MKTG12_LambHairMcDaniel_Ch15_updated_SH.pptx
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This chapter discusses marketing communications and the promotional mix. It defines promotion and its role in the marketing mix. The communication process is described, including the sender, message, channel, receiver, feedback, and factors that can interfere. The goals of promotion are to inform, persuade, and remind. The promotional mix includes advertising, public relations, personal selling, sales promotion and social media. The AIDA model outlines the stages of gaining consumer attention, interest, desire and action. Integrated marketing communications coordinates all promotional messages. Factors like the product, its life cycle stage, target market and available funds influence the optimal promotional mix.
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MKTG12_LambHairMcDaniel_Ch15_updated_SH.pptx
- 1. MKTG Principles Of Marketing Twelfth Edition Chapter 15 Marketing Communications © 2019 Cengage. All rights reserved.
- 2. © 2019 Cengage. All rights reserved. Learning Outcomes 15-1 Discuss the role of promotion in the marketing mix 15-2 Describe the communication process 15-3 Explain the goals and tasks of promotion 15-4 Discuss the elements of the promotional mix 15-5 Discuss the AIDA concept and its relationship to the promotional mix 15-6 Discuss the concept of integrated marketing communications 15-7 Describe the factors that affect the promotional mix
- 3. © 2019 Cengage. All rights reserved. The Role of Promotion in the Marketing Mix • Promotion: communication by marketers that informs, persuades, and reminds potential buyers of a product in order to influence an opinion or elicit a response • Promotional strategy: a plan for the optimal use of the elements of promotion: advertising, public relations, personal selling, sales promotion, and social media • Competitive advantage: one or more unique aspects of an organization that cause target consumers to patronize that firm rather than competitor
- 4. © 2019 Cengage. All rights reserved. Exhibit 15.1: Role of Promotion in the Marketing Mix
- 5. © 2019 Cengage. All rights reserved. Communication • Communication: the process by which we exchange or share meaning through a common set of symbols • Two major categories of communication: – Interpersonal communication: direct, face-to-face communication between two or more people – Mass communication: the communication of a concept or message to a large audience through a mass medium
- 6. © 2019 Cengage. All rights reserved. Exhibit 15.2: Communication Process
- 7. © 2019 Cengage. All rights reserved. The Sender and Encoding • Sender: the originator of the message in the communication process – For an advertisement, press release, or social media campaign, the company or organization is the sender • Encoding: the conversion of the sender’s ideas and thoughts into a message, usually in the form of words or signs – What the source says is not what matters, but what the receiver hears
- 8. © 2019 Cengage. All rights reserved. Message Transmission • Channel: a medium of communication—such as a voice, radio, or newspaper—for transmitting a message – Reception occurs when the message is detected by the receiver and enters their frame of reference • Noise: anything that interferes with, distorts, or slows down the transmission of information
- 9. © 2019 Cengage. All rights reserved. The Receiver and Decoding • Receiver: the person who decode the message – There can be multiple receivers • Decoding: interpretation of the language and symbols sent by the source through a channel – Common understanding between communicators, or a common frame of reference, is required for effective communication • Even though a message is received, it may not be properly decoded because of selective exposure, distortion, and retention
- 10. © 2019 Cengage. All rights reserved. Feedback • Feedback: the receiver’s response to a message – Feedback may be verbal, as in saying “I agree” or “I do not like this new product” • Mass communicators are often cut off from direct feedback • Social media and the Internet have impacted the communication model in two major ways: – Consumers are now able to become senders – The communication model shows the feedback channel as primarily impersonal and numbers driven
- 11. © 2019 Cengage. All rights reserved. The Goals of Promotion • Promotion can perform one or more of four tasks: – Informing – Persuading – Reminding – Connecting
- 12. © 2019 Cengage. All rights reserved. Discussion Point The Goals of Promotion • Consider the following products: –Wrangler jeans –Sprint cellular service –Kleenex tissues –Facebook Portal –Walmart Categorize the type of promotion—informative, reminder, or persuasive—that is used in the product/brand promotional mix.
