Dr. Stephanie J. Morgan Marketing Principles and Practice Marketing Mix 3 (Promotion) Download at www.bizface.co.uk

Lecture Objectives Assess the suitability of a promotional marketing mix for an organization. Develop an advertising strategy. Discuss issues involved in personal selling and sales management.

Assess the suitability of a promotional marketing mix for an organization.

Develop an advertising strategy.

Discuss issues involved in personal selling and sales management.

Key Promotional Mix Tools Advertising Personal Selling Direct Marketing Sales Promotion Internet & Online Marketing Publicity D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill 2

An organization and its publics 11 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Television Press Radio Media Customers Distribution Suppliers Commercial Local communities Pressure groups Opinion leaders General public Public Parliament Civil service Local authorities Government Shareholders Stockbrokers Fund managers Banks Finance Staff Trade union representatives Employees Organization

Television

Press

Radio

Customers

Distribution

Suppliers

Local communities

Pressure groups

Opinion leaders

General public

Parliament

Civil service

Local authorities

Shareholders

Stockbrokers

Fund managers

Banks

Staff

Trade union representatives

The communication process 4 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Noise Noise Receiver Encoded message Decoded message Transmission Source Feedback

Promotions for non-profit Organizations Promoting the cause, generating donations (including either paid or unpaid ‘sales’ staff). Promoting good health, avoiding accidents, flu vaccinations. Reminding people to complete forms, e.g. tax, social funds etc., Asking people to help police, prosecute offenders, inform on social security scams. Issues around funding, amount available, peoples perception of ‘good’ spend etc.

Promoting the cause, generating donations (including either paid or unpaid ‘sales’ staff).

Promoting good health, avoiding accidents, flu vaccinations.

Reminding people to complete forms, e.g. tax, social funds etc.,

Asking people to help police, prosecute offenders, inform on social security scams.

Issues around funding, amount available, peoples perception of ‘good’ spend etc.

Promotions in Industrial Markets (Business to Business) Advertising in specialist journals, magazines. Sales staff aimed at organizational DMU’s Trade Exhibitions Less likely to use television to aim for the business but may advertise to consumers to help with ‘pull-through’ – or help any distributors with advertising costs.

Advertising in specialist journals, magazines.

Sales staff aimed at organizational DMU’s

Trade Exhibitions

Less likely to use television to aim for the business but may advertise to consumers to help with ‘pull-through’ – or help any distributors with advertising costs.

Strong and weak theories of how advertising works 5 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Strong (AIDA ) Weak (ATR) Weaknesses? Do all customers desire? Where do they apply – low/high involvement? Desire (or conviction) Interest Awareness Action Reinforcement Trial Awareness

Developing advertising strategy 6 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Identify and understand target audience Marketing strategy Define advertising objectives Set the advertising budget Execute campaign Evaluate advertising effectiveness Message decisions Media decisions

Setting the Advertising Budget 11 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Percentage of Sales Affordability Matching Competition Objective & Task Stimulate Sales

Message decisions Customer convergence consumers across different countries share common experiences, needs and motivations Advertising platform foundation of the advertising message, the basic selling proposition it should be: important to the target audience communicate competitive advantage Advertising message translates the platform into words, symbols and illustrations which are attractive and meaningful to the target audience 12 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill

Customer convergence

consumers across different countries share common experiences, needs and motivations

Advertising platform

foundation of the advertising message, the basic selling proposition it should be:

important to the target audience

communicate competitive advantage

Advertising message

translates the platform into words, symbols and illustrations which are

attractive and meaningful to the target audience

How brand personality is used by consumers 14 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Self-expression – acts as a bridge Reassurance Communicates the brand’s functional characteristics Trustworthiness Brand personality

16 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Media Class Options Press National Regional Magazines Fashion Technical Trade Television Radio Cinema Posters Internet

Press

National

Regional

Magazines

Fashion

Technical

Trade

Defining Opportunities to See (OTS) ? Television Presence in the room with the set switched on at turn of clock minute to relevant channel, providing presence in the room with the set on is for at least 15 consecutive seconds Press and Magazines Read or looked at any issue (for at least two minutes) within the publication period (e.g. for weeklies within the last 7 days) Posters Traffic past site including pedestrians Cinema Actual cinema admissions 17 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill

