Transcript Marketing, Chapter 19 - Cole

Chapter 19
What is Promotion?
The Role of Promotion
Promotion – Any form of communication a business
or organization uses to inform, persuade, or
remind people about its products & improve its
public image.
•
Product Promotion
–
•
Used to convince customers to buy products from it
instead of the competition
Institutional Promotion
–
Used to create a favorable image for itself
4 Basic Types of Promotion:
 Advertising
 Sales Promotion
 Publicity
 Personal Selling
I. Advertising
• Any paid form of nonpersonal presentation & promotion
of ideas, goods or services by an identified sponsor
(NOT publicity, sales promotion or personal selling).
Advantages
Large # people see it
Cost per customer is low
Can choose most appropriate media to reach target market
Can control the content of the ad
Repeat viewing
Presell a product
Disadvantages
Can’t focus on individual needs
Some forms are very expensive
Can be wasteful (as to targeting correct market)
They are usually brief
II. Publicity
• Involves placing newsworthy information
about a company, product, or person in the
media.
– Used to build image
– Can be positive or negative (negative not always
bad)
– It is “free” but the company has no control
over the message.
III. Sales Promotion
• All marketing activities, other than personal
selling, advertising & publicity, that is used to
stimulate consumer purchasing & sales
effectiveness.
• Can be both Consumer (Retail) and Trade
(Industrial) oriented.
Trade Promotions
• Sales promotion activities designed to gain
manufacturers’, wholesalers’, & retailers’ support
for a product.
• SLOTTING ALLOWANCES:
• Cash premium paid by the manufacturer to a retail chain for
the costs involved in placing their product on the retailer’s
shelves.
Trade Promotions (con’t.)
• Buying Allowances:
– A special price discount given by manufacturers to
wholesalers/retailers to encourage them to either buy
a product or buy a larger quantity of a product.
• Trade Shows & Conventions:
– Opportunity for manufacturers to introduce
wholesalers/retailers with new products or ways to
increase sales of existing products.
• Sales Incentives:
– Awards given to managers & employees who
successfully meet their company’s set sales quota for
a particular product or line.
Consumer Sales Promotions
1. Licensing:
– Use, for a fee, their logo,
trademark, trade character, names
& likeness or personal
endorsement.
•
Manufacturers, movie makers, sports
teams, & celebrities, ect.
2. Promotional Tie-ins:
– Deals between one or more
retailers/manufacturers to create
additional sales for each partner.
Consumer Sales Promotions
(Con’t.)
3. Visual Merchandising & Displays:
–
–
Visual Merchandising is the coordination of all the
physical elements in a business (How it looks
inside/outside). Business Issue…
Displays is the area in the store/business where the
product is seen and how it is seen, like window
areas, floor, counter shelves, ect.
Consumer Sales Promotions (Con’t.)
4.
1.
2.
3.
4.
Premiums
Coupons
Factory Packs
Traffic Builders
Coupon Plans
5. Incentives
– Sweepstakes, Contests & Rebates
Sweepstakes, Contest or Rebate?
Consumer Sales Promotions (Con’t.)
6. Product Samples:
– free trial size of a product that is sent through
the mail, distributed door-to-door, or through
retail stores & trade shows.
• Cologne, doctors & drugs, teachers w/ textbooks
IV. Personal Selling (previous unit)
– Order takers & order getters
Concept of Promotional Mix:
•Finding the right combination of promotional
activities (Advertising, Publicity, Sales
Promotions & Personal Selling) to most
effectively persuade customers to buy our
products & support our business.