The Marketing Mix The 4 P’s Promotion

Learning Objectives Identify differences between sales promotion and advertising, above-the-line and below- the-line promotion Analyse different promotional tools and discuss their effectiveness Prepare an appropriate promotional mix

Start with this Speak to the people on your table and find out what they think was the best form of promotion they have seen Ask them to explain why

Preying on those addicted

Manipulation of the media Does sex sell…cigarettes?

Promotion The use of advertising, sales promotion, personal selling, direct mail, trade fairs, sponsorship and public relations to inform customers and persuade customers to buy Promotional objectives should aim to – Increase sales by raising customer awareness of a new product – Remind customers of an existing product and its distinctive qualities – Encourage increased purchases – Demonstrate the superior specification or qualities of a product compared to those of competitors – Create or reinforce brand image – Correct misleading reports – Develop or adapt public image – Encourage retailers to stock and actively promote products to the final consumer

Objectives of Promotion Notify target market about product Wants to learn more about product Wants to own the product Product purchased

Objectives of Promotion A Awareness I Interest D Desire A Action Notify target market about product Wants to learn more about product Wants to own the product Product purchased

What’s the Marketing objective? Cola – be yourself Lynx

What’s the Marketing objective? Stroke Sign of advice Citroen C4 Robotic dancing

The Marketing Funnel Audience Prospects Leads Customers Loyalty Aware (Inform) Express Interest (Interact) Take Action (Buy) Return (Buy Again) Talk (Word-of-Mouth) Above the Line (ATL) Below the Line (BTL)

Two ‘types’ of promotion… Above the line Uses independent media Aimed at a wide audience Below the line Uses media that the company has some form of control over

Above the line This uses advertising Advertising is using any paid form of non- personal presentation Uses media that company has little direct control over There is informative advertising and persuasive advertising although they go hand in hand

Above the line Which media to use? Limited resources restrict options Choosing the right media means considering a number of factors – Cost – Profile of the target audience – Type of product and the message to be communicated – Other aspects of the marketing mix – The law and other constraints

Below the line Promotion that is not a directly paid for means of communication but based on short term incentives to purchase E.G. sales promotion techniques

Below the Line Uses all forms other than advertising Includes – Direct mail – Exhibitions – Sales promotion – Branding – Merchandising – Packaging – Sponsorship Exhibitions don’t have to be boring

Method ExplainedPossible Limitations Price promotions – these are temporary reductions in price, also know as price discounting. They are aimed at encouraging existing customers to buy more and attracting new customers to buy the product Increased sales gained from price reductions will affect gross profit on each item sold There might be a negative impact on the brand’s reputation from the discounted price Money-off coupons – these are more versatile and better focused way of offering a price discount. May simply encourage customers to buy what they would have bought anyway Enough stock may not be held Proportion of customers using coupon may be small Customer loyalty schemes – such as air miles or customer loyalty cards. Focused on encouraging repeat purchases and discouraging customers from shopping with competitors. Info stored through loyalty cards provide info about consumer buying preferences Discount offered cuts gross profit Admin costs ‘loyalty’ impact is reduced as most companies now have these Money refunds – offered when the receipt is returned to the manufacturer Forms to be filled out by the customer Delay before refund is received BOGOF – encourages multiple purchases, which reduces demand for competitors’ products too Could lead to substantial reduction in gross profit Reputation Point-of-sale displays – maximum impact on consumer behaviour is achieved by attractive, informative and well positioned displays in stores Best display points are usually offered to market leaders New products may struggle for best positions in stores Public relations – the use of free publicity provided by newspapers, TV and other media to communicate with and achieve understanding of the public Not easily controllable as some free publicity may not be positive Sponsorship – payment by a company to team owners or event organisers so that the company name becomes associated with the event Success of the sponsorship is largely out of the company’s control. If a team fails this may reflect badly on the sponsor

Benefits and problems for above the line promotion Advantages Wide coverage Control the message Repetition Used to build brand loyalty Disadvantages Expensive Impersonal One way communication Lacks flexibility Limited capacity to close the sale

Benefits and problems for below the line promotion Advantages Higher customer attention Message is customised Interactivity Potential to develop a relationship Adaptable Opportunity to close a sale Disadvantages Labour intensive Expensive Can only reach a limited number of customers

Task Tell me your immediate thought of the – Target market and – promotional method used For the following items

For example - Playstation Target market – teenage boys Promotional method – games magazines

Task Bowling Toothpaste Airline travel Dishwasher liquid Crisps Dating Agency Local farmers market target market and promotional method used….

Viral Marketing – e-commerce! network-enhanced word of mouth Amazon.com encourages their customers to "send a book to a friend"

In groups of 2 – 3, using either an above the line technique or a below the line technique, create an advertisement for the cigarette brand Luck Strike

mad-men-smoke-smoke-smoke-cigarette mad-men-smoke-smoke-smoke-cigarette

Promotional Mix ComponentWhat it is Advertising Deliver messages using paid media; develop attitudes, build awareness, inform, persuade Paid media, identified sponsor, inexpensive & inefficient Public Relations (PR) & Publicity Creating a positive image, or delivering “interesting” information (publicity) Unpaid media Direct Marketing Highly targeted messages to target audienceNo personal contact Sales Promotion Stimulate sales; coupons, competitions, visual merchandising, etc. No media, no personal contact Personal Selling Delivering messages directly to customer; person-to-person. Expensive & efficient The combination of promotional techniques that a firm uses to communicate the benefits of its products to customers

Promotional Mix Eight stages in deciding on a promotional mix 1.Decide on the image of the product 2.Develop a profile of the target market 3.Decide on the messages to communicate 4.Set an appropriate budget 5.Decide how the messages should be communicated 6.Establish how the success of the promotional mix is to be assessed 7.Undertake the promotional plan and the mix elements of it 8.Measure its success

The Promotional Mix Advertising Direct Marketing Sales Promotion Public Relations Promotional Goals 1. Persuade, Remind, Inform the Market about Products 2. Create a Positive Public Image Promotional Goals 1. Persuade, Remind, Inform the Market about Products 2. Create a Positive Public Image Support Each Other Messages to Customers & Public Personal Selling

Promotion and the product life cycle Stage of the cyclePromotional options Introduction Informative advertising Sales promotion offering free samples Growth Focus shifts to brand building Sales promotion to encourage repeat purchase Attempt to develop brand loyalty Maturity Advertising to emphasize specification of product Sales promotion incentives to encourage brand development Decline Minimal advertising Sales promotion