CHAPTER 16 Using Effective Promotions Mc Graw-Hill Irwin Copyright

CHAPTER 16 Using Effective Promotions Mc. Graw-Hill/Irwin Copyright © 2015 by the Mc. Graw-Hill Companies, Inc. All rights reserved.

LEARNING OBJECTIVES 1. Identify the new and traditional tools that make up the promotion mix. 2. Contrast the advantages and disadvantages of various advertising media, including the Internet and social media. 3. Illustrate the steps of the B 2 B and B 2 C selling processes. 16 -2

LEARNING OBJECTIVES 4. Describe the role of the public relations department, and show publicity fits in that role. 5. Assess the effectiveness of various forms of sales promotion, including sampling. 6. Show word of mouth, viral marketing, blogging, podcasting, e-mail marketing, and mobile marketing work. 16 -3

CHRIS HARDWICK Nerdist Industries • Hardwick broke into entertainment after graduating from UCLA. • After his career hit a low, he started following his nerd passions and created The Nerdist. • Entered a partnership with Peter Levin and expanded the Nerdist franchise. 16 -4

NAME that COMPANY This company put its product into the hands of Spiderman. Viewers watched as the superhero used the product throughout his latest movie. Name that company! 16 -5

PROMOTION in an ORGANIZATION LO 16 -1 • Promotion Mix -- The combination of promotional tools an organization uses. The traditional mix includes: 16 -6

INTEGRATED MARKETING COMMUNICATION (IMC) LO 16 -1 • Integrated Marketing Communication (IMC) -Combines the promotional tools into one comprehensive strategy. IMC is used to: - Create a positive brand image. - Meet the needs of consumers. - Meet the strategic marketing and promotional goals of the firm. 16 -7

STEPS in a PROMOTIONAL CAMPAIGN LO 16 -1 1. Identify a target market 2. Define objectives 3. Determine a promotional budget 4. Develop a unifying message 5. Implement the plan 6. Evaluate effectiveness 16 -8

CLASSIC CAMPAIGNS LO 16 -1 Brilliant Marketing Ideas Campaign Company Why it’s Cool A Diamond is Forever De Beers Since 1939, it’s been tapping into our emotions. Marlboro Man Marlboro He’s the most successful trade character ever. Does she… or doesn’t she? Clairol The birth of the “shock ad” in 1957. 1984 Apple The uncommercial didn’t explain the product. Source: Entrepreneur, www. entrepreneur. com, accessed November 2014. 16 -9

ADVERTISING in the FIRM LO 16 -2 • Advertising -- Paid, nonpersonal communication through various media by organizations and individuals who are in some way indentified in the message. • Major goals of advertising: - Inform - Persuade - Remind 16 -10

IMPACT of ADVERTISING LO 16 -2 • Total advertising expenditures exceed $215 billion yearly. • Consumers benefit because production costs of TV programs, radio programs, newspapers and magazines are paid for by advertisers. • Marketers choose ad media that will reach the target market. 16 -11

MAJOR CATEGORIES of ADVERTISING LO 16 -2 Category What it is Retail From retail stores to consumers Trade From manufacturers to wholesalers and retailers B 2 B From manufacturers to other manufacturers Institutional Creates a desirable image for an organization Product Creates a desirable image for a product or service 16 -12

MAJOR CATEGORIES of ADVERTISING LO 16 -2 Category What it is Advocacy Supports a particular view of an issue Comparative Compares competing products Interactive Customer-oriented ads that allows customers to choose information to receive Online Computer ads featured on different sites Mobile Ads that reach consumers on cell phones 16 -13

ADVERTISING EXPENDITURE by MEDIA in $ MILLIONS LO 16 -2 16 -14

DEAR MR. POSTMAN… LO 16 -2 Steps in Launching a Direct-Mail Campaign 1. Plan: What should your mailing accomplish? 2. Get the Right List: The better the list, the better your chance of success. 3. Stand Out: Make your ad like no other. 4. Get Help: Contact a marketing firm with direct mail experience. 5. Follow Up: One mailing is not enough. 16 -15

MATCH GAME LO 16 -2 Match the Company with the Slogan • “Everybody doesn’t like something, but nobody doesn’t like ______. ” • “We bring good things to life. ” • “It takes a licking and keeps on ticking. ” • “With a name like _____, it has to be good. ” • “Good to the last drop. ” • “Betcha can’t eat just one!” • “Because you’re worth it. ” 16 -16

