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42 Cards in this Set

  • Front
  • Back
Promotion
o Is communicating information between the seller and potential buyer or others in the channel to influence attitudes and behavior
o Telling target customers that the right PRODUCT is available at the right PLACE at the right PRICE
o Needs to reinforce differentiation and positioning of company
Basic Types of Promoting:
1. Personal Selling
2. Mass Selling
3. Sales promotion
• Typically use them in combination
Personal Selling:
o Flexibility is its strength
o Involves direct spoken communication between sellers and potential customers
o Can be expensive
• Salespeople cost
o Usually combined with sales promotion
Mass Selling:
o Involves ADVERTISING and PUBLICITY
o Communicating with large numbers of potential customers at the same time.
o Less flexible than personal selling
o Use when target market is large and scattered
• Can be less expensive in this case
Advertising
the main form of mass selling
• Any paid form of non personal presentation of ideas, goods, or services by an identified sponsor
• Traditional media: magazines, newspapers, radio, TV, signs, and direct mail
• New media: internet
• Firms spend the LEAST amount of $ on this
Publicity
is any unpaid form of non-personal presentation of ideas, goods, or services
• Free
• Avoids media costs
• _____ people are paid though
• Attracts attention to the firm and its offering without having to pay media costs
• Examples: coverage in newspaper stories, magazines, television, getting celebrities to talk about product/company, YouTube videos
Sales Promotion
refers to promotion activities—other than advertising, publicity and personal selling—that stimulate interest, trial, or purchase by final customers or others in the channel.
• May be aimed at:
• Consumers
• Intermediaries
• Firm’s own employees
• Can be implemented quickly → get results sooner
• = designed for immediate results
• Actually costs more money than advertising:
• Accumulation of coupons, sweepstakes trade shows etc.
• Less is spent on advertising than personal selling or this
• Tries to spark immediate interest
Sales Managers
o Concerned with managing personal selling
o Build good distribution channels and implement PLACE policies
o May also be in charge of advertising and sales promotion of small firm
Advertising managers
o Manage their company’s mass-selling efforts—in TV, newspapers, magazines and other media
o Choose the right media and develop the ads
o May also handle publicity or may be handled by outside agent or whoever handles:
• Public relations
Public relations
—communication with noncustomers, including labor, public interest groups, stockholders, and the government
Sales promotion managers
o Manage their company’s sales promotion effort
o If firms sales promotion spending is substantial, it should have a specific sales promotion manager
o Firms may use inside and outside specialists
integrated marketing communications
• Send a consistent and complete message with this
o –The intentional coordination of every communication from a firm to a target customer to convey a consistent and complete message
o Ex: GEICO
• Sum is greater than its parts → commercials
• Build on one another
Basic promotion objectives:
1. Informing
2. Persuading
3. Reminding
• All try to provide more information to the buyer
• More effective to set more specific promotion objectives that state exactly whom you want to inform, persuade, remind, and why.
Informing
educating
o Customers need to know about the product if they are going to buy it
o objective:
• Helps show that it meets consumer needs better than other products
o Customers want to learn about a product before they buy it
Persuading
usually becomes necessary
o Especially among competitively similar products
o objective:
• Means the firm will try to develop a favorable set of attitudes so customers will buy, and keep buying, its product
• Usually tries to demonstrate how one brand is better than the next
• Ex: Bounty paper towel demonstrations in commercials
Reminding
may be enough, sometimes
o objective:
• Suitable when a target customer already has a positive attitude about the firm’s marketing mix or a good relation with the firm
• These loyal customers are targeted by competitors
• Don’t want to lose them
How Promotion objectives relate to adoption process:
o (How buyers adopt/reject a product)
o Informing and persuading = adoption
o Reminding = confirming adoption
AIDA model (and steps)
related to adoption process
1. To get Attention
• Get consumers aware of the company’s offerings
2. To hold Interest
• Give the communication a chance to build the consumers interest in the product
3. To arouse Desire
• Affects the evaluation process, perhaps building preference
4. To obtain Action
• Includes gaining trial, which may lead to a purchase decision
communication process
—a source trying to reach a receiver with a message
o Source→Encoding→Message Channel → Decoding → Receiver → Feedback → Source etc.
• Circle all leads to FEEDBACK and starts again
• “Noise” in the middle
source
sender of a message--trying to deliver a message to receiver
receiver
a potential customer
personal selling (with communication process)
• The source—the seller—can get immediate feedback from the receiver.
