1. Promotional Planning B2B BA 303 C 16-18 Session Lindell Phillip Chew University of Missouri- St. Louis, College of Business Administration

2. DEFINITION Promotion is a persuasive communications mix. It is a deliberate attempt to communicate information which presents a company and its products to prospective customers in a manner persuasive enough to induce the kind of acceptance, reaction, or response desired. THIS IS A CONTROLLED AND INTEGRATED PROGRAM OF COMMUNICATION METHODS AND MATERIALS.

3. THE PROMOTIONAL (COMMUNICATIONS) PLANNING PROCESS LPC1@UMSL.EDU

4. FUNCTIONS The basic purpose of promotion is to present a business and its products and services to prospective customers, to communicate the need/want satisfying attributes of those products/services, to facilitate sales, and to contribute positively to the long ran performance of the business. HOW TO SELL PRESENT CUSTOMERS ADD1T1ONAL UNITS. GET NON CUSTOMERS TO BECOME CUSTOMERS.

5. FIRST REVIEW YOUR MARKETING PLAN & ITS OBJECTIVE AND THEN PURSUE THE STEPS of the PROMOTIONAL (COMMUNICATIONS) PLANNING PROCESS

6. Our corporate objective is to increase earnings per share from $6.71 per share to $7.71 per share OUR MARKETING OBJECTIVE IS TO INCREASE MARKET SHARE FROM 23% TO 25%, ALSO IN ONE YEAR

7. STEPS SITUATIONAL ANALYSIS ESTABLISHING PROM0TIONAL OBJECTIVES JUSTIFICATONS DETERMINING BUDGET PLANNING, MANAGING, BLENDING THE COMMUNICATIONS EVALUATION MEASURING EFFECTIVENESS FOLLOW ON AND FUTURE PLANNING

8. STEPS SITUATIONAL ANALYSIS MARKET TARGETS DEFINITION Current Market Additional or Potential Customer Franchises COMPETITION ENVIRONMENTAL FACTORS Internal (policies, profit inhibitors, financial and personnel resources) External (legal/ethical, business/economic conditions,cultural/social)

9. STEPS SITUATIONAL ANALYSIS CRITICAL QUESTIONS Are you familiar with the strengths & weaknesses of various promotional efforts? Is outside technical/financial assistance available to enhance promotional efforts?

10. TYPES OF PROMOTION (EXPLICIT TOOLS)

11. TYPES OF PROMOTION (EXPLICIT TOOLS) ADVERTISING PERSONAL SELLING SALES PROMOTION PUBLIC RELATIONS / PUBLICITY

12. Advertising Personal Selling Any Paid Form of Nonpersonal Presentation by an Identified Sponsor. Sales Promotion Short-term Incentives to Encourage Trial or Purchase. Public Relations Direct Marketing Direct Communications With Individuals to Obtain an Immediate Response. Protect and/or Promote Companys Image/products. Personal Presentations. The Marketing Communications Mix

13. TYPES OF PROMOTION (EXPLICIT TOOLS) PLEASE NOTE THAT RESELLER SUPPORT OBJECTIVES AND PROGRAMS MAY ALSO BE ADDED PURPOSE TO…….. IMPROVE SUPPLEMENT CONTROL PERFORMANCE

14. TYPES OF PROMOTION (EXPLICIT TOOLS) ADVERTISING paid, nonpersonal communication regarding goods, services, organizations, people, places, and ideas that is transmitted through various media by business firms, government and other nonprofit organizations, and individuals who are identified in the advertising message as the sponsor.

15. TYPES OF PROMOTION (EXPLICIT TOOLS) PERSONAL SELLING involves oral communication with one or more prospective buyers by paid representatives for the purpose of making sales.

16. TYPES OF PROMOTION (EXPLICIT TOOLS) SALES PROMOTION Involves…paid….marketing communication activities (other than advertising, publicity, or personal selling) that are intended to stimulate consumer purchases and dealer effectiveness.

17. TYPES OF PROMOTION (EXPLICIT TOOLS) PUBLIC RELATIONS / PUBLICITY. Publicity is nonpersonal public relations that is transmitted Public relations includes any communication to foster a favorable image for goods, services, organizations, people, places, and ideas. It may be personal or nonpersonal, paid or nonpaid, and sponsor controlled or not controlled through media but not paid for by an identified sponsor.

18. TYPES OF PROMOTION (EXPLICIT TOOLS) NOW LETS PURSUE THE OTHER STEPS

19. Elements in the Communication Process SENDER (source) SENDER (source) Encoding Decoding RECEIVER(s) Message Media Feedback Response Noise

20. Decide on Explicit Communications Mix Advertising Public, Pervasive, Expressive, Impersonal Advertising Public, Pervasive, Expressive, Impersonal Sales Promotion Communication, Incentive, Invitation Sales Promotion Communication, Incentive, Invitation Public Relations & Publicity Credibility, Surprise, Dramatization Public Relations & Publicity Credibility, Surprise, Dramatization Personal Selling Personal Confrontation, Cultivation, Response Personal Selling Personal Confrontation, Cultivation, Response Direct Marketing Nonpublic, Customized, Up-to-Date, Interactive Direct Marketing Nonpublic, Customized, Up-to-Date, Interactive

21. Product Life- Cycle Stage Type of Product/ Market Push vs. Pull Strategy Factors in Developing Promotion Mix Strategies Buyer/ Readiness Stage

22. Push Versus Pull Strategy Producer Interme- diaries Marketing activities End users Marketing activities Demand Interme- diaries Demand Push Strategy Pull Strategy End users Marketing activities Demand

23. PROMOTION PLANNING STEP OBJECTIVE SETTING The objectives of promotion may be categorized as stimulating demand and enhancing company image. The sequential short-term, intermediate, and long-term promotion goals for a firm to pursue. Primary demand is an objective when seeking consumer interest for a product category. Selective demand is a later objective that seeks consumer interest for a particular brand of a product.

