2. 16-1 Introduction to Business Dr. H. Ronald Moser Cumberland University

3. Using Effective Promotions Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Chapter 16

4. 16-3 PROFILE ANDREW MASON Groupon Groupon grew faster than any e- company in history, from $740 million in 2010 to $4 billion in 2011. Google offered $6 billion in December 2010, but Mason rejected the offer. Groupon Now offers a variety of discounts via smart phone.

5. Promotion Mix -- The combination of promotional tools an organization uses; the traditional mix includes: PROMOTION IN AN ORGANIZATION 16-4 PROMOTION AND THE PROMOTION MIX Here we are asking the question: What is the best way to communication with our target market?

6. Integrated Marketing Communication (IMC) -- Combines the promotional tools into one comprehensive and unified strategy. IMC is used to:  Create a positive brand image.  Meet the needs of consumers.  Meet the strategic marketing and promotional goals of the firm. INTEGRATED MARKETING COMMUNICATION (IMC) 16-5 PROMOTION ANDTHE PROMOTION MIX

7. 1. Identify a target market. 2. Define objectives. 3. Determine a promotional budget. 4. Develop a unifying message. 5. Implement the plan. 6. Evaluate the plan. STEPS IN A PROMOTIONAL CAMPAIGN 16-6 PROMOTION ANDTHE PROMOTION MIX

8. Advertising -- Paid, non- personal communication through various media by organizations and individuals who are in some way indentified in the message. Major goals of advertising:  Inform.  Persuade.  Remind. ADVERTISING IN THE FIRM 16-7 ADVERTISING: INFORMING, PERSUADING AND REMINDING

9. Total advertising expenditures exceed $241 billion yearly. Consumers benefit because production costs of TV programs, radio programs, newspapers and magazines are paid for by advertisers. Marketers choose ad media that will reach the target market. IMPACT OF ADVERTISING 16-8 ADVERTISING: INFORMING, PERSUADING AND REMINDING

10. ESTIMATED U.S. ADVERTISING SPENDING BY MEDIUM, 2010 (IN BILLIONS OF DOLLARA) 16-9 ADVERTISING: INFORMING, PERSUADING AND REMINDING RankMedia Projected 2010 Spending 1Direct Mail$52.3 2Broadcast TV36.8 3Newspaper23.4 4Cable TV27 5Radio15.9 6Yellow Pages11.9 7Consumer Magazine9.1 8Internet25.3 Other39.7 Total241.4

11. Television Advertising TV advertising is still one of the dominant media. Digital Video Recorders (DVRs) challenge TV advertising because viewers can skip the ads on TV. POPULAR ADVERTISING MEDIA 16-10 ADVERTISING: INFORMING, PERSUADING AND REMINDING Product Placement -- Advertisers pay to put their products into TV shows and movies where the audience will see them.

12. Infomercial -- A full length TV program devoted exclusively to promoting goods and services. Online ads are attempts to get potential customers to a website to learn about a product. INFOMERCIALS AND ONLINE ADVERTISING Interactive Promotion -- Allows marketers to open a dialogue between buyers and sellers and let them work together to create a beneficial exchange. 16-11 ADVERTISING: INFORMING, PERSUADING AND REMINDING Infomercials and Online Advertising

13. 16-12 ADVERTISING: INFORMING, PERSUADING AND REMINDING Infomercials INFOMERCIAL HALL OF FAME The Biggest Hits Over the Past 40 Years Veg-O-Matic Ginsu Knives The Clapper Thigh Master George Foreman Grill Bowflex

14. 16-13 ADVERTISING: INFORMING, PERSUADING AND REMINDING Online Experience How to Avoid Losing Customers Over a Bad Web Site 1. Brand messaging is key. 2. Site must be easy to navigate. 3. Make sure calls to action are effective. 4. Users want fast, readable sites. 5. Users with disabilities should be able to navigate.

15. 16-14 ADVERTISING: INFORMING, PERSUADING AND REMINDING Social Media Complements Other Promotion (Social Media in Business) National Trust for Historic Preservation believes that investing in social media helps the Trust reach certain goals, such as building awareness for preservation. Kassie Rempel of SimplySoles sends out hand written thank-you notes and increases social media accessibility. Both can help marketers relate to customers on a personal level.SimplySoles

16. National Trust for Historic Preservation believes that investing in social media helps the Trust reach certain goals, such as building awareness for preservation. Kassie Rempel of SimplySoles sends out hand written thank-you notes and increases social media accessibility. Both can help marketers relate to customers on a personal level.SimplySoles SOCIAL MEDIA COMPLEMENTS OTHER PROMOTION (Social Media in Business) 16-15

17. Requires marketers to develop a single product and promotional strategy to implement worldwide. Problems can arise in global markets with using one advertising campaign in all countries - especially bad translations. Global Advertising 16-16 ADVERTISING: INFORMING, PERSUADING AND REMINDING

18. Personal Selling -- The face-to-face presentation and promotion of a product, including the salesperson’s search for new prospects and follow-up service. PERSONAL SELLING Salespeople need to listen to customer needs, help reach a solution and do everything possible to make the transaction as simple as possible. 16-17 PERSONAL SELLING: PROVIDING PERSONAL ATTENTION

19. Steps in the Selling Process 16-18 PERSONAL SELLING: PROVIDING PERSONAL ATTENTION 1. Prospect and qualify 2. Pre-approach 3. Approach 4. Make a presentation 5. Answer objections 6. Close the sale 7. Follow up Trial Close -- A statement or question that moves the process toward the purchase.

