Customer Communication Chapter 16 Chapter 16: Distribution and Customer Communication

Chapter 16 Objectives After studying this chapter, you will be able to: Describe the three major tasks in crafting a communication strategy and identify four important legal aspects of marketing communication. Identify the major types of advertising, the most common advertising appeals, and the most important advertising media.

Chapter 16 Objectives Cont. Explain how direct marketing differs from advertising and identify the major forms of direct media. Describe consultative selling and explain the personal-selling process. Define sales promotion and identify the major categories of consumer and trade promotions. Explain the uses of social media in customer communication and the role of public relations.

Customer Communication Challenges, Strategies, and Issues Establish clear communication goals Outline cost-effective media mix Define messages to help achieve goals Social Communication Model: An approach to communication based on interactive social media and conversational communication styles.

Establish Communication Goals Generate awareness Provide information and creating positive emotional connections Build preference Stimulate action Remind past customers

Define Customer Messages

Communication Mix Communication Mix Advertising Public Relations Direct Marketing Personal Selling Sales Promotion Social Media Public Relations

Assemble the Communication Mix Push Pull Push Strategy: A promotional strategy that focuses on intermediaries, motivating them to promote, or push, products toward end users. Pull Strategy: A promotional strategy that stimulates consumer demand via advertising and other communication efforts, thereby creating a pull effect through the channel.

Message Integration in Customer Communication

Communication Law and Ethics Marketing and sales messages must be truthful and non-deceptive. You must back up your claims with evidence. Marketing and sales messages are considered binding contracts in many states. In most cases, you can’t use a person’s name, photograph, or other identity without permission.

Advertising Advertising: The delivery of announcements and promotional messages via time or space purchased in various media. Product Comparative Advertising can also be classified according to the sponsor. National advertising is sponsored by companies that sell products on a nationwide basis. In contrast, local advertising is sponsored by a local merchant; grocery store ads are a good example. Cooperative advertising involves a financial arrangement in which companies with products sold nationally share the costs of local advertising with local marketing intermediaries. Institutional Advocacy

Advertising Product advertising, promotes the features and benefits of specific products. Comparative advertising is applied to ads that specifically highlight how one product is better than its competitors. Institutional advertising is designed to create goodwill and build a desired image for a company rather than to promote specific products. Institutional ads that address public issues are called advocacy advertising 11-12 ©2007 Prentice Hall 12

Advertising National advertising is sponsored by companies that sell products on a nationwide basis. Local advertising is sponsored by a local merchant; grocery store ads are a good example. Cooperative advertising involves a financial arrangement in which companies with products sold nationally share the costs of local advertising with local marketing intermediaries. 11-13 ©2007 Prentice Hall 13

Advertising Appeals Logic Emotion Humor Celebrity Sex Music Scarcity

Advertising Appeals Logic. The basic approach with a logical appeal is to make a claim based on a rational argument supported by solid evidence. Emotion. An emotional appeal calls on audience feelings and sympathies rather than facts, figures, and rational arguments. Humor. In a world cluttered with advertising, humor is frequently used to capture people’s attention. The humor can be so memorable that audiences remember the joke but not the product being advertised. 11-15 ©2007 Prentice Hall 15

Advertising Appeals Celebrity. The thinking behind celebrity involvement in advertising is that people will be more inclined to use products endorsed by a celebrity because they will identify with and want to be like this person. Sex. Sex-oriented appeals are the most controversial type of advertising, in terms of both social reaction and promotional effectiveness. 11-16 ©2007 Prentice Hall 16

Advertising Appeals Music. With its ability to create emotional bonds and “embed” itself in listeners’ memories, music can be a powerful aspect of advertising. Scarcity. If a product is in limited supply or available only for a limited time, advertisers can use this scarcity to encourage consumer responses. 11-17 ©2007 Prentice Hall 17

Advertising Media Newspapers Television Radio Magazines Product Placement Fixed Web (from stationary computers) Mobile Web (from mobile phones and other handheld devices)

Direct Marketing Media Direct Mail E-mail Direct Response Online Search Engine Marketing Telephone Direct Response Television

Personal Selling Consultative Selling: An approach in which a salesperson acts as a consultant and advisor to help customers find the best solutions to their personal or business needs. Personal Selling: One-on-one interaction between a salesperson and a prospective buyer.

Personal Selling 1 Prospecting Preparing 2 3 Approaching 4 Presenting Handling Objections 5 Closing 6 7 Following Up

The Personal-Selling Process

Sales Promotion Sales Promotion: Customer Promotion Trade Promotion A wide range of events and activities designed to promote a brand or stimulate interest in a product. Customer Promotion Trade Promotion

Consumer Promotions Contests and other audience involvement tactics: Giving consumers the opportunity to participate in contests, games, sweepstakes, surveys, and other activities. Coupons: Printed or electronic certificates that offer discounts on particular items and are redeemed at the time of purchase. Rebates: Partial reimbursement of price, offered as a purchase incentive.

Consumer Promotions Point-of-Purchase (POP) Display: Advertising or other display materials set up at retail locations to promote products to potential customers as they are making their purchase decisions. Samples and trial-use versions: Samples are an effective way to introduce a new product. Offering trial versions to let customers try before buying.

Consumer Promotions Special-event sponsorship: Thousands of companies spending billions of dollars to sponsor events ranging from golf to opera. Premiums: Free or bargain-priced items offered to encourage consumers to buy a product. Specialty Advertising: Advertising that appears on various items such as coffee mugs, pens, and calendars, designed to help keep a company’s name in front of customers.

Trade Promotions Trade Promotions: Trade Allowances: Sales-promotion efforts aimed at inducing distributors or retailers to push a producer’s products. Trade Allowances: Discounts or other financial considerations offered by producers to wholesalers and retailers.

Social Media in Marketing Social Media: Any electronic media that transforms passive audiences into active participants in the communication process by allowing them to share content, revise content, respond to content, or contribute new content. Word of Mouth: Communication among customers and other parties, transmitting information about companies and products through online or offline personal conversations.

Social Media in Marketing Conversation Marketing: An approach to customer communication in which companies initiate and facilitate conversations in a networked community of potential buyers and other interested parties. Brand Communities: Formal or informal groups of people united by their interest in and ownership of particular products

Public Relations Public Relations: Non-sales communication that businesses have with their various audiences (including both communication with the general public and press relations). Press Release (news release): A brief statement or video program released to the press announcing new products, management changes, sales performance, and other potential news items. Press Conference (news conference): An in- person or online gathering of media representatives at which companies announce new information.