IT’S a DOG’S LIFE LO 16 -2 Famous and Not-so-Famous Dogs in Advertising Pooch Company Nipper RCA Tige Buster Brown Shoes Chihuahua Taco Bell Spuds Mc. Kenzie Bud Light Mc. Gruff The Crime Dog Duke Bush’s Beans Bullseye Target 16 -17

POPULAR ADVERTISING MEDIA LO 16 -2 • TV advertising is still the dominant media. • Digital Video Recorders (DVRs) challenge TV advertising because viewers can skip ads. • Product Placement -Advertisers pay to put their products into TV shows and movies where the audience will see them. 16 -18

LO 16 -2 NOT QUITE the NFL… Sport Cost Why? Equestrian $15, 000+ The demographic skews to highincome females. Bowling $20, 000+ It’s shown on television and lower cost than other televised sports. Surfing $25, 000+ The young market is responsive to guerrilla marketing. $50, 000+ A popular sport in Europe and Asia and great for global companies. Women’s Golf Source: Inc. , www. inc. com, accessed November 2014. 16 -19

INFOMERCIALS and ONLINE ADVERTISING LO 16 -2 • Infomercial -- A full length TV program devoted exclusively to promote a particular product. • Online ads are attempts to get potential customers to a web site to learn about a product. • Interactive Promotion -- Allows marketers to open a dialogue between buyers and sellers and let them work together to create a beneficial exchange. 16 -20

INFOMERCIAL HALL of FAME LO 16 -2 The Biggest Hits Over the Past 40 Years • Veg-O-Matic • Ginsu Knives • The Clapper • Thigh Master • George Foreman Grill • Bowflex Source: Fortune, www. fortune. com, accessed November 2014. 16 -21

ONLINE EXPERIENCE LO 16 -2 How to Avoid Losing Customers Over a Bad Web Site 1. Brand messaging is key. 2. Site must be easy to navigate. 3. Make sure calls to action are effective. 4. Users want fast, readable sites. 5. Users with disabilities should be able to navigate. Source: Entrepreneur, www. entrepreneur. com, accessed November 2014. 16 -22

PAY-PER-TWEET • Celebrities can earn large sums of money just buy mentioning a product or site in their tweets. • Do you think it is ethical for celebrities to get paid to tweet pre-written ads that appear to be their own personal comments? 16 -23

MONITORING AD EFFECTIVENESS LO 16 -2 • Dr. Pepper posts messages on Facebook and monitors the results from their millions of fans. • Richard Branson and Tony Hsieh all tweet their customer base to maintain two-way communication. Photo Credit: Brent Moore 16 -24

SOCIAL SCAMMERS LO 16 -2 How to Protect Yourself From Schemers 1. Be wary of requests for money transfers -- even from friends’ accounts. 2. Be wary when you use applications. Don’t give unnecessary information. 3. Use URL expanders to see the full address of links on friends’ pages. Source: Kiplinger’s Personal Finance, December 2010. Photo Credit: Paul Klintworth 16 -25

WHAT’S in YOUR OREO? • To Americans, an Oreo is the same cookie we’ve been enjoying for over 100 years. • But Kraft has taken Oreos global which has led to different variations. • In China they enjoy green tea Oreos while Argentina has banana with dulce de leche. 16 -26

GLOBAL ADVERTISING LO 16 -2 • Requires marketers to develop a single product and promotional strategy to implement worldwide. • Problems can arise in global markets with using one advertising campaign in all countries - especially bad translations. 16 -27

PERSONAL SELLING LO 16 -3 • Personal Selling -- The face-to-face presentation and promotion of a product, including the salesperson’s search for new prospects and follow-up service. • Salespeople need to listen to customer needs, help reach a solution and do everything possible to make the transaction as simple as possible. 16 -28

STEPS in the SELLING PROCESS LO 16 -3 1. Prospect and qualify 2. Pre-approach 3. Approach 4. Make a presentation 5. Answer objections 6. Close the sale • Trial Close -- A statement or question that moves the process toward the purchase. 7. Follow up 16 -29

PROSPECTING and QUALIFYING in SELLING LO 16 -3 • Prospecting -- Researching potential buyers and choosing those most likely to buy. • Qualifying -- Making sure customers have a need for a product, the authority to buy and the willingness to listen to a sales message. • Prospect -- A customer who meets the qualifying criteria. 16 -30

