Elements of the Promotion Mix

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Elements of the Promotion Mix
Advertising
Ingredients of the Promotion Mix
Public Relations
Personal Selling
Sales Promotion
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The Communication Process
Noise
Receiver
Decoding
Channel
Encoding
Sender
Channel
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Goals and Tasks of Promotion
Informing
Reminding
Target Audience
Persuading
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AIDA and the Hierarchy of Effects
Purchase
Conviction
Preference
Liking
Knowledge
Awareness
Attention
Interest
Desire
Action
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When Elements of Promotion Are Most Useful
Advertising
Personal selling
Effectiveness
Sales promotion
Public relations

Awareness
Knowledge
Liking
Preference
Conviction
Purchase
Very effective
Somewhat effective
Either not effective or inefficient
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Factors that Affect the Promotion Mix
Nature of the Product
Stage in the Product Life Cycle
Target Market Characteristics
Type of Buying Decision
Available Funds

PushandPull Strategies
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Creating a Promotion Plan
Analyze the Marketplace
Identify Target Market
Set Promotion Objectives
Develop Promotion Budget
Choose Promotion Mix
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Criteria for Setting Promotion Objectives
Promotion objectives should
be measurable, concrete
be based on sound research, with a well-defined
target audience

be realistic
reinforce the overall marketing plan and relate
to specific marketing objectives
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Examples of Promotion Objectives
Objective To Inform (Awareness) To increase the
top-of-mind awareness level for Peter Pan peanut
butter from 16 percent to 24 percent
Objective To Persuade (Attitudinal) To increase
the percentage of parents who feel that Peter Pan
peanut butter is the best peanut butter for their
children from 22 percent to 35 percent
Objective To Remind To remind consumers that
Peter Pan peanut butter is the creamiest peanut
butter and is available at their nearest grocery
and convenience stores
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Techniques for Setting Promotion Budgets
Arbitrary Allocation All - You - Can -
Afford Competitive Parity Percent of
Sales Market Share Objective and Task
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Regulation of Promotion
Self-Regulation National Advertising Division
(NAD) National Advertising Review Board (NARB)
Federal Regulation Federal Trade Commission
(FTC)
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Effects of Advertising
Diminishing returns on additional spending
Increasing efficiency as ad budget
becomes sufficient
Return on Advertising Expenditures
Advertising Spending
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Major Types of Advertising
Corporate Image
Institutional Advertising
Advocacy Advertising
Types of Advertising
Pioneering
Product Advertising
Competitive
Comparative
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Advertising Campaign Decision Process
Determine the campaign objectives.
Make creative decisions.
Make media decisions.
Evaluate the campaign.
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Common Advertising Appeals
Profit
Save money, keep from losing money
Health
Body-conscious, healthy
Love or Romance
Sell cosmetics and perfumes
Fear
Social embarrassment, growing old, losing health,
power
Admiration
Celebrity endorsement effective
Convenience
Fast-food and microwave products
Fun and Pleasure
Vacations, beer, amusement parks
Vanity and Egotism
Expensive, conspicuous items
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Executional Styles for Advertising
Scientific
Slice-of-Life
Musical
Lifestyle
Common Executional Styles
Demon- stration
Spokes-person/ Testimonial
Mood or Image
Fantasy
Real/ Animated Product Symbols
Humorous
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Methods Used to Evaluate Advertising Campaigns
Pretests Examples Consumer jury tests
Portfolio or unfinished rough tests
Physiological tests
Post-tests Examples Recognition tests Recall
tests Attitude measures Audience size
measurement
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The Tools of Public Relations
New Product Publicity
Product Placement
Major Tools Used By PR Professionals
Customer Satisfaction Phone Lines
Consumer Education
Event Sponsorship
Issue Sponsorship
Web Sites
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Types of Consumer Sales Promotion Goals
Type of buyer Desired results Sales promotion
examples Loyal customers Reinforce
behavior, Loyalty marketing programs, People
who buy your increase consumption, such as
frequent-buyer cards product most or all change
purchase timing or frequent-shopper clubs of
the time Bonus packs that give
loyal consumers an incentive to stock up
