Explain the role of the promotion strategy explain how to formulate promotional plans
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Section Objectives. Explain the role of the promotion strategy. Explain how to formulate promotional plans. Identify considerations for putting together a promotional mix. Describe the elements of a promotional mix. The Main Idea.

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Explain the role of the promotion strategy explain how to formulate promotional plans

Section Objectives

  • Explain the role of the promotion strategy.

  • Explain how to formulate promotional plans.

  • Identify considerations for putting together a promotional mix.

  • Describe the elements of a promotional mix.


Explain the role of the promotion strategy explain how to formulate promotional plans

The Main Idea

The promotion strategy is the most visible marketing strategy, designed to get the attention of prospective customers and convince them to buy from you.

Promotional activities must be in the right mix.


Explain the role of the promotion strategy explain how to formulate promotional plans

Content Vocabulary

image

preselling

campaign

promotional mix

advertising

specialty item

publicity

news release

public relations

premium

rebate

sweepstakes


Explain the role of the promotion strategy explain how to formulate promotional plans

Drawing Up Promotional Plans

As a new business owner, you need two kinds of promotional plans:

  • a preopening plan to lay the groundwork for your opening

  • a second plan to support your operation once it is under way


Explain the role of the promotion strategy explain how to formulate promotional plans

The Role of Promotion Strategy

Promotion is communication intended to persuade, inform, or remind a target audience about a business or its products.

The promotion strategy involves planning, determining the right promotional mix, and selecting specific promotional activities.


Objectives of a preopening plan

Preopening Plan

Objectives of a Preopening Plan

Establish a positive image.

Let potential customers know you are opening for business.

Bring in customers or have them contact your business.

Interest customers in your new company and your products or services.

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Explain the role of the promotion strategy explain how to formulate promotional plans

Preopening Plan

The image you establish in your preopening plan sets the tone for your promotional plan.

image

the impression people have of a company; a company’s personality


Objectives of an ongoing promotional plan

Ongoing Plan

Objectives of an Ongoing Promotional Plan

Explain major features and benefits of your products.

Communicate information about sales.

Clear up customers’ questions and concerns.

Introduce new goods or services.

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Explain the role of the promotion strategy explain how to formulate promotional plans

Ongoing Plan

An ongoing promotional plan helps in preselling your goods or services.

preselling

the act of influencing potential customers to buy before contact is actually made


Explain the role of the promotion strategy explain how to formulate promotional plans

Promotional Plan Format

Both a preopening and an ongoing plan can be organized around a promotional campaign, independent promotional activities, or a combination of the two.

campaign

a series of related promotional activities with a similar theme


Explain the role of the promotion strategy explain how to formulate promotional plans

Selecting a Promotional Mix

Every business has a unique promotional mix.

promotional mix

the combination of different promotional elements that a company uses to reach and influence potential customers


When selecting elements for a promotional mix consider

Ongoing Plan

When selecting elements for a promotional mix, consider:

target market

product value

promotional channels

time frame

cost

13


Explain the role of the promotion strategy explain how to formulate promotional plans

The Elements of the Promotional Mix

personal selling

advertising

PromotionalMix

Internet

Marketing

publicity

sales promotion

14


Explain the role of the promotion strategy explain how to formulate promotional plans

Advertising

In the United States, most businesses spend about one-fourth of their advertising dollars on newspaper ads.

advertising

the paid nonpersonal presentation of ideas, goods, or services directed at a mass audience by an identified sponsor by means of print and broadcast


Explain the role of the promotion strategy explain how to formulate promotional plans

Advertising

newspapers

magazines

specialtyitems

direct mail

Types ofAdvertising

outdoor advertising

Internet

directories

radio

transit advertising

television

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Explain the role of the promotion strategy explain how to formulate promotional plans

Advertising

A specialty item serves as a reminder of a business.

specialty item

an advertising device that includes giveaways, such as pens, T-shirts, and caps, printed with a business name or logo


Explain the role of the promotion strategy explain how to formulate promotional plans

Publicity

Taking advantage of publicity means calling attention to yourself and your business.

publicity

placement in the media of newsworthy items about a company, product, or person


Explain the role of the promotion strategy explain how to formulate promotional plans

Who?

What?

Where?

When?

Why?

Publicity

A news release should answer these questions:

news release

a brief newsworthy story that is sent to the media

?

?

?

?

?


Explain the role of the promotion strategy explain how to formulate promotional plans

Publicity

Public relations may generate unsolicited publicity when such activities are reported by the media.

public relations

activities designed to create goodwill toward a business or control damage done by negative publicity


Explain the role of the promotion strategy explain how to formulate promotional plans

Sales Promotion

displays

sweepstakes and contests

premiums

Examplesof SalesPromotion

samples

rebates

21


Explain the role of the promotion strategy explain how to formulate promotional plans

Sales Promotion

One type of sales promotion may be to include a premium with a purchase.

premium

any item of value that a customer receives in addition to the good or service purchased; designed to attract new customers or build loyalty among existing customers, they may include coupons and gifts


Explain the role of the promotion strategy explain how to formulate promotional plans

Sales Promotion

Some companies give a rebate on purchases.

rebate

a return of part of the purchase price of a product used as an incentive for customers to purchase the product


Explain the role of the promotion strategy explain how to formulate promotional plans

Sales Promotion

A sweepstakes is a sales promotion that can draw attention to a business.

sweepstakes

a simple game of chance used by a business to get customers interested in what the company has to offer


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

  • Explain the role of the promotion strategy.

