14-1 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Chapter 14 Promotional Strategy In the Spotlight: Professional Foot Care In the Spotlight: Professional Foot Care

14-2 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Learning Objectives: Chapter Describe the communication process and the factors determining a promotional mix. 2. Discuss methods of determining the appropriate level of promotional expenditure. 3. Describe personal selling activities. 4. Identify advertising options for a small business. 5. Describe sales promotional tools.

14-3 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing (a) A Personal Communication Channel Personal and Small Business Communication (b) A Small Business Communication Channel Source Message Channel Options Receiver Parents “We love you.” Letter sent through the mail Personal visit to campus Flowers and a “care package” sent Daughter at college XYZ Company “Buy my product.” Newspaper advertisement Personal sales call Business gift Customer

14-4 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing A Flowchart for Comparing Alternative Promotion Expense Estimates Compute WTDJ Is WTDJ equal to or less than others? Compute average of WTDJ, APS, WCS, and ACS Compare WCS with computed average Is WCS equal to or greater than average? Proceed to develop promotion at WTDJ level Proceed to develop promotion at average level Seek additional funds to supplement promotion YES NO YES Key to Terms WTDJ-What it will take to do the job APS-A percentage of sales WCS-What can be spared ACS-As much as the competition spends START

14-5 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Objections by Clients  with Responses OBJECTIONRESPONSE “I had problems with a similar“Yes, I understand your attitude, product before and don’t wantbut have you considered... ?” to go through that again!” “I’m too busy.”“That’s why I want to explain how I can save you time by...” “The last salesperson I dealt with“That’s a regrettable situation. It’s caused me all kinds of trouble.”too bad all members of my profession aren’t honest, but...” “I like what you have said, but I“Let’s figure how much you can need to wait.”save by acting now.” “Your product sounds just like“There are similarities, but we your competitor’s.”have... at a better price.” “I’m not sure if I can risk a“Let me tell you how one of your changeover to your product.”competitors decided to buy from me.”

14-6 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Rewarding Salespeople Nonfinancial Rewards Pat on the back “Top Salesperson of the Month” New office Financial Rewards Commission Salary Bonuses

14-7 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Advantages and Disadvantages of Traditional Advertising Media Newspapers Magazines Radio Television Outdoor media Geographic selectivity and flexibility; short-term commitments; short lead time; immediacy; year-round readership Good reproduction; demographic and regional selectivity; relatively long life; high pass-along rate Low cost; immediacy; highly port- able; short-term commitments; entertainment carryover Wide, diverse audience; creative opportunities for demonstration; immediacy; entertainment carry- over Repetition; moderate cost; flexibility; geographic selectivity Little demographic selectivity; limited color capabilities; low pass-along rate; may be expensive Long-term commitments; slow audience buildup; long lead time No visual treatment; short message life; commercial clutter Short message life; high campaign cost; long-term commitments; long lead times; commercial clutter Short message; lack of demographic selectivity; distracting noise levels Source: Charles W. Lamb, Jr., Joseph F. Hair, Jr., and Carl McDaniel, Marketing (Cincinnati: South-Western, 1998), p. 509.

14-8 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing A Media Mix for Small Businesses

14-9 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Selected Specialty Advertising Items Calendar Pen Shirt Bookmark South-Western Publishing Company SWOEUSTTHERNSWOEUSTTHERNT 2000

14-10 Small Business Management, 11th edition Longenecker, Moore, and Petty © 2000 South-Western College Publishing Tips on Trade Show Exhibits from Sales & Marketing Management Create moving billboards. Make the booth interactive. Get quality leads immediately. Create a presence on the show floor. Plan ahead. Recruit customers.