MKTG 504 - Promotion and Communication
“Are you looking for a 25’’ color TV for $275? Here it is.”
Dr. Dennis PittaUniversity of Baltimore
PROMOTION
Promotion = Communicationwhich INFORM potential consumersand PERSUADE them of theWANT SATISFYING benefits of products and services.
PROMOTION MIX- DESCRIPTION - - NAME -
Paid Nonpersonal Advertising
Paid Personal Personal Selling
Nonpaid Nonpersonal Publicity
Nonpaid Personal Word of Mouth_______________________________________________Plus
Everything Else Sales Promotion
DESCRIPTION NAME
PAID NONPERSONAL ADVERTISING
PAID PERSONAL PERSONALSELLING
NONPAID NONPERSONAL PUBLICITY
NONPAID PERSONAL Word of MouthEverything else SALES
PROMOTION
PROMOTION MIX CHARACTERISTICS
EXPENSE PEREXPOSURE
EFFECTIVENESSPER EXPOSURE
AdvertisingLOW LOW
Personal Selling V. HIGH HIGH
Publicity V. LOW MOD. HIGH
Word of Mouth V. LOW V. HIGH
Sales Promotion MODERATE HIGH
ADVERTISING
Any PAID form of NONPERSONALpresentation and promotion of
ideas,goods, and/or services by anIDENTIFIED SPONSER.
Examples: Let Your Fingers Do the Walking; McDonalds’...
PERSONAL SELLING
DIRECT INTERACTION between parties - an oral presentation in conversation with one individual acting as a ‘selling agent’.
Example: Avon Representatives, Checkout person, you in an interview.
PUBLICITY
Any form of commercially significant news about an organization, good, service, idea that is published by a mass medium and that is NOT paid for by a sponsor.
Examples: Ebert (without Siskel), gourmet critics...
PUBLICITY: Traditional Media
RadioTVNewspaperMagazinesOrganization NewslettersEvents (e.g., Holiday celebrations...)...
WORD OF MOUTH (ADVERTISING)
Any form of interaction between individuals in which, neither party represents a ‘seller’.
Examples: a restaurant recommendation from a friend, a colleague’s evaluation of a movie, a neighbor’s statements about a university.
SALES PROMOTION
Sales Promotion = The promotional technique which emphasizes: Coupons, Rebates, Premiums, Contests, Sweepstakes, Trading Stamps, Free Gifts, Samples, Point of Purchase Promotions, Trade Shows.....
Sales Promotion is The Group of Activities Which Aim At:
STIMULATING CONSUMER PURCHASES
ENHANCING DEALER EFFECTIVENESS
INCREASING SALESPERSON EFFECTIVENESS
ADVERTISING
Major Decisions:
HOW MUCH TO SPEND?ADVERTISE TO WHOM?WHAT TO SAY?WHEN (AND WHERE) TO SAY IT?HOW TO DETERMINE ITS EFFECTS?
BUDGETING FOR ADVERTISING
FIVE METHODSALL YOU CAN AFFORD*% OF SALES*UNITS OF SALES*COMPETITIVE PARITY*
OBJECTIVE AND TASK METHOD**** = STUPID *** = GREAT
OBJECTIVE AND TASK METHOD OF BUDGETING
SET OBJECTIVES ANDDETERMINE THE ADVERTISING TASKS ( THE HIERARCHY OFEFFECTS) NECESSARY TO ACHIEVE
THEM
EXAMPLE OF ADVERTISING OBJECTIVES
ACTION + 1% (the goal)
CONVICTION + 11%COMPREHENSION + 22%AWARENESS + 56%EXPOSURE + 100%
EXAMPLE OF ADVERTISING OBJECTIVES used for budgeting
ACTION + 1%CONVICTION + 11%COMPREHENSION + 22%AWARENESS + 56%
$55, 000 EXPOSURE + 100%
ADVERTISING TO WHOM?
CHOOSING A TARGET AUDIENCE IS CRITICAL.
MEDIA AFFECT THE ABILITY TO REACH MARKET.
TV: MUCH WASTED EXPOSURE. MAGAZINES: MORE SPECIFIC COVERAGE -
LESS WASTE.DIRECT MAIL: MOST SPECIFIC - LEAST WASTE
WHAT TO SAY?
MESSAGE RESEARCH IS A SCIENCE
START WITH THE AUDIENCE
USE: REPETITION, NOVELTY, CONTRAST, HUMOR
MESSAGE RESEARCH REQUIRES TESTING.
WHEN AND WHERE TO SAY IT?
MEDIA RESEARCH INVOLVES WHEN AND WHERE THE TARGET AUDIENCE EXPOSES ITSELF TO YOUR MESSAGE.
SOME MAGAZINES, TV PROGRAMS ARE BETTER FOR REACHING WOMEN OR MEN, YOUNG OR OLD.
WITH WHAT EFFECTS?