The role of the promotion strategy is to set the course for and coordinate all aspects of promotion. It involves planning, determining the right mix, and selecting specific activities.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

2.Explain preopening and ongoing promotional plans.

Preopening promotional plans establish the company’s image, let customers know the business is opening, bring in customers, and create interest in the business so that the business will have customers when it opens. Ongoing promotional plans maintain and build sales after a business is open.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

3.Describe considerations for putting together a promotional mix.

When selecting elements for a promotional mix, consider the target market, product value, promotional channels, time frame, and cost.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

4.Describe the elements of a promotional mix.

The elements of the promotional mix are advertising, sales promotion, publicity, and personal selling.


Explain the role of the promotion strategy explain how to formulate promotional plans

Section Objectives

  • Determine promotional costs for a start-up business.

  • Describe ways to implement your promotion strategy.

  • Examine options for short-term changes in your promotion strategy.

  • Identify considerations for updating the promotion strategy.


Explain the role of the promotion strategy explain how to formulate promotional plans

The Main Idea

Thorough planning and information gathering can help you arrive at a realistic promotional budget.

That budget will have a direct affect on how you implement your promotional plans.


Explain the role of the promotion strategy explain how to formulate promotional plans

Content Vocabulary

industry average

cooperative advertising

advertising agency

consumer pretest


Explain the role of the promotion strategy explain how to formulate promotional plans

Budgeting for Promotion

To plan the promotional budget for a new venture, you must take these steps:

  • Cost out promotional activities.

  • Compare industry averages.

  • Make final adjustments.


Explain the role of the promotion strategy explain how to formulate promotional plans

Compare Industry Averages

You can find out the industry average for promotional expenses from such sources as trade associations or the SBA.

industry average

the standard used to compare costs among companies; usually expressed as a percentage


Explain the role of the promotion strategy explain how to formulate promotional plans

Print

Include a headline, copy, illustrations, and a signature.

Radio

Include same elements as print, but can add music or sound effects.

Television

Same elements apply, but it requires casting, set design, sound, and filming.

Internet

Same components as print, but may also have audio, video, and animation.

Basic Media Formats

Print

Radio

Television

Internet

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Explain the role of the promotion strategy explain how to formulate promotional plans

Getting Help

You can carry out your promotional plans yourself, or you can hire professionals to implement some or all of your promotional activities.

Professional help can come from the media, manufacturers and suppliers, and advertising agencies.


Explain the role of the promotion strategy explain how to formulate promotional plans

Getting Help

You may be able to save on your promotional budget by arranging for cooperative advertising.

cooperative advertising

an arrangement in which advertising costs are divided between two or more parties


Explain the role of the promotion strategy explain how to formulate promotional plans

Getting Help

An advertising agency can handle all phases of your advertising, including writing the copy, creating the artwork, choosing the media, and producing the ad.

advertising agency

a company that acts as intermediary between a business and the media to communicate a message to the target market


Explain the role of the promotion strategy explain how to formulate promotional plans

Making Possible Promotion Changes

The three most common adjustments to the promotion strategy are:

  • adjust your advertising

  • generate publicity

  • promote sales

Section 12.2 Budgeting and Implementing Promotional Plans


Explain the role of the promotion strategy explain how to formulate promotional plans

Adjust Your Advertising

market

budget

source

Factors for Evaluation

results

motives

media

messages

Section 12.2 Budgeting and Implementing Promotional Plans

39


Explain the role of the promotion strategy explain how to formulate promotional plans

Adjust Your Advertising

One way to reduce the risk involved in an expensive advertising campaign is to conduct a consumer pretest.

consumer pretest

a procedure in which a panel of consumers evaluates an ad before its release


Explain the role of the promotion strategy explain how to formulate promotional plans

Revising the Promotion Strategy

Conduct a formal review of your promotion strategy on a regular basis.

Use your sales forecast to arrive at a promotional budget to support that level of sales.

Then revise your promotional mix promotion plan.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

1.Describe how to determine promotional costs for a start-up business.

Promotional costs for a start-up business are determined by costing out the planned activities, comparing the costs to industry averages, and adjusting the budget if necessary.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

2.Describe approaches to implementing your promotional strategy.

Two approaches to implementing a promotion strategy are developing your own promotion items and hiring professionals to do the job.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

3.Discuss options for short-term changes in your promotion strategy.

Options for short-term changes are increasing the effectiveness of your advertising expenditures, capitalizing on publicity opportunities, and stimulating sales through sales promotions or changes in the sales force.


Explain the role of the promotion strategy explain how to formulate promotional plans

After You Read

4.Name considerations for updating the promotion strategy.

To update the promotional plan, consider the sales forecast for the upcoming period; make budget adjustments required by the forecast; and study changes in the target market, research results, and experiences to date. On the basis of those considerations, a new mix can be determined and a new plan developed.


Explain the role of the promotion strategy explain how to formulate promotional plans

End of

Chapter 12

The Promotion Strategy


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