Transcript No Slide Title - Cal State LA

Chapters
17, 18, 19
Promotion and Marketing
Promotion is the component of a firm’s
marketing mix that informs, persuades, and
reminds the market regarding the firm
and/or its products.
 It includes all the means by which a
company communicates with customers.
 Persuasion means to influence feelings,
beliefs, or behavior.

> It is an attempt to shift or change the shape of
the demand curve for a firm’s goods or services.
17-1
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Fig. 17-1
- Shifting Demand with Promotion
Price
Demand with
promotion
Price
Demand with
promotion
Demand
without
promotion
17-2
Demand
without
promotion
Quantit
a. A shifty in the demand
curve to the right.
McGraw-Hill/Irwin
Quantit
b. Changing
the shape
y
(or elasticity)
of the demand curve.
Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.
The Promotion Mix Components
Promotion/Communications Mix
Advertising

17-3
Public Publicity
Relations
Personal
Selling
Sales
Promotions
Name some Promotion Mix objectives.
> Increase sales, votes, desired behaviors, etc.
> Create awareness, preference, loyalty
> Identify prospects (sales leads)
> Encourage/discourage trial, retrial
> Recruit and support middlemen and sales dpt.
> Hurt competitors
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How Does Promotion Mix Persuade?

Each component
> Provides awareness
> Provides information
> Differentiates the product from competition
> Makes the perceived value = price
> Reduces cognitive dissonance
17-4
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Promotion Mix Components Defined

Advertising: Any paid-for type of non-personal
communication by an identified sponsor.
> Consumer and Business-to-Business
> Primary-Demand and Selective-Demand
> Product, Corporate, and Institutional


17-5
Public relations: A planned communication effort
intended to make the firm appear as a good
corporate citizen.
Publicity: A special form of public relations that
involves creating positive newsworthy stories
about an firm and/or its products.
> News releases, featured articles and TV segments
> Press conferences
> Product placement in movies
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Promotion Mix Components Defined
(continued)


Personal selling: The direct presentation of a
product to a prospective customer by a
representative of the selling organization.
Sales promotion: Demand-stimulating activity
designed to supplement advertising and facilitate
personal selling.
17-6
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Exercise
Advertising - Public Relations - Publicity Personal Selling - Sales Promotions

17-7
How would you classify the following:
> McDonald’s uses billboards to promote its free
fries with a Big Mac purchase.
> A Honda salesperson calls you about a new
model that coming out soon.
> Channel 5 news has a story about Energizer
Battery’s new ad campaign. It features a
commercial with the Energizer rabbit.
> Quaker Oats mails a 50 cents-off coupons to
500,000 homes in L.A. county.
> Kool-Aid donates two cases to a little league
baseball team to use in a fundraiser.
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The Promotional Campaign
Advertising - Public Relations - Publicity Personal Selling - Sales Promotions
The promotional mix components are
coordinated in a strategy called Integrated
Marketing Communications (IMC).
 When designing the IMC effort, five things
should be considered:

> The Target Audience
> The Promotional Objective
> The Nature of the Product
> Stage in the Product’s Life Cycle
17-8
> Funds Available for Promotion
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Sales Promotion

Short-term, demand-stimulating activities
designed to
> supplement advertising,
> facilitate personal selling,
> support distribution channels efforts.

The target of these activities may be
> target customers/end users
> “The Trade”/middlemen
> the producer’s own sales force
17-9
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- Push & Pull
Promotional Strategies
Fig. 17-3
PUSH STRATEGY
Producer
Wholesaler
Retailer
Consumer
Retailer
Consumer
PULL STRATEGY
Producer
17-10
McGraw-Hill/Irwin
Wholesaler
Product
flow
Promotion effort
Customer flow
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Middleman-Targeted
Sales Promotions
Directed to the members of the distribution
channel. They are intended to . . .
> Motivate: Incentives
» Contests, bonuses, push money, slotting fees,
promotion allowances, cooperative advertising
> Inform: Advance notice
» Producer’s new product
» Producer’s new promotion
» Often done at trade shows
> Educate
17-11
» Sales training and sales aides
» Management training
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Customer-Targeted
Sales Promotions

They are intended to
> Attract new customers
> Get more business out of current customers

Types
> Pricing deals: Price-off, rebate, BOGO, coupon
> Premiums: Give-a-way and self-liquidator
> Contests:
» Skill
» Chance: sweepstakes, instant win, collection
> Sampling
> Consumer shows
> Sponsorships and event marketing
17-12
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The Nature of Personal Selling
Personal selling is the personal communication of
information to persuade the target to a desired
action.
There is no business until
somebody sells something to somebody.
It is difficult to find, attract and keep high-caliber
salespersons. That’s why they earn so much.
17-13
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The New Nature of Sales Careers


17-14
The stereotypical “used car salesman” image of
personal selling is outdated. It is being replaced
by the professional selling of professional
services by professional sales consultants. (See
next slide.)
These new patterns are emerging:
> Selling Centers — Team Selling
> Systems Selling
> Global Sales Teams
> Relationship Selling
> Internet Selling
> Sales Force Automation
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Table 18-1 -
America’s Best Sales
Forces in 1999
Company
Industry
Enron Corporation Energy management
Dell Computer Corp.Computers
Cisco Systems
Computer networking
GE Capital ServicesFinancial services
Pfizer
Pharmaceuticals
17-15
Source: “Here’s to the Winners,” Sales & Marketing Management, July,
1999, pp. 46-70.
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What Makes a Good Salesperson
High energy level
 Self-confidence (when it counts)
 Competitive nature
 Hunger for status, not money
 Overcome their fears, especially rejection
which they eventually learned to love
 An expert seller of an expert nerd’s work.
Money chases them.

17-16
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Fig. 18-2
- The Personal Selling Process
PROSPECTING
Identifying:
Profiles
Leads
Records
Qualifying:
Capability
Willingness
PREAPPROACH
Information,
habits, needs,
& preferences
of specific
prospect.
PRESENTATION
AIDA:
Attention
Interest
Desire
Action
POSTSALE
SERVICES
Reduce
dissonance
Build
goodwill
Resale
17-17
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- Staffing and
Operating a Sales Force
Fig. 18-3
Recruitment
and
Selection
Assimilation
Performance
Evaluation
Supervision
Training
Compensation
Motivation
17-18
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Evaluating a Salesperson’s
Performance

Both quantitative and qualitative factors
should serve as bases for performance
evaluation.
> Quantitative bases are specific and objective.
> Qualitative factors are limited by the
subjective judgment of the evaluators.

Both inputs (or effort) and outputs (or
results) should be used.
17-19
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