Promotion mix Week-9 Tutorial 8/29/2015Dr. Yuvaraj 1.

Promotion mixWeek-9

Tutorial

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Message

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Timing

Communications need to be co-ordinated with the rest of the marketing activity eg

Product availability May wish to co-incide with related events eg

Sportswear during Olympics Turkeys at Christmas

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Setting the Promotion Budget

A variety of methods: Same as last year (plus or minus x%) What is affordable Percentage of sales Parity with competitors Objective and task

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Evaluation & Control

A system must be put in place to assess the success (or not) of a campaign, e.g.

Recall / brand awareness / brand attitude studies

Coupon returns/clicks Sales comparisons Complaints

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Marketing Communications Mix

The marketing communications mix comprises:

AdvertisingSales promotionPublic relations & publicityPersonal sellingDirect marketing

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Why?

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Includes:TVnewspapersmagazines & periodicals

cinema radiobillboards & posters Internetother media

eg buses, taxis, petrol pumps

Advertising

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Best use of the media

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TV large audience see product-in-use sound and vision relaxing environment cable, satellite and digital provide scope to segment

expensive consumers may find commercials irritating

PVRs can screen out

Media Choice

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What fits in?

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Cinemasimilar advantages to TVsmaller audiencesegmentation possibilities

often more welcome than TV ads (signals start of the programme)

Less regulation than TV

Media Choice

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Newspapers use of illustrations long copy large audience, regular purchasers

segmentation possibilities short life spans

Media Choice

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Magazines can integrate editorial with advertising

segmentation possibilities

long life spans leisure reading high readership compared to circulation

can involve audience ‘desert areas’ eg inside front, back pages

GlossyMags

Inside!That Ali G interviewWhy McDonald’swent bustOn the Paris catwalk

Media Choice

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Commercial radio growing in popularity sound only, but intimacy segmentation possibilities small, often passive audience

Media Choice

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Find the taste!

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Jingle stays longer….!

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Billboards and Posters high opportunity to see low cost segmentation possible short and long term possibilities

subject to weather environmental criticism vandalism, ‘adbusters’

Media Choice

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Guerilla Marketing

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Internet growth medium consumers actively seeking information

can be interactive sound, pictures and words

segmentation possibilities

on-line shopping ‘pop-ups’ irritate

Media Choice

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Media SelectionCharacteristics of target audience

Media usage behaviour, exposure

BudgetCreative constraints

Best presentation of the message eg visuals, colour

Timing Seasonality of offering; cost of media at different times

Reach and frequency How wide message needs to be spread, and how often

Media Choice

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Sales Promotion

Generally short term incentives to stimulate sales people to sell, customers to buy/use

Growing in popularity: Quick response Easier targeting Consumers increasing deal-orientation Often easier to evaluate Aims to break down brand loyalty

e.g. Encourage product trial, brand switching Encourage new product trial

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Best combo!!!

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Potential Disadvantages

Frequent offers may ‘cheapen’ the brand image

Encourages consumer promiscuity Consumers wait for the special offer and stockpile

Often used to meet ‘year end’ targets Reduces subsequent sales

Subsidises those who would have purchased anyway

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Internet Transactions

Business

Consumer

Business Consumer

B2B

e.g. auto industry

C2B

e.g. Priceline

B2C

e.g. Amazon

C2C

e.g. eBay

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Publishing One-way provision of information

Interaction, e.g On-line customer service Games, promotions

Transaction On-line purchasing

Integration Automated management of supply chain

Levels of On-Line Marketing

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Product What products, customer service to offer

Price Same, cheaper or higher than off-line Delivery charges

Promotion Internet only or include traditional Marketing communications mix decisions Affiliate marketing

Place In-house or outsource distribution logistics

The On-Line 4Ps

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B2B and B2C Electronic Commerce

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E-Commerce Business Models

Online direct marketing

Electronic tendering system

Name-your-own-price

Find-the-best-price

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E-Commerce Business Models

Affiliate marketing

Note the Sony logo at the top of this Web page www.howstuffworks.com

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E-Commerce Business Models

Viral marketing

Group purchasing

Online auctions

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E-Commerce Business Models

Product customization

Deep discounters

Membership

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E-Commerce Business Models

Bartering

online

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Benefits of E-Commerce

Benefits to organizations Makes national and international markets more

accessible Lowering costs of processing, distributing, and

retrieving information

Benefits to customers Access a vast number of products and services

around the clock (24/7/365)

Benefits to Society Ability to easily and conveniently deliver

information, services and products to people in cities, rural areas and developing countries.

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Limitations of E-Commerce

Technological Limitations Lack of universally accepted security standards Insufficient telecommunications bandwidth Expensive accessibility

Non-technological Limitations Perception that EC is unsecure Unresolved legal issues Lacks a critical mass of sellers and buyers

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consumers are multitasking

Source: PiperJaffray

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And…consumers don’t like ADS

Source: PiperJaffray

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Eight Types of Web sites for Advertising

Portals: most popular; best for reach but not targeting

Search: second largest reach; high advertising value

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Eight types of sites (continued)

Commerce: high reach; not conducive to advertising

Entertainment: large reach; strong targetability

Mall of Hawai’i

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Eight types of sites (continued)

Community: emphasize being a part of something; good for specific advertising

Communications: not good for branding; low targetability

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Eight types of sites (continued)

News/weather/sports: poor targetability

Games: good for very specific types of advertising

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What it is not: Forcing people to buy things they do not want Having ‘the gift of the gab’ Cheating, conning and lying

The interpersonal arm of the promotional mix: Two-way Communicate with end customers, channels, intermediaries

Represent the company to customers Represent customers to the company

Increasing emphasis on the concept of relationship marketing

Personal Selling

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Prospecting Finding / developing new customers

Communicating Communicate company/product information to customers

SellingServicing

e.g. Consult on problems

Customer relationship management e.g. major accounts in business-to-business

Information gathering Gather marketing intelligence; customer needs

The Role of Sales

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The Selling Process

Prospecting and qualifying Pre-approach Approach Presentation and demonstration Overcoming objections Closing Follow-up and maintenance

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Salesforce Management

Structure / deployment e.g. Geographical, product, market

Compensation Usually fixed + variable (OTE) e.g. Revenue, profit, product mix

Recruitment, selection, training Motivating & managing Evaluating performance

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Sales Force

Pros Two-way communication with customer

Build relationships

Speedy feedback

Often essential Flexible focusing/targeting

Cons Expensive Requires managerial infrastructure

Focus on volume / revenue can lead to short term, less profitable, approach

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Questions?

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