![MARK4210, 2014 Spring, L1/L2
MARK4210: Strategic Marketing
2014 Spring, Section L1/L2
[Class #18]
Promotion Strategies](https://image.slidesharecdn.com/iclass18-promotionstrategiesv20140405postingfinal-140605023607-phpapp02/85/promotion-strategies-4210-1-320.jpg)
promotion strategies(4210)
- 1. MARK4210, 2014 Spring, L1/L2 MARK4210: Strategic Marketing 2014 Spring, Section L1/L2 [Class #18] Promotion Strategies
- 2. 2 MARK4210, 2014 Spring, L1/L2 Communicating Promotion Communicating value Creating Value Product Price Capturing value Distribution Delivering value The Role of Promotion Inform, persuade & remind the market about the organization and/or its products
- 3. 3 MARK4210, 2014 Spring, L1/L2 Promotional Mix Elements Element Description Personal selling Presenting a product to a prospective customer by a firm’s sales representative, usually face-to-face; often used for ‘purchasing’ intermediaries Advertising Paid, non-personal mass communication, in which the sponsor is clearly identified; often used for end-users Sales promotion Demand-stimulating activity designed to supplement advertising and complement personal selling Direct Marketing Directly selling goods to consumers rather than via retailers – usually by direct-mail, telephone selling, or the internet Public Relations Planned communication effort by an organisation to contribute to generally favourable attitudes and opinions toward an organisation and its products Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 4. 4 MARK4210, 2014 Spring, L1/L2 Promotional Mix Elements (2) Source: Integrated Marketing Communications and Direct Marketing, Kerin, Hartley, Rudelius, McGraw-Hill
- 5. 5 MARK4210, 2014 Spring, L1/L2 9-5 Choosing the Right Promotional Element – Considerations (1) 1. The target market Household versus business customers Number and concentration of customers Determine customer’s readiness to buy (stage of purchase behavior): Awareness Knowledge Liking Preference Conviction Purchase Sources: Essential Marketing Skills, Peter Rix, McGraw Hill Australia; Strategic Marketing Asia Edition, Jain & Haley, Cengage Learning, 2009
- 6. 6 MARK4210, 2014 Spring, L1/L2 9-5 Choosing the Right Promotional Element – Considerations (2) 2. The nature of the product Durable versus non-durable Unit value of the product (purchase amount) Amount of product customization Amount of pre-sale and post-sale service required Perceived risks Sources: Essential Marketing Skills, Peter Rix, McGraw Hill Australia; Strategic Marketing Asia Edition, Jain & Haley, Cengage Learning, 2009
- 7. 7 MARK4210, 2014 Spring, L1/L2 9-5 Choosing the Right Promotional Element – Considerations (3) 3. The stage of the product’s life cycle Market share Industry concentration Intensity of competition Product demand 4. Budget Sources: Essential Marketing Skills, Peter Rix, McGraw Hill Australia; Strategic Marketing Asia Edition, Jain & Haley, Cengage Learning, 2009
- 8. 8 MARK4210, 2014 Spring, L1/L2 Choosing the Right Promotional Mix – Consumer Purchase Decision PRE-PURCHASE Advertising is most valuable Informs potential customers about the existence of the product and the seller PURCHASE Importance of personal selling is highest Sales promotion can encourage demand POST-PURCHASE Personal contact after the sale leads to buyer satisfaction. Advertising & personal selling helps reduce post-purchase anxiety Source: Integrated Marketing Communications and Direct Marketing, Kerin, Hartley, Rudelius, McGraw-Hill
- 9. 9 MARK4210, 2014 Spring, L1/L2 9-8 Push vs. Pull Strategy: Push Strategy Characteristics Producer creates demand for product Aims promotional activity to channel member(s) Each channel member promotes to next channel member Demand ‘pushed’ down distribution channel Consumer influenced by retailer’s advertising Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 10. 10 MARK4210, 2014 Spring, L1/L2 Push vs. Pull Strategy: Pull Strategy Characteristics Producer creates demand for product Aims promotional activity directly at the consumer Consumer demands product from retailer Demand ‘pulled’ up the distribution channel Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 11. 11 MARK4210, 2014 Spring, L1/L2 Push versus Pull Strategy: Illustration Source: Integrated Marketing Communications and Direct Marketing, Kerin, Hartley, Rudelius, McGraw-Hill
- 12. 12 MARK4210, 2014 Spring, L1/L2 Push vs. Pull Strategy: Considerations on When to Use Degree of brand loyalty Degree of brand differentiation Purchase behavior – planned or impulsive Whether sales assistance is needed in making the choice/ purchase Source: Marketing Management, Kotler & Keller, Pearson, 2012
