Chapter 15 Promoting Products: Public Relations and Sales Promotion

“There are many misconceptions about public relations “There are many misconceptions about public relations. One of the most widespread is that it’s easy” -Peter Celliers ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Chapter Objectives Understand the different public relations activities Understand the public relations process Know how the different PR tools are used ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Chapter Objectives Implement a crisis management program in a hospitality business Discuss the growth and purpose of sales promotion, setting objectives, and selecting consumer promotion tools ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Public Relations Creating a positive image and customer preference through third-party endorsement PR is experiencing explosive growth Offers a way to distinguish your company’s products from another Marketing and PR are becoming increasingly linked ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Major PR Activates Press Relations Product Publicity Corporate Communications Lobbying Counseling ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Press Relations The aim of press relations is to place newsworthy information into the news media to attract attention to a person, product, or service ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Product Publicity It is the direct function of public relations. Publicity is the task of securing editorial space, as opposed to paid space, in print and broadcast media to promote a product or a service. Some popular uses of publicity are as follows: Various efforts to publicize specific products Assists in new product launch Assists in product repositioning Creates interest in a product category ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Corporate Communications Involves communications with internal and external customers Promotes understanding of the organization ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Lobbying Dealing with legislators and government officials to promote or defeat legislation and regulation Large companies employ their own lobbyists Small companies lobby through local trade associations ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Counseling Advising management about public issues and company positions and image Important when involving special interests Example: Water scarcity and the mirage in Las Vegas ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Publicity Secures editorial space, as opposed to paid space, in print and broadcast media to promote a product or a service Influences specific target groups Defends products against public problems Builds the corporate image ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

The Public Relations Process Research Establishing marketing objectives Builds awareness Builds credibility Stimulates the sales force and channel intermediaries Lowers promotional costs ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

The Public Relations Process Defining the Target Audience Choosing the PR Message and Vehicles Implementing the Marketing PR Plan ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

The Public Relations Process Evaluating PR Results Exposures Awareness/Comprehension/Attitude Change Sales-and-Profit Contribution ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Major Tools in Marketing PR Publications Events News Speeches Public Service Activities Identity Media ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Major Tools in Marketing PR Publications: Companies can reach and influence their target market via annual reports, brochures, cards, articles, audiovisual materials and company newsletters and magazines. Events: Companies can draw attention to new products or other company activities by arranging special events. News: PR professionals cultivate the press to increase better coverage to the company. Speeches: Speeches create product and company publicity.The possibility is accomplished by printing copies of the speech or excerpts for distribution to the press, stockholders, employees, and other publics. Public service activities: Companies can improve public goodwill by contributing money and time to good causes, such as supporting community affairs. Identity media: Companies can create a visual identity that the public immediately recognizes, such as with company’s logos, stationery, signs, business cards, building, uniforms, dress code and rolling stock.

PR Opportunities for the Hospitality Industry Individual Properties Single hotels, tour operators, B&Bs They can seldom afford advertising Build PR around the Owner/Operator Owner sometimes is the face of the product ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

PR Opportunities for the Hospitality Industry Build PR around Location Turn poor locations into advantages Isolation and obscurity can be a PR tactic Build PR around a Product or Service Emphasize unique services ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Crisis Management An important area of public relations is crisis management. Not all publicity is good. There are times when things go wrong (guests fall asleep while smoking, poisoned by restaurant food,earthquakes), sometimes it is management’s fault and sometimes it is beyond managements control. A crisis management program will reduce the negative effects of these events. Take all precautions to prevent negative events from occurring When a crisis does occur Appoint a spokesperson Contact the firm’s PR agency Notify the press and keep them updated

Sales-Promotion Objectives Increase short-term sales Help build long-term market share Entice consumers to try a new product Lure consumers away from competitors ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Sales-Promotion Objectives Hold and reward loyal customers Building stronger customer relations Obtaining new accounts ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Sales-Promotion Tools Samples Coupons Packages Patronage Rewards Premiums Point-of-Purchase Displays Contests, Sweepstakes, and Games ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Sales-Promotion Tools Samples: are offers of a trial amount of a product. Some samples are free or the company charges a small amount to offset its cost. Coupons: are certificates that offer buyers savings when they purchase specified products. Packages: Promotions often involve packages of a number of the company’s products. Particularly popular with hotels and resorts that have a number of products to offer.

Sales-Promotion Tools Premiums: Premiums are goods either free or at low cost as an incentive to buy a product. (Mc Donald’s offered Batman figures for 95 cents with the purchase of a hamburger) Patronage rewards: are cash or other awards for regular use of a company’s products or services. (Frequent flier programs) Point-of-Purchase Displays: POP promotions include displays and demonstrations, that take place at the point of purchase or sale. For ex. A representative of Kavaklıdere wines might offer a taste of their wines in Kipa. Hospitality firms have discovered that POP may be used to 1)disseminate information about the company’s products or services and 2) to sell additional products and services, thus adding to gross revenue.

Developing the Sales Promotion Program Decide on the size of the incentive Set the conditions for participation Decide how to promote and distribute Set promotion dates Decide on the sales promotion budget ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Before and After Pre-test to determine if they are appropriate and of the right incentive size Evaluate the results against the objectives of the program ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Local Store Marketing Also called “area” or “neighborhood” marketing A low-cost, hands-on effort to take advantage of all opportunities in immediate training area School tours, product tastings, coupons Cause-related marketing/charities ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Best Practices Creative Publicity by Taco Bell Liberty Bell April Fools Purchase “Nothing ordinary about it” campaign Image promotion of a hip, rebellious restaurant chain ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Key Terms Contests, sweepstakes, and games Corporate communications Coupons Counseling Event creation ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Key Terms Lobbying Patronage rewards Point-of-purchase (POP) promotions Premiums Press relations ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

Key Terms Press release Product publicity Public relations Sales promotion Samples ©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens