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Chapter 12 Marketing Communication and Personal Selling Prepared by Deborah Baker Texas Christian University Chapter 12 Marketing Communication and Personal Selling Prepared by Deborah Baker Texas Christian University Chapter 12 Ver 2 e © 2000 South-Western College Publishing 1

Chapter 12 Objectives 1. Discuss the role of promotion in the marketing mix. 2. Chapter 12 Objectives 1. Discuss the role of promotion in the marketing mix. 2. Discuss the elements of the promotional mix. 3. Describe the communication process. 4. Explain the goals and tasks of promotion. (continued) Chapter 12 Ver 2 e © 2000 South-Western College Publishing 2

Chapter 12 Objectives 5. Discuss the AIDA concept and its relationship to the promotional Chapter 12 Objectives 5. Discuss the AIDA concept and its relationship to the promotional mix. 6. Describe the factors that affect the promotional mix. 7. Describe personal selling. 8. Discuss the key differences between relationship selling and traditional selling. (continued) Chapter 12 Ver 2 e © 2000 South-Western College Publishing 3

Chapter 12 Objectives 9. List the steps in the selling process. 10. Describe the Chapter 12 Objectives 9. List the steps in the selling process. 10. Describe the functions of sales management. Chapter 12 Ver 2 e © 2000 South-Western College Publishing 4

The Role of Promotion is communication by marketers that informs, persuades, and reminds potential The Role of Promotion is communication by marketers that informs, persuades, and reminds potential buyers of a product in order to influence their opinions or elicit a response Chapter 12 Ver 2 e © 2000 South-Western College Publishing 5

The Role of Promotion People no longer buy shoes to keep their feet warm The Role of Promotion People no longer buy shoes to keep their feet warm and dry. They buy them because of the way the shoes make them feel -masculine, feminine, rugged, different, sophisticated, young, glamorous, “in. ” Buying shoes has become an emotional experience. Our business now is selling excitement rather than shoes. --Francis C. Rooney Chairman, H. H. Brown Shoe Co. Chapter 12 Ver 2 e © 2000 South-Western College Publishing 6

Differential Advantage High Product Quality Rapid Delivery Features that provide Differential Advantage Low Prices Differential Advantage High Product Quality Rapid Delivery Features that provide Differential Advantage Low Prices Excellent Service Unique Features Chapter 12 Ver 2 e ©South-Western College Publishing 7

The Promotional Mix Advertising Elements of the Promotional Mix Public Relations Personal Selling Sales The Promotional Mix Advertising Elements of the Promotional Mix Public Relations Personal Selling Sales Promotion Chapter 12 Ver 2 e © 2000 South-Western College Publishing 8

The Role of Promotion in Marketing Mix Overall Marketing Objectives Marketing Mix • Product The Role of Promotion in Marketing Mix Overall Marketing Objectives Marketing Mix • Product • Distribution • Promotion • Price Target Market Chapter 12 Ver 2 e Promotional Mix • Advertising • Public Relations • Personal Selling • Sales Promotion Plan © 2000 South-Western College Publishing 9

Personal Selling Traditional Selling Chapter 12 Ver 2 e Relationship Selling © 2000 South-Western Personal Selling Traditional Selling Chapter 12 Ver 2 e Relationship Selling © 2000 South-Western College Publishing 10

Advertising Traditional Advertising Media u u u u Television Radio Newspapers Magazines Books Direct Advertising Traditional Advertising Media u u u u Television Radio Newspapers Magazines Books Direct mail Billboards Transit cards Chapter 12 Ver 2 e Electronic Advertising Media u Internet u Computer modems u Fax machines © 2000 South-Western College Publishing 11

Sales Promotion Free Samples Contests Premiums Trade Shows Types of Sales Promotion Sweepstakes Coupons Sales Promotion Free Samples Contests Premiums Trade Shows Types of Sales Promotion Sweepstakes Coupons Chapter 12 Ver 2 e © 2000 South-Western College Publishing 12

Public Relations Functions of Public Relations Executes programs to “win” public Evaluates public attitudes Public Relations Functions of Public Relations Executes programs to “win” public Evaluates public attitudes Identifies areas of interest Chapter 12 Ver 2 e © 2000 South-Western College Publishing 13

Marketing Communication Categories of Communication Interpersonal Communication Chapter 12 Ver 2 e Mass Communication Marketing Communication Categories of Communication Interpersonal Communication Chapter 12 Ver 2 e Mass Communication © 2000 South-Western College Publishing 14

The Communication Process Noise Sender Encoding Message Channel Decoding Message Receiver Message Channel Chapter The Communication Process Noise Sender Encoding Message Channel Decoding Message Receiver Message Channel Chapter 12 Ver 2 e © 2000 South-Western College Publishing 15

