2Promotion Mix (or Marketing Communication Mix) The specific blend of promotion tools that the company uses to persuasively communicate customer value and build customer relationships
3Promotion Tools Advertising Sales promotion Personal selling Public relationsDirect marketing
4Promotion ToolsAdvertising: any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor i.e. broadcast, print, Internet, outdoor, and etc.Sales promotionPersonal sellingPublic relationsDirect marketing
5Promotion Tools Advertising Sales promotion: short-term incentives to encourage the purchase or sale of a product or service for a specific period of time i.e. discounts, coupons, displays, demonstrations, and etc.Personal sellingPublic relationsDirect marketing
6Discount and Allowances in Pricing Strategy VS. Sales Promotion Discount and allowances in Pricing Strategy: offering to customer without specified time periodDiscount in Sales Promotion: offering to customer with condition and time frame to stimulate a short-term sales volume and more consumer demand in the short run
7Promotion Tools Advertising Sales promotion Personal selling: personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships i.e. sales presentations, trade shows, and etc.Public relationsDirect marketing
8Promotion Tools Advertising Sales promotion Personal selling Public relations: building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events i.e. press releases, sponsorships, special events, Web pages, and etc.Direct marketing
9Promotion Tools Advertising Sales promotion Personal selling Public relationsDirect marketing: direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships i.e. catalogs, telephone marketing, the Internet, mobile, and etc.
10Objectives of Promotion To communicate to the target groupTo inform: provide information about product/service or company to target groups such as marketing intermediaries, public, and consumerTo persuade: use the verbal/nonverbal communication in encouraging consumer buying decisionTo remind: build brand awareness by using logo, branding, or feature of product/service or company to increase consumers' knowledge of a brand's existence
11Objectives of Promotion (con’t) To change consumer demandTo correspondent with other marketing mixsIf the product is in the introduction stage of Product Life CyclePromotion mix need to communicate to its target group in term of giving information than brand reminder. Sales promotion, such giveaway or discount, may be needed to stimulate the trade channel, retailer or wholesaler, to buy more products.
17Integrated Marketing Communications (IMC) The carefully integrating and coordinating the company’s many communications channels to deliver a clear, consistent, and compelling message about the organization and its products
18IMC: carefully blended mix of promotion tools AdvertisingPersonal sellingConsistent, clear, and compelling company and brand messagesSales promotionPublic relationsDirect marketing
19IMC for Dutch Mill Group EventAdvertisingPR news
20What could be the problem for communication without IMC?
21Communication without IMC? As each communication (advertising, personal selling, PR, direct marketing, sales promotion) often come from different parts of the company, if the company fails to integrate those various communication channels, it will result in blurred customer brand perceptions.
23Elements in the Communication Process SenderEncodingMessageDecodingReceiverMediaNoiseFeedbackResponse
249 Elements of Communications 12SenderReceiverThe party sending the message to another partyThe party receiving the message sent by another party
259 Elements of Communications 3SenderMessageReceiverMediaThe set of symbols that the sender transmits4The communication channels through which the message moves from sender to receiver
269 Elements of Communications 56SenderEncodingMessageDecodingReceiverMediaThe process by which the receiver assigns meaning to the symbols encoded by the senderThe process of putting thought into symbolic form
279 Elements of Communications SenderEncodingMessageDecodingReceiverMediaThe reactions of the receiver after being exposed to the messageThe part of the receiver’s response communicated back to the senderFeedbackResponse87
289 Elements of Communications SenderEncodingMessageDecodingReceiverMedia9The unplanned static or distortion during the communication process, which results in the receiver’s getting a different message than the one the sender sentNoiseFeedbackResponse
29Steps in Developing Effective Marketing Communication
30Steps in Developing Effective Marketing Communication Identifying the target audienceDetermining the communication objectivesDesigning a messageChoosing mediaSelecting the message sourceCollecting feedback
311. Identifying the target audience Who will be your target audience?Current users or potential buyers?Those who make the buying decision or those who influence it?
322. Determining the Communication Objectives What response marketers seek?Need to know where the target audience now stands and to what stage it needs to be moved.6 Buyer-readiness stagesThe stages that consumers normally pass through on their way to purchase, including awareness, knowledge, liking, preference, conviction, and purchaseAwarenessKnowledgeLikingPreferenceConvictionPurchaseInfo. about productFeeling favorable about productPreferring this brand to other brandsConfidence in this brand, it is the best
333. Designing a MessageMessage should get Attention, hold Interest, arouse Desire, and obtain Action (AIDA model)Must decide what to say (message content) and how to say (message structure and format)
344. Choosing MediaPersonal Communication Channels: Channels through which two or more people communicate directly with each other, including face to face, on the phone, through mail or , or even through an Internet “chat”Word-of-mouth influence: personal commu. about a product between target buyers and neighbors, friends, family members, and associates.Buzz marketing: cultivating opinion leaders and getting them to spread info. about a product or service to others in their communities.Nonpersonal Communication Channels: Media that carry messages without personal contact or feedback, including major media, atmospheres, and events
35Selecting the Message Source Messages delivered by highly credible sources are more persuasive for target audiences.Picking the wrong spokesperson can result in embarrassment and tarnished image.“Celebrity endorsement”
36Collecting FeedbackAfter sending the message, the communicator mush research its effect on the target audience.Feedback on marketing communications may suggest changes in the promotion program or in the product offer itself.
38Setting the Total Promotion Budget Affordable methodSetting the promotion budget at the level management thinks the company can affordPercentage-of-Sales methodSetting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales priceCompetitive-Parity methodSetting the promotion budget to match competitors’ outlayObjective-and-Task methodDeveloping the promotion budget by:Defining specific objectivesDetermining the tasks that must be performed to achieve these objectivesEstimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget
39Push vs. Pull Promotion Strategy Push strategy: a promotion strategy that calls for using the sales force and trade promotion to push the product through channels.The producer promotes the product to channel members who in turn promote it to final consumers to create consumer demand for a product.
41Push vs. Pull Promotion Strategy Pull strategy: a promotion strategy that calls for spending a lot on advertising and consumer promotion to induce final consumers to buy the product, creating a demand vacuum that “pulls” the product through the channelIf the strategy is successful, consumers will ask their retailers for the product, the retailers will ask the wholesalers, and the wholesalers will ask the producers.
42Push vs. Pull Promotion Strategy Producer marketing activities(personal selling, trade promotion, other)Reseller marketing activities(personal selling, advertising, sales promotion, other)ProducerRetailers and wholesalersConsumersPUSHPUSHConsumersProducerRetailers and wholesalersPULLPULLProducer marketing activities(Consumer advertising, sales promotion, other)
43Summary: Push vs. Pull Strategy Push strategy involves convincing trade intermediary channel members to "push" the product through the distribution channels to the ultimate consumer via promotions and personal selling efforts.Pull strategy attempts to get consumers to "pull" the product from the manufacturer through the marketing channel.
44Product Life Cycle Stages and Promotion Tools Introduction: Ad and PR are good for producing high awareness. Sales promotion is useful in promoting early trial. Personal selling must be used to get trade to carry the product.Growth: Ad and PR continue to be powerful influences. Sales promotion can be reduced because fewer incentives are needed.Mature: Sales promotion becomes important relative to ad. buyers know the brand, and ad is needed only to remind them of product.Decline: Ad is kept at a reminder level, PR is dropped. Salespeople give the product only a little attention. Sales promotions might continue to be strong.