1.1 INTRODUCTION to PROMOTION and INTEGRATED MARKETING COMMUNICATIONS Chapter 1:

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INTRODUCTIONINTRODUCTIONto to

PROMOTIONPROMOTIONand and

INTEGRATED MARKETING INTEGRATED MARKETING COMMUNICATIONSCOMMUNICATIONS

Chapter 1:Chapter 1:

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Relationship Between Promotion, Relationship Between Promotion, the Promotional Mix, and the Promotional Mix, and Integrated Marketing CommunicationsIntegrated Marketing Communications

PROMOTIONPROMOTION Communication Process in MarketingCommunication Process in Marketing Used to Create a Favorable Predisposition Toward:Used to Create a Favorable Predisposition Toward:

Brand of ProductBrand of Product ServiceService IdeaIdea PersonPerson

PROMOTIONAL MIXPROMOTIONAL MIX Blend of Communications Tools and Activities Used by a Blend of Communications Tools and Activities Used by a

FirmFirm Carries out the Promotion ProcessCarries out the Promotion Process Communicates Directly with Target MarketsCommunicates Directly with Target Markets

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Relationship Between Promotion, Relationship Between Promotion, the Promotional Mix, and the Promotional Mix, and Integrated Marketing Communications Integrated Marketing Communications (con’t)(con’t)

INTEGRATED MARKETING COMMUNICATIONS (IMC)INTEGRATED MARKETING COMMUNICATIONS (IMC) Manages the Processes and Activities of Using Promotional ToolsManages the Processes and Activities of Using Promotional Tools Unified WayUnified Way Produces a Synergistic Communications EffectProduces a Synergistic Communications Effect

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Relationship Between Promotion, Relationship Between Promotion, the Promotional Mix, and the Promotional Mix, and Integrated Marketing Communications Integrated Marketing Communications (con’t)(con’t)

Promotion:Promotion: ProcessProcess

Promotion Mix:Promotion Mix: ToolsTools

IMC:IMC: Management of the Management of the Promotion MixPromotion Mix

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The The PromotionalPromotional Mix Mix

ADVERTISINGADVERTISING Paid Mass Media Attempt to PersuadePaid Mass Media Attempt to Persuade Complex System of Strategic Planning and Complex System of Strategic Planning and

Creative GeniusCreative Genius

INTERNET ADVERTISINGINTERNET ADVERTISING Electronic Mail (e-mail)Electronic Mail (e-mail) Internet Relay Chat (IRC)Internet Relay Chat (IRC) UsenetUsenet World Wide Web (www)World Wide Web (www)

SALES PROMOTIONSALES PROMOTION Use of Incentives to Generate a Specific Short-Term ResponseUse of Incentives to Generate a Specific Short-Term Response

Household ConsumerHousehold Consumer Trade BuyerTrade Buyer Business BuyerBusiness Buyer

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Example of Mass Media Advertising

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Example of Sales Promotion

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DIRECT MARKETING AND e-COMMERCEDIRECT MARKETING AND e-COMMERCE Distinguished From Other Primary Promotional Tools Distinguished From Other Primary Promotional Tools

in 3 Waysin 3 Ways Uses a Combination of MediaUses a Combination of Media Designed to Elicit a Direct ResponseDesigned to Elicit a Direct Response Transactions Can Occur AnywhereTransactions Can Occur Anywhere

E-Commerce is Another Form of Direct MarketingE-Commerce is Another Form of Direct Marketing Business is Conducted Between Buyers and Sellers Business is Conducted Between Buyers and Sellers

Using Electronic Exchange MediaUsing Electronic Exchange Media

The Promotional Mix The Promotional Mix (con’t)(con’t)

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SPONSORSHIPSPONSORSHIP Funding an EventFunding an Event Creating an Event to Showcase a Firm’s BrandCreating an Event to Showcase a Firm’s Brand

POINT-OF-PURCHASEPOINT-OF-PURCHASE Materials Used in Retail Setting to Attract Shoppers’ to a Materials Used in Retail Setting to Attract Shoppers’ to a

Company’s BrandCompany’s Brand

SUPPORTIVE COMMUNICATIONSSUPPORTIVE COMMUNICATIONS Used to Target Audiences Outside Mainstream Media or Used to Target Audiences Outside Mainstream Media or

Electronic CommunicationsElectronic Communications

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PUBLIC RELATIONSPUBLIC RELATIONS Communication that can Foster Goodwill Between a Firm Communication that can Foster Goodwill Between a Firm

and its Many Constituent Groupsand its Many Constituent Groups

PERSONAL SELLINGPERSONAL SELLING Presentation of Information about a Firm’s Products or Presentation of Information about a Firm’s Products or

Services by One Person to Another Person or to a Small Services by One Person to Another Person or to a Small Group of PeopleGroup of People

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Personal Selling is the Most Important Variable in the Promotional Mix of Many Organizations

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ROLE OF PROMOTION IN MARKETING STRATEGYROLE OF PROMOTION IN MARKETING STRATEGY Must Have Marketing Strategy Decisions about Products Must Have Marketing Strategy Decisions about Products

(Brand)(Brand) Branding – Established Name, Term, Symbol or Design Branding – Established Name, Term, Symbol or Design

that Identifies for Consumers that a Product is being that Identifies for Consumers that a Product is being Offered by a Particular Seller and Clearly Distinguished Offered by a Particular Seller and Clearly Distinguished the Product of that Seller from those Offered by the Product of that Seller from those Offered by CompetitorsCompetitors