Characteristics of Promotional Mix Personal Selling Communication Mode Direct and face-to-face Communication Control High Characteristics of Promotional Mix Personal Selling Communication Mode Direct and face-to-face Communication Control High Feedback Amount Much Feedback Speed Immediate Message Flow Direction Two-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Message Flexibility Chapter 12 Ver 2 e Slow Tailored to prospect © 2000 South-Western College Publishing 16

Characteristics of Promotional Mix Advertising Communication Mode Indirect and non-personal Communication Control Low Feedback Characteristics of Promotional Mix Advertising Communication Mode Indirect and non-personal Communication Control Low Feedback Amount Little Feedback Speed Delayed Message Flow Direction One-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Fast Message Flexibility Chapter 12 Ver 2 e Same message to all audiences © 2000 South-Western College Publishing 17

Characteristics of Promotional Mix Sales Promotion Communication Mode Communication Control Usually Indirect and non-personal Characteristics of Promotional Mix Sales Promotion Communication Mode Communication Control Usually Indirect and non-personal Moderate to low Little to moderate Feedback Amount Feedback Speed Varies Message Flow Direction Mostly one-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Fast Message Flexibility Chapter 12 Ver 2 e Same message to varied target © 2000 South-Western College Publishing 18

Characteristics of Promotional Mix Public Relations Communication Mode Communication Control Usually indirect, non-personal Moderate Characteristics of Promotional Mix Public Relations Communication Mode Communication Control Usually indirect, non-personal Moderate to low Little Feedback Amount Feedback Speed Delayed Message Flow Direction One-way Message Content Control No Sponsor Identification No Reaching Large Audience Message Flexibility Chapter 12 Ver 2 e Usually fast Usually no direct control © 2000 South-Western College Publishing 19

Integrated Marketing Communications Public Relations Consistent, Unified Message ct ct re g Dii tiin Integrated Marketing Communications Public Relations Consistent, Unified Message ct ct re g Dii tiin D tn ke ke ar ar M M Chapter 12 Ver 2 e Pa ckagin ll Packaging g na na rso g Pe elllliin Pe S e n S Sales a Promotion i ed g M in rtis e dv A ni n u o m ti om ca Customer C Focused © 2000 South-Western College Publishing 20

Goals and Tasks of Promotion Informing Reminding Target Audience Persuading Chapter 12 Ver 2 Goals and Tasks of Promotion Informing Reminding Target Audience Persuading Chapter 12 Ver 2 e 21 © 2000 South-Western College Publishing

Goals and Tasks of Promotion Informing PLC Stages: Stages Introduction Early Growth PLC Stages: Goals and Tasks of Promotion Informing PLC Stages: Stages Introduction Early Growth PLC Stages: Growth Maturity Reminding PLC Stages: Maturity Target Audience Persuading Chapter 12 Ver 2 e 22 © 2000 South-Western College Publishing

Goals and Tasks of Promotion Informative Objective • • Increase awareness Explain how product Goals and Tasks of Promotion Informative Objective • • Increase awareness Explain how product works Suggest new uses Build company image Persuasion Objective • • Encourage brand switching Change customers’ perception of product attributes Influence buying decision Persuade customers to call Reminder Objective • • • Remind customers that product may be needed Remind customers where to buy product Maintain customer awareness Chapter 12 Ver 2 e © 2000 South-Western College Publishing 23

Promotional Goals and the AIDA Concept Action Desire Interest Attention Chapter 12 Ver 2 Promotional Goals and the AIDA Concept Action Desire Interest Attention Chapter 12 Ver 2 e © 2000 South-Western College Publishing 24

AIDA and the Promotional Mix Awareness Interest Desire Action Personal Selling Somewhat effective Very AIDA and the Promotional Mix Awareness Interest Desire Action Personal Selling Somewhat effective Very effective Somewhat effective Advertising Very effective Somewhat effective Not effective Sales Promotion Public Relations Somewhat effective Very effective Very effective Not effective Chapter 12 Ver 2 e © 2000 South-Western College Publishing 25

Factors Affecting the Promotional Mix Nature of Product Stage in PLC Target Market Factors Factors Affecting the Promotional Mix Nature of Product Stage in PLC Target Market Factors Affecting Choice of Promotional Mix Type of Buying Decision Promotion Funds Push or Pull Strategy Chapter 12 Ver 2 e © 2000 South-Western College Publishing 26

Sales ($) PLC and the Promotional Mix Maturity Decline Growth Introduction Time Light Advertising, Sales ($) PLC and the Promotional Mix Maturity Decline Growth Introduction Time Light Advertising, preintroduction Publicity Heavy use of advertising, PR for awareness; sales promotion for trial Chapter 12 Ver 2 e Advertising, PR, Brand loyalty Personal Selling for distribution Ads decrease. AD/PR Sales decrease Promotion, Limited Personal Sales Selling Promotion, Reminder & Personal Persuasive Selling for distribution © 2000 South-Western College Publishing 27

