OAD31863 Marketing

1. OAD31863 Marketing Dr Jenne Meyer Week 6

2. Chapter 15Integrated Marketing Communications

3. Promotion - Function of informing, persuading, and influencing the consumer�s purchase decision Marketing communications - Messages that deal with buyer-seller relationships Integrated marketing communications (IMC) - Coordination of all promotional activities to produce a unified, customer- focused promotional message Introduction

4. Consumers receive many marketing messages all day The customer is at the heart of marketing communications IMC begins with their wants or needs and then works in reverse to the product, brand, or organization IMC looks at the elements of the promotional mix through the customers� eyes Integrated Marketing Communications

5. Sender - Seeks to convey a message to the receiver Message - Communication of information, advice, or a request by the sender to the receiver The receiver decodes, or interprets, the message and sends feedback Throughout, noise can interfere with the transmission of the message over the channel The Communication Process

6. An effective message does three things: Gains the receiver�s attention Achieves understanding by both sender and receiver Stimulates receiver�s needs and suggests appropriate means of satisfying them AIDA - Steps through which an individual reaches a purchase decision: attention, interest, desire, and action The Communication Process

7. Encoding - Translating a message into understandable terms Decoding - Receiver�s interpretation of a message Feedback - Receiver�s response to a message Noise - Any stimulus that distracts a receiver from receiving a message Channel - Medium through which a message is delivered The Communication Process

8. Provide information Goal is to inform the market about the availability of a product Increase demand May increase primary demand�the desire for a general product category Example: �Cotton. The fabric of our lives.� May increase selective demand�the desire for a specific brand Differentiate the product Product differentiation - Occurs when consumers regard a firm�s products as different in some way from those of competitors Accentuate the product�s value Greater value helps justify a higher price in the marketplace Marketers must choose their words wisely when creating messages that accentuate their product�s value Stabilize sales Can stabilize variations in demand Example: Dunkin� Donuts attempt to boost summertime coffee sales by focusing on its iced coffee drinks Objectives of Promotion

9. Elements of the Promotional Mix

10. Organizations provide money or in-kind resources to an event or activity in exchange for a direct association with that event or activity Sponsor purchases: Access to the event�s audience The image associated with the activity �Sponsorships

11. Cost-effectiveness Sponsor�s degree of control versus that of advertising Nature of the message Audience reaction Ambush marketing - Firm that is not an official sponsor tries to link itself to an event How Sponsorship Differs from Advertising

12. Helps increase store traffic Opens new international markets of unprecedented size Promotes goals beyond creating product awareness Databases are an important tool Direct Marketing

13. Direct mails such as brochures and catalogs Telecommunications initiated by companies or customers Television and radio through special offers, infomercials, or shopping channels Internet via e-mail and electronic messaging Print media such as newspapers and magazines Specialized channels such as electronic kiosks Direct Marketing Communication Channels

14. Many forms - Sales letters, postcards, brochures, booklets, catalogs, house organs, and DVDs Advantages Ability to select a narrow target market Achieve intensive coverage Send messages quickly Choose from various formats Direct Mail

15. Provide complete information Personalize each mailing piece Response rates are measurable and are higher than other types of advertising Do not compete for attention Disadvantages Per-reader cost is high Effectiveness depends on the quality of the mailing list Direct Mail

16. Popular form of direct mail since the late 1800s More than 10,000 different catalogs fill mailboxes every year Companies are adding online catalogs to complement print catalogs Catalogs

17. Direct marketing conducted entirely by telephone, and it can be classified as either outbound or inbound contacts Outbound - Involves a sales force that contacts customers, reducing the cost of personal visits Inbound - Involves a customer initiating the call, usually through a toll-free number Telemarketing

18. Represents almost 8 percent of total advertising spending Includes Web advertising and e-mail notices Delivers data instantly at lower costs compared to traditional programs Electronic Direct Marketing Channels

19. Print media and other traditional channels are critically important Example: Magazine ads with toll free numbers that enhance inbound telemarketing campaigns Kiosks provide an outlet for electronic sales Other Direct Marketing Channels

20. Marketers create a promotional mix by blending advertising, personal selling, sales promotion, and public relations Several factors can influence the effectiveness of promotional mix Nature of the market/type of customer Nature of the product Product lifecycle stage Price Developing an Optimal Promotional Mix

21. Pull strategy - Promotional effort by the seller to stimulate final-user demand, which then exerts pressure on the distribution channel Relies on advertising and sales promotion Push strategy - Promotional effort by the seller directed to members of the marketing channel rather than final users Relies more heavily on personal selling Timing affects the choice of promotional strategies Prior to the actual sale, advertising is usually more important Selling activities are more important than advertising at the time of purchase Pull and Push Promotional Strategies

22. Direct sales results test - Based on the specific impact on sales revenues for each dollar of promotional spending Indirect evaluation - Concentrating on quantifiable indicators of effectiveness such as recall and readership Cost per impression - Relates the cost of an ad to every thousand people who view it Cost per response (click-through) - Relates the cost of an ad to the number of people who click it Conversion rate - Percentage of visitors to a Web site who make a purchase Measuring the Effectiveness of Promotion

