Chapter 16 Using Effective Promotions McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc All rights reserved PROMOTION in an ORGANIZATION • Promotion Mix The combination of promotional tools an organization uses The traditional mix includes: 16-2 ADVERTISING 16-3 ADVERTISING in the FIRM • Advertising Paid, nonpersonal communication through various media by organizations and individuals who are in some way indentified in the message • Major goals of advertising: - Inform - Persuade - Remind 16-4 IMPACT of ADVERTISING • Total advertising expenditures exceed $241 billion yearly • Consumers benefit because production costs of TV programs, radio programs, newspapers and magazines are paid for by advertisers • Marketers choose ad media that will reach the target market 16-5 SOCIAL ADVERTISING • Social media advertising is growing so fast, marketers can’t keep up • Starbucks has over 12 million followers on Twitter • McDonald’s has over million fans on Facebook 16-6 MATCH GAME Match the Company with the Slogan • “Everybody doesn’t like something, but nobody doesn’t like _.” • “It takes a licking and keeps on ticking.” • “With a name like _, it has to be good.” • “Good to the last drop.” • “Betcha can’t eat just one!” 16-7 POPULAR ADVERTISING MEDIA • TV advertising is still the dominant media • Digital Video Recorders (DVRs) challenge TV advertising because viewers can skip ads • Product Placement -Advertisers pay to put their products into TV shows and movies where the audience will see them 16-8 INFOMERCIALS and ONLINE ADVERTISING • Infomercial A full length TV program devoted exclusively to promote a particular product • Online Ads are attempts to get potential customers to a web site to learn about a product 16-9 INFOMERCIAL HALL of FAME The Biggest Hits Over the Past 40 Years • Veg-O-Matic • Ginsu Knives • The Clapper • Thigh Master • George Foreman Grill • Bowflex Source: Fortune, www.fortune.com, accessed July 2011 16-10 USING PUBLIC RELATIONS in PROMOTION • Public Relations (PR) Evaluates public attitudes, changes policies and procedures in response to the public, and executes a program of action and information to earn public understanding and acceptance • steps of a good PR program: 1) Listen to the public 2) Change policies and procedures 3) Inform people that organization is responsive to their needs 16-23 PUBLICITY • Publicity Any information about an individual, product or organization that’s distributed to the public through the media and is not paid for or controlled by the seller 16-24 ADVANTAGES of PUBLICITY • Free • Reaches people who would not look at an advertisement • More believable than advertising 16-25 DISADVANTAGES of PUBLICITY • No control over whether the media will use a story or when they may release it • Once a story has been run, it is not likely to run again • There is such a thing as bad publicity 16-26 SALES PROMOTIONS 16-27 SALES PROMOTIONS • Sales Promotion The promotional tool that stimulates consumer purchasing and dealer interest by means of short-term activities 16-28 SOME KEY CONSUMER SALES PROMOTIONS • Coupons • Demonstrations • Sampling • Sweepstakes • In-store Displays • Contests 16-29 USING WORD-of-MOUTH PROMOTION • Word-of-Mouth Promotion People tell others about products they have purchased • Word-of-Mouth is important for products like: - Restaurants - Daycare and Eldercare - Car Repair Shops - Hair Stylists - Hotels 16-30 EMERGING PROMOTIONAL TOOLS • Viral Marketing Paying customers to say positive things on the Internet or setting up multiple selling schemes whereby consumers get commissions • People who promote through viral marketing often receive SWAG which can include free tickets, shirts, and other merchandise 16-31 BLOGS, PODCASTS, and E-MAILS • Blog Short for web log; an online diary that looks like a webpage, but is easier to create and update by posting text, photos, videos, or links • Podcasting A way to distribute audio and video programs via the Internet 16-32 MOBILE MEDIA Marketers make use of cell phones to text customers about product offers and other company information 16-33 PUSH and PULL PROMOTIONAL STRATEGIES • Push Strategy Producers use advertising, personal selling, sales promotion, and other tools to get their products stocked on shelves • Pull Strategy Directs heavy advertising and sales promotions efforts towards consumers and gets the public to request their products from retailers 16-34 PUSH, PULL, PROMOTIONAL STRATEGIES  Convince wholesalers and retailers to stock and sell  Producer uses trade discounts, personal selling, cooperative advertising to convince the intermediaries  Idea is to push the product through the distribution system to the stores  Heavy advertisements and sales promotion efforts  Directed at consumers so that they will request the products from retailers  Products are pulled down through the distribution system 16-35 MANAGING THE PROMOTION MIX  Large, homogeneous groups of consumers are best reached through ADVERTISING  Large organizations are best reached through PERSONAL SELLING  SALES PROMOTION motivates to buy now  PUBLICITY adds support and creates a good impression  WORD OF MOUTH is often the most powerful promotional tool 16-36 INTEGRATED MARKETING COMMUNICATION (IMC) • Integrated Marketing Communication (IMC) -Combines the promotional tools into one comprehensive strategy IMC is used to: - Create a positive brand image - Meet the needs of consumers - Meet the strategic marketing and promotional goals of the firm 16-37 ... toward the purchase Follow up 16-20 STEPS in the B2C SELLING PROCESS 16-21 USING PUBLIC RELATIONS in PROMOTION 16-22 USING PUBLIC RELATIONS in PROMOTION • Public Relations (PR) Evaluates public... run, it is not likely to run again • There is such a thing as bad publicity 16-26 SALES PROMOTIONS 16-27 SALES PROMOTIONS • Sales Promotion The promotional tool that stimulates consumer purchasing... short-term activities 16-28 SOME KEY CONSUMER SALES PROMOTIONS • Coupons • Demonstrations • Sampling • Sweepstakes • In-store Displays • Contests 16-29 USING WORD-of-MOUTH PROMOTION • Word-of-Mouth