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Chapter Sixteen Developing Integrated Marketing Communications.

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1 Chapter Sixteen Developing Integrated Marketing Communications

2 Question Think about your most recent purchase. What was it? What was your choice influenced by? Copyright © Houghton Mifflin Company. All rights reserved.16 | 2

3 Copyright © Houghton Mifflin Company. All rights reserved.16 | 3 The Role of Promotion Promotion –Communication about an organization and its products that is intended to inform, persuade, or remind target market members

4 Copyright © Houghton Mifflin Company. All rights reserved.16 | 4 The Promotion Mix The particular combination of promotion methods a firm uses to reach a target market –Advertising A paid nonpersonal message communicated to a select audience through a mass medium –Personal selling Personal communication aimed at informing customers and persuading them to buy a firm’s products –Sales promotion The use of activities or materials as direct inducements to customers or salespersons (coupons etc) –Public relations Communication activities used to create and maintain favorable relations between an organization and various public groups, both internal and external

5 Copyright © Houghton Mifflin Company. All rights reserved.16 | 5 Possible Ingredients for an Organization’s Promotion Mix Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 13 th ed. Copyright © 2006 by Houghton Mifflin Company, Adapted with permission.

6 Classify each of the promotion efforts 1.McDonald’s uses television to tell customers about free French fries with purchase of a Big Mac. 2.A Toyota salesperson tells customers about the quality of Michelin tires. 3.CNN has a story about Keebler’s latest ad campaign. The story features a commercial with elves. 4.Quaker Oats places an ad in Good Housekeeping magazine with a coupon attached. 5.A pharmaceutical salesperson leaves free samples with a physician Copyright © Houghton Mifflin Company. All rights reserved.16 | 6 Advertising PR Selling Promotion

7 What is your favorite commercial? Copyright © Houghton Mifflin Company. All rights reserved.16 | 7

8 Copyright © Houghton Mifflin Company. All rights reserved.16 | 8 Advertising Media The forms of communication through which advertising reaches its audience Newspapers (25% of advertising dollars) –Relatively inexpensive and timely; short life span Magazines –Reach a specific market segment; more prestigious than newspapers; high cost; lack of timeliness Direct mail –Most selective; effectiveness can be measured;

9 Copyright © Houghton Mifflin Company. All rights reserved.16 | 9 Advertising Media (cont’d) Yellow pages advertising –Print and online; local; purchased for 1 year Out-of-home advertising –Short promotional messages on billboards, posters, signs, and vehicles; focuses on geographic area; fairly inexpensive Television –The primary medium for larger firms trying to reach national or regional markets –Network time; local time; sponsoring a show; spot time; infomercials

10 Copyright © Houghton Mifflin Company. All rights reserved.16 | 10 Advertising Media (cont’d) Radio –Offers selectivity; most accessible medium; can be less expensive than other media Internet –Increasingly popular; can be expensive; potentially large audience; can target precisely; effectiveness is questionable –Banner and button ads; sponsorship ads; keyword ads; interstitials

11 Try this Design a half page yellow pages ad for the admissions department of a college or university. Present your ad to the class. Copyright © Houghton Mifflin Company. All rights reserved.16 | 11

12 Copyright © Houghton Mifflin Company. All rights reserved.16 | 12 Social and Legal Considerations in Advertising Criticisms –Advertising is wasteful –Advertising is deceptive Benefits –Advertising is the most effective and least expensive means of communicating to a large number of individuals and organizations –Advertising encourages and is a means of competition; it thus leads to new/better products, more choice, lower prices –Advertising revenues support our mass communication media –Advertising provides job opportunities

13 Copyright © Houghton Mifflin Company. All rights reserved.16 | 13 Personal Selling The most adaptable promotion method The most expensive promotion method Kinds of salespersons –Order getter Responsible for creative selling: selling a firm’s products to new customers and increasing sales to present customers –Order taker Handles repeat sales in ways that maintain positive relationships with customers

14 Copyright © Houghton Mifflin Company. All rights reserved.16 | 14 Personal Selling (cont’d) Kinds of salespersons (cont’d) –Sales support personnel Employees who aid in selling but are more involved in locating prospects, educating customers, building goodwill for the firm, and providing follow-up service Missionary salespersons –Visit retailers to encourage an initial purchase of the manufacturer’s products from wholesalers Trade salespersons –Work with customers to promote and increase retail sales of the manufacturer’s products Technical salespersons –Assist current customers with technical matters related to the manufacturer’s products

15 Copyright © Houghton Mifflin Company. All rights reserved.16 | 15 The Personal-Selling Process Source: William M. Pride and O.C. Ferrell, Marketing: Concepts and Strategies, 13 th ed. Copyright © 2006 by Houghton Mifflin Company. Adapted with permission.

16 Copyright © Houghton Mifflin Company. All rights reserved.16 | 16 Sales Promotion Activities or materials that are direct inducements to customers or salespersons Objectives –To draw new customers –To encourage trial of a new product –To invigorate the sales of a mature brand –To boost sales to current customers –To reinforce advertising –To increase traffic in retail stores –To steady irregular sales patterns –To build up reseller inventories –To neutralize competitive promotional efforts –To improve shelf space and displays

17 Copyright © Houghton Mifflin Company. All rights reserved.16 | 17 Sales Promotion Methods (cont’d) Rebate –A return of part of the purchase price of a product Coupon –Reducing the purchase price of a particular item by a stated amount at the time of purchase Sample –A free product given to customers to encourage trial Premium –A gift a producer offers to a customer in return for buying its product Frequent-user incentives –A program that rewards customers who engage in repeat (frequent) purchases

18 Copyright © Houghton Mifflin Company. All rights reserved.16 | 18 Sales Promotion Methods (cont’d) Point-of-purchase displays –Promotional material in the retail store designed to inform customers and encourage purchases Trade shows –Industry-wide exhibits at which many sellers display their products Buying allowance –A temporary price reduction to resellers for purchasing specified quantities of a product Cooperative advertising –A manufacturer agrees to pay a certain amount of the retailer’s media cost for advertising the manufacturer’s product

19 Copyright © Houghton Mifflin Company. All rights reserved.16 | 19 The Uses of Public Relations To promote people, places, activities, ideas To enhance the reputation of the organization by increasing awareness of company products and activities To create specific positive company images To maintain the public visibility of the company To reduce the effects of negative events on the company’s reputation

20 Copyright © Houghton Mifflin Company. All rights reserved.16 | 20 Public Relations A broad set of communication activities used to create and maintain favorable relationships between an organization and various public groups, both internal and external –Customers, employees, stockholders, suppliers, educators, the media, government officials, society in general Types of public relations tools –Written and spoken communications Brochures, newsletters, company magazines, annual reports, news releases, corporate-identity materials, speeches –Event sponsorship Special events such as concerts and charity functions that the firm underwrites wholly or partially

21 Copyright © Houghton Mifflin Company. All rights reserved.16 | 21 Public Relations (cont’d) Publicity –Communication in news-story form about an organization, its products, or both News release Feature article Captioned photograph Press conference

22 Copyright © Houghton Mifflin Company. All rights reserved.16 | 22 Developing the Promotion Mix Marketers may use several promotion mixes at the same time for different products The promotion mix ingredients depend on –Organizational resources and objectives –Target market characteristics –Product characteristics –The cost and availability of promotional methods


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