promotion obj and position

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Promotional objectives andpositioning

Chapter 13



Promotional objectives and positioning

The formal setting of promotional objectivesis important because they provide guidanceconcerning what is to be achieved and when.

These objectives form a pivotal role betweenthe business/marketing plans and themarketing communications strategy




The most common promotional objectives setby managers are sales related

Market share

ROI Sales volume increases

Improvements in value of sales made afteraccounting for the rate of inflation




Sales volume vary for a wide variety of reasons: Competitors change their prices

Buyers’ needs change

Changes in legislation may favor the strategies of particular

organizations Favorable third-party communications become known to

significant buyers

General economic conditions change

Technological advances facilitate improved productionprocesses, economies of scale, experience effects and for

some organizations, the opportunity to reduce costs The entry and exit of different competitors



Role of objective in corporate strategy

Provide direction and action focus for participants inthe activity

Provide a means by which variety of decisionrelating to an activity can be made in a consisted

way Determine time period in which activity is to be

completed

Communicate values and scope of the activity to allparticipants

Provide a means by which the success of theactivity can be evaluated




Hierarchy: Mission (what the O is trying to do and to become over the

long term – who, what, where - What business are we in?)

Strategic business unit (SBU) or business objectives

Functional objectives (production, finance, marketing goals)

- Mission statement outlines who the organization is, what itdoes and where it is headed

- The mission should clearly identify the following:

1. the customers/buyers to be served

2. the needs to be satisfied

3. the products and/or technologies by which these will beachieved




Mission and vision are often used interchangeablybut they have separate meanings

Vision refers to the expected or desired outcome ofcarrying out the mission over agreed period of time

At the SBU level, objectives represent thetranslation of the mission into a form that can beunderstood by relevant stakeholders. Theseobjectives are the performance requirements for theorganization or unit and these in turn are broken

down into objectives or targets that each functionalarea must achieve (functional objectives)




Promotional objectives consist of three maincomponents:

1. The first component concerns the issues

relating to the buyers2. The second concerns issues relating tosales volume, market share, profitability andrevenue

3. The third stream, relates to the image,reputation and preferences of stakeholders



The role of promotional objectives andplans

The setting of promotional objectives isimportant for three main reasons:

1. They provide a means of communication

and coordination2. They act as a guide for decision-making

3. They provide a benchmark so that relativesuccess or failure of a programme can be

determined



Two schools of thinking about objectives Sales school (the only meaningful measure of the

effectiveness of the promotional spend is thesales results)

First difficulty: sales result from a variety of influences

Second difficulty: concept of ad stock or carryover

Third difficulty: sales objectives do little to assist themedia planner, copywriters and creative team

Sales turnover, market share, ROI, number ofproducts sold relative to other periods of activity

Direct-response A (when sales-oriented objectives arejustifiable)



Two schools of thinking about objectives

Communication school (sales are not regarded asthe only goal)

Dagmar (Advertising succeeds or fails dependingon how well it communicates the desired

information and attitudes to the right people at theright time and at the right cost

Awareness

Comprehension

Conviction

Action



Awareness

Once awareness has been created in thetarget audience, it should not be neglected. Ifthere is neglect, the audience may become

distracted by competing messages and thelevel of awareness of the focus product or Omay decline.

High/low awareness, high/low involvement



Awareness



Awareness: recognition and recall

Brand awareness is the association of somephysical characteristics such as brand name, logo,package, style etc. with a category need

Recall: if people think of a soft drink, they mayspontaneously think of either Coca-Cola, Fanta or

Sprite. Recognition: people recognize a brand by its

package, color, logo etc. Buyers will be better able to recognize brands then

to recall brand name spontaneously. On the other

hand, brand recall is not a guarantee that the buyerwill regencies the brand in a shop



Comprehension

(awareness on its own is, invariably, notenough to stimulate purchase activity)

Knowledge about the product can be

achieved by providing specific informationabout key brand attributes

Audience needs to be educated (may benecessary to compare product with

competitive products)



Conviction (brand attitude)

Brand attitude is the perceived value of a brand to consumer.