- 13. © 2019 Cengage. All rights reserved. Promotional Mix (slide 1 of 2) • Promotional mix: the combination of promotional tools— including advertising, public relations, personal selling, sales promotion, and social media—used to reach the target market and fulfill the organization’s overall goals – Advertising: Impersonal, one-way mass communication about a product or organization that is paid for by a marketer – Public relations: the marketing function that evaluates public attitudes, identifies areas within the organization the public may be interested in, and executes a program of action to earn public understanding and acceptance Publicity: public information about a company, product, service, or issue appearing in the mass media as a news item
- 14. © 2019 Cengage. All rights reserved. Promotional Mix (slide 2 of 2) – Sales promotion: marketing activities—other than personal selling, advertising, and public relations—that stimulate consumer buying and dealer effectiveness – Personal selling: a purchase situation involving a personal, paid-for communication between two people in an attempt to influence each other – Content marketing and social media
- 15. © 2019 Cengage. All rights reserved. The Communication Process and the Promotional Mix • The Internet has changed how businesses promote their brands • Types of media: – Paid media: a category of promotional tactic based on the traditional advertising model, whereby a brand pays for media space – Earned media: a category of promotional tactic based on a public relations or publicity model that gets customers talking about products or services – Owned media: a new category of promotional tactic based on brands becoming publishers of their own content in order to maximize the brands’ value to customers
- 16. © 2019 Cengage. All rights reserved. Exhibit 15.3: Digital Media Types
- 17. © 2019 Cengage. All rights reserved. Exhibit 15.4: Characteristics of the Elements in the Promotional Mix
- 18. © 2019 Cengage. All rights reserved. The AIDA Model • AIDA concept: a model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message; the acronym stands for attention, interest, desire, and action • The AIDA concept assumes that promotion propels consumers along the four steps in the purchase-decision process: – Attention: The advertiser must first gain the attention of the target market – Interest: Create interest in the product – Desire: Show how product features will satisfy customer needs – Action: A special offer or strong closing sales pitch may drive the consumer to purchase the product
- 19. © 2019 Cengage. All rights reserved. AIDA and the Promotional Mix • Salespeople are more effective at creating customer interest for merchandise or a service and at creating desire • Public relations’ greatest impact is as a method of gaining attention for a company, good, or service • Sales promotion’s greatest strength is in creating strong desire and purchase intent • Social media are a strong way to gain attention and interest in a brand, particularly if content goes viral
- 20. © 2019 Cengage. All rights reserved. Exhibit 15.5: Promotional Mix and Aida
- 21. © 2019 Cengage. All rights reserved. Integrated Marketing Communications • Marketing communications from each promotional mix element should be integrated • Integrated marketing communications (IMC): the careful coordination of all promotional messages for a product or a service to ensure the consistency of messages at every contact point at which a company meets the consumer • Reasons for growth in IMC popularity – Proliferation of several media choices – Fragmentation of the mass market – Slash in advertising spending in favor of promotional techniques
- 22. © 2019 Cengage. All rights reserved. Factors Affecting the Choice of Promotional Mix • Factors that affect the promotional mix include: – Nature of the product – Stage in product life cycle (PLC) – Target market characteristics – Type of buying decision – Available funds – Push or pull strategy
- 23. © 2019 Cengage. All rights reserved. Nature of the Product • A product can be classified as either a business product or a consumer product • Business products: – Often custom-tailored to the buyer’s specifications – Often not suited to mass promotion – Producers rely more heavily on personal selling • Consumer products: – Generally are not custom-made – Do not require the selling efforts of a company representative – Consumer goods are promoted mainly through advertising to create familiarity
- 24. © 2019 Cengage. All rights reserved. Stages in the Product Life Cycle • The product’s stage in its life cycle impacts the design of a promotional mix – Introduction stage: inform the target audience that the product is available – Growth stage: emphasize the product’s differential advantage over the competition – Maturity stage: competition become fiercer, so persuasive and reminder advertising are emphasized – Decline stage: all promotion is reduced
- 25. © 2019 Cengage. All rights reserved. Exhibit 15.6: Product Life Cycle and the Promotional Mix
- 26. © 2019 Cengage. All rights reserved. Target Market Characteristics • More advertising and sales promotion and less personal selling are required for a target market characterized by: – Widely scattered potential customers – Highly informed buyers – Brand loyal repeat purchases
- 27. © 2019 Cengage. All rights reserved. Type of Buying Decision • For routine consumer decisions, the most effective promotion calls attention to the brand – Advertising and sales promotion are the most productive promotion tools • Complex consumer decisions rely on large amounts of information to help them reach a purchase decision – Personal selling is effective in helping these consumers decide • If the decision is neither routine nor complex, advertising and public relations help establish awareness for the good or service
