Chapter 15 Promotion Means Effective Communication 1 Newsline: Influencing What You Eat Did you know that suppliers pay more for the bottom rows of shelf space in the cereal aisle? p. 402

Chapter 15 Promotion Means Effective Communication 2 The Four P’s….. P_______________ P_______________ or D______________ P_______________

Chapter 15 Promotion Means Effective Communication 3 The Four P’s Product Place or D istribution rice Promotion

Chapter 15 Promotion Means Effective Communication 4 The Role of Promotion in Marketing Inform  gives information about the product or product changes (new or repeat customers) Persuade  influences the consumer to use the product/service (new customers) Remind  to encourage repeat business

Chapter 15 Promotion Means Effective Communication 5 Noise The Communication Process Receiver Decoding by Receiver Message Channel Encoding by Sender Sender Feedback

Chapter 15 Promotion Means Effective Communication 6 Types of Communication Interpersonal communication two-way communication involves two or more people in some kind of person-to-person exchange Mass communication one-way communication involves communicating to huge audiences, usually through mass media, such as magazines, radio, television, or newspapers

Chapter 15 Promotion Means Effective Communication 7 Types of Promotion Lesson 15.2 BOGO

Chapter 15 Promotion Means Effective Communication 8 Promotion comes in 4 main ways: Advertising  PAID Publicity  UNPAID or paid under the table Personal Selling  Door to door, or “Would you like to supersize that?” Sales Promotion  BOGO BOGO

Chapter 15 Promotion Means Effective Communication 9 Elements of a Promotional Mix (also covered in Lesson 15.3) Advertising Personal Selling Publicity Sales Promotion these types of Promotion are also known as (AKA) Businesses usually don’t just choose one, but mix them together to reach their target audience.

Chapter 15 Promotion Means Effective Communication 10 Advertising PAID Advantages  cost (per person)  large audience  proper medium can be affective in addressing desired target market Disadvantages of advertising Disadvantages of advertising  cost Is passed on to whom?  one-way communication How do you know it’s heard?

Chapter 15 Promotion Means Effective Communication 11 Mass Media Advertising Direct mail Internet Magazines Newspaper Outdoor Radio Television

Chapter 15 Promotion Means Effective Communication 12 Publicity FREE or paid under the table Advantages  can be positive (Goodwill)  free  public tends to trust it (yeah, like Star or National Enquirer……no, like People or the Metro section of the Star Tribune) Disadvantages Disadvantages  no control  can be negative

Chapter 15 Promotion Means Effective Communication 13 Personal Selling “Would you like to supersize your value meal?” Advantages  two-way communication  persuasive  customer is at place of purchase Disadvantages Disadvantages  high cost per customer  salesperson must earn trust quickly

Chapter 15 Promotion Means Effective Communication 14 Sales Promotion BOGO Advantages  creates short-term sales boosts (gets rid of inventory also)  hits your desired target market  supports product ad campaign Disadvantages Disadvantages  cost BOGO

Chapter 15 Promotion Means Effective Communication 15 Mixing the Promotional Plan Lesson 15.3 (also mentioned in Lesson 15.2 slides)

Chapter 15 Promotion Means Effective Communication 16 Promotional Planning promotional plan The promotional plan is a carefully arranged sequence of promotions designed around a common theme responsive to specific objectives.

Chapter 15 Promotion Means Effective Communication 17 The Steps in Promotional Planning 1.Analyze the market  conduct market research

Chapter 15 Promotion Means Effective Communication 18 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market  using market analysis, choose a target market or markets

Chapter 15 Promotion Means Effective Communication 19 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market 3.Develop promotional objectives  Define the purpose or result of promotion new customers, current customers buy more?

Chapter 15 Promotion Means Effective Communication 20 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market 3.Develop promotional objectives 4.Develop a promotional budget  easier said than done….may need to modify the objectives once you know how much cash you have to spend

Chapter 15 Promotion Means Effective Communication 21 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market 3.Develop promotional objectives 4.Develop a promotional budget 5.Select the promotional mix  Advertising, Publicity, Personal Selling or Sales Promotion?

Chapter 15 Promotion Means Effective Communication 22 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market 3.Develop promotional objectives 4.Develop a promotional budget 5.Select the promotional mix 6.Implement the promotional plan  schedule, plan, name people or departments to be responsible, allocate $

Chapter 15 Promotion Means Effective Communication 23 The Steps in Promotional Planning 1.Analyze the market 2.Identify the target market 3.Develop promotional objectives 4.Develop a promotional budget 5.Select the promotional mix 6.Implement the promotional plan 7.Evaluate the results  continue, alter or change completely?

Chapter 15 Promotion Means Effective Communication 24 Figure This p. 421 The success of most promotions ultimately depend on the effect they have on business profits. The tricky part is figuring out which parts of a complex promotional mix are responsible for what portion of subsequent changes in revenue and profits. In most cases, there is no way to tie changes in revenue directly to a specific promotion, so marketers have to use indirect means to estimate a promotion's effectiveness. Magazines and newspapers track paid circulation, total circulation and readership estimate, the latter factoring in how many people typically read each copy. Electronic media have developed new ways of measuring success. Web site hits are the number of people who log on to a site. Click through rates are the portion of viewers who click on an ad to see the sponsor’s site, where the amount of time each spends at the site is also tracked. Conversion rates are the portion of viewers who follow through by buying something or registering for whatever is being promoted.