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Unit3 promotion strategy


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Unit3 promotion strategy

  1. 1. Promotion Strategy Unit3 Subhajit Sanyal
  2. 2. <ul><li>Promotion </li></ul><ul><ul><li>Personal Selling </li></ul></ul><ul><ul><li>Mass Selling </li></ul></ul><ul><ul><ul><li>Advertising </li></ul></ul></ul><ul><ul><ul><li>Publicity </li></ul></ul></ul><ul><ul><li>Sales Promotion </li></ul></ul>
  3. 3. <ul><li>Promotion </li></ul><ul><li>communication of information </li></ul><ul><li>influence the buyer </li></ul><ul><li>3 methods </li></ul><ul><li>Personal Selling </li></ul><ul><li>Mass Selling </li></ul><ul><li>Sales Promotion </li></ul>
  4. 4. <ul><li>Personal Selling </li></ul><ul><li>direct communication between seller and buyer </li></ul><ul><li>face2face contact </li></ul><ul><li>Usually used to sell industrial goods and services </li></ul><ul><li>Also used to sell some expensive consumer items, eg. Cars, computer systems </li></ul>
  5. 5. <ul><li>Mass Selling </li></ul><ul><li>communicating with large numbers of potential customers </li></ul><ul><li>“ non”-personal selling </li></ul><ul><li>used when the target market is large and dispersed </li></ul><ul><li>Advertising is a form of Mass Selling </li></ul>
  6. 6. <ul><li>Advertising </li></ul><ul><li>the main form of mass selling </li></ul><ul><li>any paid form of nonpersonal communication eg. Techniques include billboard ads and TV commercials </li></ul>
  7. 7. The generation of awareness about a product beyond regular advertising methods. Usually less costly than advertising because sometimes the message is spread for free by a newspaper article or TV story. Publicity
  8. 8. <ul><li>Examples of Publicity </li></ul><ul><li>famous person photographed using your product </li></ul><ul><li>your product mentioned in National News in a positive way </li></ul><ul><li>your product featured in a movie </li></ul><ul><li>TV commentary about aspects of your product trade magazines carrying a story eg. Road and Track doing a feature on the new Landrover </li></ul>Publicity
  9. 9. Publicity can be negative eg. If a famous movie star gets electrocuted using your product, this can cause people to NOT want to buy it - this would be a major problems eg. If your product is sabotaged - this could include tampering with medical products ie. Tylenol eg. If there are negative rumours about the ingredients in your product eg. If there are negative ingredients about the moral aspects of your company Publicity
  10. 10. Promotion People <ul><li>Sales Managers </li></ul><ul><li>Advertising Managers </li></ul><ul><li>Sales Promotion Managers </li></ul>
  11. 11. Promotion People <ul><li>Sales Managers </li></ul><ul><li>Are concerned with managing personal selling </li></ul><ul><li>In small companies this person also does the advertising and sales promotion </li></ul>
  12. 12. Promotion People <ul><li>Advertising Managers </li></ul><ul><li>They manage the mass selling activities </li></ul><ul><li>They chose the company to make the commercials </li></ul><ul><li>Pick the billboard signs etc. </li></ul><ul><li>If the company is big enough they hire an outside agency </li></ul><ul><li>They may also do publicity as well </li></ul>
  13. 13. Promotion People <ul><li>Sales Promotion Managers </li></ul><ul><li>They manage the Sales Promotion activities </li></ul><ul><li>They decide about in-store coupons, prizes, contests etc. </li></ul><ul><li>They spend a lot of time visiting the retail outlets where the product is sold </li></ul>
  14. 14. Sales Promotion Managers - they deal with Point-of-purchase advertising specialty advertising samples coupons premiums loyalty points / air miles rebates contests People in Sales Promotion Sales Promotion Page 455
  15. 15. <ul><li>Sales Promotion includes: </li></ul><ul><li>Point-of-purchase advertising </li></ul><ul><li>specialty advertising </li></ul><ul><li>samples </li></ul><ul><li>coupons </li></ul><ul><li>premiums </li></ul><ul><li>loyalty points / air miles </li></ul><ul><li>rebates </li></ul><ul><li>contests </li></ul>Sales Promotion
  16. 16. The 3 Promotion Objectives
  17. 17. <ul><li>Chpt 13 in the Marketing 106 course Copyright, Professor W.T.G. Richardson, Seneca College </li></ul>Relationship between Advertising and the Product Life Cycle Not mentioned in your textbook
  18. 18. Promotion Objectives <ul><li>Informing </li></ul><ul><li>people have to know about it, in order to buy it </li></ul><ul><li>Advertising that seeks to develop demand through presenting factual information on the attributes of a product or service. </li></ul><ul><li>Tends to be used in promoting NEW products. </li></ul><ul><li>Use in the Introductory Stage of PLC </li></ul>Page 458 - 459
