The Promotion Strategy Chapter 12 The Promotion Strategy Developing a Promotion Strategy 12.1 12.2 Budgeting and Implementing Promotional Plans

Explain the role of the promotion strategy. 12.1 Explain the role of the promotion strategy. Explain how to formulate promotion plans. Describe considerations for putting together a promotional mix. Describe the elements of a promotional mix. Section 12.1 Developing a Promotion Strategy

The promotion strategy is the most visible marketing strategy. 12.1 The promotion strategy is the most visible marketing strategy. It is designed to get the attention of prospective customers and convince them to buy from your business. Section 12.1 Developing a Promotion Strategy

image preselling campaign promotional mix advertising specialty item 12.1 image preselling campaign promotional mix advertising specialty item publicity news release public relations premium rebate sweepstakes Section 12.1 Developing a Promotion Strategy

Drawing Up Promotional Plans As a new business owner, you need two kinds of promotional plans: a preopening plan to lay the groundwork an ongoing plan to support your operation once it is under way Section 12.1 Developing a Promotion Strategy

The Role of Promotion Strategy Promotion is communication intended to persuade, inform, or remind a target audience about a business or its products.   The promotion strategy involves planning, determining the right promotional mix, and selecting specific promotional activities. Section 12.1 Developing a Promotion Strategy

Objectives of a Preopening Plan Establish a positive image. Let potential customers know you are opening for business. Bring in customers or have them contact your business. Interest customers in your new company and products. Section 12.1 Developing a Promotion Strategy 8

Preopening Plan The image you establish in your preopening plan sets the tone for your promotional plan. image the impression people have of a company; a company’s personality Section 12.1 Developing a Promotion Strategy

Objectives of an Ongoing Promotional Plan Ongoing Plan Objectives of an Ongoing Promotional Plan Explain major features and benefits of your products. Communicate information about sales. Clear up customers’ questions and concerns. Introduce new goods or services. Section 12.1 Developing a Promotion Strategy 10

Ongoing Plan An ongoing promotional plan helps in preselling your goods or services. preselling the act of influencing potential customers to buy before contact is actually made Section 12.1 Developing a Promotion Strategy

Promotional Plan Format Both a preopening and an ongoing plan can be organized around a promotional campaign, independent promotional activities, or a combination of the two. campaign a series of related promotional activities with a similar theme Section 12.1 Developing a Promotion Strategy

Selecting a Promotional Mix Every business has a unique promotional mix. promotional mix the combination of different promotional elements that a company uses to reach and influence potential customers Section 12.1 Developing a Promotion Strategy

When selecting elements for a promotional mix, consider: Ongoing Plan When selecting elements for a promotional mix, consider: target market product value promotional channels time frame cost Section 12.1 Developing a Promotion Strategy 14

The Elements of the Promotional Mix personal selling advertising Promotional Mix sales promotion publicity Section 12.1 Developing a Promotion Strategy 15

Advertising In the United States, most businesses spend about one-fourth of their advertising dollars on newspaper ads. advertising the paid nonpersonal presentation of ideas, goods, or services directed at a mass audience by an identified sponsor by means of print and broadcast Section 12.1 Developing a Promotion Strategy

Advertising Types of Advertising magazines newspapers specialty items direct mail Types of Advertising outdoor advertising Internet radio directories television transit advertising Section 12.1 Developing a Promotion Strategy 17

Advertising A specialty item serves as a reminder of a business. specialty item an advertising device that includes giveaways, such as pens, T-shirts, and caps, printed with a business name or logo Section 12.1 Developing a Promotion Strategy

Publicity Taking advantage of publicity means calling attention to yourself and your business. publicity placement in the media of newsworthy items about a company, product, or person Section 12.1 Developing a Promotion Strategy

? ? ? ? ? Publicity A news release should answer these questions: news release a brief newsworthy story that is sent to the media ? Who? What? Where? When? Why? ? ? ? ? Section 12.1 Developing a Promotion Strategy

Publicity Public relations may generate unsolicited publicity when such activities are reported by the media. public relations activities designed to create goodwill toward a business or control damage done by negative publicity Section 12.1 Developing a Promotion Strategy

Sales Promotion Examples of Sales Promotion displays sweepstakes and contests premiums Examples of Sales Promotion samples rebates Section 12.1 Developing a Promotion Strategy 22

Sales Promotion One type of sales promotion may be to include a premium with a purchase. premium any item of value that a customer receives in addition to the good or service purchased; designed to attract new customers or build loyalty among existing customers, they may include coupons and gifts Section 12.1 Developing a Promotion Strategy

Sales Promotion Some companies give a rebate on purchases. rebate a return of part of the purchase price of a product used as an incentive for customers to purchase the product Section 12.1 Developing a Promotion Strategy

Sales Promotion A sweepstakes is a sales promotion that can draw attention to a business. sweepstakes a simple game of chance used by a business to get customers interested in what the company has to offer Section 12.1 Developing a Promotion Strategy

Explain the role of the promotion strategy. 12.1 Explain the role of the promotion strategy. The role of the promotion strategy is to set the course for and coordinate all aspects of promotion. It involves planning, determining the right mix, and selecting specific activities. Section 12.1 Developing a Promotion Strategy

Explain preopening and ongoing promotional plans. 12.1 Explain preopening and ongoing promotional plans. Preopening promotional plans establish the company’s image, let customers know the business is opening, bring in customers, and create interest in the business so the business will have customers when it opens. Ongoing promotional plans maintain and build sales after a business is open. Section 12.1 Developing a Promotion Strategy

