford”
Objective and task
Payout planning
Quantitative models
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4-16
FIGURE
5.6
A Decay Effects Model
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4-17
Marketing Budgets
Advertising
25%
Consumer Promotions
25%
Trade Promotions
50%
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4-18
Top Ten National Advertisers
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
General Motors
Procter & Gamble
Time Warner
Pfizer
DaimlerChrysler
Ford Motor Co.
Walt Disney Co.
Johnson & Johnson
Sony Corp.
Toyota Motor Corp.
$ 3.42
$ 2.32
$ 3.09
$ 2.83
$ 2.31
$ 2.23
$ 2.12
$ 1.99
$ 1.81
$ 1.68
Note: Expenditures in billions of US dollars
Source: “100 Leading National Advertisers,” Advertising Age Special Report
(June 28, 2004), pp. 1-4.
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4-19
Limited Service Restaurants
U.S. Market Share vs Media Ad Spending
Rank
Brand
Market
Share
Media Ad
Spend (Mil)
Cost Per
Share Pt.
(Thousands)
1
McDonald’s
19.5% $ 551.5 $ 28.20
2
Burger King
7.0% $ 272.1 $ 39.00
3
Wendy’s
6.5% $ 297.5 $ 45.80
4
Subway
5.0% $ 249.5 $ 49.60
5
Taco Bell
4.7% $ 201.0 $ 42.60
Source: “Top 10 Limited Service Restaurants,” www.adage.com, January 13, 2005
© 2007 by Prentice Hall
4-20
Casual Dining Restaurants
U.S. Market Share vs Media Ad Spending
Rank
Brand
Market
Share
Media Ad
Spend (Mil)
Cost Per
Share Pt.
(Thousands)
1
Applebee’s
9.8% $ 106.1 $ 10.80
2
Outback
6.9%
$ 56.3 $ 8.20
3
Chili’s
6.7%
$ 94.8 $ 14.10
4
Red Lobster
6.6%
$ 91.5 $ 13.90
5
Olive Garden
5.6%
$ 86.3 $ 15.40
Source: “Top 10 Casual Dining Restaurants,” www.adage.com, January 13, 2005
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4-21
Cookies
U.S. Market Share vs Media Ad Spending
Rank
Brand
Market
Share
Media Ad
Spend (Mil)
Cost Per
Share Pt.
(Thousands)
1
Nabisco Oreos
13.2%
$ 32.8
$ 2.48
2
Nabisco Chips
Ahoy
9.0%
$ 18.8
$ 2.10
3
Keebler Chips
Deluxe
3.4%
$ 3.3
$ 0.97
4
Pepperidge Farm
Distinctive
3.4%
$ 2.9
$ 0.86
5
Nabisco Newtons
3.3%
$ 11.4
$ 3.46
Source: “Top 10 U.S. Cookies in 2003,” www.adage.com, January 13, 2005
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4-22
Automotive Brands (Nameplates)
U.S. Market Share vs Media Ad Spending
Rank
Brand
Market
Share
Media Ad
Spend (Mil)
Cost Per
Share Pt.
(Thousands)
1
Ford
17.3% $ 757.0 $ 43.73
2
Chevrolet
15.6% $ 630.1 $ 39.76
3
Toyota
9.6% $ 651.9 $ 67.91
4
Dodge
7.3% $ 544.9 $ 74.28
5
Honda
7.1% $ 423.4 $ 59.64
Source: “Top 10 Automotive Nameplates,” www.adage.com, January 13, 2005
© 2007 by Prentice Hall
4-23
Promotions Opportunity Analysis
Step 4
Prepare a Communication Strategy
• Communication strategies are broad,
long-term guidelines for the marketing
communications program.
• Should be linked to opportunities and
threats identified by the communication
market analysis.
•Should fit with the company’s overall
message, image, and themes.
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4-24
Promotions Opportunity Analysis
Step 5
Match Tactics with Strategies
Tactics support the communication strategies.
