2 Section Objectives Explain the role of the promotion strategy. Explain how to formulate promotional plans.Identify considerations for putting together a promotional mix.Describe the elements of a promotional mix.
3 The Main IdeaThe promotion strategy is the most visible marketing strategy, designed to get the attention of prospective customers and convince them to buy from you.Promotional activities must be in the right mix.
5 a preopening plan to lay the groundwork for your opening Drawing Up Promotional PlansAs a new business owner, you need two kinds of promotional plans:a preopening plan to lay the groundwork for your openinga second plan to support your operation once it is under way
6 The Role of Promotion Strategy Promotion is communication intended to persuade, inform, or remind a target audience about a business or its products.The promotion strategy involves planning, determining the right promotional mix, and selecting specific promotional activities.
7 Objectives of a Preopening Plan Establish a positive image.Let potential customers know you are opening for business.Bring in customers or have them contact your business.Interest customers in your new company and your products or services.7
8 Preopening PlanThe image you establish in your preopening plan sets the tone for your promotional plan.imagethe impression people have of a company; a company’s personality
9 Objectives of an Ongoing Promotional Plan Ongoing PlanObjectives of an Ongoing Promotional PlanExplain major features and benefits of your products.Communicate information about sales.Clear up customers’ questions and concerns.Introduce new goods or services.9
10 Ongoing PlanAn ongoing promotional plan helps in preselling your goods or services.presellingthe act of influencing potential customers to buy before contact is actually made
11 Promotional Plan Format campaigna series of related promotional activities with a similar themeEx: Introduce your new service, a clown act, on a billboard, with flyers, and in the newspaper.ORIntroduce your Electronic Pen on a billboard, but run an advertisement in the newspaper for a sale on your Microsoft Office tabletBoth a preopening and an ongoing plan can be organized around a promotional campaign, independent promotional activities, or a combination of the two.
12 The Elements of the Promotional Mix personal sellingadvertisingPromotional MixInternetMarketingpublicitysales promotion12
13 Selecting a Promotional Mix Every business has a unique promotional mix.promotional mixthe combination of different promotional elements that a company uses to reach and influence potential customersEx: You advertise in a magazine, you have sales, frequent buyer cards, and knowledgeable sales people
14 When selecting elements for a promotional mix, consider: Ongoing PlanWhen selecting elements for a promotional mix, consider:target marketproduct valuepromotional channelstime framecost14
15 AdvertisingIn the United States, most businesses spend about one-fourth of their advertising dollars on newspaper ads.advertisingthe paid nonpersonal presentation of ideas, goods, or services directed at a mass audience by an identified sponsor by means of print and broadcast
16 Advertising Types of Advertising newspapers magazines specialty items direct mailTypes of Advertisingoutdoor advertisingInternetdirectoriesradiotelevisiontransit advertising16
17 Advertising A specialty item serves as a reminder of a business. an advertising device that includes giveaways, such as pens, T-shirts, and caps, printed with a business name or logo
18 Publicitypublicityplacement in the media of newsworthy items about a company, product, or personEx: Derek Rose comes for a visit to meet and greet customers.Taking advantage of publicity means calling attention to yourself and your business.
19 ? ? ? ? ? Publicity A news release should answer these questions: Who? a brief newsworthy story that is sent to the mediaPublicity is both free & not freeEx:If Derek Rose comes to your store, you will have to pay for that,However, It’s free because you don’t pay for the news story that you sent a news release forA news release should answer these questions:Who?What?Where?When?Why??????
20 Publicitypublic relationsactivities designed to create goodwill toward a business or control damage done by negative publicityEx: BP creating Facebook and Twitter accounts for people to vent their frustrations and concerns and for them to have a way to get information out that didn’t involve the media.Public relations may generate unsolicited publicity when such activities are reported by the media.
21 Sales Promotion Examples of Sales Promotion displays sweepstakes and contestspremiumsExamples of Sales Promotionsamplesrebates21
22 Sales Promotionpremiumany item of value that a customer receives in addition to the good or service purchased; designed to attract new customers or build loyalty among existing customers,.Ex: With a purchase of $25 or more you get a free CD.Kohl’s CashOne type of sales promotion may be to include a premium with a purchase.
23 Sales Promotion Some companies give a rebate on purchases. rebate a return of part of the purchase price of a product used as an incentive for customers to purchase the productEx: New cell phone purchase
24 Sales PromotionA sweepstakes is a sales promotion that can draw attention to a business.sweepstakesa simple game of chance used by a business to get customers interested in what the company has to offer
25 After You Read Explain the role of the promotion strategy. The role of the promotion strategy is to set the course for and coordinate all aspects of promotion. It involves planning, determining the right mix, and selecting specific activities.