20. Steps in the Selling Process Prospecting -- Researching potential buyers and choosing those most likely to buy. PROSPECTING AND QUALIFYING IN B2B SELLING Qualifying -- Making sure customers have a need for a product, the authority to buy and the willingness to listen to a sales message. Prospect -- A customer who meets the qualifying criteria. 16-19 PERSONAL SELLING: PROVIDING PERSONAL ATTENTION

21. STEPS IN THE B2C SELLING PROCESS 16-20 PERSONAL SELLING: PROVIDING PERSONAL ATTENTION

22. Public Relations (PR) – Evaluates public attitudes, changes policies and procedures in response to the public, and executes a program of action and information to earn public understanding and acceptance. 3 steps of a good PR program: USING PUBLIC RELATIONS IN PROMOTION 16-21 PUBLIC RELATIONS: BUILDING RELATIONSHIPS 1. Listen to the public. 2. Change policies and procedures. 3. Inform people you’re responsive to their needs.

23. Publicity: The Talking Arm of PR Publicity -- Any information about an individual, product or organization that’s distributed to the public through the media and is not paid for or controlled by the seller. Advantages of Publicity: Free. Reaches people who would not look at an advertisement. More believable than advertising. PUBLICITY 16-22 PUBLIC RELATIONS: BUILDING RELATIONSHIPS

24. Publicity: The Talking Arm of PR No control over whether the media will use a story or when they may release it. It can be good or bad. Once a story has been run, it isn’t likely to run again. DISADVANTAGES OF PUBLICITY 16-23 PUBLIC RELATIONS: BUILDING RELATIONSHIPS

25. Sales Promotion -- The promotional tool that stimulates consumer purchasing and dealer interest by means of short-term activities. Sales promotion can take place both internally (within the company) and externally (outside the company). SALES PROMOTIONS Categories of Sales Promotions: 1. B2B Sales Promotions. Maybe a trade show. 2. Consumer Sales Promotions. Maybe and in-store display. 16-24 SALES PROMOTION: GIVING BUYERS INCENTIVES

26. Coupons. Demonstrations. Sampling. Sweepstakes. In-store Displays. Contests. Don’t forget those free cokes at Whitts Scott. SOME KEY CONSUMER PROMOTIONS 16-25 SALES PROMOTION: GIVING BUYERS INCENTIVES

27. Word-of-Mouth Promotion -- People tell others about products they have purchased. Word-of-Mouth is important for products like:  Restaurants.  Daycare and Eldercare.  Car Repair Shops.  Hair Stylists.  Hotels. USING WORD-of-MOUTH PROMOTION 16-26 WORD OF MOUTH AND OTHER PROMOTIONAL TOOLS

28. Viral Marketing Viral Marketing -- Paying customers to say good things on the Internet or setting up multiple selling schemes whereby consumers get commissions. People who promote through viral marketing often receive SWAG which can include free tickets, shirts, and other merchandise. EMERGING PROMOTIONAL TOOLS 16-27 WORD OF MOUTH AND OTHER PROMOTIONAL TOOLS

29. Blog -- Short for web log; an online diary that looks like a webpage but is easier to create and update by posting text, photos, videos, or links. Blogs, Podcasting, and E-Mail Promotions 16-28 WORD OF MOUTH AND OTHER PROMOTIONAL TOOLS Podcasting -- A way to distribute audio and video programs via the Internet. Email promotion increase brand awareness among commercial suppliers.

30. 16-29 WORD OF MOUTH AND OTHER PROMOTIONAL TOOLS Mobile Media Marketers make use of cell phones to text customers about product offers and other company information. We’ve seen that companies can now determine where you are and send you messages about restaurants and other service in your vicinity.

31. Push Strategy -- Producers use advertising, personal selling, sales promotion, and other tools to get their products stocked on shelves. 16-30 MANAGING THE PROMOTION MIX: PUTTING IT ALL TOGETHER Pull Strategy -- Directs heavy advertising and sales promotions efforts towards consumers and gets the public to request their products from retailers. Companies that make use of a pull strategy target their promotional efforts towards consumers. Pick Strategy -- Refers to consumers who pick out their products from online outlets.

32. 3-31 The End!