24. PROMOTION PLANNING STEP BUDGETING USE OBJECTIVE & TASK Under the objective-and-task method, a firm sets promotion goals, determines the activities needed to satisfy them, and then establishes the proper budget. Most large companies use some form of objective-and-task technique. During promotional budgeting, a firm should keep the concept of the marginal return in mind. This is the amount of sales each increment of promotion spending will generate. It is usually highest for new products.

25. Step 5. Establish the Budget Competitive Parity Objective & Task Affordable % Of Sales

26. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS THE PROMOTION MIX

27. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Media are selected on the basis of these criteria: Advertising media costs. Reach Frequency. Gross Rating Points Waste Message permanence. Persuasive impact Clutter Lead time

28. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Advertising media costs Outlays for media time and space. Total costs are computed first. Per-reader or viewer costs are computed second.

29. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Reachthe number of viewers, readers, or listeners in an audience.. For TV and radio, reach is the total number of people who are exposed to an ad..For print media, reach has two components: circulation (the number of copies sold or distributed) and passalong rate (the number of times each copy is read by another reader).

30. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Wastethe part of an audience not in a firms target market. Narrowcasting, which presents messages to limited and well-defined audiences, can reduce audience waste.

31. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Frequencyhow often a medium can be used. Repetition, repetition, repetition James Smith 1890s

32. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA GROSS RATING POINTS (GRPS) GRPS = REACH X FREQUENCY

33. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Message permanencethe number of exposures one ad generates and how long it remains available to the audience. Persuasive impactthe ability of a medium to stimulate consumers.

34. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA Clutterthe number of ads found in a single program, issue, etc. of a medium. Lead timethe period required by a medium for placing an ad.

35. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA In recent years, there have been many media innovations, such as online computer services, regional editions, special one-sponsor issues, specialized Yellow Pages, TV ads in supermarkets, infomercials, etc.

36. PROMOTION PLANNING STEP PLANNING, MANAGING, BLENDING THE COMMUNICATIONS SELECTING MEDIA As of 2004, the typical U.S. consumer will have access to 44 local radio stations, 200 TV channels, 2,400 Internet radio stations, 18,000 magazine titles, and 20 million Internet sites.

37. PROMOTION PLANNING STEP THE PROMOTION MIX The promotion mix is a firms overall and specific communication program, including its use of advertising, public relations (publicity), personal selling, and/or sales promotion. With an integrated marketing communications program, each type of promotion has a distinct function and complements the other types.

38. PROMOTION PLANNING STEP THE PROMOTION MIX The promotion mix is a firms overall and specific communication program, A promotion mix varies by type of company, the product life cycle, access to media, and channel member support.

39. PROMOTION PLANNING STEP THE PROMOTION MIX ADVERTISING PERSONAL SELLING SALES PROMOTION PUBLIC RELATIONS / PUBLICITY RESELLER SUPPORT PROGRAMS

40. CONSIDERING COOPERATIVE EFFORTS With cooperative advertising, two or more firms share some advertising costs. 1.A vertical cooperative ad is an advertising agreement between firms at different levels of the distribution channel. 2.A horizontal cooperative ad is an advertising agreement among independent firms at the same stage. 3.Good agreements clearly state each partys costs, functions, and responsibilities; the ads covered; and the basis for termination.We will apply SCHNUCKS to both.

41. PROMOTION PLANNING STEP BUDGET A budget delineates expenditures by explicit tool and medium Considerations in budgeting may include alternative media costs, the number of placements needed, cost increases of media, the status of the economy, channel member tasks, production costs, and budget allocation for domestic versus international ads.

42. PROMOTION PLANNING STEP EVALUATION MEASURING EFFECTIVENESS EVALUATING… SUCCESS OR FAILURE COMMUNICATION (PROMOTIONAL) success or failure depends on how well the company achieves promotion objectives, which may range from creating awareness to expanding sales. Example: R x F= GRPs

43. PROMOTION PLANNING STEP FOLLOW ON & FUTURE PLANNING FEEDBACK & ADJUST

44. Summarize Promotional Planning Session

45. Summarize STEPS SITUATIONAL ANALYSIS ESTABLISHING PROM0TIONAL OBJECTIVES JUSTIFICATONS

46. Summarize STEPS DETERMINING BUDGET PLANNING, MANAGING, BLENDING THE COMMUNICATIONS

47. Summarize STEPS EVALUATION MEASURING EFFECTIVENESS FOLLOW ON AND FUTURE PLANNING

48. Next Steps OPPORTUNITY IS NOW HERE! JUST DO IT!!!!!! LPC1@umsl.edu

50. Promotional Planning Session Lindell Phillip Chew University of Missouri- St. Louis, College of Business Administration