Transcript Promotional Concepts and Strategiesx

Promotional Concepts and Strategies
Chapter 17
Section 17.1
THE PROMOTIONAL
MIX
Promotion in Marketing
Promotion is persuasive communication.
Promotional techniques to enhance their
public image and reputation, and to
persuade people to value their products.
 Goals of promotional activities is AIDA
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A – first Attract
I – then build Interest
D – Desire
A – finally ask for Action
Promotion in Marketing

A business uses product promotion to
convince prospects (potential customers) to
select their goods or services instead of a
competitors brand.
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Promotional activities include:
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Explain major features and benefits
Identify where it is sold
Advertise sales
Answer customer questions
Introduce new offerings
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Promotion in Marketing
Institutional promotion is a
promotional method used to create a
favorable image for a business, help it
advocate change, or take a stand on trade
or community issues
 Promotional activities include

◦ Website maintenance

Does not directly sell a certain product
The Promotional Mix
Examples of Each Different Type of Promotion
The Promotional Mix
Promotion in Marketing
Companies and nonprofit
organizations rely on promotion.
Types of Promotion in the Promotional Mix
(A combination of 5 basic types of
promotion)
 Personal selling
 Advertising
 Direct
marketing
 Sales promotion
 Public relations
1. Personal Selling
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Generate direct contact
with prospects and
customers
Examples include:
personal meetings, inhome demonstrations,
e-mail and telephone
correspondence
Most expensive forms
of promotion
The Promotional Mix
Types of Promotion in the Promotional Mix
The Promotional Mix
Personal
Selling
Direct contact
Expensive
2. Advertising
A form of non-personal
promotion
 To promote ideas, goods,
or services in a variety of
media outlets
 Examples include
billboards, business cards,
brochures, Internet,
magazines, newspapers,
phone directories,
grocery store receipts,
radio, TV, sports arenas,
cars and buses, restaurant
menus and web sites.

The Promotional Mix
Types of Promotion in the Promotional Mix
The Promotional Mix
Personal
Selling
Direct contact
Expensive
Advertising
Advertising is
everywhere
3. Direct Marketing

A type of promotion that companies use
to address individuals directly and not
through a third party medium (such as
TV, radio, or the internet)
Direct Marketing
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Direct Mail
◦ Sent via standard mail to a home or business
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Telemarketing
◦ Customers are called on the phone and asked
directly for goods or services
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E-marketing
◦ Any promotion delivered via the Internet (e-mail,
mobile apps, social media, search engine
marketing (paid search), web site optimization
Social Media

Electronic media that allows people with
similar interests to participate in a social
network
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Facebook
MySpace
YouTube
LinkedIn
Twitter
Helps businesses reach prospective
customers
Direct Marketing
Goals of direct marketing are to generate
sales or leads for sales representatives to
pursue
 Gives recipients an incentive to respond
by visiting a store or Web site, calling a
toll-free number, returning a form, or
sending an e-mail
 Targeted customers receive special offers
or incentives, such as money-off coupon
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Direct Marketing
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Allows businesses to engage in one-way
communication
Congress passed the CAN-SPAM Act of
2003
◦ Act requires senders of unsolicited commercial email to give recipients a way to opt out of e-mails
◦ Prohibits the use of deceptive subject lines and
headers
◦ Requires businesses to provide valid return
addresses on e-mails.
The Promotional Mix
Types of Promotion in the Promotional Mix
The Promotional Mix
Personal
Selling
Direct contact
Expensive
Advertising
Advertising is
everywhere
Direct
Marketing
Mail
E-marketing
Telemarketing
Social media
4. Sales Promotion

