1 Chapter 16: Promotional Planning for Competitive Advantage Prepared by Amit Shah, Frostburg State...

1

Chapter 16: Promotional Planning for Competitive

Advantage

Prepared by Amit Shah, Frostburg State University

Designed by Eric Brengle, B-books, Ltd.

Copyright 2010 by Cengage Learning Inc. All Rights Reserved

Learning Outcomes

2

Discuss the role of promotion in the marketing mix

Describe the communication process

Explain the goal of promotion

LO1

LO2

LO3


Learning Outcomes

3

Discuss the elements of the promotional mix

Discuss the AIDA concept and its relationship to the promotional mix

Discuss the concept of integrated marketing communications

Describe the factors that affect the promotional mix

LO5

LO6

LO7

LO4


The Role of Promotion in the Marketing Mix

4

Discuss the role of

promotion in the marketing mix.

LO1


The Role of Promotion

5

Promotions –

Communications by

marketers that informs,

persuades, and reminds

potential buyers of a

product in order to influence an

opinion or elicit a response.


The Role of Promotion

6

Promotional Strategy - A plan for the optimal use of the

elements of promotion: advertising, public relations, personal selling, and

sales production.

Competitive Advantage - One or more unique aspects of an organization that cause consumers to patronize that firm rather than competitors.


The Role of Promotionin the Marketing Mix

7

Overall Marketing Objectives

Overall Marketing Objectives

Marketing Mix• Product• Place• Promotion• Price

Marketing Mix• Product• Place• Promotion• Price

Target MarketTarget Market

Promotional Mix

• Advertising• Public Relations• Sales Promotion• Personal Selling

Promotional Mix



Competitive Advantage

8

Unique featuresUnique features

Excellent serviceExcellent service

Low pricesLow prices

Rapid deliveryRapid delivery

High product qualityHigh product quality


Review Learning OutcomeThe Role of Promotion in the Marketing Mix

9

LO1


Marketing Communication

10

Describe the communication process.

LO2


Communication

11

Online

http://www.mcdonalds.com

The process by

which we exchange or share

meanings through a common

set of symbols.


http://www.mcdonalds.com/

http://www.mcdonalds.com/


12

Categories of CommunicationCategories of

Communication

InterpersonalCommunicationInterpersonal

CommunicationMass

CommunicationMass

Communication



13

As Senders As Receivers

Develop messages

Adapt messages

Spot new communication opportunities

Inform

Persuade

Remind


NoiseNoise

SenderSender EncodingMessage

EncodingMessage

FeedbackChannel

FeedbackChannel

MessageChannel

MessageChannel

DecodingMessage

DecodingMessage ReceiverReceiver

The Communication Process

Copyright 2010 by Cengage Learning Inc. All Rights Reserved 14

The Impact of Blogging

15

Corporate Blogs- Sponsored by

a company or one of its brands

and maintained by one or more

of the company’s employees.

Noncorporate Blogs-

Independent and not associated

with the marketing efforts of any

particular company or brand.


Review Learning OutcomeThe Communication Process

16

LO2


The Goals of Promotion

17

Explain the goal of promotion.

LO3


Goals of Promotion

18

InformingInforming RemindingReminding

PersuadingPersuading

TargetAudienceTarget

Audience

PLC StagesPLC Stages:Introduction Early Growth

PLC Stages:PLC Stages:Growth Maturity

PLC Stages:PLC Stages:Maturity


Informing

19

Increase awareness

Explain how product works

Suggest new uses

Build company image

Informative Promotion


Persuading

20

Persuasive Promotion

Encourage brand switching

Change customers’ perceptions of product attributes

Influence immediate buying decision

Persuade customers to call


Reminding

21

Reminder Promotion

Remind customers that product may be needed

Remind customers where to buy product

Maintain customer awareness


The Promotional Mix

22

Discuss the elements of the

promotional mix.

LO4


The Promotional Mix

23

Combination of promotion tools used to reach the target

market and fulfill the organization’s overall goals.



Advertising

24

Any form of impersonal

(one-way) paid

communication in

which the

sponsor or

company is identified.


Advertising Media

25

Traditional Advertising Media

Traditional Advertising Media

NewAdvertising Media

NewAdvertising Media

Television Radio Newspapers Magazines Books Direct mail Billboards Transit cards

Internet Banner ads Viral marketing E- mail Interactive video


Public Relations

26

The marketing function that evaluates

public attitudes, identifies

areas within the organization

that the public may be

interested in, and executes a program

of action to earn public understanding

and acceptance.