23. Promotion is often a target of criticism Waste of resources Convinces consumers to buy products they don�t need or can�t afford Is conducted in a way that is insulting, offensive, or unethical New forms of promotion often aren�t recognizable as paid advertisements The Value of Marketing Communications

24. Watch Integrated Marketing Communications at Ogden Publications Come up with a single marketing and PR campaign to promote three or four of Ogden�s magazines. Visit www.ogdenpubs.com to learn more about each title. What are the challenges of maintaining a consistent look and feel across different media? What are the editorial and design differences between a Web magazine and a print one? Video

25. Chapter 16Advertising and Public Relations

26. Paid nonpersonal communication through various media with the purpose of informing or persuading members of a particular audience World�s leading advertisers each spend more than $3 billion annually on U.S. advertising Example: Procter & Gamble, AT&T, and Verizon Communications Product advertising - Nonpersonal selling of a particular good or service Institutional advertising - Promotion of a concept, an idea, a philosophy, or the goodwill of an industry, company, organization, person, geographic location, or government agency Advertising

27. Informative advertising - Seeks to develop initial demand for a good, service, organization, person, place, idea, or cause Persuasive advertising - Attempts to increase demand for an existing good, service, organization, person, place, idea, or cause Reminder advertising - Reinforces previous promotional activity by keeping the name of a good, service, organization, person, place, idea, or cause before the public Objectives of Advertising

28. Comparative advertising - Emphasizes messages with direct or indirect promotional comparisons between competing brands Used by firms whose products are not market leaders Advertising by market leaders seldom acknowledge existence of competing products Celebrity testimonials - Can improve product recognition and reach consumers of various ethnic groups. Retail advertising - Advertising by stores that sell goods or services directly to the consuming public Source, message, and shopping experience seem to affect consumer attitudes toward these advertisements Cooperative advertising - Retailer shares advertising costs with a manufacturer or wholesaler Advertising Strategies

30. Advertising campaign - Series of different but related ads that use a single theme and appear in different media within a specified time period Example: Retail chain Target�s �Hello. . . . Good Buy� ads featuring the Beatles� music Goals: Gain attention and interest Inform or persuade Lead to purchase or other desired action After conceiving an idea, ads must be refined from rough sketch to finished layout Advertising Messages

31. Fear appeals Imply or state that incorrect buying decisions could lead to bad consequences Example: Pharmaceutical companies� use of consumer�s fear of hair loss, allergic attacks, or heart attacks Can backfire if consumers find fear ads too strong or not credible. Humor in advertising messages Seeks to create a positive mood related to a good or service Some advertisers believe humor distracts from brand and product features Ads based on sex Immediately attract the consumer�s attention Do not appeal to everyone Advertising Appeals

32. Lively, engaging content Use of advertising in games, or advergames Banners are the most common form of online advertisement Missiles Keyword ads Advertorials and interstitials Pop-ups and �pop-unders� Social netowrking, ie Facebook Creating Interactive Ads

33. Comparison of Advertising Media Alternatives

34. Setting the timing and sequence for a series of advertisements Influenced by a variety of factors: Seasonal sales patterns Repurchase cycles Competitors� activities Effectiveness is measured in three ways: Reach - Number of people exposed to an advertisement Frequency - Number of times an individual is exposed to an advertisement Gross rating point (GRP) - The product of the reach times the frequency Media Scheduling

35. Firm�s communications and relationships with its various publics, including customers, employees, stockholders, suppliers, and government agencies Serves broader objectives than those of other components of promotional strategy The PR department links the firm and the media The Internet gives PR representatives more direct access to the public Public Relations

36. Nonmarketing public relations - A company�s messages about general management issues Example: An announcement to close a production facility Marketing public relations (MPR) - Narrowly focused public relations activities that directly support marketing goals Example: Sending out press releases about new products Marketing and Nonmarketing Public Relations

37. Nonpersonal stimulation of demand for a good, service, place, idea, person, or organization by unpaid placement of significant news regarding the product in a print or broadcast medium Example: Starbucks has built its brand with virtually no advertising Many consumers consider news stories more credible than advertisements Publicity

38. Promotional technique in which marketing partners share the cost of a promotional campaign that meets their mutual needs Example: Coldplay�s �Viva la Vida� album was cross-promoted with Apple�s iTunes Web site Cross-Promotion

39. Promotional prices vary widely Billboards are generally the cheapest, while television and newspapers are the most expensive Because of expense, advertising professionals must demonstrate how promotional programs contribute to increased sales and profits Measuring Promotional Effectiveness

40. The simplest and least costly method Whether the target audience received, paid attention to, understood, and retained the messages directed to them Count the number of media placements and gauge the extent of media coverage Conduct focus groups, interview opinion leaders, and more detailed and extensive opinion polls Measuring Public Relations Effectiveness

41. Hits - User requests for a file Impressions - Number of times a viewer sees an ad Click-throughs - User clicks ad for more information View-through - Measures response over time Evaluating Interactive Media