According to AMA,
sales promotion
represents all
marketing activities –
other than personal
selling, advertising
and public relations –
that are directed at
business or retail
customers to boost
sales.
Objectives are to:
 Increase sales
 Inform potential
customers about
new products
 Create positive
business or
corporate image
Sales Promotion
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Examples include
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Coupons
Money-off Promotions
Competitions
Product Samples
Point-of-Sale Displays
The Promotional Mix
Types of Promotion in the Promotional Mix
The Promotional Mix
Personal
Selling
Direct contact
Expensive
Advertising
Advertising is
everywhere
Direct
Marketing
Sales
Promotion
Mail
Coupons
E-marketing
Money-off
promotions
Telemarketing
Social media
Product samples
Displays
5. Public Relations and Publicity
PR activities enable an organization to
influence a target audience
 PR campaigns try to create influence
general opinions and create a favorable
image for a person, organization or a
company, its products, or its policies
 Goal is to encourage media relations with
reporters
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Public Relations: New Releases
Most important media tool
 An announcement that is sent to the
appropriate media outlets
 Publicity is one tactic that public relations
professionals use
 Publicity is free
 Not controlled by the business
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Public Relations: Using Social Media
Businesses interact with customers
 Get feedback on the company and its
products and services
 Provide businesses with a way to obtain
opinions and speak directly with potential
and existing customers
 Potential to reach prospective customers
is tremendous
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Publicity
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Involves bringing news or newsworthy
information about an organization to the
public’s attention.
◦ Known as placement
Can be used to make public aware of
certain people, specific products or
services, efforts by nonprofit agencies,
political issue
 Publicity is free
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The Promotional Mix
Types of Promotion in the Promotional Mix
The Promotional Mix
Personal
Selling
Direct contact
Expensive
Advertising
Advertising is
everywhere
Direct
Marketing
Sales
Promotion
Mail
Coupons
News releases
E-marketing
Money-off
promotions
Social media
Telemarketing
Social media
Product samples
Displays
Public
Relations (PR)
Publicity
The Concept of Promotional Mix
What is Promotional Mix?
 Combination of strategies and costeffective allocation of resources
 Identify target market to measuring the
results
 Strategies complement one another
 Elements of the mix must be coordinated
The Promotional Mix
Types of Promotion in the Promotional Mix
Types of Ads
Promotional Budget
Roles of marketing
dept
 Determines
promotional mix
 Establishes the
budget
 Allocates resources
 Coordinates the
campaign
Supervises outside
resources
 Measures the results
Determining the
budget can be
difficult
It is the % of sales
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The Push-Pull Concept
Push Policy
 Manufacturer pushes
product to the
retailer
 Involves personal
selling and sales
promotion – trade
shows
Pull Policy
 Directs promotion
towards consumers
 Create consumer
interest and demand
 Involves advertising
to consumers –
premiums & samples
The Promotional Mix
Types of Promotion in the Promotional Mix
Put the number of users and nonusers in the appropriate spaces on
the graphic organizer.Why or why not do you use these sites?
The Promotional Mix
The Concept of Promotional Mix
Discuss the Six
Steps of the
Promotional Mix
Develop a
Promotional Mix
Section 17.2
TYPES OF PROMOTION
Sales Promotion definition
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Incentives that
encourage customers
to buy products or
services
Build brand awareness
Encourage customers
to try new products
Increase purchases by
current customers
Reward customer
loyalty
Types of Promotion
Sales Promotions
Sales promotions are usually
supported by advertising
activities that include trade
promotions and consumer
promotions.
Trade promotions
Sales promotion activities designed to get
support for a product from
manufacturers, wholesalers, and retailers
 More money is actually spent on
promoting to businesses than to
consumers
 Good business ethics require that trade
promotional payments and awards be
offered in uniform manner.
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Types of Promotion
Sales Promotions
Trade Promotions
Promotional Allowances
Cooperative Advertising
Slotting Allowances
Sales Force Promotions
Trade Shows and Conventions
Types of Trade Promotions
1. Promotional Allowances
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Represent cash
payments or discounts
given by
manufacturers to
wholesalers or
retailers for
performing activities
to encourage sales
2. Cooperative Advertising
Manufacturer
supports the retailer
by helping to pay for
the cost of advertising
it product locally
 Known as cooperative
advertising
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3. Slotting Allowances
