Transcript No Slide Title

Slide 1
Promotion
• Personal Selling
• Mass Selling
• Advertising
• Publicity
• Sales Promotion
Copyright, Professor W.T.G. Richardson
Slide 2
Promotion
• communication of information
• influence the buyer
3 methods
Personal Selling
Mass Selling
Sales Promotion
Copyright, Professor W.T.G. Richardson
Slide 3
Personal Selling
• direct communication between seller
and buyer
• face2face contact
•Usually used to sell industrial goods and
services
•Also used to sell some expensive
consumer items, eg. Cars, computer
systems
Copyright, Professor W.T.G. Richardson
Slide 4
Mass Selling
• communicating with large numbers of
potential customers
• “non”-personal selling
• used when the target market is large
and dispersed
•Advertising is a form of Mass Selling
Copyright, Professor W.T.G. Richardson
Slide 5
Advertising
• the main form of mass selling
• any paid form of nonpersonal
communication
eg. Techniques include billboard ads and
TV commercials
Copyright, Professor W.T.G. Richardson
Slide 6
Publicity
The generation of awareness about a product
beyond regular advertising methods.
Usually less costly than advertising because
sometimes the message is spread for free by
a newspaper article or TV story.
Copyright, Professor W.T.G. Richardson
Slide 7
Publicity
Examples of Publicity
• famous person photographed using your
product
• your product mentioned in National News in
a positive way
• your product featured in a movie
• TV commentary about aspects of your
product trade magazines carrying a story
eg. Road and Track doing a feature on the new
Landrover
Copyright, Professor W.T.G. Richardson
Slide 8
Publicity
Publicity can be negative
eg. If a famous movie star gets electrocuted using your
product, this can cause people to NOT want to buy it this would be a major problems
eg. If your product is sabotaged - this could include
tampering with medical products ie. Tylenol
eg. If there are negative rumours about the ingredients
in your product
eg. If there are negative ingredients about the moral
aspects of your company
Copyright, Professor W.T.G. Richardson
Slide 9
Promotion People
• Sales Managers
• Advertising Managers
• Sales Promotion Managers
Copyright, Professor W.T.G. Richardson
Slide 10
Promotion People
Sales Managers
• Are concerned with managing personal
selling
• In small companies this person also does
the advertising and sales promotion
Copyright, Professor W.T.G. Richardson
Slide 11
Promotion People
Advertising Managers
• They manage the mass selling activities
• They chose the company to make the
commercials
• Pick the billboard signs etc.
• If the company is big enough they hire an
outside agency
• They may also do publicity as well
Copyright, Professor W.T.G. Richardson
Slide 12
Promotion People
Sales Promotion Managers
• They manage the Sales Promotion activities
• They decide about in-store coupons, prizes,
contests etc.
• They spend a lot of time visiting the retail
outlets where the product is sold
Copyright, Professor W.T.G. Richardson
Slide 13
People in Sales Promotion
Sales Promotion Managers
- they deal with
Point-of-purchase advertising
specialty advertising
samples
coupons
premiums
loyalty points / air miles
rebates
contests
Copyright, Professor W.T.G. Richardson
Slide 14
Sales Promotion includes:
• Point-of-purchase advertising
• specialty advertising
• samples
• coupons
• premiums
• loyalty points / air miles
• rebates
• contests
Copyright, Professor W.T.G. Richardson
Slide 15
Copyright, Professor W.T.G. Richardson
Slide 16
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Slide 17
Relationship between Advertising and the Product Life Cycle
Not mentioned in your textbook
Copyright, Professor W.T.G. Richardson
Slide 18
Informing
• people have to know about it, in order to buy it
Advertising that seeks to develop demand through
presenting factual information on the attributes of a
product or service.
Tends to be used in promoting NEW products.
Use in the Introductory Stage of PLC
Copyright, Professor W.T.G. Richardson
Slide 19
Persuading
• when competition offers similar product, you have
to “persuade” them to try yours
Advertising that emphasizes using words and/or images
to try to create an image for a product and to influence
attitudes about it.
Used by Coke and Pepsi re: lifestyle ads.
