PROMOTIONALSTRATEGYWhat is meant byPromotion?*

..It is PERSUASIVE COMMUNICATION.

Promotion is communication with a

What is meant by promotion? .deliberate attempt to persuade consumers to buy a companys goods or services.deliberate attempt .. . it aims to communicate information in a persuasive manner in order toinduce a desired response, which is purchase.

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*NESTLE INDIA LtdFor nearly three decades, Nestle's MAGGI noodles was the ultimate success story: an unlikely product embraced wholeheartedly by a difficult market. Over the last few weeks, it's become a case study of an entirely different sort a textbook example of how not to handle a crisis. To give you some estimate of the size of the problem facing Nestle and Maggi here are a few statistics: according to the World Instant Noodles Association, India consumed 5,340 #Maggi In A Soup: A case study of how not to handle a crisisBy Ravi Balakrishnan & Amit Bapna, ET Bureau | 10 Jun, 2015, 05.20AM ISTThe 2-minute noodle, Maggi, got its goose cooked in as much time, when Nestle decided to stay mum during a crisis of mammoth proportions.

*Following the reports of high content of lead in Maggi, FDA Maharashtra conducted its own tests and banned the sale of Maggi in the state on 6 June. Photo: Reuters

Mumbai: Nestle India Ltd on Thursday filed a case in the Bombay high court for a review of orders passed by the Food and Drug Administration (FDA) in Maharashtra and the Food Safety and Standards Authority of India (FSSAI) banning the sale, distribution and production of Maggi noodles.The company has also raised issues of interpretation of the Food Safety and Standards Act 2011. Maggie Noodles, Source: Livemint

. Emergence of new kinds of promotional activity like..Recent Challenges facing the Promotional Manager. . Emergence of new forms of Promotional Activity:

This is known as the THE IMC REVOLUTION*

THE IMC REVOLUTIONNew Forms of IMC ACTIVITIES Mobile Marketing. Telemarketing (Direct Response Advertising: (via Telephone calls) Eg. by Banks,Tourist Resorts; Consumer Goods; Water filter companies (Aquaguard). Personalized e-mail Ads to prospects. Direct Response Advertising (via TV/PC/Ordinary Mail)yes, I want to know more about the product service Product Advertising in Films / TV Programs: Ex Nike `Just do it campaign. Ex. Mahindra Flyte Placement in `3 Idiots film.`The aim here is to be associated with content which appears more authentic and desirable. Sponsorships of Events. (Fashion shows, Sports events, .. Below- the- Line Advertising Activities. This leads to faster acceptance of Brands through more Exposure.*

**`PRODUCT PLACEMENT IN FILMS:Mahindra Flyte Power Scooter in 3 Idiots Film.

*Product Placement in Films: Canon Equipment in Film `Jab Tak Hai Jaan.

* Use of Interactive Games on company websites Use of Shopping Carts for Ad Space. Use of Helmets with the Company logo. Getting Radio Jockeys of the local FM Radio Channels to promote and speak about a Companys Brand. Sales Personnel inside Retail Outlet deployed near store shelves (Logo on Uniforms). Store Banners given to Retailers by Companies. Nike Logo on Air Deccan Aircraft. Personalized e-mails useful for targeting high value individuals

Companies are looking at non-conventional advertising (BTL) media as well as Advertising Media, as they get more focused on Integrated Advertising.What is meant by BELOW THE LINE ADVERTISING (BTL ADVERTISING)A company does not have to purchase Ad space.***

*Why Use BTL? Need to get acceptance of their brands much faster. Therefore multiple media are used.It is most useful for small businesses for small target groups.

TRADITIONAL MEDIA ADVERTISING - TV,Radio, Newspaper, Magazines, Cinema Outdoor Advertising (Billboards, Posters) Consumer Promotions Trade Promotions

Direct Response Advertising : Direct Mail, Tele-marketing, Interactive TVEvent Marketing (Sponsorships) Mobile Phones Public Relations/PublicityBTL AdvertisingNEWER MEDIA: NEWER Promotional Techniques that have been added EXISTING Promotional Techniques Used by Marketing Managers *

Recent Concerns in Promotional Strategy.There is a Need for Integrated MarketingCommunicationsHow do we go about Integratingthe elements ofthe Promotional MixHere we apply a Flow Chart Diagram to Illustrate this.See the 1st Reading in the polycopy.*MARKETING INFERENCE:

