B2B BA 303 C 16- 18 Session Lindell Phillip Chew University of Missouri- St. Louis, College of Business Administration
Mar 29, 2015
Promotional PlanningB2B BA 303 C 16-18
Session
Lindell Phillip ChewUniversity of Missouri- St. Louis, College of Business Administration
DEFINITION Promotion is a persuasive communications mix. It is
a deliberate attempt to communicate information which
presents a company and its products to prospective customers in a
manner persuasive enough to induce the kind of acceptance, reaction, or
response desired. THIS IS A CONTROLLED AND
INTEGRATED PROGRAM OFCOMMUNICATION METHODS AND MATERIALS.
THE PROMOTIONAL (COMMUNICATIONS) PLANNING PROCESS [email protected]
FUNCTIONS The basic purpose of promotion is to
present a business and its products and services to prospective customers, to communicate the
need/want satisfying attributes of those products/services, to facilitate sales, and to contribute positively to the long ran performance of the business.
HOW TO SELL PRESENT CUSTOMERS ADD1T1ONAL UNITS.
GET NON CUSTOMERS TO BECOME CUSTOMERS.
FIRST REVIEW YOUR MARKETING PLAN & ITS
OBJECTIVE AND THEN PURSUE THE STEPS of the
PROMOTIONAL (COMMUNICATIONS) PLANNING PROCESS
Our corporate objective is to increase earnings per share
from $6.71 per share to $7.71 per share
OUR MARKETING OBJECTIVE IS TO INCREASE MARKET SHARE FROM 23% TO 25%, ALSO IN ONE YEAR
STEPS SITUATIONAL ANALYSIS
ESTABLISHING PROM0TIONAL OBJECTIVES JUSTIFICATONS
DETERMINING BUDGET
PLANNING, MANAGING, BLENDING THECOMMUNICATIONS
EVALUATION MEASURING EFFECTIVENESS
FOLLOW ON AND FUTURE PLANNING
STEPS SITUATIONAL ANALYSISMARKET TARGETS DEFINITION
Current Market
Additional or Potential Customer Franchises
COMPETITION ENVIRONMENTAL FACTORS
Internal (policies, profit inhibitors, financial and personnel resources)
External (legal/ethical, business/economic conditions,cultural/social)
STEPS SITUATIONAL ANALYSISCRITICAL QUESTIONS
Are you familiar with the strengths & weaknesses of various promotional
efforts?
Is outside technical/financial assistance available to enhance
promotional efforts?
TYPES OF PROMOTION
(EXPLICIT TOOLS)
TYPES OF PROMOTION (EXPLICIT TOOLS)
ADVERTISINGPERSONAL SELLINGSALES PROMOTIONPUBLIC RELATIONS / PUBLICITY
AdvertisingAdvertising
Personal SellingPersonal Selling
Any Paid Form of Nonpersonal Presentation by an Identified Sponsor.
Any Paid Form of Nonpersonal Presentation by an Identified Sponsor.
Sales Promotion Short-term Incentives to Encourage Trial or Purchase.
Public Relations
Direct MarketingDirect Communications With Individuals to Obtain an Immediate Response.
Protect and/or Promote Company’s Image/products.
Personal Presentations.
The Marketing Communications Mix
The Marketing Communications Mix
TYPES OF PROMOTION (EXPLICIT TOOLS)
PLEASE NOTE THAT RESELLER SUPPORT OBJECTIVES AND PROGRAMS MAY ALSO BE ADDED
PURPOSE TO……..
IMPROVESUPPLEMENTCONTROL PERFORMANCE
TYPES OF PROMOTION (EXPLICIT TOOLS)
ADVERTISING paid, nonpersonal communication regarding goods, services, organizations, people, places, and ideas that is transmitted through various media by business firms, government and other nonprofit organizations, and individuals who are identified in the advertising message as the sponsor.
TYPES OF PROMOTION (EXPLICIT TOOLS)
PERSONAL SELLING
involves oral communication with one or more prospective buyers by paid representatives for the purpose of making sales.
TYPES OF PROMOTION (EXPLICIT TOOLS)
SALES PROMOTIONInvolves…paid….marketing
communication activities(other than advertising, publicity, or
personal selling) that are intended to stimulate consumer purchases and dealer effectiveness.
TYPES OF PROMOTION (EXPLICIT TOOLS)
PUBLIC RELATIONS / PUBLICITY . Publicity is nonpersonal public relations that is
transmitted Public relations includes any communication to foster a favorable image for goods, services, organizations, people, places, and ideas. It may be personal or nonpersonal, paid or nonpaid, and sponsor controlled or not controlled through media but not paid for by an identified sponsor.
TYPES OF PROMOTION (EXPLICIT TOOLS)
NOW LET’S PURSUE THE OTHER STEPS
Elements in the Communication Process
SENDER(source)SENDER(source) EncodingEncoding DecodingDecoding RECEIVER(s) RECEIVER(s)Message
Media
FeedbackFeedbackResponseResponse
NoiseNoise
Decide on Explicit Communications Mix Decide on Explicit Communications Mix
AdvertisingPublic, Pervasive, Expressive, Impersonal
AdvertisingPublic, Pervasive, Expressive, Impersonal
Sales PromotionCommunication, Incentive, Invitation
Sales PromotionCommunication, Incentive, Invitation
Public Relations & PublicityCredibility, Surprise, DramatizationPublic Relations & Publicity
Credibility, Surprise, Dramatization
Personal SellingPersonal Confrontation, Cultivation, Response
Personal SellingPersonal Confrontation, Cultivation, Response
Direct MarketingNonpublic, Customized, Up-to-Date, Interactive
Direct MarketingNonpublic, Customized, Up-to-Date, Interactive
Product Life-Cycle Stage
Type of Product/ Market
Push vs. Pull Strategy
Factors in Developing Promotion Mix Strategies
Factors in Developing Promotion Mix Strategies
Buyer/ Readiness
Stage
Push Versus Pull Strategy
Producer
Producer
Interme-diaries
Marketingactivities
End users
Marketingactivities
Demand Interme-diaries
Demand
Push Strategy
Pull Strategy
End users
Marketing activities
Demand
PROMOTION PLANNING STEP OBJECTIVE SETTING
The objectives of promotion may be categorized as stimulating demand and enhancing company image.
