Chapter 9 PROMOTION

Objectives

Developing & Managing an

Advertising Program
Deciding on Media & Measuring
Effectiveness
Sales Promotion
Public Relation
Principles of Personal Selling

Major Decisions in Advertising

Objectives
Objectives Setting
Setting
Budget
Budget Decisions
Decisions
Message
Message Decisions
Decisions

Media
Media Decisions
Decisions

Campaign
Campaign Evaluation
Evaluation

Advertising Objectives

Specific Communication Task

Accomplished with a Specific Target Audience
During a Specific Period of Time

Informative
Informative Advertising
Advertising

Persuasive
Persuasive Advertising
Advertising

Comparison
Comparison Advertising
Advertising

Reminder
Reminder Advertising
Advertising

Build
BuildPrimary
PrimaryDemand
Demand

Compares
ComparesOne
OneBrand
Brandto
to
Another
Another

Build
BuildSelective
SelectiveDemand
Demand

Keeps
Keeps Consumers
ConsumersThinking
Thinking
About
About aaProduct.
Product.

The Five Ms of
Advertising
Message

Mission
Sales
goals
Advertising
objectives

Money

Message generation

Factors to
consider:

Message evaluation
and selection

Stage in PLC

Message execution

Market share
and consumer base
Competition
and clutter
Advertising
frequency
Product
substitutability

Social-responsibility
review

Media
Reach, frequency,
impact
Major media types
Specific media
vehicles
Media timing
Geographical
media allocation

Measurement
Communication
impact
Sales
impact

Advertising Budget Factors

Market Share &
Consumer Base
Stage in the
Product Life Cycle

Product
Substitutability

Competition &
Clutter

Advertising
Frequency

Profiles of Major Media

Types
Newspapers

Advantages: Flexibility, timeliness; good local market coverage;

broad acceptance, high believability
Limitations: Short life; poor reproduction quality; small
pass-along audience

Television

Advantages: Combines sight, sound, motion; high attention;

high reach; appealing to senses
Limitations: High absolute costs; high clutter; fleeting exposure;
less audience selectivity

Direct Mail

Advantages: Audience selectivity; flexibility, no ad competition within same medium; allows personalization
Limitations: Relative high cost; junk mail image

Profiles of Major Media

Types
Radio

Advantages: Mass use; high geographic and demographic

selectivity; low cost
Limitations: Audio only; fleeting exposure; lower attention;
nonstandardized rates; fragmented audiences

Magazines

Advantages: High geographic and demographic selectivity;

credibility and prestige; high-quality reproduction;
long life; good pass-along readership
Limitations: Long ad purchase lead time; waste circulation;
no guarantee of position

Outdoor

Advantages: Flexibility; high repeat exposure; low cost;

low message competition
Limitations: Little audience selectivity; creative limitations

Classification of
Advertising Timing Patterns
Concentrated

Level
(1)

Rising
(2)

Falling
(3)

Alternating
(4)

(5)

(6)

(7)

(8)

(9)
(9)

(10)

(11)

(12)

Continuous

Intermittent

Month

Number of
messages
per month

Advertising Strategy
Message Execution

Turning the Big Idea Into an Actual Ad to Capture the

Target Markets Attention and Interest.
Testimonial
Testimonial
Evidence
Evidence
Scientific
Scientific
Evidence
Evidence
Technical
Technical
Expertise
Expertise
Personality
Personality
Symbol
Symbol

Slice
Sliceof
ofLife
Life

Typical
Typical
Message
Message
Execution
Execution
Styles
Styles
Musical
Musical

Lifestyle
Lifestyle
Fantasy
Fantasy
Mood
Moodor
or
Image
Image

Advertising Evaluation
Advertising
Advertising Program
Program Evaluation
Evaluation

Communication
Communication Effects
Effects

Sales
Sales Effects
Effects

Is
Isthe
theAd
AdCommunicating
CommunicatingWell?
Well?