- 28. © 2019 Cengage. All rights reserved. Available Funds • When funds are available, firms will try to optimize their return on promotion dollars while minimizing the cost per contact, or the cost of reaching one member of the target market – Cost per contact is high for personal selling, public relations, and sales promotions – Cost per contact is low for national advertising since it reaches a large number of people
- 29. © 2019 Cengage. All rights reserved. Push and Pull Strategies • Push strategy: a marketing strategy that uses aggressive personal selling and trade advertising to convince a wholesaler or a retailer to carry and sell particular merchandise • Pull strategy: a marketing strategy which stimulates consumer demand to obtain product distribution
- 30. © 2019 Cengage. All rights reserved. Exhibit 15.7: Push Strategy Versus Pull Strategy
- 31. © 2019 Cengage. All rights reserved. Key Terms (slide 1 of 2) • Promotion • Promotional strategy • Competitive advantage • Communication • Interpersonal communication • Mass communication • Sender • Encoding • Channel • Noise • Receiver • Decoding • Feedback
- 32. © 2019 Cengage. All rights reserved. Key Terms (slide 2 of 2) • Promotional mix • Advertising • Public relations • Publicity • Sales promotion • Personal selling • Paid media • Earned media • Owned media • AIDA concept • Integrated marketing communications (IMC) • Push strategy • Pull strategy
Editor's Notes
- Few goods or services, no matter how well developed, priced, or distributed, can survive in the marketplace without effective promotion. Promotion: communication by marketers that informs, persuades, and reminds potential buyers of a product in order to influence an opinion or elicit a response Promotional strategy: a plan for the optimal use of the elements of promotion: advertising, public relations, personal selling, sales promotion, and social media Competitive advantage: one or more unique aspects of an organization that cause target consumers to patronize that firm rather than competitor
- The marketing manager determines the goals of the company's promotional strategy in light of the firm’s overall goals for the marketing mix. Using the overall goals, marketers combine the elements of the promotional strategy into a coordinated plan. The promotional plan becomes an integral part of the marketing strategy for reaching the target market. The main function of promotional strategy is to convince target customers that the goods and services offered provide a competitive advantage over the competition.
- Promotional strategy is closely related to the process of communication. As humans, we assign meaning to feelings, ideas, facts, attitudes, and emotions. Communication: the process by which we exchange or share meaning through a common set of symbols Examples of mass medium—Television or newspapers. When a company advertises, it does not know the consumers personally. The company cannot respond immediately to reactions to its messages. Any clutter from competitors’ messages or other distractions can reduce the effectiveness of the mass-communication effort. Two major categories of communication: Interpersonal communication: direct, face-to-face communication between two or more people A salesperson speaking to a customer Mass communication: the communication of a concept or message to a large audience through a mass medium
- Marketers are both senders and receivers of messages. Most marketing communication is a two-way process
- Sender: the originator of the message in the communication process For an advertisement, press release, or social media campaign, the company or organization is the sender Encoding: the conversion of the sender’s ideas and thoughts into a message, usually in the form of words or signs What the source says is not what matters, but what the receiver hears
- Channel: a medium of communication—such as a voice, radio, or newspaper—for transmitting a message Reception occurs when the message is detected by the receiver and enters their frame of reference Noise: anything that interferes with, distorts, or slows down the transmission of information
- Receiver: the person who decode the message There can be multiple receivers Decoding: interpretation of the language and symbols sent by the source through a channel Common understanding between communicators, or a common frame of reference, is required for effective communication Even though a message is received, it may not be properly decoded because of selective exposure, distortion, and retention People manipulate messages to reflect their own biases, needs, experiences, and knowledge Differences in age, social class, education, culture, and ethnicity can lead to miscommunication Bright colors and bold graphics can increase consumers’ comprehension
- Feedback: the receiver’s response to a message Feedback may be verbal, as in saying “I agree” or “I do not like this new product” Mass communicators are often cut off from direct feedback Social media and the Internet have impacted the communication model in two major ways: Consumers are now able to become senders The communication model shows the feedback channel as primarily impersonal and numbers driven
- Promotion can perform one or more of four tasks: Informing: seeks to convert and existing need into a want or to stimulate interest in a new product Persuading: stimulate a purchase or an action Reminding: keep the product and brand name in the public’s mind Connecting: form relationships with customers Often a marketer will try to accomplish two or more of these tasks at the same time. Tools for connection include social networks, social games, social publishing tools, and social commerce.