The sequential short-term, intermediate, and long-term promotion goals for a firm to pursue.
Primary demand is an objective when seeking consumer interest for a product category.
Selective demand is a later objective that seeks consumer interest for a particular brand of a product.
PROMOTION PLANNING STEP BUDGETING
USE OBJECTIVE & TASK Under the objective-and-task method, a firm sets promotion goals,
determines the activities needed to satisfy them, and then establishes the proper budget. Most large companies use some form of objective-and-task technique.
During promotional budgeting, a firm should keep the concept of the marginal return in mind. This is the amount of sales each increment of promotion spending will generate. It is usually highest for
new products.
Step 5. Establish the BudgetStep 5. Establish the Budget
CompetitiveParity
Objective& Task
Affordable% OfSales
PROMOTION PLANNING STEP PLANNING, MANAGING,
BLENDING THECOMMUNICATIONS
• THE PROMOTION MIX
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA
Media are selected on the basis of these criteria: Advertising media costs. Reach Frequency. Gross Rating Points Waste Message permanence. Persuasive impact Clutter Lead time
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Advertising media costs
Outlays for media time and space. Total costs are computed
first. Per-reader or viewer costs are
computed second.
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Reach—the number of viewers,
readers, or listeners in an audience. . For TV and radio, reach is the total
number of people who are exposed to an ad. . For print media, reach has two
components: circulation (the number of copies sold or distributed) and passalong rate (the number of times each copy is read by another reader).
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Waste—the part of an
audience not in a firm’s target market.
Narrowcasting, which presents messages to limited and well-defined audiences, can reduce audience waste.
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Frequency—how often a medium can
be used.
Repetition, repetition, repetition
James Smith 1890’s
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA
GROSS RATING POINTS (GRP’S)
GRP’S = REACH X FREQUENCY
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Message permanence—the number of exposures one
ad generates and how long it remains available to the audience.
Persuasive impact—the ability of a medium to stimulate consumers.
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA Clutter—the number of ads found in a single
program, issue, etc. of a medium. Lead time—the period required by a medium for
placing an ad.
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA In recent years, there have been many
media innovations, such as online computer services, regional editions, special one-sponsor issues, specialized Yellow Pages, TV ads in supermarkets, infomercials, etc.
PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
SELECTING MEDIA
As of 2004, the typical U.S. consumer will have access to 44 local radio stations, 200 TV channels, 2,400 Internet radio stations, 18,000 magazine titles, and 20 million Internet sites.
PROMOTION PLANNING STEP THE PROMOTION MIX
The promotion mix is a firm’s overall and specific communication program, including its use of advertising, public relations (publicity), personal selling, and/or sales promotion.
With an integrated marketing communications program, each type of promotion has a distinct function and complements the other types.
PROMOTION PLANNING STEP THE PROMOTION MIX
The promotion mix is a firm’s overall and specific communication program,
A promotion mix varies by type of company, the product life cycle, access to media, and channel member support.
PROMOTION PLANNING STEP THE PROMOTION MIX
ADVERTISING PERSONAL SELLING SALES PROMOTION PUBLIC RELATIONS /
PUBLICITY RESELLER SUPPORT
PROGRAMS
CONSIDERING COOPERATIVE EFFORTS
With cooperative advertising, two or more firms share some advertising costs. 1. A vertical cooperative ad is
an advertising agreement between firms at different levels of the distribution channel.
2. A horizontal cooperative ad is an advertising agreement among independent firms at the same stage.
3. Good agreements clearly state each party’s costs, functions, and responsibilities; the ads covered; and the basis for termination.We will apply SCHNUCKS to both.
PROMOTION PLANNING STEP BUDGET
A budget delineates expenditures by explicit tool and medium
Considerations in budgeting may include alternative media costs, the number of placements needed, cost increases of media, the status of the economy, channel member tasks, production costs, and budget allocation for domestic versus international ads.
PROMOTION PLANNING STEPEVALUATION
MEASURING EFFECTIVENESS
EVALUATING… SUCCESS OR FAILURE COMMUNICATION
(PROMOTIONAL) success or failure depends on how well the company achieves promotion objectives, which may range from creating awareness to expanding sales. Example: R x F= GRP’s
PROMOTION PLANNING STEP
FOLLOW ON & FUTURE PLANNING
FEEDBACK & ADJUST
Summarize
Promotional PlanningSession
Summarize STEPS
SITUATIONAL ANALYSIS
ESTABLISHING PROM0TIONAL OBJECTIVES
JUSTIFICATONS
Summarize STEPS
DETERMINING BUDGET
PLANNING, MANAGING, BLENDING THE
COMMUNICATIONS
Summarize STEPS
EVALUATION MEASURING EFFECTIVENESS
FOLLOW ON AND FUTURE PLANNING
Promotional PlanningSession
Lindell Phillip ChewUniversity of Missouri- St. Louis, College of Business Administration