Transcript Welcome to Marketing 2!

Chapter 12
Instructor Shan A. Garib, Fall 2012
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Promotion: communication by marketers that
informs, persuades, and reminds potential
buyers of a product for the purpose of
influencing their opinion or getting a
response
Promotional Strategy is a plan for the optimal
use of the elements of promotion: advertising,
direct response, public relations, personal
selling, event marketing (sales promotion),
alternative marketing communication
approaches (on-line marketing)
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The tools of the promotion mix can be used
to:
◦ Inform prospective buyers about product benefits
◦ Persuade prospective buyers to try product
◦ Remind buyers of benefits they enjoyed by using
the product
Outbound marketing: widely broadcasting
messages using ads, direct mail, e-mail
marketing, telemarketing, personal selling
Promotional Strategy is a plan for the optimal
use of the elements of promotion: advertising,
direct marketing, public relations, personal
selling, sales promotion, on-line marketing
-main goal to convince target customers that
the products offered provide a competitive
advantage over the competition
-unique features that make make
buyer think product is superior eg. high QLTY
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Advertising
Any paid form of non-personal, one-way
communication about an organization,
product or service paid for by marketer
eg. TV commercial
◦ Paid: must cost money
◦ Non-personal: mass media without feedback
◦ Identified sponsor: can tell who ad is for
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Advantages:
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Attention-getting, large number of people
Communicates specific product benefits
Control what is said
Decide who sees message
 Example: use a channel that fits your target market
◦ Same message to all receivers
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Disadvantages
◦ Cost per contact low but overall cost high
◦ Lack of direct feedback – difficult to know if
message received
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PR: evaluates public attitudes, identifies areas
within the organization the public may be
interested in and excecutes a programme of
action to earn public understanding and
acceptance
Wants to influence the feelings, opinions or
beliefs held by customers, suppliers and
employees
Events sponsorship, image management and
publicity are all aspects of public relations
Generates Publicity
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Nonpaid presentation in news or informational medium
Advantages
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Adds credibility
Disadvantages
 Uncertain timing
 No guarantee
 Little control
◦ Short-term offer to make people want to buy a
product
◦ Example: Coupon, rebate, samples
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Advantages
◦ Stimulates sales
◦ Increase participation of non-loyal customers
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Disadvantages
◦ Benefits are temporary
◦ Advertising support necessary for new customers
◦ Continuous sales promotions do not work –
customer gets in habit of waiting for sales
Conversation between a buyer to a seller,
often face-to-face, to influence a buyer’s
decision
-paid selling
-maximize revenue and profits
-business to business, business to
consumer build LTR ie. relationship selling
eg.University recruiters
Retail salespeople
Army recruiters
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Advantages
 Control to whom presentation is made
 Seller can see and hear buyer’s reaction
▪ If not positive, message can be adjusted
 Other channels allow for some control, but there
will be wasted coverage
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Disadvantages
 Different sales people change the message
 High cost – most expensive
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Direct communication with carefully selected
customers
Advantages
 Customized to meet specific needs
 Messages adapted to facilitate one-on-one
relationships
 Results can be measured and altered
 Internet easy way to directly communicate
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Disadvantages
 Requires accurate, up-to-date information on
target market
 Maintain customer information is expensive
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In the past, advertising, personal selling,
sales promotion, public relations and direct
marketing have been done separately
Now, it is important to make sure they all
work together and maximize promotional
budget and customer impact
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Communication
◦ Exchange and share meanings to others through
common set of symbols
◦ Divided into two categories:
1. Interpersonal Communication – direct, face to face
-can see reaction and respond immediately
eg. salesman
2. Mass Communication – communicating a concept or
message to large audience
eg. TV or Magazine
-marketer does not know consumer
-can’t respond to reactions
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Communication requires six elements:
◦ A source
 company or person with information to convey
◦ A message
 information sent by a source to receiver
◦ A channel of communication
 Way to convey message
◦ A receiver
 Consumers who read, hear, or see the message sent
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Encoding: the process of having the sender
transform an abstract idea into a set of
symbols
Decoding: the process of having the receiver
take a set of symbols and transform them
into an abstract idea
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Source: BMW
Encoded Message: the advertisement
Channel: magazine
Decoded message: Any weather, any corner,
any pace, any passion
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Source might not correctly change the
message into symbols
An encoded message might be sent through
the wrong channel and not reach receiver
The receiver may not properly transform
symbols into idea
Effective communication is difficult!