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ROLE OF PROMOTION IN MARKETING STRATEGY (con’t)ROLE OF PROMOTION IN MARKETING STRATEGY (con’t) Role of Promotion in Marketing Strategy Affects 3 Key Role of Promotion in Marketing Strategy Affects 3 Key

Aspects of Decision Making with Respect to BrandsAspects of Decision Making with Respect to Brands Creating the Marketing MixCreating the Marketing Mix Achieving Effective Market Segmentation, Product Achieving Effective Market Segmentation, Product

Differentiation, and PositioningDifferentiation, and Positioning Enhancing Revenues and ProfitsEnhancing Revenues and Profits

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ROLE OF PROMOTION IN THE MARKETING MIXROLE OF PROMOTION IN THE MARKETING MIX Assumes a Wide Range of Responsibilities Assumes a Wide Range of Responsibilities

Related to:Related to: ConceptionConception PricingPricing Distribution BrandsDistribution Brands

Product (Brand)Product (Brand)

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The Promotional Mix The Promotional Mix (Con’t)(Con’t)

ROLE OF PROMOTION IN THE MARKETING MIX (con’t)ROLE OF PROMOTION IN THE MARKETING MIX (con’t) Promotion Affects the Product Area of the Promotion Affects the Product Area of the

Marketing MixMarketing Mix Information and PersuasionInformation and Persuasion Introduction of New Brand or Brand ExtensionsIntroduction of New Brand or Brand Extensions Building and Maintaining Brand Loyalty Building and Maintaining Brand Loyalty

Among ConsumersAmong Consumers Building and Maintaining Brand Loyalty Building and Maintaining Brand Loyalty

Within the TradeWithin the Trade

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One Role for Promotion is to Help Introduce Brand ExtensionsLike this Extension of Jell-O intothe Yogurt Market

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ROLE OF PROMOTION IN THE MARKETING MIX (con’t)ROLE OF PROMOTION IN THE MARKETING MIX (con’t) PricePrice

Effects the Consumer MarketEffects the Consumer Market Effects the Trade MarketEffects the Trade Market

DistributionDistribution Consumer Access to BrandsConsumer Access to Brands Securing Trade DistributionSecuring Trade Distribution

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The Role of Promotion in Effective Market The Role of Promotion in Effective Market Segmentation, Differentiation and PositioningSegmentation, Differentiation and Positioning

Promotion is Important in Helping to Promotion is Important in Helping to Execute These StrategiesExecute These Strategies Market SegmentationMarket Segmentation Product DifferentiationProduct Differentiation PositioningPositioning

ExternalExternal InternalInternal

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The Role of Promotion in Revenue and ProfitsThe Role of Promotion in Revenue and Profits

Sales OccurSales Occur Brand has Well-Conceived Marketing MixBrand has Well-Conceived Marketing Mix Complete Marketing MixComplete Marketing Mix Good PromotionGood Promotion

Large-Scale Demand /Production ProducesLarge-Scale Demand /Production Produces Cost to Produce Item is ReducedCost to Produce Item is Reduced Known as Economies of ScaleKnown as Economies of Scale

Brand Loyalty at Any CostBrand Loyalty at Any Cost Firm Raises PricesFirm Raises Prices Known as Inelasticity of DemandKnown as Inelasticity of Demand

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Promotional Tools HelpIncrease Brand Loyalty

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Integrated Marketing CommunicationsIntegrated Marketing Communications

FACTORS CONTRIBUTING TO IMC’s RISING PROMINENCEFACTORS CONTRIBUTING TO IMC’s RISING PROMINENCE Fragmentation of MediaFragmentation of Media Better Audience Assessment Through Database TechnologyBetter Audience Assessment Through Database Technology Consumer EmpowermentConsumer Empowerment Increased Advertising ClutterIncreased Advertising Clutter Shifting Channel PowerShifting Channel Power Desire of Greater AccountabilityDesire of Greater Accountability

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Promotion and IMCHelp Cut Through the Clutter of Advertising

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Participants in IMC Management

Marketing Organization•Marketing Plan•Goal & Objectives•Customer/Prospect Databases

Marketing Organization•Marketing Plan•Goal & Objectives•Customer/Prospect Databases

Specialized Promotion Organizations•Media Organizations•Event Management Firms•Web Site Designers•Sales Promotions Agencies•Direct Marketing Agencies•Public Relations Firms•P-O-P Agencies & Designers

Specialized Promotion Organizations•Media Organizations•Event Management Firms•Web Site Designers•Sales Promotions Agencies•Direct Marketing Agencies•Public Relations Firms•P-O-P Agencies & Designers

Advertising Agency•Research•Creative Strategies•Production•Message Placement

Advertising Agency•Research•Creative Strategies•Production•Message Placement

Internet Advertising (Chapter 9)

Internet Advertising (Chapter 9)

Advertising (Chapter 8)

Advertising (Chapter 8)

Sales Promotions(Chapter 11)

Sales Promotions(Chapter 11)

IMC ManagementIMC Management Personal Selling(Chapter 14)

Personal Selling(Chapter 14)

Direct Marketing e-Commerce (Chapter 10)

Direct Marketing e-Commerce (Chapter 10)

Sales PromotionsP-O-P

Supportive(Chapter 12)

Sales PromotionsP-O-P

Supportive(Chapter 12)

Public Relations(Chapter 13)

Public Relations(Chapter 13)

1.1 INTRODUCTION to PROMOTION and INTEGRATED MARKETING COMMUNICATIONS Chapter 1:

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