MBA2210 MKM 8 Promotion Chapter 10

8/8/2019 MBA2210 MKM 8 Promotion Chapter 10

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Jonathan Groucutt 2006 Foundations of Marketing 1

The Marketing Mix

Week 8 Chapter 10: Promotion


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Learning Outcomes

Explain and critically evaluate the variouscommunication models.

Critically evaluate the different types of promotionalactivities organisations can use

Discuss the different models used in persuading aconsumer to purchase a product or service.

Evaluate the concept of integrated marketing

communications. Understand the elements of pricing as it

relates to the marketing mix


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4 key Promotional Objectives

Creating a primary demand or market especially when introducingnew product or creating new market

Creating brand awareness tactical re features & benefits especiallyin saturated markets where risk of new entrants is high & competitionfierce

Enhancing attitudes and influencing intentions seeking a positiveview to create the right attitude. Psychologically linking customersneeds, wants and desires to how the product will benefit the customer

Facilitating purchase making it easy to purchase. The more intense

the promotion the higher the risk of failing to meets customersexpectations

The promotional objectives must link effectively & efficientlywith the marketing mix elements to achieve lifecycle equity & brand

awareness. Adapted from Groucott, J


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Communication Model (after Schramm, 1955)

Field of experience Field of experience

Sender Encoder Signal Decoder Receiver

Noise

Schramm believed that the communication only occurs whenthe Field of experience of the sender and receiver overlaps,however we communicate with people with little or norequivalent field of experience. Communicating knowledgewhich can be easily understood is critical to the process of

promotion as a marketing tool.


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Communication Feedback

Communication feedback provides

A discussion, comment and analysis of the issue(s)

being communicated.

A mechanism for clarification of points and issues

e.g. focus groups.

A critical response to the message, which could be

translated, e.g into a boycott of a product or service.

A positive response to the message, e.g increase in

purchases


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Communication Noise:

elements which lead to distortion of thecommunication message

This can be described as the interruptions or distortions thatinfluence the communications process or understanding of themessage. Noise can be:

Physical does the train block your view?

Semantic words linked to culture a risky business!

Competitive often unethical use of tactics by onecompany to distort how customersinterpret messages from other companies

Channel

overload world cluttered by communication signals!


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Promotional Strategy & Tactics

Advertising Direct marketing

Sales promotion - Sponsorship Product placement Merchandising

Public relations Word of mouth Exhibitions

Advertising is not a new concept

consider cave drawings!

Promotional strategies andtactics can be stand-alonetactics or part of anintegrated strategy. Thedecision of which to usemust be based on how

best to use the tactic ortactics to achieve thepromotional objectives


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Advertising

Advertising can be describedas:

A paid for communication vehicle

that is intended to inform,

influence and/or persuade one or

more individuals (to take action).

2006 Jonathan Groucutt

3 basic functions:

InformPersuade

Sell


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AIDA Model (afterLewis 1898)

o itio

Affe t

o atio

Atte tio

I terest

Desire

A tio

Seque i models k owas the Hierar hy of Effe ts(Barry 1987) have beedeveloped over the years.

Early Developme t - 1898

Moder Developme t - 1961

halle e & Defe e Phase

- 1973


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Types of Advertising

Primary

Range

Selective

Primary

stimulate demand

Selective product or

service

focus on single brand with

no reference to corporateidentity

Product or service range

highlights the features and

benefits

Institutional

Promoting CorporateIdentity, Image and Values


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Types of Advertising Media

Print

Daily newspapers

Local and regional

newspapers Consumer

magazines

Trade and

professionalmagazines

Customer magazines

Television

Cinema

Radio Outdoor billboard

Ambient

Internet - Online


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Outdoor or Billboard Advertising

Usually strategically locatednear high-density areas. Thushigh visibility.

Can be static or moving changing from oneadvertisement to another.

Can incorporate lighting andeffects.

Can vary in size.

Can be restricted by localgovernment location, size andsubject.



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Using a celebrity as aBrand Ambassador

Clarity needed of what

own brand is and whichcharacteristics thecelebrity stands for

Synergies need to beachieved

Which characteristics isthe celebrity going toadvertise?

David Beckham has deals with:Adidas,Gillette, Got Milk?, Marks &Spencer, Pepsi, Snickers, TBCCosmetics,Vodafone

Celebrity endorsements


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Ambient Media

Aerial - e.g. airships, balloonsGiveaway cards e.g featuring an event, product or service

Maps e.g. tourist maps carry adverts for local products & services

Taxis e.g exterior and interior advertisements

Tickets e.g cinema ticket with soft drink advert on the reverse

Trolleys e.g airport, supermarket & train trolleys carry adverts

Washrooms e.g one of the fastest growing forms of ambient advertising

Others carrier bags, pavements, rubbish bins, lamp posts, petrol pumps,fast-food cartons, etc.

But beware Guerilla fly-posting!

Sony & BMG both engaged in fly-posting in 2004 saving an estimated totalof 8m in advertising costs by using unauthorised poster sites ASBOS!


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Online Concerns

Credit card fraud

Cloning of sites

Data protection

Quality and delivery of goodspurchased

Trust in suppliers

Spamming (US 9 million per month

2003)

Viruses worms and Trojan horses Hackers

Pop-ups

Failure of computing networks

Internet

sales by UK

businesses

rose to163bn in

2007 (Office

of National

Statistics

SO

whats the

problem?

Banner

Button

Button

Banner

Pop - up


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Shock Advertising

(shockvertising)

The inclusion of frightening, visceral, offensive,

taboo an emotion-provoking imagery and words to

promote a product, service, concept or idea.(Groucott, J)

BENEFIT: Can be used to cut through thecommunication clutter.