Used after the Introductory Stage of the PLC
Copyright, Professor W.T.G. Richardson
Slide 20
Reminding
• when new competition comes along, you have to
“remind” customers of your greater experience,
advantages etc.
Advertising whose goal is to reinforce previous
promotional activity by keeping the product’s or
service’s name in front of the public.
Used in the Maturity Period and the Decline Stage of the
PLC.
Copyright, Professor W.T.G. Richardson
Slide 21
Copyright, Professor W.T.G. Richardson
Slide 22
Effective Communication
Noise
• distractions that reduce the effectiveness
of the communication
• things which make an ad, useless
because people don’t get the message
clearly
• eg. Competition from similar ads
Copyright, Professor W.T.G. Richardson
Slide 23
Effective Communication
Encoding
• means to make a code
• the process of making your message,
and hoping you do it so it will be
understood
Copyright, Professor W.T.G. Richardson
Slide 24
Effective Communication
Decoding
• means to break a code into language you
can understand
• the process of the customer listening to a
message, and being able to correctly
figure out what the advertiser wants you
to know, or do
Copyright, Professor W.T.G. Richardson
Slide 25
• Pushing through the promotion channel
Producer -
personal selling
2 wholesaler
retailer
customer
Promotion techniques used
• run ads in trade magazines to make wholesalers aware of the product
• provide incentives to retailers to carry the item
“… free case of drinks with each 2
cases it buys…” page 466
• run contests for salespeople to win prizes for selling the product
Copyright, Professor W.T.G. Richardson
Slide 26
Potential Mail Recipients
Once your name is on a list for a newspaper
subscription, your name and address can
be “sold” to another company who will mail
you information to try and convince you to
buy their product.
Buying and selling lists (databases) of such
names is big business.
Copyright, Professor W.T.G. Richardson
Slide 27
Comparison of Direct Marketing and General Advertising
Direct Marketing
General Advertising
Selling to individuals. Customers are
often identifiable by name, address, and
purchase behaviour.
Mass selling. Buyers identified as broad
groups sharing common demographic and
psychographic characteristics.
Products have added value or service.
Distribution is important product benefit.
Product benefits do not always include
convenient distribution channels.
The medium is the marketplace.
Retail outlet is the marketplace.
Marketer controls product until delivery.
Marketer may lose control as product
enters distribution channel.
Advertising used to motivate an
immediate order or inquiry.
Advertising used for cumulative effect
over time to build image, awareness,
loyalty, benefit recall. Purchase action
deferred.
Repetition used within ad.
Repetition used over time.
Consumers feel high perceived risk –
product brought unseen. Recourse is
distant.
Consumers feel less risk – have direct
contact with the product and direct
recourse.
Copyright, Professor W.T.G. Richardson
Slide 28
• Pulling through the promotion channel
Producer -
personal selling
2 wholesaler
retailer
customer
Promotion techniques used
• run TV commercials so customers directly learn about the product - then
they go to the store and ask for it, or call around to find out where it is
sold
• give free samples to potential customers
Copyright, Professor W.T.G. Richardson
Slide 29
• Pulling through the promotion channel
Producer -
personal selling
2 wholesaler
retailer
customer
Sometimes you do “pulling” when the Middlemen cannot be
pushed, that is they already have a competitors product, so
the way to get Middlemen to WANT to carry the product, is to
have customers ask for it.
Copyright, Professor W.T.G. Richardson
Slide 30
Adoption Process
• Innovators
• Early Adopters
- sales people concentrate their efforts here
• Early majority
• Late majority
• Laggards, or nonadopters
Copyright, Professor W.T.G. Richardson
Slide 31
Setting the promotion budget
Most common method is based on using past
percentages
- that is to say,,,,
If you sold $ 1,000,000 and you spent 20% on
advertising, which = $200,000
then,
if you spend $400,000 you should sell $2 million!
Copyright, Professor W.T.G. Richardson
Slide 32
Setting the promotion budget
Other methods - used in real world
• Matching what competition spends
• Based on what is required to get number of
customers that will meet corporate objectives called the Task Method
- sometimes stated as a % of sales
Copyright, Professor W.T.G. Richardson