Promotion decisions 29-10-13
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Transcript of Promotion decisions 29-10-13
Books Recommended
Integrated Marketing Communications AdvertisingPromotions
Session CoverageIntegrated Marketing CommunicationsImportance and Role of Marketing CommunicationDeveloping Effective CommunicationDeciding upon Marketing Communication Mix
AdvertisingDeveloping and Managing advertisingDecision on media and measurement
PromotionSales PromotionsPublicityPublic Relations
Marketing Communications
The means by which firms attempt to inform, persuade, and remind
consumers, directly or indirectly, aboutthe products and brands they sell.
Corporate Image
I don’t know who you are
I don’t know your company
I don’t know your company’s products
I don’t know what your company stands for
I don’t know your company’s customers
I don’t know your company’s record
I don’t know your company’s reputation
Now what was it you wanted to sell?
Anonymous
Communication Objectives
Marketing Communication Or Promotion
Seeks to
Modify behavior or reinforceExisting behavior
Seeks to
Inform, persuade or remind theTarget markets about the firm’s offering
Marketing Communications
Inform Persuade RemindNew Products, pack, feature benefits etc.
To buy now Maintain brand awareness & recall
Difference with respect to competitors
Switching from competitors by giving them clear reason
Product will be needed in near future Foreg: Seasonal products.. AC, Fans, Ice-cream, Cold drinks
Outlets where brands are available
Persuade to stay loyal with the brand
Pricing offered in market
Occasion of Use
How product works where to buy the product
Correct a –ve perception
Communication Mix TYPESCommunication Mix
Personal Non-Personal
Advertising Promotions
Media Direct Response Consumer Trade
Personal Selling
Elements of I.M.C Mix
Tools that a company uses to pursue it’s advertising & marketing objectives.
AdvertisingAny paid form of non-personal promotion by an identified sponsor
Personal sellingFace to face presentation & selling
Sales promotionShort term incentives to encourage trial or purchase
Public relationsRelationship building plan with the outside world to build & protect co’s image
Direct marketingUse of non-personal form of communication to communicate with select customer groups
Relevance of the IMC Elements
Advertising- When product is widely distributed- Market is large & spread out- Demo is not an important criteria- Literacy levels exist
Personal selling- Information needs are high- Product is complex- Customers are few & reachable- Employing push strategy
Relevance of the IMC Elements (contd…)
Sales promotion- When short-term gains are desired- New product requires to induce trial - Brand switchers are to be targeted
Public relations- Long term relationships are targeted- Building public opinion- Pre-event hype is required
Direct marketing- Well defined target market - Service & relationships are crucial
Communication Platforms
Advertising• Print and broadcast ads• Packaging inserts• Motion pictures• Brochures and booklets• Posters• Billboards• POP displays• Logos• Videotapes
Sales Promotion• Contests, games,
sweepstakes• Premiums• Sampling• Trade shows, exhibitions• Coupons• Rebates
Communication Platforms
Personal Selling• Sales presentations• Sales meetings• Samples• Fairs and trade shows
Direct Marketing• Catalogs• Mailings• Telemarketing• Electronic shopping• TV shopping• Fax mail• E-mail• In formals
Communication Platforms
Public Relations• Press kits• Speeches• Seminars• Annual reports• Charitable donations• Publications• Lobbying
Elements in the Communications Process
M. Manager
Ad. Manager
Ad. Agency
Ad, Sales presentation, Store display
News Articles
Other Advertisements
Other store displays
Market Research
Sales Results
Media, Local News
Salesperson, Retail Store etc
Receiver Interpretation of message
Customers, listeners, viewers
Response Hierarchy Models
Learn
Feel
Do
AIDA and the Promotional Mix
AwarenessAwareness InterestInterest DesireDesire ActionAction
Advertising Veryeffective
Veryeffective
Somewhateffective
Noteffective
PublicRelations
Veryeffective
Veryeffective
Veryeffective
Noteffective
SalesPromotion
Somewhateffective
Somewhateffective
Veryeffective
Veryeffective
PersonalSelling
Somewhateffective
Veryeffective
Veryeffective
Somewhateffective
Response Hierarchy Models
LearnFeelDo
LearnDoFeel
DoLearnFeel
High Involvement
High Involvement
Low Involvement
More Differentiation
Little OR NoDifferentiation
Little Differentiation
House, Automobiles
Airline ticket, Personal Comp.
