Using Integrated Marketing Communications to Promote Products

1. Using IntegratedMarketing Communicationsto Promote Products Chapter 16

2. Chapter 16 Learning Goals • Whatare the goals of promotional strategy? • What is the promotional mix, and what are its elements? • What are the types of advertising? • What are the advertising media, and how are they selected? • What is the selling process?

3. Chapter 16 Learning Goals (cont’d.) • What are the goals of sales promotion, and what are several types of sales promotion? • How does public relations fit into the promotional mix? • What factors affect the promotional mix? • What are three important trends in promotion?

4. Learning Goal 1 • What are the goals of promotional strategy? • Promotional strategyis designed to inform, persuade, or remind target audiences about a company’s products • Goals of promotion • Create awareness • Get people to try products • Provide information • Keep loyal customers • Increase use of a product • Identify potential customers

5. Promotion: the attempt by marketers to inform, persuade, or remind consumers and industrial users to engage in the exchange process

6. Goals of Promotion • Create awareness • Get consumers to try products • Provide information • Keep loyal customers • Increase amount and frequency of use • Identify target customers

7. Keeping Loyal Customers Some companies establish customer loyalty through social identity. Social identity: aspects of self-definition that derive from membership in social groups Example: “It’s a Jeep thing. You wouldn’t understand.” This slogan implies Jeep owners are an elite group with common qualities.

8. Learning Goal 2 • What is the promotional mix, and what are its elements? • Promotional mix is the combination of the following to promote a product • Advertising • Paid form of nonpersonal promotion by an identified sponsor • Personal selling • Face-to-face presentation with a prospective buyer • Sales promotion • Marketing activities that stimulate consumers to buy • Public relations • Marketing function that links policies of the organization with public interest • Develops programs designed to earn public understanding and acceptance

9. Components of Promotional Mix 1. Advertising 2. Personal selling (face-to-face) 3. Sales promotion • includes coupons, free samples,demonstrations 4.Public relations

10. Discussion Question How could Compaq use each component of the promotional mix to introduce a new computer to the market? Advertising - educate consumers Personal selling - persuade retailers to stock the new computer Sales promotion - in-store demonstrations, rebates Public relations - issue a press release about the new product

11. Learning Goal 3 • What are the types of advertising? • Institutional advertising • Creates a positive picture of a company • Advocacy advertising • Takes a stand on controversial social or economic issues • Product advertising • Features a specific good or service • Comparative advertising • Company’s product is compared with competing, named products • Reminder advertising • Used to keep a brand name in the public’s mind

12. 1. Advertising Advertising: any paid form of nonpersonal promotion by an identified sponsor

13. 1. Advertising Types of Advertising: 1. Product advertising • promotes a specific good or service 2. Institutional advertising • promotes a company’s image • Advertising businesses received approx. $34 billion in 1997, about 45% more than in 1988 ($19 billion) (Source: US Census, www.census.gov)

14. Learning Goal 4 • What are the advertising media, and how are they selected? • Main types of advertising media • Newspapers • Magazines • Radio • Television • Outdoor • Direct mail • Two main factors in selecting media • Cost of medium • Audience reached by medium

15. 1. Advertising Advertising Media Types of media: newspaper, magazine, radio, television, outdoor advertising, direct mail, Internet Factors influencing choice of media: • cost • audience reached

16. 1. Advertising Advertising Regulation Some types of complaints made against advertisers by consumers and competitors: • unsupported claims regarding the popularity and performance of goods and services • unfair comparisons to competitors’ goods and services • exaggerated, unrealistic visual depiction of products • overstatements that need qualification • broad claims based on one testimonial Source: The Better Business Bureau, www.bbb.org

17. 2. Personal selling Personal Selling: a face-to-face presentation to a prospective buyer

18. Learning Goal 5 • What is the selling process? • Prospecting and qualifying • Approaching customers • Presenting and demonstrating the product • Handling objections • Closing the sale • Following up on the sale

19. 2. Personal selling Steps of the Selling Process 1. Prospecting and qualifying 2. Approaching customers 3. Presenting and demonstrating 4. Handling objections 5. Closing the sale 6. Following up the sale

20. 2. Personal selling Enhancing Personal Sales When salespersons do favors for potential clients, the clients may feel obligated to reciprocate by buying the product. Reciprocityis the social norm that positive behavior should be re-payed in kind. Example: salespersons may pay for lunch, give free samples, go out of their way to do small favors

21. Learning Goal 6 • What are the goals of sales promotion, and what are several types of sales promotion? • Goal of sales promotion: Immediate purchase • Most popular types of sales promotions • Coupons • Samples and premiums • Contests and sweepstakes • Trade shows • Conventions • Point-of-purchase displays

22. 3. Sales promotion Sales Promotion: marketing activities that stimulate consumer buying, including coupons and samples, displays, shows and exhibitions, demonstrations, and other types of selling efforts

23. 3. Sales promotion Promotional Goals Dependon Type of Customer

24. 3. Sales promotion Promotional Products Can Be Used To: • Motivate sales teams • Draw customers to a store or event • Publicize an event • Increase brand awareness • Raise funds • Use as souvenirs and thank-yous • Gain attention for new products Source: Alpha Promotional Products, www.logomall.com/about/APP3.htm

25. Learning Goal 7 • How does public relations fit into the promotional mix? • Public relations • Mostly concerned with getting good publicity for companies • Public relations departments • Furnish company speakers for business and civic clubs • Write speeches for corporate officers • Encourage employees to take active roles in civic groups

26. 4. Public relations Public Relations: the linking of organizational goals with key aspects of the public interest and the development of programs designed to earn public understanding and acceptance

27. 4. Public relations Public Relations Activities: • Press relations • Product publicity • Corporate communication • Public affairs • Lobbying • Employee & investor relations • Crisis management

28. 4. Public relations Discussion Question If you were public relations director for Nike, how could you have responded to the negative publicity of exploiting overseas labor? Press relations- release information about how Nike addressed the problem; release positive information about Nike Corporate communication&Employee/investor relations- restore confidence among Nike employees and shareholders Crisis management- minimize damage; take positive steps to control the problem

29. Learning Goal 8 • What factors affect the promotional mix? • Nature of the product • Market characteristics • Available funds • Whether a push or a pull strategy is emphasized

30. Factors That Affect the Promotional Mix: • Nature of the product • Market characteristics • Available funds • Push and pull strategies

31. Using a Pull Strategy Sometimes a pull strategy can be used by increasing demand for a product through scarcity. Scarcity principle: products seem more valuable when their availability is limited Example: The scarcity of Ty’s Beanie Babies© increased their appeal among consumers.

32. Learning Goal 9 • What are three important trends in promotion? • Integrated marketing communications (IMC) • Produces a consistent, unified message that is customer focused • Growth of Web advertising • Traditional advertising techniques don’t work well on the Internet • Advertisers must use rational branding • Digital VCRs may make the measurement of television audiences more difficult

33. Trends in Promotion: 1. Integrated marketing communications 2. Growth of advertising on the Internet 3. Impact of Digital VCRs on television

34. Leaders in Advertisingon the Internet TRUSTe Microsoft Yahoo! Amazon Next Card AOL Gateway AT&T LinkExchange Barnes & Noble Source: The Nielsen//NetRatings Reporter, www.nielsen-netratings.com