Mass selling (with communication process)
usually relies on marketing research or total sales figures for feedback—which can take too long
o Use toll-free numbers and websites to try and get direct-response feedback from consumers into their mass selling efforts
Noise
—is any distraction that reduces the effectiveness of the communication process
• Ex: conversations and getting a snack during TV ads, looking at your phone during a salesperson presentation
encoding
the source deciding what it wants to say and translating it into words or symbols that will have the same meaning to the receiver
Decoding
the receiver translating the message
Message channel
—the carrier of the message
• Voice—salesperson
• Media—magazines, TV, e-mail, websites
o Some ad methods work better than others
• Ex: Dawn Dish soap→ commercial shows effectiveness more than an email about it would.
Internet
• Most common and far-reaching message channel to use for search is the
Pushing
(a product through a channel)
• Means using normal promotion effort—personal selling, advertising, and sales promotion—to help sell the whole marketing mix to possible channel members
• This approach emphasizes the importance of securing the wholehearted cooperation of channel members to promote the product in the channel and to the final user
• Usually the responsibility of the producers but:
• Wholesalers often handle some of the promotion to retailers
• Retailers often handle promotion in their local market
• Most effective when all of the individual messages are carefully integrated
Pulling
• Getting customers to ask intermediaries for the product
• Use when getting little help from intermediaries
The adoption curve
o Innovators→early adopters→ early majority→ late majority → Laggards or non adopters
• Shows when different groups accept ideas
• Emphasizes the relations among groups and shows that individuals in some groups act as leaders in accepting a new idea
• Promotion efforts usually need to change over time to adjust to differences among the adopter groups
innovators
• don’t mind taking some risks
o the first to adopt
• Eager to try a new idea and willing to take risks
• Usually young and well educated
• Likely to be mobile and have many contacts outside their local social group and community
• Tend to rely on impersonal and scientific information sources or other innovators rather than salespeople
• Business firms in this group are often specialized and willing to take the risk of doing something new
Early adopters
often opinion leaders; respected by their peers and often are opinion leaders
• Tend to be younger, more mobile, and more creative than later adopters
• Unlike innovators, they have fewer contacts outside their own social group or community
• Business firms in this category also tend to be specialized
• This one tends to have the greatest contact with salespeople
• Their acceptance is crucial! → Marketers should be very concerned with attracting them
• Spread word of mouth and advice among other customers
o OPINION LEADERS HELP SPREAD THE WORD
• Reviews/blogs
• Online blogs = word of mouse
Late majority
is cautious about new ideas.
• Often older and more set in their ways
• Less likely to follow early adopters
• Strong social pressure from their own peer group may be needed before they adopt a new product
• Business firms in this group tend to be conservative, smaller-sized firms with little specialization
• Makes little use of marketing sources of information—mass media and salespeople
• Oriented more towards other late adopters rather than outside sources they don’t trust
Laggards or non-adopters
hang onto tradition; prefer to do things the way they’ve been done in the past and are very suspicious to new ideas
• Tend to be older and less well educated
• The smallest businesses with the least specialization often fit this category
• They cling to the status quo and think it’s the safe way
• Main source of information for laggards is other laggards
• Bad news for marketers
• May not pay to bother with this group
Market introduction stage
—“this new idea is good”
o Must build primary demand
• Ex: “smart” appliances and video phone service→ primary demand is just beginning to grow for them
primary demand
—demand for the general product idea—not just for the company’s own brand
Marketing growth stage
—“our brand is the best”
o More competitors enter the market and promotion emphasis shifts from building primary demand to stimulating selective demand
• Main job is to persuade customers to buy, and keep buying, the company’s product
o Mass selling becomes more economical (more potential customers)
o Salespeople and personal selling still important too→ expand # of outlets and cementing relationships with channel members
selective demand
—demand for a company’s own brand
Market maturity stage
—“our brand is better, really”
o Mass selling and sales promotion may dominate
• More aggressive personal selling
• More advertising?
• Total $$ allocated may rise
o May have real advantage is a firm has high sales relative to competitors
o Use of reminder type advertising
o Some companies resort to price-cutting
• May only temporarily increase the number of units sold
• May reduce total revenue and money available for promotion
• Competitors will retaliate with their own short term sales promotion like price-off coupons
Sales decline stage
—“let’s tell those who still want our product”
o Cut costs to remain profitable = cut promotion spending
o Need more targeted promotion to get those who still want product
o Or spend more on promotion to try to save it
task method
—basing the budget on the job to be done
• Helps you to set priorities so that the money you spend produces specific results

most sensible approach