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For the message to be communicated
effectively, the sender and receiver should
have a mutually shared field of experience
Field of experience: similar understanding
and knowledge
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Response:
◦ Impact the message had on receiver’s knowledge
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Feedback:
◦ The sender’s interpretation of the response
◦ Proves whether the message was decoded and
understood as intended
◦ Feedback in this class is used to make sure we all
understand each other and that the class is going
well
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Outside factors that can work against
effective communication by distorting a
message or feedback
Example:
◦ A printing mistake
◦ Words or pictures that don’t communicate clearly
◦ Salesperson’s accent, use of terms or slang isn’t
understood
Promotion seeks to modify behaviour and
thoughts
-also tries to reinforce existing behaviour
-performs three tasks:
1) inform
2) persuade
3) remind
Promotion seeks to modify behaviour and
thoughts
1) inform – convert an exisiting need into a want
or to stimulate interest in a new product
-usally during early stages of life cycle
-complex technical products use
promotion even after purchase
-higher risk purchase
Promotion seeks to modify behaviour and
thoughts
2) Persudae – designed to stimulate a purchase or
actions
-usally during growth stage of life cycle
-consumers have general awareness of
product category and how it fulfills need
-emphasizes competitive advantage
-appeal to emotional need
-sometimes in mature stage it is used to
elicit brand switching
Promotion seeks to modify behaviour and
thoughts
3) Reminding – designed to keep product in
public’s mind
-usally during maturity stage of life cycle
-consumers already know product is good
Promotion al goal to have someone buy
product
Classic model for achieving these goals is the
AIDA concept
-consumers respond to marketing
messages in a cognative, affective, and conative
sequence
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The following are the four steps in the
purchase decision process:
Attention: gain attn of target market
Interest: create interest in the product eg
arrange demos of iPad
Desire: create brand preference by
highlighting unique features that full-fill
needs
Action: continue to advertise to effectively
communicate features and benefits
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A Changing Consumer
◦ Time spent with the media
 Most time on the internet, TV second
 18-24 spend most time on net
◦ Use of Technology
 Affordable leads to ease of use, portable
communications
Social Media: form of on-line media allows
create network of friends to exchange msgs,
pics, vids, self-expression
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A Changing Consumer
◦ An evolving Media
 Offline media now creating websites, APP, TWITTER eg
mags, TV shows, news (RT)
◦ A Changing Advertiser
 Spending on on-line ads is second to TV
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Five areas that work together to form the
industry:
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The media
Agencies
Research companies
Associations
Regulatory bodies
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Five areas that work together to form the
industry:
◦ The media
 TV, Internet, Mags, paper, radio, out-of-home, mobile
Out-of-Home Advertising: “Outdoor” reaches
consumers outside the home, in transit, in
business locations eg billboards, posters,
electronic signs
Mobile Marketing: using mobile devices to
communicate with consumers eg txt msgs
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New Media Terms:
◦ Paid media: media time purchased eg TV
commercials
◦ Owned media: TV channels that a company controls
eg website CBC used to communicate
◦ Earned Media: free publicity through unpaid media
mentions and word-of-mouth
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Five areas that work together to form the
industry:
◦ Marketing Communication Agencies
 Provide marketers with expertise on how best to
communicate messages
◦ Research Companies
 Need metrics on readership numbers, consumer trends
 Eg Nielson
◦ Associations
 Provide research data, and host informative events and
educational workshops for the industry
 eg. Marketing week hosted by the CDN marketing
association, and Marketing magazine event focussed
on media innovation
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Five areas that work together to form the
industry:
◦ Regulations
 Limitations and restrictions placed on marketers
 Four main groups:
Advertising Standards Canada (ASC)
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Self-regulatory, non-government
Sets and regulates advertising, advises
Uses consumer complaint process to review ads
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Five areas that work together to form the
industry:
The Canadian Radio-Television and
Telecommunications Commission (CRTC)
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Regulates the broadcast and television
industry including licencing of stations
The Canadian Marketing Association
◦ Uses a code of ethics and standards of practice to
guide the marketing industry on telemarketing,
email marketing, cell marketing, contests,
fundraising
Inbound marketing: consumers find products
through online techniques eg search engine
optimization, pay-per-click ads, and social
media
-it is the result of paid, unearned and
owned media
-smaller businesses use more
Integrated Marketing Communications (IMC):
designing a marketing programme that
coordinates all promotional activities
-each element has a distinct role in overall
campaign eg use TV ads, mag ads, personal
selling, events, on-line, mailing
Advertising – see previous slides for definition
 Eg.