ADVERTISING &PUBLIC RELATIONSPUBLICITY COMMUNICATIONSSALES PROMOTIONSMANUFACTURERPROMOTIONS

ADVERTISINGBrand AdvertisingCorporate AdvertisingDirect Response AdsConsumerPromotionsTradePromotionsTrial PromotionsRepeat Purchase PromotionsPOP DisplaysPrice-Off PromotionsTV /PC Interactive ShoppingCustomerFLOW CHART MODEL for INTEGRATION OF ADVERTISING COMMUNICATIONS & PROMOTIONSRETAILERPROMOTIONSBrand Equity in the form of Consumer FranchiseAll IMCActivitiesContributeTo BrandEquity132What is the Difference betweenAdvertising and Promotions?Which May be:May be:PUBLIC RELATIONSSponsorshipsEvent MarketingPUBLICITY*

DIFFERENCE BETWEEN ADVERTISING AND Sales PROMOTIONS in the Flow ChartAdvertising is Indirect, basedOn Mental ImpressionsConsists of Direct ExternalIncentivesADVERTISING COMMUNICATIONSSALES PROMOTIONSConsumerPromotionsTradePromotions The Proportion of Expenditure on Advertising versus Promotions: (For Consumer Products): 53%(Adv) : 47% (Sales Prom) (MacCann-Erickson, U.S. Guide to Marketers) Indirect*direct

W hat Activities are we integrating? Traditional with New Forms of Promotional Activity.

Awareness (Through PR, Publicity, Advtg.)Attitude (Likes/ Dislike toward the Brand)ConvictionPurchase Intention (Here, more Emphasis is given to Consumer Promotions)

Reason for Integration? There must be a Common Communication Objective underlying the different forms of Promotional Activity:

Need for SYNERGY in the Promotional Mix* The Challenge facing Companies for IMC:

The Communication Objective may be:

The Ad Agency may be made responsible by the company for the Coordinated Integrated Marketing Communications. WHAT DO WE MEAN BY INTEGRATED MARKETING COMMUNICATIONS ?

Advertising interacts with other Marketing Mix Inputs such as the:

Product Performance Packaging, BRAND NAME, Price, Location, retail Shelf Display and other promotional Activities

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ALL these ARE PROMOTIONAL TOOLS.

PRODUCT (Benefits) PRICE (Prestige/Value)PLACE/ LOCATION (Store Atmosphere)PACKAGING PERSONAL SELLINGADVERTISING & SALES PROMOTIONS INTEGRATED MARKETING COMMUNICATIONS & PROMOTIONEVERY ELEMENT OF THE MARKETING MIX COMMUNICATESAll the Elements are Promotional ToolsExamining the MARKETING MIX in the context of INTEGRATED MARKETING COMMUNICATIONS:*

INFORMATION FLOW from each marketing mix elementINFORMATION FLOWPRODUCT OFFERINGThere is a COMMUNICATION FLOW ININTEGRATED MARKETING COMMUNICATIONSTHE PROMOTIONALMIX ELEMENTSIMPLICATIONS OF IMC*

PRODUCT PRICE PROMOTION PLACE

PRODUCTCOMMUNICATIONPRICE COMMUNICATIONPROMOTION COMMUNICATIONPLACE COMMUNICATION

ELEMENTS OF THE PROMOTIONAL MIXADVERTISINGSALES PROMOTIONPERSONAL SELLINGPUBLICITY /PUBLIC RELATIONSNarrowing down to DESCRIBING THE 4 ELEMENTS OF the Promotional MixHow do these 4 Promotional Mix ElementsDiffer from each other?Refer to: Second Reading in Polycopy for differentiating characteristics.*

*Advertising : Paid for by the Company /Non-personal /Identifiable Sponsor/ Long-term Brand building /Generally regarded as Indirect, building up mental associations.Sales Promotion: Paid for by the company /Impersonal /Identifiable Sponsor/Short-term Incentives to buy/Generally considered Direct inducement at Retail outlet. Personal Selling: Paid for by the Company /Personal/ Identifiable Sponsor, Direct.Public Relations: Paid for by the company/Identifiable sponsor.Publicity: Not paid for by the company. The media pay for news items they carry.HOW DO THE PROMOTIONAL ELEMENTS DIFFER FROM EACH OTHER?DEFINING CHARACTERISTICS**

*Who Pays?: Is it paid for or unpaid by the sponsor?Sponsor: Identifiable or not? Personal (Face to Face) or Nonpersonal/ Impersonal? Is it Direct or Indirect? Short-Term or Long-Term in Effects?The Four DEFINING CHARACTERISTICS OF THE PROMOTIONAL MIX ELEMENTS*

*A broader definition of advertising means that it is not necessarily impersonal,or only through the mass media as originally stated.. It may be personal or non-personal, direct or indirect.Redefining Advertising. See Reading 2 of your PolycopyQ. `Are personalized e-mails sent to prospects, advertising or direct marketing? Are logos advertising or sales promotion?Q. Which forms of promotion are not advertising? *

