Business & Marketing Unit 6: Promotion

Promotional Concepts and Strategies Chapter 17

Sec. 17.1 – Promotion and the Promotion Mix What you’ll learn The role of promotion in marketing The concept of promotional mix The characteristics of personal selling and advertising The nature and scope of publicity

Promotional Concepts & Strategies

Promotion Any form of communication a business or organization uses to inform, persuade, or remind people about its products

Product Promotion Used to convince customers to buy your products instead of those of the competition

Institutional Promotion Used by a business to create a favorable image for itself

Promotional Mix – a combination of the different types of promotion Personal Selling Advertising Direct marketing Sales promotion Public relations

Personal Selling Any form of direct contact occurring between a salesperson and a customer

Advertising Any paid form of non- personal presentation and promotion of ideas, goods, or services by an identified sponsor Nationally, businesses spend about $200 billion annually on various types of advertising

Direct Marketing A type of advertising directed to a targeted group of prospects and customers rather than to a mass audience. Printed direct mail, sent via regular mail to a home or business Electronic direct mail It’s goal is to generate sales or leads for sales representatives to pursue

Sales Promotion All marketing activities, other than personal selling, advertising, and public relations, that are used to stimulate consumer purchasing and sales effectiveness

Public Relations and Publicity Public Relations – any activity designed to create a favorable image toward a business, its products, or its policies

PR Specialists Write News Releases -- a prewritten story about a company that is sent to the various media

Writing News Releases First paragraph should answer Who, What, When, Where, and Why questions. Develop important facts in next few paragraphs. Less important information can follow but should be edited. Include the full name and position of any people mentioned. Include the name, address, and phone number of the contact person. Be brief – only one or two pages. “###” at the bottom of the last page signifies the end.

Public Relations and Publicity Publicity – a specific kind of public relations that involves placing positive and newsworthy information about a business, its products, or its policies in the media.

Because it is free, business often has the least control over publicity http://www.signonsandiego.com/uniontrib/20050503/news_1m3wankie.html To see negative publicity abut Hogle Zoo, click on the elephant To see positive publicity about Hogle Zoo, click on the baby Orangutan. http://www.deseretnews.com/article/600132516/Zoo-goes-ape-over-baby.html

Coordination of Promotional Mix Most businesses use more than one type All types of promotion must be coordinated Must consider the promotional budget

Promotion Chapter 17

Transition 17-2 Discounts, coupons, gifts, free offers, etc. 755 Transition 17-2 With groups of 2 – 4: Brainstorm and list some of the types of promotions you encounter: Discounts, coupons, gifts, free offers, etc. How do these affect your buying decision? How does the promotion affect your feelings toward the business? Would you be likely to buy from that business without a promotion? Save as: Marketing-promotions 17-2-filastname

Premiums (Free offers) Limited price discounts Rebates Product Samples Types of Promotions: Coupons Premiums (Free offers) Limited price discounts Rebates Product Samples

Sec. 17.2 – Types of Promotion What you’ll learn The characteristics of sales promotion The concept of trade promotions The different kinds of consumer sales promotions

Incentives that encourage customers to buy products or services Sales Promotion Incentives that encourage customers to buy products or services

Trade Promotions – Designed to gain manufacturers’, wholesalers’, and retailers’ support for a product

Types of Trade Promotions Promotional Allowances – a cash payment or discounts given by manufacturers to wholesalers or retailers for performing activities to encourage sales.

Types of Trade Promotions Cooperative Advertising – A manufacturer supports the retailer by helping to pay for the cost of advertising its product locally.

Types of Trade Promotions Slotting Allowances – a cash premium paid for placing a product on a retailer’s shelves

Types of Trade Promotions Sales Force Promotions – awards given to managers and employees who successfully meet or exceed a sales quota.

Types of Trade Promotions Trade Shows and Conventions The Consumer Electronics Show is held annually in Las Vegas. Check it out by clicking on the image.

Consumer Sales Promotions – designed to encourage customers to buy a product

Types of Consumer Promotion Coupons – certificates that entitle customers to cash discounts on goods or services.

Types of Consumer Promotion Premiums – low-cost items given to consumers at a discount or for free – Should: be low-cost provide added value negate the target audience’s price issue effectively differentiate the product from the competition create an immediate need to buy

Types of Premiums Factory packs (in-packs) – free gifts placed in product packages

Types of Premiums Traffic builders – pen, calendar, key- chain given free for visiting or attending event

Types of Premiums Coupon plans – ongoing program offering a premium in exchange for labels, coupons or other tokens from one or more purchases.

Incentives – generally higher-priced products earned and given through contests, sweepstakes, and rebates Contests – activities that require demonstration of a skill Sweepstakes – game of chance

Incentives Rebates – discounts offered to customers who purchase

Product Samples Free, trial-size sample Distributed through mail, door- to-door, or at a retail or trade show Especially important with new products

Sponsorship The sponsoring company pays a fee for the right to promote itself and its products or services at or on a set location May negotiate the right to use logos and names on retail products

Promotional Tie-In Involves arrangements between one or more retailers or manufacturers. Ex: McDonald’s and Fisher-Price Toys

Product Placement Featuring a product at a special event, on television, or in the movies Click on the “Pieces Icon” to learn about the history of product placement.

Loyalty Marketing Programs Frequent buyer programs Reward customers for making multiple purchases

Point-of-Purchase Displays Placed in high- traffic areas and promote impulse purchases.