◦ TV
◦ Internet
 Display ads: use of online ads with graphics places on
website they can be static or dynamic
 Display ads are also called banner ads in form of boxes,
leaderboards – stretch across top of webpage,
skyscrapers – tall, slim vertical on side of page
advergamming – banner ads embedded within online
games they appear like posters or billboards in the game
Display ads can also take over home pages this is called
home page take overs
Advertising – see previous slides for definition
 Eg.
◦ TV
◦ Internet
 On-line Video advertising – use of video ads on the
internet eg. a pre-roll TV tape that run before watching a
TV show, movie, news clip
 Pay-per-click ads (PPC) - mini text ads that are served
during keyword searches
 Search engine gets paid when the ad is clicked
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Newspapers
Mags
Radio
Outdoor/Transit
PR – see previous slides for definition
 Eg.
 Press releases – an announcement sent out to media
 Press Conferences – when media are invited to
informal meeting with company
 Special Events – sponsorships
 Company Reports – formal company info published to
spread positive msgs
 Social Media – SM release: use of on-line media to
communicate with consumers
Sales Promotion – see previous slides for
definition
 User Generated Content (UGC) – content created by
participants ie. Contest Interaction by txting
 Augmented Reality (AR) – real world images interact
with computer generated information to provide
additional info to views eg QR codes to access online
content
Direct Response – see previous slides for
definition
 Lead generation – request for additional info by
consumer
 Traffic generation – visit to a website, or location
Event Marketing and Sponsorship
 Event Marketing - Creation or involvement
of a brand in an experience or occasion that
heightens it’s awareness, creates positive
association and generates desired
responses
Event Marketing and Sponsorship
 Sponsorship – a company paying a fee to be
included in an event eg marathon
Personal Selling -see previous slides for
definition
Alternative Marketing Communication
Approaches
 Word-of-mouth
 Product placement
 Branded entertainment – when company
pays to have whole episode focussed on its
business eg The Apprentice
Unique On-Line Tools
 Search Engine Marketing (SEM) – includes
search engine optimization (SEO) and payper-click ads
Search engine optimization (SEO): looks at web
design, codes, written content, links and
updates to ensure that websites are highly
rated
Microsites: short term promos
Corporate Websites: access to info about
company
Unique On-Line Tools
Social Network Marketing: use of on-line
communities to interact with consumers by
sharing ideas, events and offers.
Affiliate Marketing: promotion of business
through online affiliates who get commissions
for business generated
Designing Marketing and Comm programmes
 Push Strategy: focus communication efforts
on the distribution channel eg retailers,
distributors, wholesalers
 Pull Strategy: focus efforts on end user eg
consumer to build awareness, trial and
demand
The Customer Advocacy Funnel
The Customer Advocacy Funnel: encompasses
the latest in marketing approaches where, over
time, the positive connections that customers
make with brands encourage them to become
brand advocates
Steps:
Awareness – using web
Interest – use experts to demo
Engagement – social media added to mix to
generate additional interest
The Customer Advocacy Funnel
Steps:
Trial – contest, samples, free downloads and
trials
Purchase – display ads can prompt purchases
Retargeted ads – display ads redelivered to
computer’s IP address after a consumer clicked
on an ad
Loyalty – through CRM programmes that
reward continued purchases
Advocacy – on-going comm through email,
blogs, social networks used to provide
consumers with info that can be passed on
Steps in the Marketing Communications
Process
1. Specify Integrated Marketing
Communication (IMC) objectives –
formalizes purpose of the promotional
programme eg build brand awareness,
creating customer engagement, increase
brand loyalty
2. ID the target audience – ID demo, geo,
psyco, behavioural data
Consumer Touch Points – points of interaction
that can be used to connect with customers
including personal time at home, shopping
time, workplace, travel time or face-to-face
Steps in the Marketing Communications
Process
3. Set the promotional Budget – allocated initial
amount and then change
4. Design the Promotional Programme – key
component is messaging
- needs to be visible and resonate with
audience
Promotional Mix - promotional tools used to
comm with the target market using both online and offline modes
Inform Persuade Remind Min Spending
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Steps in the Marketing Communications
Process
5. Schedule and Run the IMC elements – make
sure individual aspects work together
6. Evaluate the Programme and Recommend
Changes – Four Levels
1. Messaging is evaluated before
programme is developed
2. once programme live need research to
measure awareness and elements like
“likeability, messaging comprehension,
attitude changes towards the brands”
Steps in the Marketing Communications
Process
6. Evaluate the Programme and Recommend
Changes – Four Levels
3. Once programme over each element
evaluated against expectations
4. Once programme over promotional
programme will be measured against
objectives