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Chapter 9 PROMOTION.

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Presentation on theme: "Chapter 9 PROMOTION."— Presentation transcript:

1 Chapter 9 PROMOTION

2 Objectives Developing & Managing an Advertising Program
Deciding on Media & Measuring Effectiveness Sales Promotion Public Relation Principles of Personal Selling

3 Major Decisions in Advertising
Objectives Setting Major Decisions in Advertising Budget Decisions Message Decisions Media Decisions Campaign Evaluation

4 Advertising Objectives
Specific Communication Task Accomplished with a Specific Target Audience During a Specific Period of Time Informative Advertising Build Primary Demand Persuasive Advertising Build Selective Demand Comparison Advertising Compares One Brand to Another Reminder Advertising Keeps Consumers Thinking About a Product.

5 The Five Ms of Advertising
Message Message generation Message evaluation and selection Message execution Social-responsibility review Media Reach, frequency, impact Major media types Specific media vehicles Media timing Geographical media allocation Money Factors to consider: Stage in PLC Market share and con- sumer base Competition and clutter Advertising frequency Product substituta- bility Mission Sales goals Adver- tising objectives Measure- ment Communi- cation impact Sales

6 Advertising Budget Factors
Market Share & Consumer Base Competition & Clutter Stage in the Product Life Cycle Advertising Frequency Product Substitutability

7 Profiles of Major Media Types
Newspapers Advantages: Flexibility, timeliness; good local market coverage; broad acceptance, high believability Limitations: Short life; poor reproduction quality; small pass-along audience Television Advantages: Combines sight, sound, motion; high attention; high reach; appealing to senses Limitations: High absolute costs; high clutter; fleeting exposure; less audience selectivity Direct Mail Advantages: Audience selectivity; flexibility, no ad compe- tition within same medium; allows personalization Limitations: Relative high cost; “junk mail” image

8 Profiles of Major Media Types
Radio Advantages: Mass use; high geographic and demographic selectivity; low cost Limitations: Audio only; fleeting exposure; lower attention; nonstandardized rates; fragmented audiences Magazines Advantages: High geographic and demographic selectivity; credibility and prestige; high-quality reproduction; long life; good pass-along readership Limitations: Long ad purchase lead time; waste circulation; no guarantee of position Outdoor Advantages: Flexibility; high repeat exposure; low cost; low message competition Limitations: Little audience selectivity; creative limitations

9 Classification of Advertising Timing Patterns
Concen- trated (1) (2) (3) Level Rising Falling Alternating (4) Continuous (8) (7) (6) (5) (9) Inter- mittent (10) (11) (12) Number of messages per month Month

10 Advertising Strategy Message Execution
Testimonial Evidence Slice of Life Turning the “Big Idea” Into an Actual Ad to Capture the Target Market’s Attention and Interest. Lifestyle Typical Message Execution Styles Scientific Evidence Fantasy Technical Expertise Mood or Image Personality Symbol Musical

11 Advertising Evaluation
Advertising Program Evaluation Advertising Evaluation Communication Effects Is the Ad Communicating Well? Sales Effects Is the Ad Increasing Sales?

12 Why the increase in Sales Promotion?
Growing retailer power Declining brand loyalty Increased promotional sensitivity Brand proliferation Fragmentation of consumer market Short-term focus Increased managerial accountability Competition Clutter Retailer - scanner data, industry consolidation -MFGs want to break through Loyalty & Sensitivity & proliferation - we did that Frag - more media, more targeted Short-term&Account - US Business, stock mkt, not BE

13 Long-Term Promotional Allocation
10 20 30 40 50 60 1986 88 90 92 94 1996 Year %t of total - 3 yr.MA Trade Promo Media Adv Cons. Promo Cox Direct 19th Annual Survey of Promotional Practices

14 Channels of Sales Promotions
MANUFACTURER CONSUMER Consumer Promotions RETAILER Trade Promotions Push Pull Retail Promotions

15 Consumer Promotion Consumer-Promotion Objectives
Consumer-Promotion Tools Entice Consumers to Try a New Product Point-of-Purchase Displays Premiums Price Packs Cash Refunds Coupons Samples Patronage Rewards Games Sweepstakes Contests Advertising Specialties Lure Customers Away From Competitors’ Products Get Consumers to “Load Up’ on a Mature Product Hold & Reward Loyal Customers Consumer Relationship Building

