Copyright © 2015 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Using Effective Promotions CHAPTER 16

LEARNING OBJECTIVES Identify the new and traditional tools that make up the promotion mix. 2. Contrast the advantages and disadvantages of various advertising media, including the Internet and social media. 3. Illustrate the steps of the B2B and B2C selling processes.

LEARNING OBJECTIVES Describe the role of the public relations department, and show how publicity fits in that role. 5. Assess the effectiveness of various forms of sales promotion, including sampling. 6. Show how word of mouth, viral marketing, blogging, podcasting, marketing, and mobile marketing work.

CHRIS HARDWICK Nerdist Industries 16-4 Hardwick broke into entertainment after graduating from UCLA. After his career hit a low, he started following his nerd passions and created The Nerdist. Entered a partnership with Peter Levin and expanded the Nerdist franchise.

NAME that COMPANY 16-5 This company put its product into the hands of Spiderman. Viewers watched as the superhero used the product throughout his latest movie. Name that company!

Promotion Mix -- The combination of promotional tools an organization uses. The traditional mix includes: PROMOTION in an ORGANIZATION 16-6 LO 16-1

INTEGRATED MARKETING COMMUNICATION (IMC) 16-7 LO 16-1 Integrated Marketing Communication (IMC) -- Combines the promotional tools into one comprehensive strategy. IMC is used to:  Create a positive brand image.  Meet the needs of consumers.  Meet the strategic marketing and promotional goals of the firm.

STEPS in a PROMOTIONAL CAMPAIGN 16-8 LO Identify a target market 2. Define objectives 3. Determine a promotional budget 4. Develop a unifying message 5. Implement the plan 6. Evaluate effectiveness

CLASSIC CAMPAIGNS Brilliant Marketing Ideas 16-9 Source: Entrepreneur, accessed November LO 16-1

ADVERTISING in the FIRM LO 16-2 Advertising -- Paid, non- personal communication through various media by organizations and individuals who are in some way indentified in the message. Major goals of advertising:  Inform  Persuade  Remind

IMPACT of ADVERTISING LO 16-2 Total advertising expenditures exceed $215 billion yearly. Consumers benefit because production costs of TV programs, radio programs, newspapers and magazines are paid for by advertisers. Marketers choose ad media that will reach the target market.

MAJOR CATEGORIES of ADVERTISING CategoryWhat it is RetailFrom retail stores to consumers TradeFrom manufacturers to wholesalers and retailers B2BFrom manufacturers to other manufacturers InstitutionalCreates a desirable image for an organization ProductCreates a desirable image for a product or service LO 16-2

MAJOR CATEGORIES of ADVERTISING CategoryWhat it is AdvocacySupports a particular view of an issue ComparativeCompares competing products Interactive Customer-oriented ads that allows customers to choose information to receive OnlineComputer ads featured on different sites MobileAds that reach consumers on cell phones LO 16-2

ADVERTISING EXPENDITURE by MEDIA in $ MILLIONS LO 16-2

1. Plan: What should your mailing accomplish? 2. Get the Right List: The better the list, the better your chance of success. DEAR MR. POSTMAN… Steps in Launching a Direct-Mail Campaign LO Stand Out: Make your ad like no other. 4. Get Help: Contact a marketing firm with direct mail experience. 5. Follow Up: One mailing is not enough.

MATCH GAME Match the Company with the Slogan LO 16-2 “Everybody doesn’t like something, but nobody doesn’t like ___________.” “We bring good things to life.” “It takes a licking and keeps on ticking.” “With a name like _________, it has to be good.” “Good to the last drop.” “Betcha can’t eat just one!” “Because you’re worth it.”

IT’S a DOG’S LIFE Famous and Not-so-Famous Dogs in Advertising LO 16-2

TV advertising is still the dominant media. Digital Video Recorders (DVRs) challenge TV advertising because viewers can skip ads. POPULAR ADVERTISING MEDIA LO 16-2 Product Placement -- Advertisers pay to put their products into TV shows and movies where the audience will see them.

NOT QUITE the NFL… LO 16-2 Source: Inc., accessed November

INFOMERCIALS and ONLINE ADVERTISING LO 16-2 Infomercial -- A full length TV program devoted exclusively to promote a particular product. Online ads are attempts to get potential customers to a web site to learn about a product. Interactive Promotion -- Allows marketers to open a dialogue between buyers and sellers and let them work together to create a beneficial exchange.

INFOMERCIAL HALL of FAME The Biggest Hits Over the Past 40 Years Source: Fortune, accessed November LO 16-2 Veg-O-Matic Ginsu Knives The Clapper Thigh Master George Foreman Grill Bowflex

ONLINE EXPERIENCE How to Avoid Losing Customers Over a Bad Web Site Source: Entrepreneur, accessed November LO Brand messaging is key. 2. Site must be easy to navigate. 3. Make sure calls to action are effective. 4. Users want fast, readable sites. 5. Users with disabilities should be able to navigate.

PAY-PER-TWEET Celebrities can earn large sums of money just buy mentioning a product or site in their tweets. Do you think it is ethical for celebrities to get paid to tweet pre-written ads that appear to be their own personal comments?