Television

Presence in the room with the set switched on at turn of clock minute to relevant channel, providing presence in the room with the set on is for at least 15 consecutive seconds

Press and Magazines

Read or looked at any issue (for at least two minutes) within the publication period (e.g. for weeklies within the last 7 days)

Posters

Traffic past site including pedestrians

Cinema

Actual cinema admissions

Forces influencing selling and sales management practices Behavioural forces Rising customer expectations Customer avoidance of buyer-seller negotiations Expanding power of major buyers Globalisation of markets Fragmentation of markets Managerial forces Direct marketing Direct mail Telemarketing Computer salespeople Blending of sales and marketing Intranets Qualifications for salespeople and sales managers Managerial forces Direct marketing Direct mail Telemarketing Computer salespeople Blending of sales and marketing Intranets Qualifications for salespeople and sales managers Behavioural forces Rising customer expectations Customer avoidance of buyer-seller negotiations Expanding power of major buyers Globalisation of markets Fragmentation of markets 2 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Technical forces Sales force automation Laptop computers and software Electronic data interchange Desktop videoconferencing Electronic sales channels Internet Television home shopping Technical forces Sales force automation Laptop computers and software Electronic data interchange Desktop videoconferencing Electronic sales channels Internet Television home shopping

Behavioural forces

Rising customer expectations

Customer avoidance of buyer-seller

negotiations

Expanding power of major buyers

Globalisation of markets

Fragmentation of markets

Managerial forces

Direct marketing

Direct mail

Telemarketing

Computer salespeople

Blending of sales and marketing

Intranets

Qualifications for salespeople and

sales managers

Managerial forces

Direct marketing

Direct mail

Telemarketing

Computer salespeople

Blending of sales and marketing

Intranets

Qualifications for salespeople and

sales managers

Behavioural forces

Rising customer expectations

Customer avoidance of buyer-seller

negotiations

Expanding power of major buyers

Globalisation of markets

Fragmentation of markets

Technical forces

Sales force automation

Laptop computers and software

Electronic data interchange

Desktop videoconferencing

Electronic sales channels

Internet

Television home shopping

Technical forces

Sales force automation

Laptop computers and software

Electronic data interchange

Desktop videoconferencing

Electronic sales channels

Internet

Television home shopping

3 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Types of selling The selling function There are many types of selling jobs Selling varies according to the nature of the selling task Order-takers Order creators Order-getters

4 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Types of selling The selling function Order-takers Order creators Order-getters Inside order-takers Delivery salespeople Outside order-takers

5 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Types of selling The selling function Order creators Missionary salespeople Order-takers Order-getters

6 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Types of selling The selling function Order-getters Front-line salespeople Sales support salespeople New business salespeople Order-takers Order creators Organizational salespeople Consumer salespeople Technical support salespeople Merchandisers

7 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Sales responsibilities Profitable sales Prospecting Providing service Maintaining customer records and information feedback Relationship management Self-management Handling complaints

8 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill The selling process Preparation The opening Need and problem identification Presentation and demonstration Dealing with objections Closing the sale The follow-up

Personal selling skills Asking questions Providing product information, making comparisons and offering evidence to support claims Acknowledging the viewpoint of the customer Agreeing with the customers perceptions Supporting the customer Releasing tension 9 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill

Asking questions

Providing product information, making comparisons and offering evidence to support claims

Acknowledging the viewpoint of the customer

Agreeing with the customers perceptions

Supporting the customer

Releasing tension

Key account relational development model Complex Simple Transactional Collaborative 11 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Nature of Customer Relationship Level of Involvement With Customers Synergistic-KAM Partnership-KAM Mid-KAM Early-KAM

Marketing strategy and the management of the sales-force 12 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Setting objectives Recruitment and selection Training Motivation and compensation Evaluation of salespeople Salesforce size Salesforce organization Personal selling objectives and strategies Marketing strategy Designing the salesforce Managing the salesforce Evaluation and control of total sales operation

The cycle of motivation 13 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Source: Churchill Jr, G.A., N.M. Ford & O. C. Walker Jr (1995) Sales Force Management: Planning, Implementation and Control Motivation Effort Performance Satisfaction Rewards

