Higher/Intermediate 2 Business Management Promotion

What is Promotion Promotion is the process by which people are encouraged to buy an organisations product / service. Promotion exists for a number of reasons Inform Persuade Remind

Different methods of Promotion “Above the line” - Promotion carried out through the mass-media “Below the line” – Promotion carried out without the use of the mass-media Mass Media = the main means of communicating to a large audience

Promotional Mix Advertising (“Above the line”) Personal Selling (“Below the line”) Sales Promotion (“Below the line”) Public Relations (“Below the line”) Direct Marketing (“Below the line”)

Advertising The way that most organisations will promote their good or service Non personal ‘Paid for’

Advertising Informative Advertising - used to increase awareness of a product/service and to inform the consumer about the product/service - for example: Yellow Pages Persuasive Advertising - aim to persuade a customer to buy a product by stressing that it’s very desirable to have - for example: Marks & Spencer (Food)

Advertising (Types) TV Radio Cinema Magazines / Newspapers Posters / Billboards Internet Sponsorship

TV Advertising Most people watch TV - hard to avoid Advert breaks / Commercial breaks Programme Sponsorship Placement Costly, People may switch channel

Radio Advertising Commercial Stations funded by advertising Advertising forthcoming events / shows Local Advertising – Target Audience Cannot see product – relies on descriptions

Cinema Advertising Captive Audience Advertises forthcoming movies Products can relate to feature movie (targeted) – Kids – Toys High Cost

Newspapers / Magazines Can be targeted – Local / National / Specialist / Young / Old Widely available Can be cost prohibitive

Posters / Billboards Many locations – Side of roads, Buses etc… Length of exposure Short and Punchy – Messages need to be short and easily understood

Internet Becoming more and more popular Huge audience Banner advertising Pop ups can be blocked

Sponsorship Advertise name at Pop Concerts, Football Teams, Stadiums Effective in building recognisable name May put people off by association

“Below the Line” Promotion Personal Selling Sales Promotion Public Relations Direct Marketing

Personal Selling One of the oldest forms of promotion. It involves using a sales force May involve a “push” or “pull” strategy Push – Encouraging to buy the product Pull – Supporting retailers and providing after sales service

Personal Selling Direct sales forces - Insurance and Finance Costs a lot of money to hire and train a sales force

Personal Selling Where satisfying the individual needs of the customer is paramount, personal selling is essential In some situations the customer’s needs can only be satisfied by personal contact between buyer and seller: - special advice is required e.g. insurance - where special benefits are required - where negotiation on price is required

Personal Selling It involves persuasive communication between buyer and seller It’s designed to convince the consumer to purchase the products or services on offer ‘make the sale’The objective is therefore to ‘make the sale’

Sales Promotion Sales promotions are short-term inducements used to encourage customers to react quickly and make a purchase Sales promotions can be given to the wholesaler/retailer or to the customer There are 2 main types of sales promotions…

Into the Pipeline Promotions (Manufacturer to retailer) Dealer Loaders (eg 6 for the price of 5) Point of Sale materials Dealer Competitions/Bonuses Staff Training Sale or Return Credit Facilities

Out of the Pipeline Promotions (Retailer to customer) Free Samples Bonus Packs Price Reductions BOGOF Demonstrations Merchandising Competitions Coupons/Vouchers

Public Relations Building goodwill between a business and its customers Does this by: Putting across positive messages Changing negative opinions

Public Relations (cont) Think of the Glasgow Commonwealth Games Bid Can be very costly

Public Relations The activities of an organisation which help it improve its image locally, nationally and internationally Includes making donations to charities, event sponsorship, product endorsement, publicity materials, merchandising, press conferences and press releases Staff must also deal with bad publicity with the aim to create positive publicity

PR Manager/Officer Arranges press conferences Deals with any bad publicity Issues press releases Organises charitable events Liaises with celebrities regarding their endorsements

Direct Marketing Direct Mail – “Junk Mail” Mail Order catalogues – “Betterware” Telemarketing – “Cold Calling” Magazine Inserts

Packaging* Manufacturers need to consider: Shape and weight Protection Convenience Design Product Information Environmental Factors – recycling

Merchandising* An attempt to encourage the customer to buy at the point of sale in shops and petrol stations Display material like window displays, in- store posters will attract customers’ attention Lighting and smells can also affect consumers’ buying decisions (bright lights to suggest cleanliness and bakery smells to make the customer hungrier)