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A cash premium paid by a
manufacturer to a retailer to
help the retailer cover the
costs of placing the
manufacturer’s product on
the shelves
Range from a few thousand
dollars to several million
dollars per product
Also pay retailer’s discount
specials, charge for store
shelves, penalties for poor
sales, store advertising and
display costs
4. Sales Force Promotions
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Awards given to dealers
and employees who
successfully meet or
exceed a sales quota
Sales force promotions
vary, but can include
bonuses or prizes such
as merchandise awards
or travel awards.
5. Trade Shows and Conventions
Showcase a particular
line of products
 Introduce new
products, encourage
increased sales of
existing products &
meet customers and
partners in
distribution
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Consumer Promotions
Sales strategies that encourage customers
and prospects to buy a product or service
 Consumer promotions support advertising,
personal selling and public relations efforts
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Types of Consumer Promotions
1. Coupons
Certificates that
entitle customers to
cash discounts on
goods or services
 Placed inside product
packages or in
newspapers /
magazines
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2. Premiums
Low-cost items given
to consumers at a
discount or for free
 Designed to increase
sales by building
product loyalty &
attract new
customers
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2. Premiums
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Fundamental concept behind premium
marketing is that people will be more
motivated to buy a product when they are
offered an added value gift in exchange
Three types of premiums
◦ Factory Packs
◦ Traffic Builders
◦ Coupon Plans
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Drawback – customers think premiums are
disposable
Types of Promotion
Sales Promotions
Three Different Types of
Premiums and Descriptions
2. Premiums
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Factory Packs, or in-packs, are free gifts
placed in product packages or as a container
premium
◦ Popular with cereal manufactures
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Traffic Builders – low cost premiums such
as pens, key chains, pocket calendars, and
coffee mugs
◦ New store or special event
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Coupon Plans – ongoing programs offering
a variety of premiums in exchange for labels
or coupons obtained from a product
◦ Ex – Send 3 soup labels in to manufacturer to
receive a cookbook
3. Deals
Deals or price packs
offer short-term price
reductions that are
marked directly on
the label or package
 Deal might “bundle”
two-related products
together, such as free
wing chair with
purchase of sofa
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4. Incentives
Are higher-priced
products, awards, or
gift cards that are
earned and given away
through contestsgames of skill;
sweepstakes-games of
chance; and rebates.
 Create customer
excitement & increase
sales
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5. Product Samples
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A free trial size of a
product sent through
the mail, distributed
door-to-door, or given
away at retail stores
and trade shows
6. Sponsorship
Company pays a fee
for the right to
promote itself and its
products or services
at or on a set location
 Negotiate the right to
use logos and names
on retail products
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7. Promotional Tie-Ins, CrossPromotion, Cross-Selling
Cross-promotion and cross-selling campaigns
 Activities include sales promotional arrangements
between one or more retailers or manufacturers
 They product mutually
beneficially results
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8. Product Placement
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A consumer promotion that involves
using a brand-name product in a movie,
television show, sporting event, or even in
a commercial for another product
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9. Loyalty Marketing Programs
Also called frequent
buyer programs,
reward, or frequent
shopper programs
reward customers by
offering incentives
for repeat purchases
 Frequent flyer
promotions
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Customer loyalty
means that
customers are so
satisfied with a brand
or retailer that they
continue to buy that
brand or patronize
that retailer
10. Online Loyalty Marketing
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Online versions of
loyalty marketing
programs
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Internet search engine
award points
11. Point-of-purchase displays
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Displays designed
primarily by
manufacturers to hold
and display their
products
High traffic area and
promote impulse
purchases
Kiosks – web based or
display screens that
customers can use to
interact with sales staff
Types of Promotion
Sales Promotions
Examples of Each Type of
Consumer Promotion
Types of Promotion
Examples of Different Types of Sales Promotions