A marketing database 4 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Marketing database Product information Transactional information Geodemographic information Promotional information Customer and prospect information

Managing a direct marketing campaign 5 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Identify and understand target audience Marketing strategy Campaign objectives Media decisions Creative decisions Execute and evaluate campaign

A multiple-medium, multiple-stage campaign 9 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Direct response advertising Outbound telemarketing Salesforce Inbound telemarketing/direct/mail/e-mail Direct mail

Creative decisions 10 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Communication objectives Product benefits (and weaknesses) Target market analysis Development of the offer Communication of the message Action plan

11 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Execute and evaluate the campaign Cost per enquiry Conversion rate from enquiry to sale Number of enquiries Sales rate (% purchasing) Number of contacts purchasing Total sales Campaign Performance Renewal rate Cost per contact Cost per sale Repeat purchase rate Response rate Average order value Enquiry rate

The effect of a sales promotion on sales 2 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Prior to promotion Promotion period Short-run post-promotion period Long-run post-promotion period Time Sales 1 = positive effect 2 = no effect 3 = negative effect 1 2 3

Consumer and trade promotions 3 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Consumer promotions Trade promotions Money off Free samples Prize promotions Loyalty cards Free goods Allowances Bonus packs Premiums Coupons Price discounts Competitions

P.R. - Potentially newsworthy items Marketing issues: New products Research breakthrough potentially new products Large orders/contracts Sponsorship Price changes Service changes New logos Export success Personnel issues: Training awards Winners of company contests Promotions/new appointments Success stories Visits by famous people Reports of interviews General issues: Conferences/seminars/exhibitions Anniversaries of significant events Production issues: Productivity achievements Employment changes Capital investments Financial issues: Financial statements Acquisitions Sales/profit achievements 12 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill

Marketing issues:

New products

Research breakthrough

potentially new products

Large orders/contracts

Sponsorship

Price changes

Service changes

New logos

Export success

Personnel issues:

Training awards

Winners of company contests

Promotions/new appointments

Success stories

Visits by famous people

Reports of interviews

General issues:

Conferences/seminars/exhibitions

Anniversaries of significant events

Production issues:

Productivity achievements

Employment changes

Capital investments

Financial issues:

Financial statements

Acquisitions

Sales/profit achievements

Values transferred from sponsorship categories Healthy Young Energetic Fast Vibrant Masculine Sophisticated Elite Discriminating Up-market Serious Pretentious Young Accessible Friendly Current Innovative Commercial Admirable Concerned Caring Intelligent Explosive Caring Concerned Explosive Sports High-brow arts Mass arts Social causes Environmental programs 13 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill

Exhibition objectives Maintain relationship Transmit benefits Remedy service problems Stimulate extra sales Maintain image Demonstrate products Gather competitive intelligence Widen experience Contact prospects Determine needs Transmit benefits Commit to follow-up or sale Contact prospects Foster image building Demonstrate products Gather competitive intelligence Selling objectives 4 D Jobber, Principles and Practice of Marketing, © 2001 McGraw-Hill Current customers Non-selling objectives Potential Customers (prospects)

Ethical Considerations Misleading Advertising; influence on society values; targeting children. Selling: Deception, hard sell, bribery, reciprocal buying. Direct Marketing: Poorly targeted mail, timing and intrusiveness of calls, content of envelopes, invasion of privacy, (selling-on details). Exhibitions and sales promotions/P.R.: Use of trade inducements, mal-redemption of coupons (not verifying), payments to third parties to endorse products.

Misleading Advertising; influence on society values; targeting children.

Selling: Deception, hard sell, bribery, reciprocal buying.

Direct Marketing: Poorly targeted mail, timing and intrusiveness of calls, content of envelopes, invasion of privacy, (selling-on details).

Exhibitions and sales promotions/P.R.: Use of trade inducements, mal-redemption of coupons (not verifying), payments to third parties to endorse products.

Ethics in Personal Selling Potential for deception Potential for a ‘hard sell’ Bribery Reciprocal Buying

Potential for deception

Potential for a ‘hard sell’

Bribery

Reciprocal Buying