Examples of tactics would include:
• Specific advertisements
• Personal selling enticements for sales reps
• Sales promotions
• Special product packages and labels
• Price changes
• Trade discounts to retailers
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4-25
Advantages to Segmenting Markets
 Identify company strengths and weaknesses
 Identify opportunities
 Match firm’s expertise with most lucrative markets
 Clarify marketing objectives with target markets
 Focus budget on market segments
 Link strategies and tactics to specific markets
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4-26
Tests to Determine if a Particular Market
Segment Is Viable
 The individuals or businesses within the segment
are homogeneous.
 The market segment is different from the
population as a whole and distinct from other market
segments.
 The market segment is large enough to be
financially viable to target with a separate marketing
campaign.
 The market segment must be reachable through
some type of media or marketing communications
method.
© 2007 by Prentice Hall
4-27
FIGURE
4.9
Methods of Segmenting Consumer Markets
• Demographics
• Psychographics
• Generations
• Geographic
• Geodemographics
• Benefits
• Usage
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4-28
A Nail Cares
advertisement
targeted to
females.
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4-29
Radio Ad Directed to Children
An advertisement by
Junior Fitness Academy
targeted to children.
Click on speaker to play ad.
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4-30
VALS 2
Psychographic Segmentation
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Innovators – successful, sophisticated – upscale products.
Thinkers – educated, conservative, practical – durability, value.
Achievers – goal-oriented, conservative, career, and family
Experiencers – young, enthusiastic, impulsive, fashion, social
Believers – conservative, conventional, traditional
Strivers – trendy, fun-loving, peers important
Makers – self-sufficient, respect authority, not materialistic
Survivors – safety, security, focus on needs, price
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Psychographics and Technology
Psychographic Segmentation
• New Enthusiasts – cutting edge, eager, high
incomes/education
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Hopefuls – cutting edge, lack financial means
Faithful – not eager, but not averse
Oldliners – not interested in new technologies
Independents – higher incomes, but do not value new
technology
• Surfers – ambivalent about new technology, cynical about
business
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4-32
Generation Segmentation
Senior
Empty 14%
Nester
13%
Older
Boomer
24%
Gen. Y
5%
Gen. X
18%
Younger
Boomer
26%
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4-33
Generation Segmentation
(Part I)
• Generation Y (18-24) – Clothes,
automobiles, college big ticket items. Spend heavily
on TVs, stereos, and personal appearance.
• Generation X (25-34) – Food, housing,
transportation, and personal services primary
emphasis. Time pressure so outsource daily tasks.
• Younger Boomers (35-44) – 60% own
home. Mortgage, home furnishings, home
renovations major purchases. Spend remaining
disposable income on pets, toys, playground
equipment, and large recreational vehicles.
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Generation Segmentation
(Part 2)
• Older Boomers (45-54) – Priorities are
upgrading homes, education and independence of
children, luxury items, exotic vacations, insurance, and
investments.
• Empty Nesters (55-64) – 80% own homes.
Mortgage, new furniture, new automobiles, personal
indulges.
• Seniors (65+) – Fixed incomes. Drugs, health
insurance, and health care major expenditures.
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4-35
Ad targeted to senior citizens.
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4-36
Reaching Asian-Americans
Ethnic/Geographic Segmentation
Asian-American population in 2000 was 6.9 million
with a buying power of $254.6 billion annually
Asian-American Distribution
Los Angeles
San Francisco
New York
Honolulu
Chicago
percentage
18.8%
13.9%
15.2%
6.9%
4.2%
Source: Deborah L. Vence, “Top Niche; Growth in Asian-Am. Spending Fuels
Targeted Marketing,” Marketing News, Vol. 38 (June 1, 2004), pp. 11-13.
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4-37
Geodemographic Segmentation
• Combines
• Demographic census data
• Geographic information
• Psychographic information
• PRIZM
• 62 market segments
• Southside City
• Towns and Gowns
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4-38
FIGURE
4 . 11
Methods of Segmenting B-to-B Markets
• Industry NAICS/SIC
codes
• Size of business
• Geographic location
• Product usage
• Customer value
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4-39
A business-to-business
advertisement based on
the product usage
segmentation strategy.
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4-40
FIGURE
4.12
Successful Globally Integrated Marketing
Communications Tactics
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Understand the international market
A borderless marketing plan
Thinking globally but acting locally
Local partnerships
Communication segmentation strategies
Market communication analysis
Solid communication objectives
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4-41