Marketing Management MKT 600

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Marketing Management MKT 600
Promotion Communication
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Promotion Mix

• Lecture Overview
• Introduction
• Communications Theory
• Communication Process
• Hierarchy of Response Models
• Communication Objectives
• Designing a Message
• Choosing the right Channel
• Scheduling
• Budgeting
• Promotional Tools/Techniques
• Persuasion Swing
• Advertising
• PR
• Sales Promotion
• Sponsorship
• Personal Selling

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INTRODUCTION

• Having the right product available at the right
  time and at the right price still may not
• achieve a sale because the potential customer may
  not know of the offer. To be
• successful companies need therefore to
  communicate their offer.
• Since early days, individuals have used hand
  signals, sounds, symbolic drawing and
• facial expressions for the purpose of
  communicating some form of message to one
• another.
• Today the exchange of information takes place
  through sophisticated media, such as,
• interconnecting computers, telephones, text, TV
  and radio etc. An efficient network of
• communication is essential for successful
  promotional activity. It enables the company
• not only to communicate with its customers but
  also hold up an image with its markets at
• large. Such an image will help others to form
  perceptions and beliefs about what the
• company stands for and will influence their
  attitudes and future behaviour in dealing with
• it.
• For marketing purposes, communication of products
  and services contributes to the
• persuasion process to encourage the customer to
  avail themselves of whatever is on
• offer.

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COMMUNICATIONS THEORY

• For organisations to be successful they need to
  communicate their offer to their target
• markets (audience). The process entails sending
  messages through various channels or
• media to create awareness and understanding of
  why they might wish to buy a particular
• product. The process itself is highlighted below
• Communication Process

Sender
Receiver
Receiver
Response
All communication requires a response of some
sort. Unfortunately, the response is not always
what we expect.
Organisations are the senders in the
communications process and consumers are the
receivers. A sender will put information in a
form that a receiver will understand. This might
involve a visual, verbal or written message to
transmit the ideas. This process is called
encoding. The sender will choose a particular
medium or channel to carry the message to the
receiver (eg television, radio, newspapers etc).
The consumer interprets the message through a
process called decoding. If the consumer
interprets the message as required, it should
impact on the receiver and lead to a response
indicated by the feedback as shown over.
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Message
Encode
Sender
Sender
Decode
Channel
Message
Noise
Feedback
Unfortunately, there is no guarantee the receiver
will receive the full message or even understand
it fully. This is because of the of interference
with the flow of the information which is called
noise. Noise acts as a barrier to the flow and
understanding of the information and can include
other competing communication drowning out your
information, or it might be poor presentation of
the message in terms of the words, visuals or
even media chosen to carry the message. To
improve the chances of a message getting through
it may be necessary to change the format of the
message and repeat the message several times
rather than rely on one transmission
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• Hierarchy of Response Models
• These models attempt to predict the sequence of
  mental stages that the consumer passes
• through on the way to purchase. As you pass
  through each stage your propensity to buy
• increases.
• Behavioural Aida Adoption Dagmar
• Stage Unawareness Information
  Stage
• Cognitive Attention Awareness Awareness
• Knowledge
• (awareness)
• Affective Interest Interest Comprehension
• Liking and
• Beliefs Desire Evaluation Conviction
• Trial
• Conative Action Adoption Action Persuasion

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COMMUNICATION OBJECTIVES

• Once the target audience has been defined,
  marketing communicators must decide what
• is our objective? What response is sought? The
  objectives will in part be based around
• the buyers readiness stages previously
  discussed.
• Objective
• Awareness - to build awareness for a new product
  may begin with simple messages that repeat the
  company name or product name.
• Knowledge - to increase knowledge about the
  product or products on offer.
• Liking - this presumes there is some knowledge
  and awareness for the product. This is about
  creating interest for your product.
• Preference - building customer preference by
  promoting the products quality, value etc.
• Conviction - getting the customer to trial the
  product/taste it.
• Purchase - finally getting the customer to buy
  the product.
• NB Communication on its own cannot create
  positive feelings and purchase for a
• product. It requires the support of the whole
  marketing mix to do this. It can, however,
• speed up the demise of a product.