no brand attitude – should be created

moderately favorable brand attitude – should be reinforcedthrough adapted communications

very favorable brand attitude – to maintain it

unfavorable brand attitude - repositioning To try the product

1. By using messages that demonstrates a product’s superiority

2. By emphasizing the rewards conferred as a result of using theproduct (high-involvement decisions are best supported with PS and SP in

attempt to gain conviction, low-involvement decisions rely on A,packaging and SP to secure conviction)



Action

A communication programme is used toencourage buyers to engage in purchaseactivity

(for high involvement goods – PS andDM)



DAGMAR model

Category awareness: 100%Brand awareness: aided 95%, unaided: 65%

Brand knowledge: 60%

Brand liking (positive brand attitude): 30%

Brand preference: 20% Brand trial: 10%

Brand repurchase/loyal buyers: 3%

The number of people in each step of the

hierarchy of objectives can be expected todecrease



A good advertising objective

A specific communication task to beaccomplished among defined audience to agiven degree in a given period of time

1. a need to specify the communication task

2. a need to define the audience

3. a need to state the required degree ofchange

4. a need to established the time period inwhich activity is to occur



Difficulties associated with DAGMARmodel (communication school)

Sales orientation (sales is the only validmeasure of effectiveness as the purpose ofthe comm. activities is to generate sales)

Restriction upon creativity (the focus is givenon measures of recall, attitude change andawareness)

Short-term accountability (short accountingperiod)



Derivation of promotional objectives

Three main streams:

1. Sales-oriented objectives

2. Customer-oriented objectives

3. Issues related to the perception of the O



Need for realism when setting objectives SMART (SMARRTT)

Specific Measurable

Achievable (Aspirational)

Realistic

Timed

Example: The marketing communication objective for theperiod October to March 2000 (timed) is to create85%(measurable and achievable) prompted awareness(specific) of current female customers, in the 24 to 45 yearold age group and earning $15.000 plus (targeted)

Relevant Targeted



Objectives

Corporate objective:

Company objective might be to deliver innovativeproducts to make people’s work more comfortableand more efficient in a profitable way by realizing acertain minimum profit annually

Marketing objective might be to increase the totalmarket for product by 10% by targeting newcustomer segments such as housewives

Marketing Communications objective could be toinduce a product trial in 30% of the new targetsegments or to make 50% of all housewives awareof its product.



Positioning

The act of designing the company’s offering andimage so that they occupy a meaningful and distinctcompetitive position in the target customers’ mind

All products and all organisations have a position There are two main ways in which a brand can

positioned: functional and expressive Perceptual mapping Positioning is not about the product but what the

buyer thinks about the product or organisation Organisations are also positioned relative to one

another, mainly as a consequence of their corporateidentity



The development of the positioningconcept

Product era – little competition, features andbenefits were used in communication, theunique selling proposition was of paramountimportance

Image era – image is in the center ofattention

Positioning era – big competition, little

difference between products within eachclass



Types of positioning

Functional positioning

Expressive (symbolic) positioning

- ego

- social- hedonic satisfactions



Developing and managing a position

To develop a position, managers should be guidedby the following process: Which positions are held by which competitors?

Which position if any is already held by the focus brand?

Will it be possible to determine a positioning strategy, thatis, what is the desired position for the brand?

Is the strategy feasible in view of the competitors and anyobligatory constraints?

Impalement a programme to establish the desired position

Monitor the perception held by consumers of the brand and

of their changing tastes and requirements on a regularbasis.



Positioning mapping – reasons why it issuch a powerful tool It develops understanding of how the relative

strengths and weaknesses of different products areperceived by buyers

It builds knowledge about similarities anddissimilarities between competing products

It assists the process of repositioning existingproducts and the positioning of new products

The technique helps to track the perception thatbuyers have a particular product and assist themeasurement of the effectiveness of communicationprogrammes and marketing actions, intended tochange buyer’s perceptions



Positioning strategies

Product features Price/quality

Use

Product class dissociation

User

Competitor

Benefit

Heritage or cultural symbol



An example Harvey Bristol cream



Repositioning

Market opportunities and development

Mergers and acquisitions

Changing buyer preferences

Documents

promotion obj and position