Promotion Strategy

Promotion Any form of communication a

business/organization uses to inform, persuade, or remind people about its products or services.

Types of Promotion:o Advertisingo Public Relations (PR) & Publicityo Sales Promotiono Personal Selling

Advertising Paid form of non-personal presentation of ideas,

goods, or services directed toward a mass audience by an identified sponsor

Two Types:o Print Media:

• Newspapers, magazines, direct mail, outdoor (billboards), transit (ads on buses or subways)

o Broadcast Media:• Radio, television, Internet web sites

Public Relations & Publicity

PR: any activity designed to create a favorable image toward a business, its products, or its policieso News release, press kits

Publicity: The placement of newsworthy items about a business, new products, or employees in the media

Sales Promotion Use of short-term incentives or interest-building marketing

activities to stimulate traffic and encourage the buying of a product or serviceo Increase sales

Business to Businesso Slotting Allowances: manufacturer pays retailer for costs involved in

placing a new product on shelves

o Buying Allowances: price discount given by manufacturers to wholesalers and retailers to encourage the purchase of a product

o Trade Shows & Conventions: designed to reach wholesalers and retailers• Introduce new products or increase sales of existing products

o Sales Incentives: financial awards given to managers or employees who reach or exceed sales quotas

Sales Promotion Cont. Business to Consumer:

o Premiums: low-cost items given to consumers at a discount or for free.• Designed to increase sales, attract

new customers, and persuade nonusers to switch brands

o Sponsorship: promotion of a company in association with a property, event, or group

o Incentives: create customer excitement and increase sales.• Include sweepstakes, contests,

and rebates

o Product Samples: free trial size of a product

o Promotional Tie-Ins: involve sales promotional arrangements between one or more retailers

o Product Placement: the strategic placement of an item will increase or enhance public knowledge

o Visual Merchandising/Displays: coordination of all physical elements in a place of business so that it projects the right image to its customers

o Loyalty Marketing Programs: reward customers for making multiple purchases

Promotion Cont. Personal Selling: Consists of oral presentations

to one or more potential buyers with the intent of making a sale

Promotional Mix: refers to the combination of different types of promotiono A business decides on the promotional mix that will be

most effective in persuading potential customers to purchase and support its products• Wholesalers, retailers, and/or consumers

Promotion Policy Push Policy: when a manufacturer is trying to

“push” a product through a channel of distributiono Main purpose: to convince a retailer to stock a producto Relies heavily on personal selling and sales promotion,

esp. at trade shows

Pull Policy: designed to create consumer interesto Consumer demand can “pull” or encourage retailers to

carry a producto Relies heavily on advertising

geared towards consumers in addition to premiums, samples, and demonstrations

Promotion Plan Process

o Keep in mind your Target Market and the 4PsDetermine marketing objectives

Determine your promotional budget

Determine your promotional mix (what)

Create your plan (who, when)

Execute your promotional plan

Evaluate your plan & readjust accordingly

Example Marketing Objective

o Create awareness of baby care products among mothers of newborns

Promotional Budgeto $100,000.00

Promotional Mixo Advertise in national baby care and motherhood

magazineso Distribute product samples to major obstetricians’

offices in major urban areaso Offer free baby care seminars to expectant mothers at

major hospitalso Provide free samples to maternity wards at major

hospitals

Publicity Placement of newsworthy items about a business,

new products, or employees in the mediao An act designed to attract public interesto Information with news value issued as a means of

gaining public attention or support

o Involves creating demand for a business or product by placing news about it in publications, radio, television, or another form of media

o It is not paid for

Publicity The principal function of publicity is “building an

image”o Image: the way a business or organization is defined in

people’s minds

Publicity can be positive or negative

Advantages vs. Disadvantages

Major Advantages of Publicity:o People are more likely to pay attention to news stories

than to advertisements• News reporters and newspapers are viewed as more

objective than advertisers

Major Disadvantages of Publicity:o A business gives up control over their

message• The content and how it is presented

Public Relations The business of inducing the public to have

understanding for and goodwill toward a person, firm, or institutiono An individual or group of people who serve as public

spokespeople for an individual or an organization• They relate information to the public

The right kind of public relations can create a positive image for a company and maintain or improve that image within the communityo Example: sponsoring cultural events (concerts or art

exhibits)o Awarding scholarships to a local high schoolo Donating equipment for public use

Public Relations Refers to any activity designed to create goodwill

towards a business

The goodwill benefits a business by:o Increasing sales

o Reinforcing the firm’s good reputation

o Increasing the receptivity of consumers to the firm’s advertising

o Conditioning customers to expect quality products from the firm

Public Relations Specialists

These specialists attempt to get good publicity for their companies by creating news events

