Sales Promotion Direct Response, Internet, and Database Marketing Marketing 340 Prof. Bill White

Sales Promotion Short-term, demand-stimulating activities designed to –supplement advertising, –facilitate personal selling, –support distribution channels efforts. The target of these activities may be… –customers/end users –The Trade/middlemen –the producers own sales force

Most Common Objectives For Sales Programs

Push versus Pull Promotional Strategies Producer Wholesaler Retailer Consumer Producer Wholesaler Retailer Consumer PUSH STRATEGY PULL STRATEGY Product flow Promotion effort Customer flow

Middleman-Targeted Sales Promotions Directed to the members of the distribution channel. They are intended to... Motivate: Incentives –Contests, bonuses, push money, slotting fees, promotion allowances, cooperative advertising Inform: Advance notice –Producers new product –Producers new promotion –Often done at trade shows Educate –Sales training and sales aides –Management training

Customer-Targeted Sales Promotions Directed to end customers. They are intended to… –Attract new customers –Get more business out of current customers Types: Pricing deals: Price-off, rebate, BOGO, coupon Premiums: Give-a-way and self-liquidator Contests: Skill and Chance Sampling Point-or-purchase (POP) Consumer shows Sponsorships and event marketing Specialty advertising Cooperative advertising Directories and Yellow Page advertising Fulfillment

Exhibit 14.2: Promotion Industry Gross Revenues (in millions)

Direct Response, Internet, and Database Marketing

The Internets Relation To Direct Response Mail Order, Direct Response, Direct Marketing are all the same for our purposes. Definition: A method of selling using interactive media/advertising to solicit a measurable response in a manner convenient for the customer. The Internet is one form of interactive media/advertising.

Contrasting Marketing Models Image Based Awareness/Image Promotion Shopping & A Sale Undefined Market share Database/Response/Relationship Based Response Invitation Promotion Response Sale Inquiry Database Private Target Market Lifetime Value Custom Programs

Targeted, Integrated, Interactive, and Intimate Marketing Targeting: Who is/are the Target Market(s)? –End-users, dealers, suppliers, employees, stockholders, the media, movers & shakers, government -- local, national, international Integration: How will you reach them? –Conventional Media: TV, radio, newspaper, magazines, direct mail, publicity, specialty advertising, event sponsorships, trade shows, sampling –Electronic Media: Cable & satellite TV, telephone/voic , store scanners, broadcast fax, videotapes, CD-ROM, kiosks/ATMs, the Internet ( , news groups, web site, gopher, chatrooms, bulletin boards, etc.)

Targeted, Integrated, Interactive, and Intimate Marketing (continued) Interaction: How will they reach me to order and/or ask questions? How do they receive the product/service? –800#, 900# –fax-on-demand –mail/delivery service –cable & satellite TV –face-to-face contact (store, home, office) –the Internet ( , news groups, web site, gopher, chatrooms, bulletin boards, auto-responders, etc.) Intimacy: How will you build a lasting relationship? –Databases, loyalty programs (rewards, recognition, clubs)

Internet Marketing System Components Marketplace vs Marketspace Marketing Mix Activities Product Selection & Pricing Site Merchandising: Design & Content/Editorial Site Distribution/Marketspace Site Promotion Customer Service/Fulfillment Technical Infrastructure Activities Hardware/software Service Providers & Suppliers Databases Administration Activities Human Resources & Payroll Accounting & Budgeting

Types of Web Sites End-user and/or Middleman-Targeted Supplemental versus Stand-Alone Promotion: Ads, product/co. info, education Customer Service: Product/co info, support, dealer locator, lead generation, research Retail: Selling products/services The Site as a Product Itself: Info, education, entertainment, tools –Sells subscriptions and ad/banner space –Portals & Virtual Communities Hybrid: Combinations of the above

Best Internet Products/Services Competitive advantage(s) Mailable, drop-shippable, downloadable Line extendible Easy to describe and/or photograph Easy to install, assemble and use Potential customers are internet savvy Reliable suppliers Lends itself to repeat business Sufficient mark-up per unit Note: Information products are the most profit potential on a per-unit sold basis.

Martha Stewart Does It All: Targeted, Integrated, Interactive, and Intimate Marketing 24 Martha Stewart Books Martha Stewart Living Magazine Martha Stewart Living TV Show Martha Stewart Living Newspaper Column Martha Stewart Living Radio Show Martha Stewart Living Catalog marthastewart.com Web Site Martha Stewart Personal Appearances