The Function of Public Relations

• Maintain a positive image

• Educate the public about the company’s objectives

• Introduce new products

• Support the sales effort

• Generate favorable publicity

27Copyright 2010 by Cengage Learning Inc. All Rights Reserved

Personal Selling

28

A purchase situation involving

a personal, paid-for

communication between two

people in an attempt to

influence each other.


Personal Selling

29

Traditional Selling

Traditional Selling

Relationship Selling

Relationship Selling


Sales Promotion

30

Online

http://www.nabiscoworld.com

Marketing activities– other than

personal selling, advertising, and

public relations– that

stimulate consumer buying

and dealer effectiveness.


http://www.nabiscoworld.com/

http://www.nabiscoworld.com/

Sales Promotion

31

EndConsumers

EndConsumers

Trade Customers

Trade Customers

CompanyEmployees Company

Employees

Free samplesFree samples

ContestsContests

PremiumsPremiums

Trade ShowsTrade Shows

Vacation GiveawaysVacation Giveaways

CouponsCoupons


Characteristics of the Elements

in the Promotional Mix


Review Learning OutcomeElements of the Promotional Mix

33

LO4


Promotional Goals and the AIDA Concept

34

Discuss the AIDA concept and its relationship to the promotional mix.

LO5


The AIDA Concept

35

AIDA Concept (Attention, Interest,Desire, Action)- Model that outlines

the process for achieving promotionalgoals in terms of stages of consumer

Involvement with the message.


The AIDA Concept

36

Action

Desire

Interest

Attention Cognitive (thinking)

Affective (feeling)

Conative (doing)


Review Learning OutcomeThe AIDA Concept

37

LO5


Integrated Marketing Communications

38

Discuss the concept of

integrated marketing

communications.

LO6


Integrated Marketing Communications

39

The careful coordination of

all promotional

messages to assure the

consistency of messages at

every contact point where a

company meets the consumer.


IMC Popularity Growth

• Proliferation of thousands of media choices

• Fragmentation of the mass market

• Slash of advertising spending in favor of promotional techniques that generate immediate response


Review Learning Outcome Integrated Marketing Communications

41

LO6


Factors Affecting the Promotional Mix

42

Describe the factors that affect the promotional mix.

LO7


Factors Affecting the Choice of Promotional Mix

43

Nature of the productNature of the product

Stage in PLCStage in PLC

Target market factorsTarget market factors

Type of buying decisionType of buying decision

Promotion fundsPromotion funds

Push or pull strategyPush or pull strategy


Stage in the Product Life Cycle

44

Pre-introductionPublicity, light advertising

Heavy use of advertising &PR to buildawareness; sales promotionfor trial

AD/PRdecrease;limited sales promotion; personal selling fordistribution

Ads decrease;sales promotion;personal selling;reminder & persuasive

Advertising, PR, brandloyalty;personal selling fordistribution

IntroductionIntroduction GrowthGrowth

MaturityMaturityDeclineDecline

Sal

es (

$)S

ales

($)

TimeTime


Target Market Characteristics

45

For…

Widely scattered market

Informed buyers

Brand-loyal repeat purchasers

AdvertisingAdvertising

Sales PromotionSales Promotion

Less Personal SellingLess Personal Selling


Type of Buying Decision

46

Advertising

Sales PromotionRoutineRoutine

Personal Selling

Neither Routinenor Complex

Neither Routinenor Complex

Advertising

Public Relations

Print AdvertisingComplexComplex


Available Funds

• Trade-offs with funds available

• Number of people in target market

• Quality of communication needed

• Relative costs of promotional elements


Push and Pull Strategies

48

Manufacturerpromotes to wholesaler

Manufacturerpromotes to wholesaler

Wholesaler promotes to

retailer

Wholesaler promotes to

retailer

Retailer promotes toconsumer

Retailer promotes toconsumer

Consumerbuys from

retailer

Consumerbuys from

retailer

PUSH STRATEGY

Orders to manufacturer

Manufacturerpromotes to

consumer

Manufacturerpromotes to

consumer

Consumer demands product

from retailer

Consumer demands product

from retailer

Retailer demands product

from wholesaler

Retailer demands product

from wholesaler

Wholesaler demands

product frommanufacturer

Wholesaler demands

product frommanufacturer

Orders to manufacturer

PULL STRATEGY


Review Learning OutcomeFactors Affecting Promotional Mix

49

LO7


1 Chapter 16: Promotional Planning for Competitive Advantage Prepared by Amit Shah, Frostburg State...

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