  19. 19. Promotion Objectives <ul><li>Persuading </li></ul><ul><li>when competition offers similar product, you have to “persuade” them to try yours </li></ul><ul><li>Advertising that emphasizes using words and/or images to try to create an image for a product and to influence attitudes about it. </li></ul><ul><li>Used by Coke and Pepsi re: lifestyle ads. </li></ul><ul><li>Used after the Introductory Stage of the PLC </li></ul>Page 458 - 459
  20. 20. Promotion Objectives <ul><li>Reminding </li></ul><ul><li>when new competition comes along, you have to “remind” customers of your greater experience, advantages etc . </li></ul><ul><li>Advertising whose goal is to reinforce previous promotional activity by keeping the product’s or service’s name in front of the public. </li></ul><ul><li>Used in the Maturity Period and the Decline Stage of the PLC. </li></ul>
  21. 21. A.I.D.A. Attention Interest Desire Action 4 promotion jobs
  22. 22. P U S H P U L L <ul><li>Pushing through the promotion channel </li></ul><ul><li>Producer - personal selling 2 wholesaler retailer customer </li></ul><ul><li>Promotion techniques used </li></ul><ul><li>run ads in trade magazines to make wholesalers aware of the product </li></ul><ul><li>provide incentives to retailers to carry the item “… free case of drinks with each 2 cases it buys…” page 466 </li></ul><ul><li>run contests for salespeople to win prizes for selling the product </li></ul>
  23. 23. P U S H P U L L <ul><li>Pulling through the promotion channel </li></ul><ul><li>Producer - personal selling 2 wholesaler retailer customer </li></ul><ul><li>Promotion techniques used </li></ul><ul><li>run TV commercials so customers directly learn about the product - then they go to the store and ask for it, or call around to find out where it is sold </li></ul><ul><li>give free samples to potential customers </li></ul>
  24. 24. P U S H P U L L <ul><li>Pulling through the promotion channel </li></ul><ul><li>Producer - personal selling 2 wholesaler retailer customer </li></ul>Sometimes you do “pulling” when the Middlemen cannot be pushed, that is they already have a competitors product, so the way to get Middlemen to WANT to carry the product, is to have customers ask for it.
  25. 25. Potential Mail Recipients Once your name is on a list for a newspaper subscription, your name and address can be “sold” to another company who will mail you information to try and convince you to buy their product. Buying and selling lists (databases) of such names is big business. D i r e c t M a r k e t i n g
  26. 26. Comparison of Direct Marketing and General Advertising Direct Marketing General Advertising Selling to individuals. Customers are Mass selling. Buyers identified as broad often identifiable by name, address, and groups sharing common demographic and purchase behaviour. psychographic characteristics. Products have added value or service. Product benefits do not always include Distribution is important product benefit. convenient distribution channels. The medium is the marketplace. Retail outlet is the marketplace. Marketer controls product until delivery. Marketer may lose control as product enters distribution channel. Advertising used to motivate an Advertising used for cumulative effect immediate order or inquiry. over time to build image, awareness, loyalty, benefit recall. Purchase action deferred. Repetition used within ad. Repetition used over time. Consumers feel high perceived risk – Consumers feel less risk – have direct product brought unseen. Recourse is contact with the product and direct distant. recourse. D i r e c t M a r k e t i n g
  27. 27. Adoption Process <ul><li>Innovators </li></ul><ul><li>Early Adopters - sales people concentrate their efforts here </li></ul><ul><li>Early majority </li></ul><ul><li>Late majority </li></ul><ul><li>Laggards, or nonadopters </li></ul>
  28. 28. Setting the promotion budget Most common method is based on using past percentages - that is to say,,,, If you sold $ 1,000,000 and you spent 20% on advertising, which = $200,000 then, if you spend $400,000 you should sell $2 million!
  29. 29. Setting the promotion budget <ul><li>Other methods - used in real world </li></ul><ul><li>Matching what competition spends </li></ul><ul><li>Based on what is required to get number of customers that will meet corporate objectives - called the Task Method - sometimes stated as a % of sales </li></ul>