Transcript Advertising

chapter 14
Promotion and
Distribution
Better Business
3rd Edition
Solomon (Contributing Editor) ·
Poatsy · Martin
© 2014 Pearson Education, Inc.
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What Is Promotion?
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Promotion
– Communication about an organization and its products that
is intended to inform, persuade, or remind target market
members
– There are several ways in companies can communicate to
target market members
– Promotion is NOT just advertising!!!
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The Promotion Mix
– The particular combination of promotion methods a
firm uses to reach a target market
1) Advertising
3) Public Relations
4) Personal Selling
5) Sales Promotion
Integrated Marketing Communications (IMC)
– Coordination of all promotion efforts for maximum
informational and persuasive impact on customers,
and to communicate a unified impression about a
product
– Goal = Consistent Messages to Customers
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The Promotional Mix
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Integrated Marketing Communication
A strategy to deliver a clear, consistent, and
unified message about the company and its
products to customers at all contact points.
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The Role of Advertising
Advertising is paid,
nonpersonal
communication,
designed to influence a
target audience.
Television remains the
#1 advertising media.
But it is fragmenting….
Businesses use Advertising
to:
– Build brand awareness
and brand association
– Emphasize product
differentiation
– Build brand loyalty and
brand equity
– Inform and educate
consumers
– Increase sales and
lower prices
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Some Common (Not All) Types of
Advertising
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Institutional (or corporate) advertising
• Advertising that focuses on creating a positive image toward
an organization or an entire industry as opposed to a specific
product.
• Ex. “Beef, It’s What’s for Dinner,” sponsored by the
Cattlemen’s Beef Board and National Cattlemen’s Beef
Association or “Got Milk” by California Milk Processing Board
Produce (brand) advertising
• Used to promote a specific product’s uses, features, and
benefits. This is the type of advertising we most often see.
Comparative advertising
• Advertising that compares a brand’s characteristics with
those of other established brands. You have probably seen
toothpaste, pain relievers, and detergents compared.
Retail (or local) advertising
• Advertising that focuses on attracting customers to a fixed
location like a department store or a grocery store.
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Types of Advertising Appeals
The 5 Appeals of Product Advertisements
1) Humor
2) Informational
3) Sex
4) Emotional (ex. Fear/Heartfelt)
5) Celebrity
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Types of Advertising Media
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Advertising Trends
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Online advertising
Social media
Mobile marketing
Product placement
Infomercials
Global advertising
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Public Relations
• Public Relations is the ongoing effort to create “nonsales”, positive relationships with all of a firm’s
different stakeholders.
• The management function that establishes and
maintains mutually beneficial relationships
between an organization and its stakeholders.
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Public Relations Tools
• Controlled messages
– Corporate, advocacy, and public service
advertising and corporate reports publishing
• Semicontrolled messages
– Messages are placed on Web sites, in chat
rooms, and on blogs
– Sponsorships
• Uncontrolled messages
- Publicity
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Publicity
Information about an individual, organization, or
product transmitted through mass media at no
charge.
Advantages
– Free
– Often more believable as it is presented as a
news story
Disadvantages
– Actual message and timing controlled by the
media, not the seller
– Bad news gets shared too
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Personal Selling
• Personal selling is paid, personal communication
between buyer and seller.
• Direct communication between a firm’s sales force and
potential buyers to make a sale and to build good
customer relationships.
– Most expensive part of the promotional mix as a salesperson
deals with one buyer at a time
– Preferred with high-value, custom-made, or technically
complex products
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Types of Salespeople
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Order getters
Order takers
Order influencers
Support personnel
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The Personal Selling Process
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Sales Promotion
Consumer Sales Promotion
Stimulate immediate sales
• Premiums
• Contests/Games/Promo
Items
• Samples
• Coupons
• Rebates
• Point of Purchase
Displays
Trade Sales Promotion
Stimulate wholesalers
and retailers to push
specific products
• Special Deals
• Allowances
• Trade Shows
• Contests
• Sweepstakes
• Special Events
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Sales Promotion: Tools
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Trade Sales Promotions
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Advantages & Disadvantages of
Promotional Tools
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What is the Distribution (Place)
Element of the Marketing Mix?
The process that makes products available
to consumers when and where consumers
want them.
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Distribution: Getting the
Product to the Consumer
Producer
Wholesaler
Consumer
Channel of Distribution –
the path that a product takes from
the producer to the consumer
Distribution Strategy: getting the right product to the right
person at the right place, at the right time
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Elements of a Distribution
Strategy
• Physical Distribution – the actual
movement of products to consumers
(i.e. by what means do products get
to marketing channels/consumers,
like trucking, railroad, air, etc.)
• Direct Channel – producers who sell
products directly to consumers (ex.
Producer->Consumer)
Question: Are Sam’s Club
and Costco Wholesale
acting as a retailer
or wholesaler?
• Channel Intermediaries (aka
Middlemen, Marketing Channels) –
help products move from factories to
consumers efficiently (ex. Retailers
and Wholesalers)
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Types of Distribution Channels
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Marketing Intermediaries
• Merchant Wholesalers
(ex. PYA/Monarch,
IFH)
– Full-service
merchant
wholesalers
– Limited-service
merchant
wholesalers
– Drop Shippers
– Cash and Carry
Wholesalers
– Truck (rack) Jobbers
• Agents/Brokers (ex.
The Match Maker, Inc.
– my company!)
– Connect Buyers and
Sellers
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Retailers and Wholesalers
Retailers – the
distributors that sell
products directly to
the ultimate users
Wholesalers –
distributors that buy
products from producers
and sell them to other
businesses or
Non-final users (i.e. other retailers
or wholesalers)
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The Role of Marketing
Intermediaries
 Justifications for marketing
intermediaries
• Intermediaries perform essential marketing
services (promotion of products, help sell product)
• Intermediaries provide important market
information to producers (what’s selling, who’s
buying, customer feedback)
• Intermediaries help store products (producers
won’t be burdened with storage costs)
• Intermediaries provide customers with
convenience and choice selection
• Intermediaries accept risk for customer nonpayment or non-sold products
• Intermediaries create efficiency and utility
• Intermediaries help REDUCE COSTS and provide
VALUE! How?
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Why Are Intermediaries Needed?
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Types of Retailers
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Non-Store Retailers
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Electronic shopping
Telemarketers
Direct sellers
Direct marketers
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Retail Strategies: Market Coverage
Intensity
 Intensity of market coverage
• Intensive distribution
– The use of all available outlets for a
product to saturate the market
– Convenience Products
• Selective distribution
– The use of only a portion of the
available outlets for a product in each
geographic area
– Shopping Products
• Exclusive distribution
– The use of only a single retail outlet
for a product in a larger geographic
area
– Specialty Products
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Distribution Logistics
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Benefits & Costs of Transportation
Modes
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Warehousing & Inventory Control
Storage warehouses store goods from moderate
to long periods of time
Distribution warehouses (or distribution
centers) are designed to gather and move goods
quickly to consumers
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