Salt, Batteries
By understanding and choosing right sequence, We can do a better job in M. Communications
Steps in Developing Effective Communications
Identify target audience
Determine objectives
Design message/communications
Select channels
Establish budget
Decide on media mix
Manage IMC
Developing Effective Marketing Communications
• Step 1: Identifying the target audience– Includes assessing the audience’s
perceptions of the company, product, and competitors’ company/product image
• Step 2: Cognitive, affective, and behavioral objectives may be set
• Step 3: AIDA model guides message design
Developing Effective Marketing Communications
• Step 4: Selecting Communication Channels– Personal communication channels
• Effectiveness derives from personalization and feedback
– Non-personal communication channels• Influence derives from two-step flow-of-
communication process
Developing Effective Marketing Communications
• Step 5: Establishing the Marketing Communications Budget– Affordability method– Percentage-of-sales method– Competitive-parity method– Objective-and-task method
MONEY : Allocating BudgetsEstablishing IMC Budget• One of the most difficult decisions:• Methods:1. Affordable Method: Completely ignores impact on sales volume,
Leads to uncertain annual budget, long term planning difficult.2. Percentage of sale method3. Competitive parity method: In line with competition
• Competitors expenses represent collective wisdom on industry4. Objective and task Method: Define specific objectives
– Establish market share goals (50 Lakh potential users, we can attract 25%)
– %age of aware prospects that should be persuaded to buy this year.
Step 6: Deciding on the Marketing Communications Mix
•Advertising-Development and Management-Decisions on Media and Measurement
What is Advertising?Advertising is Any Paid Form of Non-
personal Presentation and Promotion ofIdeas, Goods, or Services by an IdentifiedSponsor.
Major Media Types• Television• Newspapers• Radio• Magazines
• Outdoor• Yellow Pages• Newsletters• Brochures• Telephone• Internet• Direct mail
Characteristics of Leading Media Advertizing- (I)-Television
Advantages• Ability to reach broad
segments of consumers• Low cost per exposure• Ability to demonstrate
product use• Ability to portray image
and brand personality
Disadvantages• Brief • High cost of
production• High cost of
placement• Lack of attention by
viewers
Characteristics of Leading Media Advertizing- (II)-Newspapers
Advantages• Considered
Informational• Most people look upon
advertising +vely.• Broad coverage of local
market• Flexible-Space need not
be reserved in advance
Disadvantages• Life is Only ONE DAY• Weak Reproduction
Quality as compared to magazines
Characteristics of Leading Media Advertizing- (IV)-Magazines
• Very sharply defined audience to consumers• Longest Life• Strong Message to target customers.
Print Ad Components
Headline
Picture
SignatureCopy
Characteristics of Leading Media Advertizing- (III)-Radio
Advantages• Local Medium• Large number of stations
and their distinct positions (Well Segmented)
• Low Cost if message frequency is well defined
Disadvantages• Sound Only and Ads
may easily be turned out
• Clutter is an issue as many ads compete for consumer attention
Alternative Advertising OptionsPlace Advertisement or out of home
advertisement
• Billboards• Public spaces• Product placement• Point-of-purchase
Public Spaces: Movies, Airlines, Sports Arenas, Kiosks, public areas etc
Problems in Communicating to the Rural Audience
• Large variations in language and culture• Campaigns have to be tailor made for product
and region• Product demonstrations in haats, mandis,
and melas (fairs) are useful• TV and print media do not reach all villages
and all customers• Wall paintings and signboards very popular• Folk theatre, magic shows and puppet shows
are also used as a media vehicle
Developing the Advertising Plan
• The 5 M’s of Advertising
Mission – setting advertising & sales growth objectives Money – budgeting the allocation of resourcesMessage – deciding the content & formMedia – media vehicles to be used, frequency & timingMeasurement – evaluating the impact of communication & it’s effect on sales
The Five M’s of Advertising
MISSION : Defining the objectives
Possible objectives• To inform – informing the market about a new
product/service- suggesting new uses- building brand/company image- building primary demand- generate interest amongst
trade/consumers• To persuade - build brand preference
- induce brand switching- persuade to buy now
• To remind - maintain Top of the mind Recall- keeping customers informed about
availability & improvements
Factors to Consider in Setting an Advertising Budget
Stage in the product life cycle
Market share and consumer base
Competition and clutter
Advertising frequency
MONEY : Allocating Budgets
• One of the most difficult decisions:• Methods:
– Affordability method– Percentage-of-sales method– Competitive-parity method– Objective-and-task method
Message: Deciding ContentAdvertising can take either an emotional route or a rational route to convey the message.
Concept of USP
Each advertisement must make a specific propositionto the consumer : Buy this product & you will get this benefit.
The proposition must be one that competition either cannot or does not offer: It must be unique.
The proposition must be so strong that it can: Pullnew customers to your product.
Message-Appeals
• Rational Appeals: Strong Claim supported by numbers.