BUY THIS! LO 16 -3 Successful Selling Strategies • Know your competition • Understand your customer’s business • Differentiate your product or service • Sell to the people most likely to buy • Build relationships • Put the right people in the right selling spots 16 -31

WHOOPS! LO 16 -3 Sales Slip-Ups • Not feeling the customer’s pain • Making money is the only goal • Seeing sales as just a job • Getting upset during the presentation • Failing to properly prepare or over-preparing • Not being yourself • Neglecting the relationship 16 -32

STEPS in the B 2 C SELLING PROCESS LO 16 -33

TEST PREP • What are the four traditional elements of the promotion mix? • What are three most important advertising media in order of dollars spent? • What are the seven steps in the B 2 B selling process? How does it differ from the B 2 C selling process? 16 -34

USING PUBLIC RELATIONS in PROMOTION LO 16 -4 • Public Relations (PR) -- Evaluates public attitudes, changes policies and procedures in response to the public, and executes a program of action and information to earn public understanding and acceptance. • 3 steps of a good PR program: 1) Listen to the public 2) Change policies and procedures 3) Inform people you’re responsive to their needs 16 -35

PUBLICITY LO 16 -4 • Publicity -- Any information about an individual, product or organization that’s distributed to the public through the media and is not paid for or controlled by the seller. • Advantages of Publicity: - Free - Reaches people who would not look at an advertisement - More believable than advertising 16 -36

DISADVANTAGES of PUBLICITY LO 16 -4 • No control over whether the media will use a story or when they may release it. • It can be good or bad. • Once a story has been run, it is not likely to run again. 16 -37

SALES PROMOTIONS LO 16 -5 • Sales Promotion -- The promotional tool that stimulates consumer purchasing and dealer interest by means of short-term activities. • Categories of Sales Promotions: 1. B 2 B Sales Promotions 2. Consumer Sales Promotions 16 -38

SALES PROMOTION TECHNIQUES LO 16 -5 16 -39

SOME KEY CONSUMER PROMOTIONS LO 16 -5 • Coupons • Demonstrations • Sampling • Sweepstakes • In-store Displays • Contests 16 -40

CLIP THESE LO 16 -5 Most Visited U. S. Coupon Clearing Sites • Coupons, Inc • Ever. Save • Retail. Me. Not • Coupon. Cabin 16 -41

TEST PREP • What are three steps in setting up a public relations program? • What are the sales promotion techniques used to reach consumers? • What sales promotion techniques are used to reach businesses? 16 -42

USING WORD-of-MOUTH PROMOTION LO 16 -6 • Word-of-Mouth Promotion -- People tell others about products they have purchased. • Word-of-Mouth is important for products like: - Restaurants - Daycare and Eldercare - Car Repair Shops - Hair Stylists - Hotels 16 -43

WHAT ARE COMPANIES YELPING ABOUT? • Many companies have a website, Facebook page or some online presence. • However, on review sites like Yelp, they cannot control their public image. • The Federal Trade Commission has received over 2, 000 complaints about Yelp. • Companies can respond to reviews. But often the damage is already done. 16 -44

EMERGING PROMOTIONAL TOOLS LO 16 -6 • Viral Marketing -- Paying customers to say positive things on the Internet or setting up multiple selling schemes whereby consumers get commissions. • People who promote through viral marketing often receive SWAG which can include free tickets, shirts, and other merchandise. 16 -45

BLOGS, PODCASTS, and E-MAILS LO 16 -6 • Blogs are a great way to interact with customers and improve the company’s website ranking. • Podcasting -- A way to distribute multimedia files via the Internet. • Email promotions increase brand awareness among commercial suppliers. 16 -46

MOBILE MEDIA LO 16 -6 • Marketers make use of smartphones to text customers about product offers and other company information. 16 -47

PUSH, PULL, AND PICK PROMOTIONAL STRATEGIES LO 16 -6 • Push Strategy -- Producers use advertising, personal selling, sales promotion, and other tools to get their products stocked on shelves. • Pull Strategy -- Directs heavy advertising and sales promotions efforts towards consumers and gets the public to request their products from retailers. • Pick Economy -- Refers to consumers who pick out their products from online outlets. 16 -48

TEST PREP • What’s viral marketing? • What are blogging and podcasting? • Describe a push strategy and a pull strategy. 16 -49