Chapter 16 McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. IMC: Direct Marketing, Personal Selling, Packaging, and Sales Promotion

Learning Objectives LO1: Explain the importance of relationship marketing and IMC. LO2: Discuss the benefits & challenges of direct marketing. LO3: Explain the various types of direct marketing activities 16-2

Learning Objectives LO4: Describe the advantages and drawbacks of personal selling LO5: Identify the elements that must be considered in establishing a trade show program. LO6: Explain the factors that must be considered in designing packaging LO7: Describe the roles that sales promotion can play in marketing strategy 16-3

The Importance of Relationship Marketing & IMC – Seamless, consistent communication from all aspects of the company is how a firm earns a good reputation – Advertising should be integrated with other marketing communication tools – Advertising can create an image, reputation must be earned direct marketing sales promotion personal selling public relations 16-4

Understanding Direct Marketing Direct Marketing – interactive process of addressable communication – using one or more advertising media – to create a sale, lead, purchase or donation – analyzed on a database to develop ongoing beneficial relationships 16-5

Direct Marketing in IMC Importance of Direct Marketing to IMC – You can’t do the job with just one medium. – Direct Marketing is the best way to develop a good database a database allows marketers to build relationships by learning about customers databases let companies choose good customers – Direct Response Media are more cost-competitive than ever before 16-6

Direct Marketing in IMC Drawbacks to Direct Marketing – bad reputation – efforts have to be able to stand on their own – lots of clutter – privacy concerns 16-7

Types of Direct Marketing Activities Direct Response Advertising Direct Sales Telemarketing Catalog Sales 16-8

Types of Direct Marketing Activities Direct Response Print Advertising – Ads that use coupons or listing toll-free numbers Direct Response Broadcast Advertising – Infomercials, shopping networks Interactive 16-9

Personal Selling: The Human Medium the objective of personal selling should be relationship building with long term benefits to all parties Types of personal selling – Door-to-Door girl scout cookies, magazine subscriptions – Any kind of sale often to understand the selling environment, advertisers will make calls with sales person 16-10

Personal Selling: The Human Medium Advantages of personal selling – Its Personal – helps distribution – Good for high price items Drawbacks of personal selling – labor-intensive – poor reputation/perception 16-11

Personal Selling: The Human Medium The role of Personal Selling in IMC – Salespeople are the company’s communicators – Sales reps gather & provide information – Getting the sale, fulfilling orders and following up – Sales people build (or ruin) relationships 16-12

Trade Shows Exhibitions where manufacturers, dealers, and buyers of an industry’s products can get together for demonstrations and discussions on products An extraordinary opportunity for personal selling 16-13

Product Packaging Packaging – The last thing a customer sees before purchasing a product – Four functions create relationship with customer, influence shopping decisions, help differentiate from competitors, inform customers of features & benefits 16-14

The Role of Sales Promotion in IMC Positive effects of sales promotion on brand volume – adds value to brand – maximizes sales & market volume – combats brand parity 16-15

The Role of Sales Promotion in IMC Negative effects of sales promotion on brand volume – excessive promotions can reduce profitability – high sales promotions and low advertising efforts can negatively affect brand attitudes – overemphasis of price can destroy brand equity – excessive efforts can lead to a price war – high cost 16-16

Sales Promotion Strategies & Tactics Push Strategy vs. Pull Strategy – Push: use distribution channels to push products to consumers – Pull: use advertising to get customers to pull products 16-17