Target Market Characteristics Widely-scattered markets Highly-informed buyers Brand-loyal repeat purchasers Advertising Sales Promotion Less Target Market Characteristics Widely-scattered markets Highly-informed buyers Brand-loyal repeat purchasers Advertising Sales Promotion Less Personal Selling Chapter 12 Ver 2 e © 2000 South-Western College Publishing 28

Type of Buying Decision Routine Type of Buying Decision affects Promotional Mix Choice Advertising Type of Buying Decision Routine Type of Buying Decision affects Promotional Mix Choice Advertising Sales Promotion Advertising Public Relations Complex Chapter 12 Ver 2 e Not Routine or Complex Personal Selling © 2000 South-Western College Publishing 29

Available Funds u Trade-offs with funds available u Number of people in target market Available Funds u Trade-offs with funds available u Number of people in target market u Quality of communication needed u Relative costs of promotional elements Chapter 12 Ver 2 e © 2000 South-Western College Publishing 30

Push and Pull Strategies PUSH STRATEGY Manufacturer promotes to wholesaler Wholesaler promotes to retailer Push and Pull Strategies PUSH STRATEGY Manufacturer promotes to wholesaler Wholesaler promotes to retailer Retailer promotes to consumer Consumer buys from retailer Orders to manufacturer PULL STRATEGY Manufacturer promotes to consumer Consumer demands product from retailer Retailer demands product from wholesaler Wholesaler demands product from manufacturer Orders to manufacturer Chapter 12 Ver 2 e © 2000 South-Western College Publishing 31

Advantages of Personal Selling u Provides a detailed explanation or demonstration of product u Advantages of Personal Selling u Provides a detailed explanation or demonstration of product u Message can be varied to fit the needs of each prospective customer u Can be directed to specific qualified prospects u Costs can be controlled by adjusting sales force size u Most effective in obtaining sales and gaining satisfied customers Chapter 12 Ver 2 e © 2000 South-Western College Publishing 32

Personal Selling is more important if. . . Advertising & sales promotion are more Personal Selling is more important if. . . Advertising & sales promotion are more important if. . . Product has a high value Product has a low value Product is custom made Product is standardized Product is technically complex Product is simple to understand There are few customers There are many customers Customers are concentrated Customers are geographically dispersed Chapter 12 Ver 2 e ©South-Western College Publishing 33

Relationship Selling Traditional Personal Selling Relationship Selling Sell products Sell advice, assistance, counsel Focus Relationship Selling Traditional Personal Selling Relationship Selling Sell products Sell advice, assistance, counsel Focus on closing sales Focus on customer’s bottom line Limited sales planning Sales planning is top priority Discuss product Build problem-solving environment Assess “Product-specific” needs Conduct discovery in scope of operations “Lone wolf” approach Team approach Pricing/product focus Profit impact and strategic benefit focus Short-term sales follow-up Long-term sales follow-up Chapter 12 Ver 2 e © 2000 South-Western College Publishing 34

Steps in the Selling Process Generate Leads Qualify Leads Probe Customer Needs Develop Solutions Steps in the Selling Process Generate Leads Qualify Leads Probe Customer Needs Develop Solutions Basic Steps in the Personal Selling Process Chapter 12 Ver 2 e Handle Objections Close the Sale © 2000 South-Western College Publishing Follow Up 35

Generating Leads Advertising Publicity Direct Mail/ Telemarketing Cold Calling Web Sites Client Referrals Sales Generating Leads Advertising Publicity Direct Mail/ Telemarketing Cold Calling Web Sites Client Referrals Sales Networking Trade Shows/ Conventions Company Records Sources of Sales Leads Chapter 12 Ver 2 e © 2000 South-Western College Publishing 36

Qualifying Leads Characteristics of Qualified Leads Receptivity & Accessibility Recognized Need Buying Power Chapter Qualifying Leads Characteristics of Qualified Leads Receptivity & Accessibility Recognized Need Buying Power Chapter 12 Ver 2 e © 2000 South-Western College Publishing 37

Probing Needs Product or service Salesperson must know everything about. . . Customers and Probing Needs Product or service Salesperson must know everything about. . . Customers and their needs Competition Industry Chapter 12 Ver 2 e © 2000 South-Western College Publishing 38

Sales Management Define sales goals and sales process Determine sales force structure Tasks of Sales Management Define sales goals and sales process Determine sales force structure Tasks of Sales Management Recruit and train sales force Compensate and motivate sales force Evaluate sales force Chapter 12 Ver 2 e ©South-Western College Publishing 39

Leadership Traits of Sales Leaders Effective Sales Leaders. . . Are assertive Possess ego Leadership Traits of Sales Leaders Effective Sales Leaders. . . Are assertive Possess ego drive Possess ego strength Take risks Are innovative Have a sense of urgency Are empathetic Chapter 12 Ver 2 e © 2000 South-Western College Publishing 40