- Answers: Wrangler: reminder advertising Sprint: persuasive advertising Kleenex: reminder advertising Facebook Portal: informative advertising Walmart: persuasive advertising
- Promotional mix: the combination of promotional tools—including advertising, public relations, personal selling, sales promotion, and social media—used to reach the target market and fulfill the organization’s overall goals The proper promotional mix is the one that management believes will meet the needs of the target market and fulfill the organization’s overall goals Advertising: Impersonal, one-way mass communication about a product or organization that is paid for by a marketer Marketer’s budgets are shifting more towards digital media Advertising is beneficial because it allows marketers to communicate to a large number of people at one time, so cost per contact is low Public relations: the marketing function that evaluates public attitudes, identifies areas within the organization the public may be interested in, and executes a program of action to earn public understanding and acceptance Helps an organization communicate with its customers, suppliers, stockholders, government officials, employees, and the community in which it operates Maintain a positive image and educate public Publicity: public information about a company, product, service, or issue appearing in the mass media as a news item Publicity: public information about a company, product, service, or issue appearing in the mass media as a news item
- Sales promotion: marketing activities—other than personal selling, advertising, and public relations—that stimulate consumer buying and dealer effectiveness Short-run tool used to stimulate immediate increases in demand Marketers may use sales promotion to improve the effectiveness of other ingredients in the promotional mix Personal selling: a purchase situation involving a personal, paid-for communication between two people in an attempt to influence each other Whether it is face-to-face or over the phone, personal selling attempts to persuade the buyer to accept a point of view Relationship develops between buyer and salesperson is important Content marketing and social media Content created by brands is usually distributed through social media Social media helps to facilitate conversations and other interactions among people online
- The Internet has changed how businesses promote their brands As a result of the impact of social media as well as new platforms, tools, and ideas, promotional tactics can be categorized according to media types Types of media: Paid media: a category of promotional tactic based on the traditional advertising model, whereby a brand pays for media space TV, magazine, outdoor, radio, or newspaper advertising Also, display advertising on website and pay-per-click advertising on search engines Earned media: a category of promotional tactic based on a public relations or publicity model that gets customers talking about products or services Word of mouth, electronic word of mouth, search engine optimization Owned media: a new category of promotional tactic based on brands becoming publishers of their own content in order to maximize the brands’ value to customers Company websites, Facebook page, blog, YouTube channels, Twitter, etc.
- As a result of the impact of social media as well as the proliferation of new platforms, tools, and ideas, promotional tactics can also be categorized according to media type—paid, earned, or owned. Paid media: Based on the traditional ad model, whereby a brand pays for media space Earned media: Based on a public relations or publicity model that gets customers talking about the brand Owned media: Based on brands becoming publishers of their own content in order to maximize the brand's value to customers
- Characteristics among the promotional mix elements with respect to mode of communication. The message, identification of the sender, speed in reaching large audiences, and message flexibility. The promotional mix are indirect and impersonal when used to communicate with a target market, providing only one direction of message flow Social media are also considered two-way communication, though not quite as immediate as personal selling.
