Slides prepared by Joe Rosagrata Promotion Strategies Chapter 9 Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata

Slides prepared by Joe Rosagrata What is a promotion? Promotion is the element in an organisation’s marketing mix that serves to inform, persuade and remind the market about the organisation and/or its products. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-1

Slides prepared by Joe Rosagrata The promotional mix Personal selling: the presentation of a product to a prospective customer by a firm’s sales executive. Advertising: paid, non-personal mass communication, in which the sponsor is clearly identified. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-2

Slides prepared by Joe Rosagrata The promotional mix (cont.) Sales promotion: demand-stimulating activity designed to supplement advertising and co-ordinate personal selling. Publicity: a non-paid form of advertising that uses mass communication to stimulate demand. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-3

Slides prepared by Joe Rosagrata The Promotional Mix Public relations: a planned communication effort by an organisation to contribute to generally favourable attitudes and opinions toward an organisation and its products. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-4

Slides prepared by Joe Rosagrata Choosing the right form of promotion Marketers need to consider: The target market. The nature of the product. The stage of the product’s life cycle. Money available for the promotion. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-5

Slides prepared by Joe Rosagrata Reaching the target market Marketers need to identify whom they are trying to influence. Determine customer’s readiness to buy. Awareness Knowledge Liking Preference Conviction Purchase Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-6

Slides prepared by Joe Rosagrata Nature of the product Unit value of the product. Amount of product customisation. Amount of pre-sale and post-sale service required. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-7

Slides prepared by Joe Rosagrata Push vs pull strategy Push Strategy Producer creates demand for product. Aims promotional activity to channel member(s) Each channel member promotes to next channel member Demand ‘pushed’ down distribution channel. Consumer influenced by retailer’s advertising. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-8

Slides prepared by Joe Rosagrata Push vs pull strategy (cont.) Pull Strategy Producer creates demand for product Aims promotional activity directly at the consumer Consumer demands product from retailer Demand ‘pulled’ up the distribution channel. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-9

Slides prepared by Joe Rosagrata Push vs pull strategy (cont.) PUSH STRATEGY Producer Wholesaler Retailer Consumer PULL STRATEGY Producer Wholesaler Retailer Consumer Product flow Promotion effort Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-10

Slides prepared by Joe Rosagrata The promotional budget Did I spend too much? Percentage of sales method Company may determine past or anticipated sales and apply a percentage of sales as the promotional budget. All available funds Company uses all available funds on the promotional campaign . Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-11

Slides prepared by Joe Rosagrata The promotional budget (cont.) Matching the competition (also known as competitive parity). Promotional expenditure based on market share of competitors, or actual expenditure if known. Task or objective method Determine what tasks or objectives the promotion must accomplish. Determine what it will cost to perform the task or meet objective. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-12

Slides prepared by Joe Rosagrata Skills of the sales person A good sales person requires various attributes: Time management. Organising ability. Consulting skills. Communication skills. Problem-solving skills. Credibility (also a positive attitude). Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-13

Slides prepared by Joe Rosagrata Managing the sales team Recruitment and selection Decide who the right person is for the job and what attributes and qualifications they should have. Choose the right people Various methods used are interview, references, psychological and aptitude tests, also physical examinations. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-14

Slides prepared by Joe Rosagrata Managing the sales team (cont.) The induction A method used to familiarise a new employee with their new working environment. The training Determine who should train new sales person. A training program should be developed to meet company objectives which outline philosophy, company and product overview. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-15

Slides prepared by Joe Rosagrata Managing the sales team (cont.) Sales people need: Coaching Spending time with a sales person to observe and assist with their work practice, outcomes and to develop knowledge and skills. Motivation Managers should find out what motivates an individual. These include financial and non-financial rewards. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-16

Slides prepared by Joe Rosagrata Compensation There are various forms of compensation: Straight salary. Straight commission. A third from of compensation used in business is a combination of both methods. This is used to motivate sales team members with financial incentives. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-17

Slides prepared by Joe Rosagrata Types of advertising Consumer versus business advertising Emotional and rational vs informational. Product versus institutional advertising Focus on particular product or brand and information and goodwill to company. Primary-demand and selective-demand advertising Stimulate demand for generic or specific brands Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-18

Which media should we use? To Choose the right medium for a promotional message, we need to consider the following. What do we want our ads to do? Who are we trying to reach? What message do we want to communicate? How much will each medium cost? Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-19

Media characteristics Newspapers Television Radio Magazines Direct Mail Outdoor advertising Yellow pages Internet Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-20

Did our advertising work? Here are some of the factors that make it difficult to measure the sales impact of advertising Ads have different objectives Ads can have an effect over time The effects of ads are difficult to measure Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-21

Methods used to measure effectiveness include Direct tests: these measure or predict the sales volume stemming from an advertising campaign Tabulating the number of inquiries from a direct-response campaign Indirect tests: these measure something other than actual sales (e.g. recall tests) Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-22

Choosing the right sales promotion What are our promotional objectives? Who is our target market? Can our product be sampled? What will it cost to use the right promotional tool? What is the current economic condition? Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-23

Slides prepared by Joe Rosagrata Managing public relations and publicity P.R. can be achieved by: Supporting charitable projects Supplying volunteers or other resources Participating in community-service events Sponsorship Providing information to customers via newsletters. Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-24

Slides prepared by Joe Rosagrata Managing public relations and publicity (cont.) Publicity can be achieved by: structured news-release to the media co-ordinating personal communication with a group co-ordinating one-to-one personal communication (lobbying) Copyright  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Essential Marketing Skills by Rix Slides prepared by Joe Rosagrata 9-25