*RECENT ISSUES THAT HAVE BEEN RAISED

Advertising Defined: (ORIGINAL DEFINITION)It involves Paid announcements in Print,Broadcast,Electronic media.- It is Salesmanship in Print (1960).It is A Symbol Manipulation activity (1964). (Semiotics)-- it is Selling Cornflakes to people who are eating Cheerios (Leo Burnett).Defining/Redefining Advertising. Ref: Second Reading in Polycopy `Oracles of Advertising.*

*Example: Tatas `Nano (Initial Publicityprior to product launch.) IPL Cricket Series The New relaunched `Beetle in the US market (1998) was also primarily built up on publicity. Publicity is most relevant in the first week of the official launch. Publicity is also useful to influence Hard to reach audiences who are not heavy TV viewers.It is possible for a Brand to be built primarily on Publicity?*How Important is PUBLICITY in the Promotional Mix

CEO of Renault Nissan with Tamil Nadu CM and former PM of Japan Yoshiro Mori, unveiling the India Plant at Chennai.Public RelationsExample of*

Flagging off Reva Electric Car Companys new model. (2008)Which Element of the Promotional Mix is this?Public Relations*

2009*Which Element of the Promotional Mix is this?Flagging off the I10 Kappa..

Richard Branson`s Public Relations and Publicity`The First Commercial Passenger Spaceship2009*Importance of Publicity

**Impact of VIRAL MARKETING in PublicityThe Power of Twitter to spread information both to Inform and Misinform.An unfounded report in a little known Blog by a liberal blogger went viral in a matter of minutes due to re-tweeting by several without checking the veracity of the news.A lie races across twitter before the truth can boot up. Within 2 and a half hours period it gathers speed and embellishment.Media Outlets competing with twitter may add to the confusion.

Much of IBMs success (1980s decade) was built on Personal Selling by its smart dedicated workforce. Subsequently on Customer relationships. Sales force served as a problem solver, consulting function to help customers.Importance of PERSONAL SELLINGas an Element of the Promotional Mix: *

*Ford Motor in India PR (2009)The Initial use of PR is generally followed by Publicity..Chief Executive Alan MULALLY UNVEILED THE Figo in Chennai. EXAMPLE*

The Relative role of Advertising versus Sales Promotions varies according to stages of the plcINTRODUCTION GROWTH MATURITY DECLINEPLC STAGESALESAdv: HighSales Prom: HighThe % of Expenditure on Advertising to Sales Promotion will change as the PLC progresses.Adv: HighSales Prom: LowSOURCE: ROSSITER & PERCY See Polycopy ReadingPg.EXAMINING the PLC Curve for THE ROLE OF ADVERTISING versus SALES PROMOTIONINITIAL Adv: May be Low/ HighINITIAL Sales Prom: May be High to Induce BuyersAdv: High if Market Leader BrandSales Prom: Low if Market Leader Brand*

RELATIVE ROLES OF ADVERTISING AND PROMOTIONS ACCORDING TO PLC STAGES

PLC STAGE ADVERTISING PROMOTIONS COMMUNICATION OBJECTIVE1. INTRODUCTION HIGH HIGH Awareness2. GROWTH STAGE MARKET LEADER HIGHLOW Brand Identity Me-Too PRODUCT LOWHIGH Induce Trial3. MATURITY HIGH BRAND LOYALTY HIGHLOW Brand Image LOW BRAND LOYALTY LOWHIGH Hold Buyers4. DECLINE NONELOW (Trade Promotions))INTRODUCTION GROWTH MATURITY DECLINESOURCE: ROSSITER & PERCY*

Varying Emphasis on Advertising & Sales Promotion in the PLCIntroduction Stage: HIGH PROMOTION BUDGET. High Advertising + High Sales PromotionGrowth Stage: Once Sales take off, the Promotion Budget is frequently reduced. However, PROMOTION BUDGET MAY BE HIGH OR LOW and will depend on whether the company is a Market Leader or Market Follower.Maturity Stage: Once sales slow down, a company will normally reduce its promotional budget. Here again, PROMOTION BUDGET MAY BE HIGH OR LOW. Decline Stage: Reduction in overall promotional budget.How will the allocation of the Promotion Budget in terms of Proportion for Advertising vs Sales Promotion change over time?*

What are the Product Life Cycle Promotional Implicationsfor the Manager? Promotional Expenditure is decided on the basis of the Companys Market Share Objective of Brand:Also whether it is an New Brand or Existing Brand. Implications Regarding Market Share?*

Market Share is dependent on the Brand Equity, which in turn depends on how the consumer processes the advertising & brand related promotion. This is shown in THE SIX-STEP SEQUENCE OF EFFECTS (Next Time)PLC Promotional Implications for Brand Equity*

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