Describe considerations for putting together a promotional mix. 12.1 Describe considerations for putting together a promotional mix. When selecting elements for a promotional mix consider the target market, product value, promotional channels, time frame, and cost.   Section 12.1 Developing a Promotion Strategy

Describe the elements of a promotional mix. 12.1 Describe the elements of a promotional mix. The elements of the promotional mix are advertising, sales promotion, publicity, and personal selling. Section 12.1 Developing a Promotion Strategy

Describe how to determine promotional costs for a start-up business. 12.2 Describe how to determine promotional costs for a start-up business. Describe approaches to implementing your promotion strategy. Discuss options for short-term changes in your promotion strategy. Name considerations for updating the promotion strategy. Section 12.2 Budgeting and Implementing Promotional Plans

12.2 Thorough planning and information gathering can help you arrive at a realistic promotional budget. That budget will have a direct affect on how you implement your promotional plans. Section 12.2 Budgeting and Implementing Promotional Plans

cooperative advertising advertising agency consumer pretest 12.2 industry average cooperative advertising advertising agency consumer pretest Section 12.2 Budgeting and Implementing Promotional Plans

Budgeting for Promotion To plan the promotional budget for a new venture, you must take these steps: Cost out promotional activities. Compare industry averages. Make final adjustments. Section 12.2 Budgeting and Implementing Promotional Plans

Compare Industry Averages You can find out the industry average for promotional expenses from such sources as trade associations or the SBA. industry average the standard used to compare costs among companies; usually expressed as a percentage Section 12.2 Budgeting and Implementing Promotional Plans

Basic Media Formats Print Include a headline, copy, illustrations, and a signature. Print Radio Radio Include same elements as print, but you may add music or sound effects. Television Same elements apply, but it requires casting, set design, sound and filming. Television Internet Internet Same components as print, but may also have audio, video, and animation. Section 12.2 Budgeting and Implementing Promotional Plans 35

Getting Help You can carry out your promotional plans yourself or you can hire professionals to implement some or all of your promotional activities.   Professional help can come from the media, manufacturers and suppliers, and advertising agencies. Section 12.2 Budgeting and Implementing Promotional Plans

Getting Help You may be able to save on your promotional budget by arranging for cooperative advertising. cooperative advertising an arrangement in which advertising costs are divided between two or more parties Section 12.2 Budgeting and Implementing Promotional Plans

Getting Help An advertising agency can handle all phases of your advertising, including writing the copy, creating the artwork, choosing the media, and producing the ad. advertising agency a company that acts as intermediary between a business and the media to communicate a message to the target market Section 12.2 Budgeting and Implementing Promotional Plans

Making Possible Promotion Changes There are three most common adjustments to the promotion strategy: adjust your advertising generate publicity promote sales Section 12.2 Budgeting and Implementing Promotional Plans

Factors for Evaluation Adjust Your Advertising market overall results source Factors for Evaluation budget motive media message Section 12.2 Budgeting and Implementing Promotional Plans 40

Adjust Your Advertising One way to reduce the risk involved in an expensive advertising campaign is to conduct a consumer pretest. consumer pretest a procedure in which a panel of consumers evaluates an ad before its release Section 12.2 Budgeting and Implementing Promotional Plans

Revising the Promotion Strategy Conduct a formal review of your promotion strategy on a regular basis.   Use your sales forecast to arrive at a promotional budget to support that level of sales. Then revise your promotional mix promotion plan. Section 12.2 Budgeting and Implementing Promotional Plans

Describe how to determine promotional costs for a start-up business. 12.2 Describe how to determine promotional costs for a start-up business. Promotional costs for a start-up business are determined by costing out the planned activities, comparing the costs to industry averages, and adjusting the budget if necessary. Section 12.2 Budgeting and Implementing Promotional Plans

Describe approaches to implementing your promotional strategy. 12.2 Describe approaches to implementing your promotional strategy. Two approaches to implementing a promotion strategy are developing your own promotion items and hiring professionals to do the job. Section 12.2 Budgeting and Implementing Promotional Plans

Discuss options for short-term changes in your promotion strategy. 12.2 Discuss options for short-term changes in your promotion strategy. Options for short-term changes are increasing the effectiveness of your advertising expenditures, capitalizing on publicity opportunities, and stimulating sales through sales promotions or changes in the sales force. Section 12.2 Budgeting and Implementing Promotional Plans

Name considerations for updating the promotion strategy. 12.2 Name considerations for updating the promotion strategy. To update the promotional plan consider the sales forecast for the upcoming period, make budget adjustments required by the forecast, and study changes in the target market, research results, and experiences to date. On the basis of those considerations, a new mix can be determined and a new plan developed. Section 12.2 Budgeting and Implementing Promotional Plans

Web Site Personalization Today, the technology exists for companies to personalize their Web Sites for each visitor.   Tailoring a Web page by using rules-based or inference-based personalization and cookies increases customer satisfaction and promotes sales. Section 12.2 Budgeting and Implementing Promotional Plans 47

Tech Terms cookie a file sent to a Web browser by a Web server that is used to record and store information for later use   inference-based personalization a data analysis tool that is used to suggest products that are similar to the products a customer has viewed or purchased personalization the process of tailoring Web pages to individual users’ characteristics Section 12.2 Budgeting and Implementing Promotional Plans 48

Tech Terms privacy policy a statement on a Web site that explains how a company collects, uses, protects, and shares customers’ personal information   rules-based personalization a data analysis tool that is used to recommend products that go with products a customer has viewed or purchased on a Web site Section 12.2 Budgeting and Implementing Promotional Plans 49

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