• Radio Mirchi “India’s 2nd largest channel is not seen, it is heard”. (TRP)
• Zodiac “ Why Zodiac makes best shirts in India” Fabric, Stitching, buttons, Collars, Style and Comfort, Customer Satisfaction.
• Complan “23 vital nutrients”• Maggi 2-Minute Noodles
Message-Appeals Cont…• Emotional Appeals:• “ A Gift for someone you love”• Kingfisher Airlines• Fly Kingfisher this season for good times• Because Queen of your heart deserves to fly
like one• To make someone feel like she is on cloud
nine
Message-Appeals Cont…• Humour Appeals: Important clutter breaker• Newsweek (Times Magazine):• “ If your Ad doesn’t work in TM, Change your Ad
Agency”• “ If your Ad doesn’t work in TM,DON’T Change
your Ad Agency” Place it in Newsweek.• Negative Appeals: Fear, Guilt, Shame• Fear Appeals:• “Today a picture of safety, tomorrow a picture of
disaster”
Informational Appeals• Elaborates of product/service benefits:• Saridon stops headache pain quickly• Product demonstration ads• Transformational Appeals (Non product
related benefits or image)• Kind of person or kind of experience results
from using of brand• Liril (Freshness Soap), Mentos (electrify
your mind, (Raymonds-A complete man)
Media: Selecting Appropriate Media
Media options are: Print Media - Newspapers/magazines Audio visual - Radio/TV/internet Outdoor - Hoardings/bus panels/kiosks/banners Data bases - Yellow pages/trade directories Direct mail - Brochures/leaflets/newsletter
Selecting specific media: Circulation/ readership/ viewer ship Reach-penetration Feasibility Cost Visibility vs. clutter
Media Selection
• Reach• Frequency• Impact• Exposure
Relationship among Trial, Awareness, and the Exposure Function
Measures of Audience SizeTRP Ratings
• Circulation• Audience• Effective audience• Effective ad-exposed
audience
Classification of Advertising Timing Patterns
Product Launch Communications Mix
Kleenex allocated its communications:•75% Television•23% Print•2% Online
MEASUREMENTEvaluating Advertising Effectiveness
• Communication Effect Research
1. Consumer feedback method:– Main Message you get from is Ad– What works well and what works poorly?– Which is the best place to reach you with this message?
2. Portfolio Tests: Asked to view and listen to many Ads (Asked to recall all Ads and its content.
3. Lab Tests: Physiological reactions (Heartbeat, BP Etc) Asked to turn a knob to indicate their liking or disliking moment by moment.
Current Consumer States for Two Brands
PROMOTIONSales Promotion
PublicityPublic Relations
Sales Promotion
Collection of incentive tools, mostlyshort term, designed to stimulate
quicker or greater purchase of particular products or services
by consumers or the trade.
Sales Promotion-Examples
• Exchange your new car, get loyalty points• Buy a Chocolate, win free trip to
Switzerland• Buy one, get TWO free• Reward of 5% for paying your bills with us• Clearance sales, rock bottom prices• Scratch and Win, get lucky with our
sweepstakes.
Sales Promotion ToolsConsumer-directed• Free Samples• Coupons• Cash refund offers• Price offs• Premiums• Product Warranties• Patronage Awards• Tie-in promotions
Trade-directed• Temporary Price Cuts• Renting Shelf space• Cooperative
advertising• Volume Discounts• Contests
Sales Promotion Tools
• Consumer promotion tools– Sampling – Free amount of Product– Couponing – Entitles bearer to stated saving on specific
product– Cash Refund Offer (Rebate) – Price reduction after
purchase rather than at retail shop.– Premiums – Product offered at low cost or free as an
incentive to purchase particular product.– Patronage awards – Value in cash or other form if you
purchase things from certain vendor or group of vendors.– Product Warranties- Promises by sellers that product will
perform as specified or they will replace/repair/refund it.
Sales Promotion Tools
• Consumer promotion tools– Sampling – to induce trial– Couponing – to induce repeat buying– Price-offs – to induce brand switching– Premiums – to induce preponement of purchase– Patronage awards – to reward loyalty/ retain customers– Contests – to induce immediate purchase
• Trade promotion tools– Discounts on list prices– Free goods offers– Promotional allowances– Gifts
• Business promotion tools– Trade shows & Conventions– Sales contests for sales personnel
Public Relations• Press relations• Product publicity• Corporate communications• Lobbying• Counseling• Lobbying: Dealing with Lawmakers/Government Officials
to defeat law.• Counseling: Ad Management about public issues,
company position and image in good/bad times.
Major Tools in Marketing PR
• Publications• Events• Sponsorships• News• Speeches• Public Service
Activities