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Chapter 11 Advertising and Promotion. The Retail Promotion Mix. What is promotion?. The Retail Promotion Mix. What is promotion? A means that retailers use to bring traffic into their stores, and includes… Advertising, Sales promotion, Publicity, and Personal selling.

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chapter 11 advertising and promotion
Chapter 11

Advertising and Promotion

the retail promotion mix
The Retail Promotion Mix
  • What is promotion?
the retail promotion mix1
The Retail Promotion Mix
  • What is promotion?
    • A means that retailers use to bring traffic into their stores, and includes…
      • Advertising,
      • Sales promotion,
      • Publicity, and
      • Personal selling.
1 advertising
1. Advertising
  • Definition:
      • Paid, non-personal communication through various media by business firms, and individuals who are in some way identified in the advertising message and who hope to inform and/or persuade members of a particular audience
    • Key points:
      • Performed by retailers (profit or nonprofit)
      • The retailer is identified within the message
      • Designed to persuade or inform
      • Includes, but not limited to:
        • Communication of products, services, institutions, and/or ideas
2 sales promotion
2. Sales Promotion
  • Definition:
      • Involves the use of media and non-media marketing pressure applied for a pre-determined, limited period of time at the level of consumer, retailer or wholesaler in order to stimulate trial, increase consumer demand, or improve product availability
    • Key points:
      • Uses both media and non-media
      • Runs for a limited, and pre-determined, period of time
      • Directed at the “customer” (final customer, retailer, wholesaler)
      • Has one of three end-goals
        • Stimulate trial, increase existing purchases, or expand availability
3 publicity
3. Publicity
  • Definition:
      • Non-paid-for communications of information about the company or product, generally in some media form
    • Key points:
      • Non-paid-for communication
        • Does not mean that no money has been spent
      • Provides some form of information about a company or product
        • Examples:
          • Macy’s parade
          • Del Frisco’s Double Eagle Steakhouse
4 personal selling
4. Personal Selling
  • Definition:
      • Selling that involves a face-to-face interaction with the customer
    • But why is this considered promotion?
4 personal selling1
4. Personal Selling
  • Definition:
      • Selling that involves a face-to-face interaction with the customer
    • But why is this considered promotion?
      • Rationale:
        • It provides a service to the customer
          • Ease in information gathering
        • Such service enhances one’s value proposition
        • Value propositions are the reasons customers shop a store
          • What is the goal of a promotion – traffic
integrated effort
Integrated Effort
  • Promotion decisions relate to and must be integrated with other management decisions, such as:
      • Location
      • Merchandise
      • Credit
      • Cash flow
      • Building and fixtures
      • Price
      • Customer service
promotion in the supply chain
Promotion in the Supply Chain
  • Three major differences in the way retailers and manufacturers use promotion:
    • Consider which, the retailer or manufacturer, highlights each in their promotions:
      • Product image versus availability
      • Specific product benefits versus price
      • Focused image versus cluttered ads
promotional objectives
Promotional Objectives
  • Long-term objectives
    • Institutional advertising
      • Promoting and selling the store itself rather than the merchandise in the store.
  • Short-term objectives
    • Promotional advertising
      • Promoting the product availability and price to increase short-term performance
    • Two major goals:
      • Increased patronage from existing customers
      • Attraction of new customers
steps in planning for a retail advertising campaign
Steps in Planning for aRetail Advertising Campaign
  • Select advertising objectives
  • Budget for the campaign
  • Design the message
  • Select media to use
  • Schedule ads
  • Evaluate results
selecting advertising objectives
Selecting Advertising Objectives
  • Advertising objectives are informed by one’s promotional objectives
    • Advertising objectives are very idiosyncratic, but should never include “to increase sales”. Why?
    • Generally though, all chosen objectives must be:
      • Aimed at a specific market segment
      • Measurable
      • Stated in terms of a specific time frame
      • Would this example be okay or poor? Why?
        • “increase the level of awareness by 30% over the next 6 months”
budgeting for a retailer only campaign
Budgeting for a“Retailer-Only” Campaign
  • Three general approaches:
    • Affordable Method
      • Allocates all the money that the retailer can afford for advertising in any given period.
    • Percentage-of-Sales Method
      • Targets a specific percentage of forecasted sales to be used for advertising

----------------------

    • Task and Objective Method*
designing the message
Designing the Message
  • Creative ads should seek to accomplish 3 goals:
      • Attract attention and retain attention.
      • Achieve the objective of the advertising strategy.
      • Avoid errors, especially legal ones
    • Some approaches used attract & hold attention include:
      • Lifestyle
      • Fantasy
      • Humorous
      • Slice of life
      • Mood or image
general guidelines for scheduling one s advertising
General Guidelines forScheduling One’s Advertising
  • Ads should…
      • Appear on, or slightly proceed, the days when customers are most likely to purchase.
      • Be concentrated around the times when people receive their payroll checks.
      • Be concentrated during periods of high seasonal demand if the retailer has limited advertising funds.
      • Appear during the time of day/week when the lowest CPM will be obtained.
      • Spaced so that a greater amount of time exists between the advertisement and the purchase time, when a product class has a high level of habitual purchasing
evaluating advertising s results
Evaluating Advertising’s Results
  • Most ineffective advertising is due to:
      • Messages or sales getting discounted.
      • Advertising not appealing, not giving customers all the information they need, or not directed at the proper target market.
      • Advertising dollars spread too thinly.
      • Poor internal communications.
      • Too many last-minute changes in the advertising copy.
      • Retailer used a medium that reached too many people not in the target market.
publicity management
Publicity Management
  • When publicity is formally managed, it should be integrated with other elements of the promotion mix.
    • Major advantages of publicity
      • It’s perceived as more objective and credible
      • Likely to appeal to a mass audience.
    • Major disadvantages of publicity
      • It’s difficult to control and time
      • Rumors are just one event that is beyond one’s control and can be highly damaging.
      • Must be prepared for such events if at al possible.
what you should have learned chapter s learning objectives
What You Should Have Learned…Chapter’s Learning Objectives
  • The four basic components of the retailer’s promotional mix and their relationship with other decision areas.
  • The differences between a retailer’s long-term and short-term promotional objectives.
  • The six steps involved in developing a retailer’s advertising campaign.
  • How retailers manage their sales promotion & publicity.