Examples:o The opening of a new storeo An interview with a company officialo Launching of a new producto Presentation of an award to an employeeo A community activity that is sponsored by the businesso A charitable activity that the business participates in

What Advertising Can Do for your Business

Remind customers and prospects about the benefits of your product or service

Establish and maintain your distinct identity

Enhance your reputation

Encourage existing customers to buy more of what you sell

Attract new customers and replace lost ones

Build sales slowly

Promote your business to customers, investors, and others

What Advertising Can’t do for your

Business Create an instant customer base

Solve cash flow or profit problems

Substitute for poor or indifferent customer base

Sell useless or unwanted products/services

Advertising Pros You have complete control.

o You determine exactly where, when, and how often your message will appear, how it will look, and what it will say

o You can target your audience more readilyo You can aim at very specific geographic areas

You can be consistent, presenting your image and sales message repeatedly to build awareness and trusto A distinctive identity will eventually become clearly

associated with your companyo Customers will recognize you quickly and easily

Advertising Cons It takes planning

o Advertising works best and costs less when planned and prepared in advanced

It takes time and persistenceo The effectiveness of your advertising improves gradually

over time• Customers don’t see every one of your ads

o You must repeatedly remind prospects and customers about the benefits of doing business with you• The long-term effort triggers recognition and helps special

offers or direct marketing pay off

Advertising vs. Public Relations

Advertising Public Relations Space or time in the mass

media must be paid for

You determine the message

You control the timing

One-way communicationo Using the mass media does

not allow feedback

Coverage in mass media, if any, is not paid for

Interpretation of the message is in the hands of the media

Timing is in the hands of the media

Two-way communicationo The company should be

listening as well as talking & the various PR venues often provide immediate feedback

Advertising vs. PR Cont.

Advertising Public Relations Message sponsor is

identified

The intention of most messages is to inform, persuade, or remindo With the intent of making a

sale

The public may view the message negatively, recognizing advertising as an attempt to persuade or manipulate

Message sponsor is not overtly identified

The intention is often to create good will, keep company in front of the public, or to humanize a company

The public often sees PR messages that have been covered by the media as more neutral or believable

Advertising vs. PR Cont.

Advertising Public Relations Very powerful at creating

an image

Writing style is usually persuasive, can be creative, often taking a conversational toneo May even be grammatically

incorrect

Can also create image, but sometimes stray from how it was originally intended

Writing style relies heavily on journalism talentso Any persuasion is artfully

inserted in the fact-based content

Effective Selling Selling: helping customers make satisfying

buying decisions by communicating how products and their features match customers’ needs and wants

Goals of selling:o Help customers decide on purchases

• Sometimes educating customers on products

o Ensure customer satisfactions• Happy customers mean repeat business

Selling is a broad concept and can take place inside or outside a firm

Inside vs Outside Selling

Inside Saleso Selling efforts that take place at the salesperson’s place

of business (i.e. retailers)

Outside Saleso Selling efforts that take place outside the salesperson’s

place of business (i.e. door-to-door salespeople)

Insurance agents or real estate agents may sell their consumer services through inside or outside sales efforts

The Selling ProcessProspecting (finding potential

customers)The pre-approach (gathering info about potential

customers)The approach (why would a potential customer want to listen

to you?)The sales presentation (presenting to the potential

customer)Handling objections (responding to

concerns)The close (the handshake &

agreement)The departure and follow-up (how you deal with the potential

customers next)

The Selling Process Prospecting: the process of finding potential

customers who could benefit from and buy a good/serviceo Potential customers are prospects

Gathering and analyzing information about the prospect and using it to construct the sales presentation is the pre-approach

The Selling Process The way the salesperson enlists the prospect’s

willingness to hear more about a product is the approach. o The approach is made to gain an interview and make the

sales presentationo Examples:

• Telephone call to a business at a time, day, week, etc.• Using a business card• Direct mail• Personal visit

During the sales presentation, the salesperson demonstrates or explains the product and attempts to build a desire for ownership within the prospect

The Selling Process An objection is an honest difference between the

customer and the salesperson

Example of an objection:o “I like your product, but I don’t think the school can

afford it right now”

o Salesperson could respond by stressing the benefits of immediate ownership, while also explaining the various credit plans offered

The Selling Process The close is the completion of the sale

o Avoid pressureo Call againo Suggest additional purchases (of same item or

related/additional items)

The departure and follow-upo thank prospecto Show appreciation for prospect’s time and attentiono A good salesperson is always interested in future

business and sales

After each sales call—examine reasons for success or failure.

Follow a Product—Promotion Strategy

Discuss the different aspects of your promotion strategy:o What forms of advertising will you use:

• Print media• Broadcast media

o Will there be any form of publicity or PR?

o What types of sales promotions will be used?