1. Chapter 19
What is Promotion?

2. The Role of Promotion
Promotion – Any form of communication a business or organization uses to inform, persuade, or remind people about its products & improve its public image.
Product Promotion
Used to convince customers to buy products from it instead of the competition
Institutional Promotion
Used to create a favorable image for itself
4 Basic Types of Promotion:
Advertising
Publicity
Sales Promotion
Personal Selling

3. I. Advertising
Any paid form of nonpersonal presentation & promotion of ideas, goods or services by an identified sponsor (NOT publicity, sales promotion or personal selling).
Advantages
Large # people see it
Cost per customer is low
Can choose most appropriate media to reach target market
Can control the content of the ad
Repeat viewing
Presell a product
Disadvantages
Can’t focus on individual needs
Some forms are very expensive
Can be wasteful (as to targeting correct market)
They are usually brief

4. II. Publicity
Involves placing newsworthy information about a company, product, or person in the media.
Used to build image
Can be positive or negative (negative not always bad)
It is “free” but the company has no control over the message.

5. III. Sales Promotion
All marketing activities, other than personal selling, advertising & publicity, that is used to stimulate consumer purchasing & sales effectiveness.
Can be both Consumer (Retail) and Trade (Industrial) oriented.

6. Trade Promotions SLOTTING ALLOWANCES:
Sales promotion activities designed to gain manufacturers’, wholesalers’, & retailers’ support for a product.
SLOTTING ALLOWANCES:
Cash premium paid by the manufacturer to a retail chain for the costs involved in placing their product on the retailer’s shelves.

7. Trade Promotions (con’t.)
Buying Allowances:
A special price discount given by manufacturers to wholesalers/retailers to encourage them to either buy a product or buy a larger quantity of a product.
Trade Shows & Conventions:
Opportunity for manufacturers to introduce wholesalers/retailers with new products or ways to increase sales of existing products.
Sales Incentives:
Awards given to managers & employees who successfully meet their company’s set sales quota for a particular product or line.

8. Consumer Sales Promotions
Licensing:
Use, for a fee, their logo, trademark, trade character, names & likeness or personal endorsement.
Manufacturers, movie makers, sports teams, & celebrities, ect.
Promotional Tie-ins:
Deals between one or more retailers/manufacturers to create additional sales for each partner.

9. Consumer Sales Promotions (Con’t.)
3. Visual Merchandising & Displays:
Visual Merchandising is the coordination of all the physical elements in a business (How it looks inside/outside). Business Issue…
Displays is the area in the store/business where the product is seen and how it is seen, like window areas, floor, counter shelves, ect.

10. Consumer Sales Promotions (Con’t.)
4. Premiums
Coupons
Factory Packs
Traffic Builders
Coupon Plans
5. Incentives
Sweepstakes, Contests & Rebates

11. Sweepstakes, Contest or Rebate?

12. Consumer Sales Promotions (Con’t.)
6. Product Samples:
free trial size of a product that is sent through the mail, distributed door-to-door, or through retail stores & trade shows.
Cologne, doctors & drugs, teachers w/ textbooks

13. IV. Personal Selling (previous unit)
Order takers & order getters
Concept of Promotional Mix:
Finding the right combination of promotional activities (Advertising, Publicity, Sales Promotions & Personal Selling) to most effectively persuade customers to buy our products & support our business.