Promotion mix Week-9 Tutorial 8/29/2015Dr. Yuvaraj 1

Message 8/29/2015Dr. Yuvaraj 2

Timing  Communications need to be co-ordinated with the rest of the marketing activity eg  Product availability  May wish to co-incide with related events eg  Sportswear during Olympics  Turkeys at Christmas 8/29/2015Dr. Yuvaraj 3

Setting the Promotion Budget  A variety of methods:  Same as last year (plus or minus x%)  What is affordable  Percentage of sales  Parity with competitors  Objective and task 8/29/2015Dr. Yuvaraj 4

Evaluation & Control  A system must be put in place to assess the success (or not) of a campaign, e.g.  Recall / brand awareness / brand attitude studies  Coupon returns/clicks  Sales comparisons  Complaints 8/29/2015Dr. Yuvaraj 5

Marketing Communications Mix  The marketing communications mix comprises:  Advertising  Sales promotion  Public relations & publicity  Personal selling  Direct marketing 8/29/2015Dr. Yuvaraj 6

Why? 8/29/2015Dr. Yuvaraj 7

 Includes:  TV  newspapers  magazines & periodicals  cinema  radio  billboards & posters  Internet  other media  eg buses, taxis, petrol pumps Advertising 8/29/2015Dr. Yuvaraj 8

Best use of the media 8/29/2015Dr. Yuvaraj 9

 TV  large audience  see product-in-use  sound and vision  relaxing environment  cable, satellite and digital provide scope to segment  expensive  consumers may find commercials irritating  PVRs can screen out Media Choice 8/29/2015Dr. Yuvaraj 10

What fits in? 8/29/2015Dr. Yuvaraj 11

 Cinema  similar advantages to TV  smaller audience  segmentation possibilities  often more welcome than TV ads (signals start of the programme)  Less regulation than TV Media Choice 8/29/2015Dr. Yuvaraj 12

 Newspapers  use of illustrations  long copy  large audience, regular purchasers  segmentation possibilities  short life spans Media Choice 8/29/2015Dr. Yuvaraj 13

8/29/2015Dr. Yuvaraj 14

 Magazines  can integrate editorial with advertising  segmentation possibilities  long life spans  leisure reading  high readership compared to circulation  can involve audience  ‘desert areas’ eg inside front, back pages Glossy Mags Inside! That Ali G interview Why McDonald’s went bust On the Paris catwalk Media Choice 8/29/2015Dr. Yuvaraj 15

 Commercial radio  growing in popularity  sound only, but intimacy  segmentation possibilities  small, often passive audience Media Choice 8/29/2015Dr. Yuvaraj 16

Find the taste! 8/29/2015Dr. Yuvaraj 17

Jingle stays longer….! 8/29/2015Dr. Yuvaraj 18

 Billboards and Posters  high opportunity to see  low cost  segmentation possible  short and long term possibilities  subject to weather  environmental criticism  vandalism, ‘adbusters’ Media Choice 8/29/2015Dr. Yuvaraj 19

Guerilla Marketing 8/29/2015Dr. Yuvaraj 20

 Internet  growth medium  consumers actively seeking information  can be interactive  sound, pictures and words  segmentation possibilities  on-line shopping  ‘pop-ups’ irritate Media Choice 8/29/2015Dr. Yuvaraj 21

Media Selection  Characteristics of target audience  Media usage behaviour, exposure  Budget  Creative constraints  Best presentation of the message eg visuals, colour  Timing  Seasonality of offering; cost of media at different times  Reach and frequency  How wide message needs to be spread, and how often Media Choice 8/29/2015Dr. Yuvaraj 22

Sales Promotion  Generally short term incentives to stimulate sales people to sell, customers to buy/use  Growing in popularity:  Quick response  Easier targeting  Consumers increasing deal-orientation  Often easier to evaluate  Aims to break down brand loyalty  e.g. Encourage product trial, brand switching  Encourage new product trial 8/29/2015Dr. Yuvaraj 23

Best combo!!! 8/29/2015Dr. Yuvaraj 24

Potential Disadvantages  Frequent offers may ‘cheapen’ the brand image  Encourages consumer promiscuity  Consumers wait for the special offer and stockpile  Often used to meet ‘year end’ targets  Reduces subsequent sales  Subsidises those who would have purchased anyway 8/29/2015Dr. Yuvaraj 25

Internet Transactions Business Consumer Business Consumer B2B e.g. auto industry C2B e.g. Priceline B2C e.g. Amazon C2C e.g. eBay Source: The Economist 8/29/2015Dr. Yuvaraj 26