Is
Isthe
theAd
Ad Increasing
IncreasingSales?
Sales?

Why the increase in Sales

Promotion?

Growing retailer power

Declining brand loyalty
Increased promotional sensitivity
Brand proliferation
Fragmentation of consumer market
Short-term focus
Increased managerial accountability
Competition
Clutter

%t of total - 3 yr.MA

Long-Term Promotional
Allocation
60
50
40
30
20
10
0

Trade Promo
Media Adv
Cons. Promo

1986

88

90

92

94

1996

Year
Cox Direct 19th Annual Survey of Promotional Practices

Channels of Sales
Promotions
MANUFACTURER
Push

Trade
Promotions
RETAILER

Push

Retail
Promotions
CONSUMER

Consumer
Promotions
Pull

Consumer Promotion
Consumer-Promotion
Objectives
Entice
EnticeConsumers
Consumersto
to
Try
TryaaNew
NewProduct
Product
Lure
LureCustomers
CustomersAway
Away
From
FromCompetitors
CompetitorsProducts
Products
Get
GetConsumers
Consumersto
toLoad
LoadUp
Up
on
onaaMature
MatureProduct
Product
Hold
Hold&&Reward
Reward Loyal
Loyal
Customers
Customers
Consumer
ConsumerRelationship
Relationship
Building
Building

Consumer-Promotion
Tools
Samples
Samples
Coupons
Coupons
Cash
CashRefunds
Refunds
Price
PricePacks
Packs
Premiums
Premiums

Advertising
Advertising
Specialties
Specialties
Patronage
Patronage
Rewards
Rewards
Contests
Contests
Sweepstakes
Sweepstakes
Games
Games

Point-of-Purchase
Point-of-Purchase
Displays
Displays

Deal Proneness,
Liechtenstein, Burton, & Netemeyer,
Journal of Retailing, Summer 1997

Examination of deal proneness

among consumers in a
supermarket setting
Surveys & Grocery Receipts used
Eight types of deals:

Cent-off, One-free, Gift, Display,

Rebate, Contest, Sale, & Coupon

Deal Proneness,
Liechtenstein, Burton, & Netemeyer
Cluster analysis yielded two interpretable
results:
49% are deal prone, 51% not
24% High Deal prone, 50%
intermediate, 26% deal insensitive
Deal-proneness a generalized construct
- (crosses type of promotion)
Younger & Less educated more likely to be
deal prone

Trade Promotions
Trade-Promotion
Objectives

Trade-Promotion
Tools

Persuade
PersuadeRetailers
Retailersor
or
Wholesalers
Wholesalersto
toCarry
CarryaaBrand
Brand

Price-Offs
Price-Offs

Premiums
Premiums

Give
GiveaaBrand
BrandShelf
ShelfSpace
Space

Allowances
Allowances

Promote
PromoteaaBrand
Brandin
in
Advertising
Advertising

Buy-Back
Buy-Back
Guarantees
Guarantees

Patronage
Displays
Rewards

Push
PushaaBrand
Brandto
toConsumers
Consumers

Free
FreeGoods
Goods
Contests
Contests

Discounts
Discounts
Push
PushMoney
Money
Specialty
Specialty
Advertising
Advertising
Items
Items

Business-to-Business
Promotion
Business-Promotion
Objectives
Generate
GenerateBusiness
BusinessLeads
Leads
Stimulate
StimulatePurchases
Purchases
Reward
RewardCustomers
Customers
Motivate
MotivateSalespeople
Salespeople

Business-Promotion
Tools
Conventions
Conventions
Trade
TradeShows
Shows
Sales
SalesContests
Contests

Major Public Relations Tools

Public
Public
Service
Service
Activities
Activities

Web
Web Site
Site

Speeches
Speeches

Corporate
Corporate
Identity
Identity
Materials
Materials
Audiovisual
Audiovisual
Materials
Materials

News
News

Written
Written
Materials
Materials

Special
Special
Events
Events

When might you decide to

use Personal Selling?