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DESIGNING A MESSAGE

• Ideally a message should grab attention, hold
  interest, arouse desire and obtain action
• (purchase), ie AIDA model.
• In putting a message together, the marketer must
  decide
• What to say? message content
• How to say it? message structure and format
• Message Content
• Content relates to an appeal or theme that will
  produce a desired response.
• Rational Appeal - emphasises functional
  benefits, ie better performance, higher
  quality, economy eg Volvo crumple zones.
• Emotional - stirs up negative or positive
  emotions that can motivate purchase. This
  includes fear, guilt and shame appeals. (Crest,
  only toothpaste to protect teeth from
  cavities) but also love, humour, pride and
  promise of success appeals. (Haagen Dazs
  pleasure appeal ie Now its on everyones
  lips)

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• Moral Appeal - Directed at an audiences sense of
  what is right and proper. Often used by
  charities and voluntary organisations.
• Message Structure
• Do not put too much detail into an advertisement.
  Keep your key messages to 1 maybe 2.
• Dont dilute the message. Decide on a headline,
  illustration and colour to attract attention. Use
  
• different sounds to project message on radio or
  TV.

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• Choosing the right Channel
• Important to choose the right channel to reach
  the target audience (eg young people tend
• to frequent the cinema, fashion conscious women
  read specialist magazines,
• professional people read trade/professional
  magazines/broadsheet newspapers,
• commuters listen to the radio going to work.

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• Scheduling
• Schedules are designed to achieve the optimum
  number of viewing by members of the
• target audience. The measure is of opportunities
  to see (or hear) O.T.S.
• Learning theory suggests the best learning is
  cognitive individuals restructure their
  cognition
• with regard to given problem situations and this
  restructuring leads to greater insight simply
• put, the more times and ad is seen, the greater
  the reinforcement a form of parrot fashion
• learning.
• Question Should an ad campaign concentrate ads
  over a short period (burst scheduling) or over a
  longer period (drip scheduling)?
• Budgeting
• All campaigns need to be costed to assess the
  effectiveness in reaching its target audience
• (eg TV is very expensive, but can be offered on a
  regional as well as national basis. It may
• become even more competitive with digital TV.)
  100K budget would be insufficient for TV
• advertising, but 1M would allow the use of TV
  nationally.

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• Budget Methods Used
• Affordable Method What the company can afford.
  Problem with this method is it ignores
• the effect of promotion on sales.
• Percentage of Sales Method (ie 5 of sales
  revenue will be budgeted). This method is
• simple to use and makes managers think about the
  relationship between promotion and
• selling.
• Problems relate to
• It views sales as the cause of promotion, rather
  than opportunities
• It fails to consider spending higher or lower
  levels of spending
• Does not explain what percentage level is
  appropriate
• Competitive Parity Setting budget to match
  competitors. This is reasonable in way it
• represents the collective wisdom of the industry.
  But why should the competitor know best?
• Objective Methods Sets budget based on what it
  wants to achieve. Good for making
• managers define their objectives, but problems
  exist because it is difficult to implement.

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PROMOTIONAL TOOLS/TECHNIQUES

• The promotional mix comprises all the marketing
  and communication tools used to achieve
• the promotional objectives. The diagram below
  shows a complete range of tools that can be
• used to influence a customer or potential
  customer.
• Promotional influences on the customer

Sales promotion
Word of mouth
Branding
Public relations
Personal selling
Advertising
Merchandising
The Customer
Sponsorship
Direct marketing
Packaging
Corporate image
Exhibitions
Internal marketing
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• The influence the different tools have on the
  consumer s are indicated on the Persuasion Swing
  below

Attention
Action
Interest
Desire
Advertising
P.R.
Sponsorship
Sales promotion
Selling
Persuasion Swing
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• Advertising
• Definition Any paid form of non-personal
  presentation and promotion of ideas, goods
• or services by an identified sponsor.
• Objectives To create awareness, inform about a
  feature or benefit, remind, reassure,
• create an image and sometimes to encourage trial
  of support a sale.
• Copy Copy lines are words of an advertisement
  that are crucial to its understanding and
• impact on its target audience. Agencies employ
  copywriters to develop effective copy lines.
• 3 types of copywriter apprentice, journeyman
  and master.
• Apprentice attends award dinners
• Journeyman receives the awards
• Master sends regrets from Bahamas they are too
  busy to attend.
• Media
• Broadcasting - TV, radio, cinema

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• Public Relations
• Definition Building good relations with the
  companys various publics by obtaining
• favourable publicity, building a good corporate
  image and handling favourable stories
• and events.
• The role of PR is to create and maintain goodwill
  and mutual understanding between the
• company (or person) and its publics. It is
  different from advertising, in that, it is not
  paid for
• directly, and it is focused more on behavioural
  change.