 Publishing  One-way provision of information  Interaction, e.g  On-line customer service  Games, promotions  Transaction  On-line purchasing  Integration  Automated management of supply chain Levels of On- Line Marketing 8/29/2015Dr. Yuvaraj 27

 Product  What products, customer service to offer  Price  Same, cheaper or higher than off-line  Delivery charges  Promotion  Internet only or include traditional  Marketing communications mix decisions  Affiliate marketing  Place  In-house or outsource distribution logistics The On-Line 4Ps 8/29/2015Dr. Yuvaraj 28

B2B and B2C Electronic Commerce 8/29/2015Dr. Yuvaraj 29

E-Commerce Business Models Online direct marketing Electronic tendering system Name-your-own-price Find-the-best-price 8/29/2015Dr. Yuvaraj 30

E-Commerce Business Models Affiliate marketing Note the Sony logo at the top of this Web page 8/29/2015Dr. Yuvaraj 31

E-Commerce Business Models Viral marketing Group purchasing Online auctions 8/29/2015Dr. Yuvaraj 32

E-Commerce Business Models Product customization Deep discounters Membership 8/29/2015Dr. Yuvaraj 33

E-Commerce Business Models Bartering online 8/29/2015Dr. Yuvaraj 34

Benefits of E- Commerce  Benefits to organizations  Makes national and international markets more accessible  Lowering costs of processing, distributing, and retrieving information  Benefits to customers  Access a vast number of products and services around the clock (24/7/365)  Benefits to Society  Ability to easily and conveniently deliver information, services and products to people in cities, rural areas and developing countries. 8/29/2015Dr. Yuvaraj 35

Limitations of E-Commerce  Technological Limitations  Lack of universally accepted security standards  Insufficient telecommunications bandwidth  Expensive accessibility  Non-technological Limitations  Perception that EC is unsecure  Unresolved legal issues  Lacks a critical mass of sellers and buyers 8/29/2015Dr. Yuvaraj 36

consumers are multitasking Source: PiperJaffray 8/29/2015Dr. Yuvaraj 37

And…consum ers don’t like ADS Source: PiperJaffray 8/29/2015Dr. Yuvaraj 38

Eight Types of Web sites for Advertising Portals: most popular; best for reach but not targeting Search: second largest reach; high advertising value 8/29/2015Dr. Yuvaraj 39

Eight types of sites (continued) Commerce: high reach; not conducive to advertising Entertainment: large reach; strong targetability Mall of Hawai’i 8/29/2015Dr. Yuvaraj 40

Eight types of sites (continued) Community: emphasize being a part of something; good for specific advertising Communications: not good for branding; low targetability 8/29/2015Dr. Yuvaraj 41

Eight types of sites (continued) News/weather/sports: poor targetability Games: good for very specific types of advertising 8/29/2015Dr. Yuvaraj 42

 What it is not:  Forcing people to buy things they do not want  Having ‘the gift of the gab’  Cheating, conning and lying  The interpersonal arm of the promotional mix:  Two-way  Communicate with end customers, channels, intermediaries  Represent the company to customers  Represent customers to the company  Increasing emphasis on the concept of relationship marketing Personal Selling 8/29/2015Dr. Yuvaraj 43

 Prospecting  Finding / developing new customers  Communicating  Communicate company/product information to customers  Selling  Servicing  e.g. Consult on problems  Customer relationship management  e.g. major accounts in business-to-business  Information gathering  Gather marketing intelligence; customer needs The Role of Sales 8/29/2015Dr. Yuvaraj 44

The Selling Process  Prospecting and qualifying  Pre-approach  Approach  Presentation and demonstration  Overcoming objections  Closing  Follow-up and maintenance 8/29/2015Dr. Yuvaraj 45

Salesforce Management  Structure / deployment  e.g. Geographical, product, market  Compensation  Usually fixed + variable (OTE)  e.g. Revenue, profit, product mix  Recruitment, selection, training  Motivating & managing  Evaluating performance 8/29/2015Dr. Yuvaraj 46

Sales Force  Pros  Two-way communication with customer  Build relationships  Speedy feedback  Often essential  Flexible focusing/targeting  Cons  Expensive  Requires managerial infrastructure  Focus on volume / revenue can lead to short term, less profitable, approach 8/29/2015Dr. Yuvaraj 47

Questions? 8/29/2015Dr. Yuvaraj 48