Tight budget (straight

commission)
Concentrated Market

Few buyers
High value product

Product must be customized

Personal contact important
Must demonstrate product
Product involves trade-in/up

Designing the Sales Force

Sales
Sales force
force objectives
objectives
Sales
Sales force
force strategy
strategy
Sales
Sales force
force structure
structure
Sales
Sales force
force size
size
Sales
Sales force
force compensation
compensation

Sales Force Structures

Territorial

Market

Product

Complexity

Workload Approach to
Sales Force Size

Classify customers by size

Determine desirable call frequencies
Determine total sales calls needed per
year
Determine average number of sales
calls per sales representative per year
Divide total by number per rep

Sales Force Compensation

Fixed
Variable
Expense Allowances
Benefits

Managing the Sales Force

Recruiting
Recruiting &
& selecting
selecting sales
sales
representatives
representatives
Training
Training sales
sales representatives
representatives
Supervising
Supervising sales
sales representatives
representatives
Motivating
Motivating sales
sales representatives
representatives
Evaluating
Evaluating sales
sales representatives
representatives

Time and Duty Analysis

Preparation
Preparation
Administration
Administration

Travel
Travel

Selling
Selling

Food &
& Breaks
Breaks
Food
Waiting
Waiting

Sales Representative
Motivation
Motivation
Effort
Performance
Rewards
Satisfaction

Evaluating Salespeople

Call
Call
Reports
Reports

Work
Work
Plan
Plan

Sources
Sources of
of
Information
Information
Annual
Annual
Territory
Territory
Marketing
Marketing Plan
Plan

Improving Sales Force

Effectiveness
Training
Training in
in sales
sales techniques
techniques &
&
professionalism
professionalism
Negotiation
Negotiation skills
skills
Relationship-building
Relationship-building skills
skills

The Zone of Agreement

Zone of agreement
Sellers surplus

s
Sellers reservation
price (seller wants
s or more)
Seller wants to move
x to the right

Buyers surplus

Final
contract

b
Buyers reservation
price (buyer wants
b or less)

Buyer wants to move

x to the left

Performance Evaluation

Current-to-Past
Customer Satisfaction
Qualitative Evaluation

Steps in the Selling Process

Step
Step1.
1. Prospecting
Prospectingand
and
Qualifying
Qualifying

Identifying and Screening For

Qualified Potential Customers.

Step
Step 2.
2. Pre-approach
Pre-approach

Learning
LearningAs
AsMuch
MuchAs
AsPossible
Possible
About
AboutaaProspective
ProspectiveCustomer
Customer
Before
BeforeMaking
MakingaaSales
SalesCall.
Call.

Step
Step3.
3. Approach
Approach

Step
Step4.
4.Presentation/
Presentation/
Demonstration
Demonstration

Knowing
KnowingHow
Howto
toMeet
Meetthe
theBuyer
Buyer
to
toGet
Getthe
theRelationship
RelationshipOff
Off
to
toaaGood
GoodStart.
Start.
Telling
Tellingthe
theProduct
ProductStory
Story
to
tothe
theBuyer,
Buyer,and
andShowing
Showingthe
the
Product
ProductBenefits.
Benefits.

Steps in the Selling Process

Step
Step5.
5. Handling
HandlingObjections
Objections

Step
Step 6.
6. Closing
Closing

Step
Step7.
7. Follow-Up
Follow-Up

Seeking Out, Clarifying,

and Overcoming
Customer Objections to
Buying.

Asking the Customer

for the Order.

Following Up After the Sale to

Ensure Customer Satisfaction
and Repeat Business.

Alternative Steps:
Find em
em
Find
Grab em
em
Grab
Show em
em
Show
Answer em
em
Answer

Sell em
em
Sell
Keep em
em
Keep