Promotions

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  • 1. Promotion 1
    • R. van Oorschot
    • November 2006
    • IBL- V2
  • 2. Promotion
    • Promotion is how marketers communicate with their target markets that include existing customers and prospective customers.
    • Promotion can build or destroy a brand, it can change attitudes, and it can influence the view that society as a whole has of the company and its products.
  • 3. Figure 15.4: Haagen-Dazs –Providing Information to Consumers
  • 4. Haagen-Dazs Also Provides Information to Consumers via Its WWW Site Copyright © 2001 by Harcourt, Inc. All rights reserved.
  • 5. Promotional tools
    • The company’s total marketing communications mix, also referred to as the promotional mix, consists of a blend of marketing tools that include the following five main promotional tools:
    • Advertising
    • Personal selling
    • Sales promotion
    • Public relations
    • Direct marketing
    • Also: sponsoring!
  • 6. Examples?
    • Advertising…..
    • Personal selling…..
    • Public relations…..
    • Sales promotion…..
    • Direct marketing……
    • Sponsoring…..
  • 7. Figure 17.1  The marketing communications system The marketing communications system
  • 8. Integrated marketing communications
    • The changing needs of the 21st Century consumer have delivered huge challenges to marketing communications.
    • The move is away from the mass marketing message where one message meant the same to the target market.
    • Our ‘globalised’ society requires marketers to create different communications for a very diverse consumer base.
  • 9. The changing communications environment
    • Two major forces have changed marketing communications:
        • Mass markets have fragmented and emphasis is focused on building relationships with customers in narrowly defined targeted market segments.
        • New technologies have opened opportunities for unique communication methods associated with media fragmentation from CD catalogues to interactive television.
  • 10. The need for integrated marketing communications Figure 17.2  Integrated marketing communications
  • 11. Schramm Model of communication Figure 17.3  Elements in the communication process
  • 12. Steps in developing effective communication
    • 1. Identifying the target market
      • What, how, when, where and who?
  • 13. Steps in developing effective communication
    • 2. Determining the communications objectives
      • What response is sought? !!!!!!!!
      • What stage of buyer-readiness is the target audience?
        • Awareness
        • Knowledge
        • Liking
        • Preference
        • Conviction
        • Purchase
  • 14. Objectives……
    • Provide information
    • Increase demand
    • Differentiate the product
    • Accentuate the product’s value
    • Stabilise sales
    • => “AIDA”
  • 15. Steps in developing effective communication Ideally the message should get Attention , hold Interest , arouse Desire and obtain Action . The AIDA Model.
    • 3. Designing a message
  • 16. Steps in developing effective communication
    • 3. Message content
        • Rational appeals
          • Relate to audience’s self interest.
          • Message of quality, economy, value or performance.
        • Emotional appeals
          • Negative or positive emotions, fear, guilt, love, humour, pride and joy.
        • Moral appeals
          • Directed to audience’s sense of what is right and proper.
  • 17. Steps in developing effective communication
    • 3. Message structure
        • How to ‘say’ it.
      • Message format
        • Strong format to gain attention
          • Must have practical value to target audience
          • Must be interesting
          • Must communicate new information about the product or brand
          • New products or brands
          • Must reinforce or justify the decision to buy.
          • Must make an impact
  • 18. Steps in developing effective communication
    • 4. Choosing media
      • Personal communication channels
      • Channels where people communicate directly with each other, including face to face, person to audience, telephone or mail.
        • Word of mouth influence
        • Buzz marketing
          • Cultivating opinion leaders and getting them to spread information
      • Non-personal communication channels
      • Channels that carry messages without personal contact
        • Media
        • Atmospheres – designed environments that create or reinforce the buyer’s consumption of the product.
        • Events – conferences and grand openings
      • Selecting the message source
        • Credible sources and brand ambassadors
  • 19. Steps in developing effective communication
    • 5. Collecting feedback
      • Evaluation of every campaign is essential so as to measure efficacy of the communication.
  • 20. Methods used to set the promotional budget
    • Affordable method
      • Setting budget at what the company can afford.
    • Percentage of sales method
      • Setting the budget at a determined percentage of current or forecasted sales, or as a percentage of sales price.
    • Competitive parity method
      • Matching competitor spend.
    • Objective-and-task method
      • Defining specific objectives and setting budgets for those objectives to be achieved.
  • 21. Promotion mix strategies 1
    • Push strategy
      • Sales force and trade promotion to push the product through the channels.
      • Producer promotes product to wholesalers, the wholesalers promote to the retailers and retailers promote to the consumers.
  • 22. Promotion mix strategies 2
    • Pull strategy
      • Promotion strategy that spends a lot on advertising and consumer promotion to create consumer demand.
  • 23. © PhotoDisc PULLING AND PUSHING PROMOTIONAL STRATEGIES
    • Pulling strategy: promotional effort by a seller to stimulate demand among final users, who will then exert pressure on the distribution channel to carry the good or service, pulling it though the marketing channel
    • Pushing strategy: promotional effort by a seller to members of the marketing channel intended to stimulate personal selling of the good or service, thereby pushing it through the marketing channel
  • 24. Figure 17.6  Push versus pull promotion strategy Push versus pull promotion strategy
  • 25. Factors in designing promotion mix strategies
    • Type of product/market
      • E.g. non-durable goods<-> durable goods
    • Buyer readiness stage
      • is your target group: innovator, early majority, laggard etc.
    • Product life-cycle stage
      • Introduction – growth – maturity - decline
  • 26. Factors in designing promotion mix strategies Figure 17.7  Relative importance of promotion tools in consumer versus industrial markets
  • 27.