42. Advertising to children Kids need to learn how to consume thoughtfully, but they are inundated with promotional messages teaching the opposite Insertion of product messages in media programs without full disclosure of the marketing relationship to audiences Use of cookies in online advertising Advertising Ethics

43. Puffery - Exaggerated claims of a product�s superiority or the use of subjective or vague statements that may not be literally true The Uniform Commercial Code standardizes sales and business practices throughout the United States Puffery and Deception

44. Issues include performing services for companies that produce unsafe products The Public Relations Society of America�s Code of Professional Standards prohibits promoting products or causes widely known to be harmful Ethics in Public Relations

45. Watch Advertising and Public Relations at Ogden Publications Given that most of a magazine�s revenue comes from ads, would you be willing to turn down a large consumer advertiser because your readers may disagree with their product or business practices? Discuss the ethical, PR, and financial implications of your decision. What challenges do specialized magazines such as Mother Earth News face when trying to entice advertisers? Create a pitch to a potential green-product advertiser stating the benefits of advertising in Mother Earth News. Video

46. Chapter 17Personal Selling and Sales Promotion

47. Personal selling - Interpersonal influence process involving a seller�s promotional presentation conducted on a person-to-person basis with the buyer Introduction

48. Salespeople must be able to: Focus on a customer�s situation and needs and create solutions that meet those needs Follow through and stay in touch before, during, and after a sale Know the industry and have a firm grasp of their firm�s and their competitors� abilities Exceed their customers� expectations, even if it means going above and beyond the call of duty Field sales Inside Sales Network selling Personal selling that relies on lists of family members and friends of the salesperson, who organizes a gathering of potential customers for a demonstration of products (Avon, Mary Kay Cosmetics) The Evolution of Personal Selling

49. The selling process is conducted by phone Serves two purposes (Sales & Service) Serves two markets (B2B & B2C) Drawback: Most consumers dislike the practice and have signed up for the national Do Not Call Registry Some firms still use telemarketing because: The average call cost is low Firms point to a significant rate of success Telemarketing

50. Orchestrate events and bring to bear whatever resources are necessary to satisfy the customer Provide counseling to customer based on in-depth knowledge of the product, market, and customer needs Solve problems proficiently to ensure satisfactory customer service over extended time periods Demonstrate high ethical standards and communicate honesty at all times Willingly advocate the customer�s cause withint he selling organization Create imaginative arrangements to meet buyers needs Arrive well prepared for sales call/meetings What buyers expect from sales people

51. Meeting customer needs by listening to them, understanding their problems, paying attention to details, and following through after the sale Online companies have instituted consultative selling models to create long-term customers Cross-selling - Offering multiple goods or services to the same customer Consultative Selling

52. What are techniques in each of the following? The AIDA Concept and Personal Selling

53. Motivational tools include information sharing, recognition, bonuses, incentives, and benefits Knowledge of what motivates individual salespeople is important Expectancy theory � Motivation depends on an individual�s expectations of his or her ability to perform a job and how that performance relates to attaining a desired reward Motivation

54. Managers must set standards and choose the best methods for measuring sales performance Sales quotas - Specified sales or profit targets that the firm expects salespeople to achieve Often tied to compensation system Other measures include customer satisfaction, profit contribution, share of product-category sales, and customer retention Evaluations should identify areas of strength and weakness and serve as motivation for improved performance Evaluation and Control

55. Long-term success requires strong code of ethics Honesty and ethical behavior is encouraged when: Employees understand what is expected of them Open communication is encouraged Managers lead by example Ethical Issues in Sales

56. Marketing activities other than personal selling, advertising, and publicity that enhance consumer purchasing and dealer effectiveness Integrated into overall marketing plan Promotions are likely to stress price advantages, giveaways, or special offers Goal is speeding the sales process and increasing sales volume Produces best results when combined with other marketing activities, such as advertising Cannot overcome poor brand images, product deficiencies, or poor training for salespeople Sales Promotion

57. Encourage repurchases by rewarding current users Boost sales of complementary products Increase impulse purchases Coupons Rebates and discounts Sampling Bonus pack or premiums Contests or sweepstakes Consumer-Oriented Sales Promotions

58. Trade promotion - Sales promotion that appeals to marketing intermediaries rather than to consumers Trade allowances - Special financial incentives offered to wholesalers and retailers that purchase or promote specific products May give a discount on goods or include off-invoice allowances Trade-Oriented Promotions

59. Point-of-purchase (POP) advertising - Display or other promotion located near the site of the actual buying decision Trade shows - Product exhibition organized by industry trade associations to showcase goods and services Vendors who serve the industries display and demonstrate their products for attendees Trade-Oriented Promotions

60. Dealer incentives and contests reward retailers who increase sales Push money - Cash reward paid to retail salespeople for every unit of a product they sell Specialized training helps salespeople explain features, competitive advantages, and other information to consumers Trade-Oriented Promotions

61. Watch Personal Selling and Sales Promotion at Scholfield Honda How important is sales force management in Scholfield Honda�s overall success? Why? Which step in the sales process is most important in a consumer�s decision to purchase a car? Video