- 13. 13 MARK4210, 2014 Spring, L1/L2 Setting the Promotional Budget Percentage of sales method • Determine past or anticipated sales and apply a percentage All available funds (or what can be afforded) • Use all available funds on the promotional campaign Competitive Parity • Match competition – promotions based on market share of competitors, or actual expenditure if known Task or objective method (build-up) • Determine needed promotion tasks or objectives • Determine cost to perform tasks or meet objective Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 14. 14 MARK4210, 2014 Spring, L1/L2 Personal Selling: Sales Force Strategic Considerations Priority/emphasis between maintaining existing accounts versus converting new customers Increasing sales force productivity, e.g., leveraging technology and innovative sales techniques Targeting the ‘right’ people in the customer organization Sales force size Sales force motivation (financial, non-financial incentives) Sales force supervision – includes territory assignment, control, and communication Source: Strategic Marketing Asia Edition, Jain & Haley, Cengage Learning, 2009
- 15. 15 MARK4210, 2014 Spring, L1/L2 Advertising: Types Consumer versus business advertising Emotional & rational vs informational Product versus institutional advertising Focus on particular product or brand, and information and goodwill to company Stimulate demand for generic or specific brands Primary-demand versus selective-demand (brand) advertising Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 16. 16 MARK4210, 2014 Spring, L1/L2 Advertising and the Product Life Cycle Informative advertising • Build initial demand during introductory phase of life cycle Persuasive advertising • Improve the competitive status of a product, usually during growth and maturity stages of product life cycle Comparative advertising • Compares products directly with their competitors Reminder-oriented advertising • Maintain awareness of the importance and usefulness of a product, especially during late maturity or decline stages of product life cycle Source: Contemporary Business, David L. Kurtz, Louis E. Boone, Cengage Learning, 2009
- 17. 17 MARK4210, 2014 Spring, L1/L2 Advertising: Measuring Effectiveness Direct tests • Measure or predict the sales volume stemming from an advertising campaign • Tabulate number of inquiries from a direct-response campaign Indirect tests • Measures something other than actual sales (e.g., recall tests) Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 18. 18 MARK4210, 2014 Spring, L1/L2 Sales Promotions: Considerations What are our promotional objectives? Who is our target market? Can our product be sampled? What will it cost to use the right promotional tool? What is the current economic condition? Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 19. 19 MARK4210, 2014 Spring, L1/L2 Sales Promotions: Consumer- oriented Premiums, Coupons, Rebates, Samples • Coupons attract customers but focus on price rather than brand loyalty • Rebates increase purchase rates, promote multiple purchases, and reward product users Games, Contests, and Sweepstakes • Introduction of new products • Subject to legal restrictions Specialty Advertising • Gift of useful merchandise carrying the name, logo, or slogan of an organization Source: Contemporary Business, David L. Kurtz, Louis E. Boone, Cengage Learning, 2009
- 20. 20 MARK4210, 2014 Spring, L1/L2 Sales Promotions: Trade-oriented Sales promotions geared to distribution intermediaries (NOT consumers) Objectives: • To encourage stocking of new products • To encourage continued stocking of existing products • To encourage (sometimes “pressure”) intermediaries to promote products to consumers Source: Contemporary Business, David L. Kurtz, Louis E. Boone, Cengage Learning, 2009
- 21. 21 MARK4210, 2014 Spring, L1/L2 Public Relations: Examples Supporting charitable projects Supplying volunteers or other resources Participating in community-service events Sponsorship Providing information to customers via newsletters. Publicity can be achieved by: • structured news-release to the media • coordinating personal communication with a group • coordinating one-to-one personal communication (lobbying) Source: Essential Marketing Skills, Peter Rix, McGraw Hill Australia
- 22. 22 MARK4210, 2014 Spring, L1/L2 Announcements & Reminders PharmaSim Team Live Play Round 1 ends April 14 @8pm • Round 1 data/results will be erased (!), make sure you download/record beforehand PharmaSim Team Live Play Round 2 • Starts April 22 @ 7am – Ends May 8 @ 8pm • NO replay, NO restarts, NO consultation • In-class team discussions on April 25 (Fri) & April 30 (Wed), LSKG005 -- NO consultations; attendance checked PharmaSim Final Report – email to [email protected] (copy all members) by May 9 class Guest Speaker on April 23 (Wed), 7-820pm, LTB • Mr. Larry CHAN, Digital Marketing Manager, L’Oreal • Attendance checked (or valid documented excuse) • Replaces afternoon session (no class)