Promotions Opportunity
Analysis
Chapter 4
Promotions Opportunity Analysis
Must accomplish two objectives:
1. Determine which promotional objectives
exist for the company.
2. Identify the characteristics of each target
market, to better understand how to reach
that target audience.
Discussion Question
 Make a list of five consumer products or
services that are segmented on the basis of
gender but are sold to both genders. Are
there any differences in the product or
services attributes? Are there differences in
how they are marketed? What are those
differences? Do you think that using a
different marketing approach has worked?
Steps in Promotions Opportunity
Analysis
1.
2.
3.
4.
5.
Communication market analysis.
Establish communication objectives.
Create a communications budget.
Prepare a promotional strategy.
Coordination of the promo. tools
 Each of these have multiple components.
Communication Market Analysis
Step1
 Competitive analysis
 Opportunity analysis
 Target market analysis
 Customer analysis
 Positioning analysis
Steps in Promotions Opportunity
Analysis
1.
2.
3.
4.
5.
Communication market analysis.
Establish communication objectives.
Create a communications budget.
Prepare a promotional strategy.
Coordination of the promo. tools
 Each of these have multiple components.
Establishing Communication
Objectives - Step2
What are some communication objectives that a
firm may wish to pursue?
 __________
 __________
 __________
 __________
 __________
Communication Budgets - Step 3
 Budgets based on


communication objectives
marketing objectives
 Budgets vary from consumer to B-to-B markets
 Unrealistic assumption to assume direct relationship
between advertising sales and market share
Restaurant Chains
U.S. Market Share vs. Media Ad Spending
Rank
Brand
Market Share
Media Ad
Spend (Mil)
Cost Per
Share Pt. (Mil)
1
McDonald’s
7.7%
$ 727.7
$ 93.9
2
Burger King
2.4%
$ 268.8
$ 113.2
3
Wendy’s
2.3%
$ 374.7
$161.5
4
Subway
2.2%
$ 325.2
$150.1
5
Taco Bell
1.9%
$ 231.7
$125.1
Source: “Top 10 Restaurant Chains,” www.adage.com, accessed October 1, 2008
4-9
Automotive Brands
U.S. Market Share vs. Media Ad Spending
Rank
Brand
Market
Share
Media Ad
Spend (Mil)
Cost Per
Share Pt. (Mil)
1
Toyota Camry
5.4%
$ 65.6
$ 12.1
2
Honda Accord
4.6%
$ 114.3
$ 24.8
3
Honda Civic
3.9%
$ 112.0
$ 28.7
4
Nissan Altima
3.2%
$ 132.1
$ 41.2
5
Chevrolet Impala
3.1%
$ 58.5
$ 18.8
Source: “Top 10 Auto Brands,” www.adage.com, accessed October 1, 2008
FIGURE
4. 4
% of Total Marketing Budget
An comparative example: 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
Marketing Methodology/Media
Business-to-Business
Consumer
Direct Mail
Creating a Communications
Budget - Step 3
Most common methods used include:
 Percentage of sales
 Affordable method
 Competitive-Parity method
 Objective and task method
 Payout Planning
Factors Impacting Relationship
Between Promotions and Sales
 The goal of the promotion
 Threshold effects
 Carryover effects
 Wear-out effects
 Decay effects
 Random events
Sales-Response Curve
Carryover effects
are important in
advertising products
such as boats.
FIGURE
4.6
A Decay Effects Model
Preparing the Communication
Strategy - Step 4
 Communication strategies are broad, long-
term guidelines for the marketing
communications program.
 The communication strategy should be linked
to opportunities and threats identified in the
communication market analysis.
 The strategy should fit with the firms
positioning (image, message, theme,etc.)
Coordination - Step5
 Matching what you plan to do , with what is actually
available to support the communication.
Examples include:
 specific ads
 sales promotions - contests, coupons, etc
 holiday events/anniversary events
 enticements from sales reps
 price changes
 special product packaging for brand extensions
Segmentation and Promotion
 Segmentation helps to clarify marketing
objectives geared towards specific target
markets – critical to address in a promotions
opportunity analysis.
 This allows for more precise communications
budgeting.
 This also helps link the firm’s strategies and
tactics to a specific target group.
Determining Viable Segments
 The segment is different from the population
as a whole and distinct from other market
segments.
 The segment is large enough to be financially
viable to target with a separate marketing
campaign. Examples?
 The individuals or businesses within the
segment are homogeneous.
Segmentation Variables
 Demographics
 Psychographics - click
 Geographic
 Benefits Sought
 Usage
 Geodemographic Segmentation

Combines census demographic data with
psychographic and geographic information
 Generations - see page 106, table 4.1 -click
VALS 2
Psychographic Segmentation
 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
 Click to go back
Generation Segmentation