Opinion Leaders
Community
Potential Employees
Consumers
Public
Employees
Distributors
Money Markets
Suppliers
Change Attitudes From Negative to Positive Ho
stility to Sympathy Prejudice to
Acceptance Apathy to Interest Ignorance to
Knowledge
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• Media Relations - Maintain positive contact with
  journalist press releases, articles.
• Lobbying - Seeking to influence people in
  authority in order to secure support and achieve
  a
• desired action (political lobbying NW Tourist
  Board).
• Crisis Management - Involves using PR operations
  to handle any problem that may arise.
• Corporate Identity Programmes Design of Logos
• Literature
• Corporate Livery
• Stationery
• Annual Reports
• Web site
• Special Events Conferences
• Community Programmes
• Sponsorship
• Internal Newsletter/House Magazines

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• Sales Promotion
• Definition Short term incentives to encourage
  the purchase or sale of a product or
• service.
• Sales promotion is clearly geared towards the
  persuasion stage of the adoption/process. In
• seeking customer action buy NOW rather than
  later.
• Objectives - To achieve awareness and interest,
  but moreover, desire.
• To get customers to switch their buying
• To buy more (ie 3 for the price of 2)
• To smooth out seasonal dips in demand
• Sales Promotional Tools - Samples trial offers
• Coupons saves off future purchases
• Cash refund offers
• Price packs (multi-buys)
• Premium offers
• Price reduction 20 off

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• Sponsorship
• Definition Sponsorship is the provision of
  resources to build a relationship of mutual
• benefit.
• True sponsorship is expressed in the phrase
  enlightened self interest!
• A cause is supported with cash in return for
  satisfactory specific corporate and PR marketing
• objectives.
• Type of Sponsorship Example
• Personality Individual sports people sponsoring
  kit manufacturer
• Bodies Sports teams play with sponsored name on
  kit
• Titles Nationwide Football League
• Events Cadbury sponsor Christmas shows in UK
  theatres. Martell sponsors the Grand National
• Tournaments ATP tennis sponsored by Mercedes
• Happenings Budweiser sponsor the Kick Off in
  American Football
• Creations Pizza Hut promised every spectator at
  the Pittsburgh Pirates Baseball game a free
  soda/pizza if a spectator chosen at random
  could catch 3 popping balls. All 3 were caught
  and 33798 people shared a pizza to the value
  of 150,000. international headlines more
  than justified the cost.

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• Personal Selling
• Definition the presentation of products and
  associated persuasive communications to
• potential clients, employed by the supplying
  organisation.
• Different Types
• Order taker - shop assistant/sales order office
  clerk
• Deliverer - van driver
• Missionary - builds goodwill, creates ideas and
  gains specifications in medical/architectural
  type markets.
• Technician - provides technical advice and
  support for major purchase decisions
  technical consultants
• (ie computers/telecommunications)
• Demand Creator - Merchandiser/seller.
• Key objectives/Sales tasks
• Prospecting - looking for sales leads
• Communicating - providing information
• Servicing - providing service

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• Sales Approach
• Product Knowledge - know your product features
  and benefits
• Opening - act professionally gain interest
• Establish needs - re-establish what customer
  wants, ie ask questions
• Presentation - a review of what you can offer to
  meet their needs
• Objection handling - chance to review customer
  needs and reinforce why your product/service
  is superior
• Closing - asking for the order/and follow up
• Follow up - checking to make sure customer
  received the product/service they
  wanted-chance to get another order.

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• Negotiations
• Definition Conferring with another with a view
  to compromise. Negotiation as with
• selling is the only promotional vehicle that
  truly offers 2 way communication
• between the seller and the buyer.
• Advantages and Disadvantages
• Advantages Disadvantages
• High level of customer attention Expensive
• Can customise message Difficult to interact
  with more than one
• Immediate feedback buyer at a time.
• Lots of technical detail can be explained Time
  consuming
• Can demonstrate product
• Can develop long term relations

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• Direct Marketing
• Definition the planned recording, analysis and
  tracking of customer behaviour to
• develop relational marketing strategies.
• Components
• Direct Mail - Main medium direct response
  advertising good for personalising messages,
  testing messages and is not as visible to
  competitors as is advertising. The main problem
  is direct mail does not allow for sound or
  movement.
• Telemarketing - Used a lot with financial
  services as link ups with direct mail
  campaigns. Good for immediate 2 way
  communications. Quick and accurate, flexible
  tool. Good for building and cleaning data and
  bases and for
• Market evaluation and test marketing
• Dealer support
• Traffic generator
• Account servicing
• Customer care and loyalty building

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• The Internet
• Enhances customer service and promotes marketing
  relationships. Can be used for direct
• sales or for directing the viewer to some other
  media.
• Can be interactive in gaining further information
  about the customer.
• Rules to consider
• Internet ads need to seize viewers attention
• Long download times will encourage the viewer to
  switch
• Selling must offer price savings
• All must cross promote sites
• Catalogue Marketing
• On-line Marketing with the explosion of PCs and
  the internet at home this type of service
• offers on line information and marketing services
  free of charge for many customers.