DANGER: But society can become immune toissues and offensive media advertising.Or Society can raise complaints againstthe advertisers


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Direct Marketing

Tapp (1998) suggest that:

Direct marketing focuses on using a

database to communicate (andsometimes distribute) directly tocustomers so as to attract a directresponse.

An example ofdistribution cited above isonline airline tickets.


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Advantages of Direct Marketing

Organizations have the opportunity to

track single and/or segmented groupsof customers via their database

Opportunity for a dialogue

Opportunity for enhancedcustomization


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Direct Marketing Techniques

Door drops (door-to-door distribution)

Door-to- door selling Inserts

Newspapers

Magazines

Bills/invoices Bank/credit card

statements

Direct mail

Physical mail

email

Telemarketing

Outbound

Inbound


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Word of Mouth =Viral or contagion Marketing

people like to share their experiences with one another..and when those are favourable, the recommendations cansnowball, resulting in runaway success..[this can be dubbed]

self-generating demand.Dye, R. (2000) The buzz on buzz. Harvard Business Review, Vol 78 No 6. pp:139 148.

these viral ambassadors can be valuable, low-cost avenues

for building existing relationships, recruiting new customers andkeeping old customers happy for life

Blackshaw, P. (2001) Viral consumers. Executive Excellence. July Vol 18 No 7. p: 20.


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Product Placement

This is where a product or service appearswithin a television programme or movie

It is also known as: Alternative Advertising

Entertaining Marketing

Product or Brand Integration


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Product Placement Objectives

Overcome Noise attempts to break throughthe clutter

Local and global reach

Cost-effectiveness andfrequency

Helps to build a brands

awareness exposurefor new brands.Reinforces currentbrands

Positive association think of wearing the sameOmega watch as JamesBond?

Helps to build brandloyalty develops fromthe positive association.Buy the watch and

become loyal to thebrand.


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A New Version of Product Placement

Product Parody Companies are increasingly

working with TV and moviecompanies on brand parodies. It

is believed that this might be away to find a niche within thegrowing product placementmarket.

The key is that the consumer can

recognize the the brand that isbeing parodied so that they canbuy into the brand.

Examples:

Shrekand Shrek 2: Farbucks for Starbucks

VERSARCHERY forVersace (clothes)

Basking Robinhood forBaskin Robbins (ice

cream)

Tower of London Recordsfor Tower Records


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Sponsorship

Sponsorship is acontribution to anactivity by a commercial

organization in cash, orin kind, with theexpectation of achievingcorporate andmarketing objectives.

Berrett, T.(1993) The sponsorship of amateursport government, national sport organizationand corporate perspectives. Society andLeisure, 16. pp: 323 346.



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Potential Benefits of Sponsorship

The value of the association itself for

example, arts festivals or acharity.Thus can enhance reputations.

Exposure can be global. Consider,for example, the global audience forFormula 1 racing, football matches, etc


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Growth of Sponsorship

Different from traditional advertising and marketing.Can be used to breakthrough the clutter of traditionaltechniques.

Creation of favourable association. The physical andemotional link with the sponsored organization.

Overcomes cultural barriers. Consider Sport, Artsand Music.

Wide and multiple target audience appeal.

Can overcome legal barriers For example,Alcopops!


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Types of Sales promotion

Free samples

Money-off coupons

Extra value offers More product for the

same price

Addition products addedto the pack

Buy One Get One Free

Special offer bins or shelves

Bundling Privilege points

SALES PROMOTION can be used to: Promote a new product or service.

Reinvigorate interest in an established product or service.

Discount a product or service due to, for example, overstocking orto increase off-peak sales.


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Exhibitions & their value

Can be B2B or B2C

Can be large events

Can be niche markets

Attendees are receptive to what exhibitors have tomarket

Cost of lead generation is relatively low

Target audience Quality audience

Time spent

Launch potential

VALUE


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What is PR?

The Chartered Institute of Public Relations (UK) definition

the planned and sustained effort to

establish and maintain goodwill and mutualunderstanding between the organization and its publics.

Image

ReputationInformation

Communication


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Public Relations Publics

Direct They have a direct

relationship with the

organization orindividual

Employees

Customers

Suppliers

Competitors Local community

The media

Indirect

Individuals ororganizations thatmay be influenced bythe actions of anorganization orindividual. For

example, proposedregulations.


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Scope of Public Relations

Corporate relations

Community relations

Customer relations Employee relations

Industrial relations

Governmentrelations

Issues management

Investor relations

Market or supplychain relations

Media relations

New product andservice launches

Promotion

Public affairs

Publicity


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Merchandising & Examples

A university this can beeverything from pens toumbrellas.

A movie consider the Star

Wars sagas. Everythingfrom the book the makingof to toys not onlypromotes the movie but isalso revenue generating.

A City reflects the cityspast and present.

An airline from postcards

of planes to videos. Food manufacturers

Heinz produce a rangefrom watches to footballs. Allwith the distinctive logo.

The creation of a range of products that reflect an organizationsbrand. These are in turn marketing to raise the profile of the

original brand.


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Further Readings

Dye, R. (2000) The buzz on buzz. Harvard BusinessReview, Vol 78 No 6. pp:139 148.

L. Percy & R. Elliott (2005) Strategic Advertising

Management, 2nd ed. , Oxford University press.Vaughn, R. (1980) How advertising works: a planningmodel. Journal of Advertising Research 20 (October)pp: 27-33.

Chartered Institute of Public Relations: www.cipr.co.uk

Public Relations Society of America: www.prsa.org


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Next Session

Pricing Tactics (ch.11)

People (ch.12)



MBA2210 MKM 8 Promotion Chapter 10

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