16 “Deal Proneness,” Liechtenstein, Burton, & Netemeyer, Journal of Retailing, Summer 1997
Examination of “deal proneness” among consumers in a supermarket setting Surveys & Grocery Receipts used Eight types of deals: Cent-off, One-free, Gift, Display, Rebate, Contest, Sale, & Coupon

17 “Deal Proneness,” Liechtenstein, Burton, & Netemeyer
Cluster analysis yielded two interpretable results: 49% are “deal prone,” 51% not 24% High “Deal prone,” 50% intermediate, 26% deal insensitive “Deal-proneness” a generalized construct - (crosses type of promotion) Younger & Less educated more likely to be deal prone

18 Trade Promotions Trade-Promotion Tools Trade-Promotion Objectives
Specialty Advertising Items Contests Free Goods Buy-Back Guarantees Allowances Price-Offs Patronage Rewards Push Money Discounts Premiums Displays Persuade Retailers or Wholesalers to Carry a Brand Give a Brand Shelf Space Promote a Brand in Advertising Push a Brand to Consumers

19 Business-to-Business Promotion
Business-Promotion Objectives Business-Promotion Tools Generate Business Leads Conventions Trade Shows Sales Contests Stimulate Purchases Reward Customers Motivate Salespeople

20 Major Public Relations Tools
Web Site News Public Service Activities Speeches Corporate Identity Materials Father of PR was Edward Bernays, turns out he was Freud’s nephew! Value of some good brand publicity/movie placements: SPECIAL EVENTS: Reeses Pieces sales jumped 85% after E.T. Mumford High sold $1M in school shirts after Beverly Hills Cop CA. Raisin Board paid $25K for bus-stop sign and raisin eating scene in Back to the future. Coke and Pepsi scout out roles full time. Special Events Audiovisual Materials Written Materials

21 When might you decide to use Personal Selling?
Tight budget (straight commission) Concentrated Market Few buyers High value product Product must be customized Personal contact important Must demonstrate product Product involves trade-in/up

22 Designing the Sales Force Sales force objectives
Sales force strategy Sales force structure Sales force size Sales force compensation

23 Sales Force Structures
Territorial Product Complexity Market

24 Workload Approach to Sales Force Size
Classify customers by size Determine desirable call frequencies Determine total sales calls needed per year Determine average number of sales calls per sales representative per year Divide total by number per rep

25 Sales Force Compensation
Fixed Variable Expense Allowances Benefits

26 Recruiting & selecting sales representatives Managing the Sales Force
Training sales representatives Supervising sales representatives Motivating sales representatives Evaluating sales representatives

27 Time and Duty Analysis Preparation Travel Administration Selling
Food & Breaks Waiting

28 Sales Representative Motivation
Effort Performance Rewards Satisfaction

29 Sources of Information
Evaluating Salespeople Call Reports Work Plan Sources of Information Annual Territory Marketing Plan

30 Improving Sales Force Effectiveness
Training in sales techniques & professionalism Negotiation skills Relationship-building skills

31 The Zone of Agreement $ Final contract Zone of agreement
Seller’s surplus Buyer’s surplus x Final contract $ Seller’s reservation price (seller wants s or more) Seller wants to move x to the right s Buyer’s reservation price (buyer wants b or less) Buyer wants to move x to the left b

32 Performance Evaluation
Current-to-Past Customer Satisfaction Qualitative Evaluation

33 Steps in the Selling Process
Step 1. Prospecting and Qualifying Steps in the Selling Process Step 2. Pre-approach Identifying and Screening For Qualified Potential Customers. Step 3. Approach Learning As Much As Possible About a Prospective Customer Before Making a Sales Call. Step 4. Presentation/ Demonstration Knowing How to Meet the Buyer to Get the Relationship Off to a Good Start. Telling the Product “Story” to the Buyer, and Showing the Product Benefits.

34 Steps in the Selling Process
Step 5. Handling Objections Steps in the Selling Process Step 6. Closing Seeking Out, Clarifying, and Overcoming Customer Objections to Buying. Asking the Customer for the Order. Step 7. Follow-Up Following Up After the Sale to Ensure Customer Satisfaction and Repeat Business.

35 Alternative Steps: Find ’em Sell ‘em Keep ‘em Grab ‘em Show ‘em
Answer ‘em Sell ‘em Keep ‘em

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