MONITORING AD EFFECTIVENESS Photo Credit: Brent Moore LO 16-2 Dr. Pepper posts messages on Facebook and monitors the results from their millions of fans.Dr. Pepper Richard Branson and Tony Hsieh all tweet their customer base to maintain two-way communication.Richard BransonTony Hsieh

SOCIAL SCAMMERS How to Protect Yourself From Schemers Source: Kiplinger’s Personal Finance, December Photo Credit: Paul Klintworth LO Be wary of requests for money transfers -- even from friends’ accounts. 2. Be wary when you use applications. Don’t give unnecessary information. 3. Use URL expanders to see the full address of links on friends’ pages.

To Americans, an Oreo is the same cookie we’ve been enjoying for over 100 years. But Kraft has taken Oreos global which has led to different variations.Kraft WHAT’S in YOUR OREO? In China they enjoy green tea Oreos while Argentina has banana with dulce de leche.

GLOBAL ADVERTISING LO 16-2 Requires marketers to develop a single product and promotional strategy to implement worldwide. Problems can arise in global markets with using one advertising campaign in all countries - especially bad translations.

Personal Selling -- The face-to-face presentation and promotion of a product, including the salesperson’s search for new prospects and follow-up service. PERSONAL SELLING LO 16-3 Salespeople need to listen to customer needs, help reach a solution and do everything possible to make the transaction as simple as possible.

1. Prospect and qualify 2. Pre-approach 3. Approach 4. Make a presentation 5. Answer objections 6. Close the sale Trial Close -- A statement or question that moves the process toward the purchase. 7. Follow up STEPS in the SELLING PROCESS LO 16-3

Prospecting -- Researching potential buyers and choosing those most likely to buy. PROSPECTING and QUALIFYING in SELLING LO 16-3 Qualifying -- Making sure customers have a need for a product, the authority to buy and the willingness to listen to a sales message. Prospect -- A customer who meets the qualifying criteria.

BUY THIS! Successful Selling Strategies LO 16-3 Know your competition Understand your customer’s business Differentiate your product or service Sell to the people most likely to buy Build relationships Put the right people in the right selling spots

WHOOPS! Sales Slip-Ups LO 16-3 Not feeling the customer’s pain Making money is the only goal Seeing sales as just a job Getting upset during the presentation Failing to properly prepare or over-preparing Not being yourself Neglecting the relationship

STEPS in the B2C SELLING PROCESS LO 16-3

TEST PREP What are the four traditional elements of the promotion mix? What are the three most important advertising media in order of dollars spent? What are the seven steps in the B2B selling process? How does it differ from the B2C selling process?

USING PUBLIC RELATIONS in PROMOTION LO 16-4 Public Relations (PR) -- Evaluates public attitudes, changes policies and procedures in response to the public, and executes a program of action and information to earn public understanding and acceptance. 3 steps of a good PR program: 1) Listen to the public 2) Change policies and procedures 3) Inform people you’re responsive to their needs

PUBLICITY LO 16-4 Publicity -- Any information about an individual, product or organization that’s distributed to the public through the media and is not paid for or controlled by the seller. Advantages of Publicity:  Free  Reaches people who would not look at an advertisement  More believable than advertising

DISADVANTAGES of PUBLICITY LO 16-4 No control over whether the media will use a story or when they may release it. It can be good or bad. Once a story has been run, it is not likely to run again.

Sales Promotion -- The promotional tool that stimulates consumer purchasing and dealer interest by means of short-term activities. SALES PROMOTIONS LO 16-5 Categories of Sales Promotions: 1. B2B Sales Promotions 2. Consumer Sales Promotions

SALES PROMOTION TECHNIQUES LO 16-5

SOME KEY CONSUMER PROMOTIONS LO 16-5 Coupons Demonstrations Sampling Sweepstakes In-store Displays Contests

CLIP THESE Most Visited U.S. Coupon Clearing Sites LO 16-5 Coupons, Inc EverSave RetailMeNot CouponCabin

TEST PREP What are the three steps in setting up a public relations program? What are the sales promotion techniques used to reach consumers? What sales promotion techniques are used to reach businesses?

USING WORD-of-MOUTH PROMOTION LO 16-6 Word-of-Mouth Promotion -- People tell others about products they have purchased. Word-of-Mouth is important for products like:  Restaurants  Daycare and Eldercare  Car Repair Shops  Hair Stylists  Hotels

WHAT ARE COMPANIES YELPING ABOUT? Many companies have a website, Facebook page or some online presence. However, on review sites like Yelp, they cannot control their public image.Yelp The Federal Trade Commission has received over 2,000 complaints about Yelp. Companies can respond to reviews. But often the damage is already done.

EMERGING PROMOTIONAL TOOLS LO 16-6 Viral Marketing -- Paying customers to say positive things on the Internet or setting up multiple selling schemes whereby consumers get commissions. People who promote through viral marketing often receive SWAG which can include free tickets, shirts, and other merchandise.

BLOGS, PODCASTS, and S LO 16-6 Blogs are a great way to interact with customers and improve the company’s website ranking. Podcasting -- A way to distribute multimedia files via the Internet. promotions increase brand awareness among commercial suppliers.

MOBILE MEDIA LO 16-6 Marketers make use of smartphones to text customers about product offers and other company information.

PUSH, PULL, AND PICK PROMOTIONAL STRATEGIES LO 16-6 Push Strategy -- Producers use advertising, personal selling, sales promotion, and other tools to get their products stocked on shelves. Pull Strategy -- Directs heavy advertising and sales promotions efforts towards consumers and gets the public to request their products from retailers. Pick Economy -- Refers to consumers who pick out their products from online outlets.

TEST PREP What’s viral marketing? What are blogging and podcasting? Describe a push strategy and a pull strategy.