- The goal of any promotion is to get someone to buy a good or service or take some action. A classic model for reaching promotional goals is called the AIDA concept. AIDA concept: a model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message; the acronym stands for attention, interest, desire, and action The AIDA concept assumes that promotion propels consumers along the four steps in the purchase-decision process: Attention: The advertiser must first gain the attention of the target market Interest: Create interest in the product Desire: Show how product features will satisfy customer needs Action: A special offer or strong closing sales pitch may drive the consumer to purchase the product
- Salespeople are more effective at creating customer interest for merchandise or a service and at creating desire Public relations’ greatest impact is as a method of gaining attention for a company, good, or service Sales promotion’s greatest strength is in creating strong desire and purchase intent Social media are a strong way to gain attention and interest in a brand, particularly if content goes viral
- The relationship between the promotional mix and the AIDA model. That although advertising does have an impact in the later stages, it is most useful in gaining attention for goods or services. By contrast, personal selling reaches fewer people at first. Salespeople are more effective at creating customer interest for merchandise or a service and at creating desire.
- Marketers determine what roles each aspect of the promotional mix will play in the marketing mix. This includes the timing of promotions and examining campaign results. These activities are generally coordinated by the marketing communications director. IMC is the careful coordination of all promotional messages—traditional advertising, direct marketing, social media, interactive, public relations, sales promotion, personal selling, event marketing, and other communications—for a product or service to assure the consistency of messages at every contact point where a company meets the consumer. Following the concept of IMC, marketing managers carefully work out the roles that various promotional elements will play in the marketing mix.
- Promotional mixes vary a great deal from one product and one industry to the next. Advertising and personal selling are used to promote goods and services, supported and supplemented by sales promotion. Public relations help develop a positive image for the product line and the organization. A firm may choose not to use all five promotional elements, or it may choose to use them in varying degrees. Characteristics of the product itself can influence the promotional mix.
- A product can be classified as either a business product or a consumer product Business products: Often custom-tailored to the buyer’s specifications Often not suited to mass promotion Producers rely more heavily on personal selling Consumer products: Generally are not custom-made Do not require the selling efforts of a company representative Consumer goods are promoted mainly through advertising to create familiarity The costs and risks associated with a product influence the promotional mix As costs or risks of buying and using a product increase, personal selling becomes more important
- In the introduction stage, the basic goal of promotion is to inform the target audience of product availability. Advertising and public relations inform the target audience, while sales promotion encourages early trial. Personal selling gets retailers to carry the product. During the growth stage, advertising and public relations continue to be important although sales promotion can be reduced because customers need fewer incentives to purchase. The promotional strategy is to emphasize the product’s differential competitive advantage. Persuasive promotion is used to build and maintain brand loyalty. By this stage, personal selling has succeeded in obtaining adequate distribution for the product. In the maturity stage, competition becomes fiercer, and persuasive and reminder advertising are more strongly emphasized. Sales promotion comes back into focus to try to increase market share. As the product enters the decline stage, all promotion, especially advertising, is reduced. Nevertheless, personal selling and sales promotion efforts may be maintained, particularly at the retail level.
- More advertising and sales promotion and less personal selling are required for a target market characterized by: Widely scattered potential customers Highly informed buyers Brand loyal repeat purchases
- For routine consumer decisions, the most effective promotion calls attention to the brand Advertising and sales promotion are the most productive promotion tools Complex consumer decisions rely on large amounts of information to help them reach a purchase decision Personal selling is effective in helping these consumers decide If the decision is neither routine nor complex, advertising and public relations help establish awareness for the good or service
- There is a trade-off among the funds available, the number of people in the target market, the quality of communication needed, and the relative costs of the promotional elements. When funds are available, firms will try to optimize their return on promotion dollars while minimizing the cost per contact, or the cost of reaching one member of the target market Cost per contact is high for personal selling, public relations, and sales promotions Cost per contact is low for national advertising since it reaches a large number of people
- Push strategy: a marketing strategy that uses aggressive personal selling and trade advertising to convince a wholesaler or a retailer to carry and sell particular merchandise Pull strategy: a marketing strategy which stimulates consumer demand to obtain product distribution
- Heavy sampling, introductory consumer advertising, cents-off campaigns, and couponing are part of a pull strategy Rarely does a company use a pull or a push strategy exclusively. Instead, the mix will emphasize one of these strategies. Pharmaceutical companies generally use a push strategy (personal selling and trade advertising) to promote their drugs and therapies to physicians.