or premiums offered in return for
proofs-of-purchase Competitors Break loyalty,
persuade Sampling to introduce
your customers to switch to your brand products
superior qualities People who buy a compared to
their brand competitors product Sweepstakes,
contests, or most or all of the time premiums
that create interest in the product Brand
switchers Persuade to buy your Any promotion
that lowers the People who buy a brand more
often price of the product, such as variety of
products coupons, price-off packages, in the
category and bonus packs Trade deals that
help make the product more readily
available than competing products Price
buyers Appeal with low prices Coupons,
price-off packages, People who or supply added
value refunds, or trade deals that consistently
buy the that makes price less reduce the price
of brand to least expensive brand important match
that of the brand that would have been
purchased
Source From Sales Promotion Essentials, 2E by
Don. E. Schultz, William A. Robinson, and Lisa A.
Petrison. Reprinted by permission of NTC
Publishing Group, Lincolnwood, IL.
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Tools for Consumer Sales Promotion
Coupons
Premiums
Six Categories of Consumer Sales Promotions
Frequent Buyer Programs
Contests and Sweepstakes
Samples
Point-of-Purchase Displays
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Tools for Trade Sales Promotion
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Advantages of Personal Selling
Detailed Information
Message Control
Targeted
Cost Control
Closing Sales
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Advertising Versus Personal Selling
Personal Selling is more important if... The
product has a high value. It is a custom-made
product. There are few customers. The product is
technically complex. Customers are geographically
concentrated.
Advertising/Sales Promotion is more important
if... The product has a low value. It is a
standardized product. There are many
customers. The product is simple to
understand. Customers are geographically
dispersed.
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Differences Between Traditional Relationship
Selling
Traditional Personal Selling Sell products (goods
and services) Focus on closing sales Limited
sales planning Spend most contact time telling
customers about product Conduct
product-specific needs assessment Lone-wolf
approach to the account Proposals and
presentations basedon pricing and product
features Sales follow-up focused on product
delivery
Relationship Selling Sell advice, assistance, and
counsel Focus on improving the customers bottom
line Considers sales planning as top
priority Spend most contact time attempting to
build a problem-solving environment with the
customer Conduct discovery in the full scope of
the customers operations Team approach to the
account Proposals and presentations based on
profit impact and strategic benefits to the
customer Sales follow-up is long term, focused on
long-term relationship enhancement
Source Robert M. Peterson, Patrick L. Shul, and
George H. Lucas, Jr., Consultative Selling
Walking the Walk in the New Selling Environment,
National Conference on Sales Management,
Proceedings, March 1996.
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Steps in the Selling Process
Generating Sales Leads
Qualifying Sales Leads
Basic Steps in the Selling Process
Making the Sales Approach
Making the Sales Presentation
Handling Objections
Closing the Sale
Following Up
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Functions of Sales Management
Set Sales Objectives
Evaluate Sales Force
Structure Sales Force
Major Tasks of Sales Management
Manage Turnover
Determine Sales Force Size
Motivate Sales Force
Develop Compen-sation Plan
Train Sales Force
Recruit Sales Force
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Cost Determinants of Price
MC
ATC
Dollars
AVC
AFC
Quantity
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Break-Even Analysis
Total Revenue

Profits
Break Even
Total Costs
Price ()
Fixed Costs
Losses
Quantity (units)
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Steps in Setting the Right Price
Establish Pricing Goals
Estimate Demand, Costs, and Profits
Choose Strategy
Fine-Tune Base Price

Right Price
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Legal and Ethical Issues in Pricing
Unfair Trade Practices
Key Legal and Ethical Issues Related to Price
Price Fixing
Price Discrimination
Predatory Pricing
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Discounts, Allowances, and Rebates
Price Reductions
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Geographic Pricing
FOB Origin
Uniform Delivered
Pricing Tactics Based on Geography
Zone Pricing
Freight-Absorption
Basing-Point
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Special Pricing Tactics
Single Price
Two-Part Pricing
Flexible Pricing
Common Special Pricing Tactics
Bundle Pricing
Professional Services
Odd-Even Pricing
Price Lining
Bait Pricing
Leader Pricing