MEASURING ADVERTISING EFFECTIVENESS
PRETEST
PORTFOLIO TEST (AWARENESS, RECALL)
LAB TESTS
AFTER APPEARING IN THE MEDIA (POST TEST)
PERSONAL SELLING: Sales Tasks
ORDER GETTING TASKS: Focus on converting prospects to customers or in getting customers to buy products they have not purchased before.
ORDER TAKING TASKS: Focus on building repeat sales of products that customers have purchased previously.
SALES SUPPORT TASKS: Facilitate order getting and
order taking.
THE PERSONAL SELLING PROCESS
PROSPECTINGPREPARING THE PREAPPROACHAPPROACHPRESENTATIONHANDLING OBJECTIONSCLOSING THE SALEPOST SALE FOLLOW-UP
PROSPECTING
The process of searching for, identifying, and qualifying potential customers.
Leads => qualified prospectsIF they can benefit from the product, IF they can afford it, IF they can make the buying decision.
SOURCES OF LEADS
INTERNAL: COMPANY RECORDS, PERSONNEL
EXTERNAL: TRADE JOURNALS, PRESENT CUSTOMERS, TRADE SHOWS.
PREPARING THE PREAPPROACH
Gathering specific information about the
prospect which will help in tailoring the
sales presentation to the prospects’ situation.
APPROACH
The manner chosen to gain access to the
prospect, establish rapport, and get the
prospect’s attention and interest.
PRESENTATION
There are various approaches:Stimulus-Response SellingBarrier SellingFormulized Selling*Need-Satisfaction Selling =>
recognizes that the main reason people buy comes from within the person, not from outside stimuli.
HANDLING OBJECTIONS
Encouraging prospects to voice objections
provides FEEDBACK and helps the salesperson deal with objections in a positive fashion.
CLOSING THE SALE
The CLOSE involves asking the prospect for
an order. Closing is an art, and may take
many forms.
Types of Closing Techniques
Standing Room Only Close (It’s the Last One)
Extra Inducement CloseEmotional CloseSilent CloseAlternative Decision Close (Either/Or)
POST SALE FOLLOW-UP
Important since it helps ensure:customer satisfactiongoodwillmay lead to repeat business
SALES FORCE ISSUES
ORGANIZING THE SALE FORCETERRITORIAL SPECIALIZATION
PRODUCT SPECIALIZATION TASK SPECIALIZATION
TASK MARKET SPECIALIZATIONRECRUITING AND SELECTING THE
SALES FORCE
TRAINING AND DEVELOPMENT OF THE SALES FORCE
COMPENSATING THE SALES FORCESTRAIGHT SALARYSTRAIGHT COMMISSIONCOMBINATION PLANS
MOTIVATING THE SALES FORCE
That depends on their strengths.
Two vital measures are:1) the effectiveness of a single exposure and2) the cost of a single exposure
ADVERTISING
Any PAID form of NONPERSONALpresentation and promotion of
ideas,goods, and/or services by anIDENTIFIED SPONSER.
Examples: Let Your Fingers Do the Walking; McDonalds’...
Let’s look at ADVERTISING
A 30 second commercial aired on the SuperBowl might cost $500,000.
If 50,000,000 people see it, it costs, $.01 or one penny per person exposed (LOW)
How many people run out and buy the product? 5000? That is 1 in 1000 or .1% of viewers (LOW SUCCESS RATE)
PERSONAL SELLING
DIRECT INTERACTION between parties - an oral presentation in conversation with one individual acting as a ‘selling agent’.
Example: Avon Representatives, Checkout person, you in an interview.
Let’s look at PERSONAL SELLING
A single sales call by a salesperson costs $750 (VERY HIGH EXPENSE PER EXPOSURE)
If he or she sells one customer in 4 that is a 25% success rate (HIGH SUCCESS RATE)
PUBLICITY
Any form of commercially significant news about an organization, good, service, idea that is published by a mass medium and that is NOT paid for by a sponsor.
Examples: Ebert (without Siskel), gourmet critics...
Let’s look at PUBLICITY
A favorable restaurant review by a restaurant critic costs nothing but consistent good food (VERY LOW)
If 10% of the readers come to your restaurant because of the review (MODERATELY HIGH SUCCESS RATE)
WORD OF MOUTH (ADVERTISING)
Any form of interaction between individuals in which, neither party represents a ‘seller’.
Examples: a restaurant recommendation from a friend, a colleague’s evaluation of a movie, a neighbor’s statements about a university.
Let’s look at WORD OF MOUTH advertising
A favorable restaurant comment by a friend costs nothing but consistent good food (VERY LOW)
If 50% of the friends come to your restaurant because of the comments (VERY HIGH SUCCESS RATE)
SALES PROMOTION
Sales Promotion = The promotional technique which emphasizes: Coupons, Rebates, Premiums, Contests, Sweepstakes, Trading Stamps, Free Gifts, Samples, Point of Purchase Promotions, Trade Shows.....
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