26 After You Read 2. Explain preopening and ongoing promotional plans. Preopening promotional plans establish the company’s image, let customers know the business is opening, bring in customers, and create interest in the business so that the business will have customers when it opens. Ongoing promotional plans maintain and build sales after a business is open.
27 After You Read3. Describe considerations for putting together a promotional mix.When selecting elements for a promotional mix, consider the target market, product value, promotional channels, time frame, and cost.
28 After You Read 4. Describe the elements of a promotional mix. The elements of the promotional mix are advertising, sales promotion, publicity, and personal selling.
29 Section ObjectivesDetermine promotional costs for a start-up business.Describe ways to implement your promotion strategy.Examine options for short-term changes in your promotion strategy.Identify considerations for updating the promotion strategy.
30 The Main IdeaThorough planning and information gathering can help you arrive at a realistic promotional budget.That budget will have a direct affect on how you implement your promotional plans.
31 Set goals for your promotional activities so you can better evaluate how successful they were. Ex: To increase sales by 10%
32 Content Vocabulary industry average cooperative advertising advertising agencyconsumer pretest
33 Cost out promotional activities. Budgeting for PromotionCost out promotional activities.Allocate money available for promotional activities.Make final adjustments.
34 Compare Industry Averages You can find out the industry average for promotional expenses from such sources as trade associations or the SBA.industry averagethe standard used to compare costs among companies; usually expressed as a percentage
35 Basic Media Formats Print Include a headline, copy, illustrations, and a signature.PrintRadioInclude same elements as print, but can add music or sound effects.RadioTelevisionSame elements apply, but it requires casting, set design, sound, and filming.TelevisionInternetInternetSame components as print, but may also have audio, video, and animation.35
36 Getting HelpYou can carry out your promotional plans yourself, or you can hire professionals to implement some or all of your promotional activities.Professional help can come from the media, manufacturers and suppliers, and advertising agencies.
37 Federal Trade Commission (FTC) Advertising LawsFederal Trade Commission (FTC)Protects consumers from false advertisingWhen a company says something that is not supported by factBait & Switch which is offering a sale price for an item and then not stocking the item and convincing customers to buy a more expensive substitute.Will issue a Cease & Desist Order to stop and may even fine company
38 Getting HelpYou may be able to save on your promotional budget by arranging for cooperative advertising.cooperative advertisingan arrangement in which advertising costs are divided between two or more parties
39 Getting HelpAn advertising agency can handle all phases of your advertising, including writing the copy, creating the artwork, choosing the media, and producing the ad.advertising agencya company that acts as intermediary between a business and the media to communicate a message to the target market
40 Making Possible Promotion Changes The three most common adjustments to the promotion strategy are:adjust your advertisinggenerate publicitypromote salesSection 12.2 Budgeting and Implementing Promotional Plans
41 Factors for Evaluation Adjust Your AdvertisingmarketbudgetsourceFactors for EvaluationresultsmotivesmediamessagesSection 12.2 Budgeting and Implementing Promotional Plans41
42 Adjust Your Advertising One way to reduce the risk involved in an expensive advertising campaign is to conduct a consumer pretest.consumer pretesta procedure in which a panel of consumers evaluates an ad before its release
43 Conduct a formal review of your promotion strategy on a regular basis. Revising the Promotion StrategyConduct a formal review of your promotion strategy on a regular basis.Use your sales forecast to arrive at a promotional budget to support that level of sales.Then revise your promotional mix promotion plan.
44 After You Read1. Describe how to determine promotional costs for a start-up business.Promotional costs for a start-up business are determined by costing out the planned activities, comparing the costs to industry averages, and adjusting the budget if necessary.
45 After You Read2. Describe approaches to implementing your promotional strategy.Two approaches to implementing a promotion strategy are developing your own promotion items and hiring professionals to do the job.
46 After You Read3. Discuss options for short-term changes in your promotion strategy.Options for short-term changes are increasing the effectiveness of your advertising expenditures, capitalizing on publicity opportunities, and stimulating sales through sales promotions or changes in the sales force.
47 After You Read4. Name considerations for updating the promotion strategy.To update the promotional plan, consider the sales forecast for the upcoming period; make budget adjustments required by the forecast; and study changes in the target market, research results, and experiences to date. On the basis of those considerations, a new mix can be determined and a new plan developed.