MARKETING FUNDAMENTALS II

MK302E

LECTURE 7: MASS PROMOTIONS

2016-2017 Second Semester

Slides by: Martine Felts

Module Coordinator : Dr. Elodie Huré

Lectures by : Dr. Sheila Matson

Tutorials by: Dr. Rajibul Hasan

And Dr. Sheila Matson

Programme Grande Ecole 1st year – Undergraduate Transfer Credits – Level 3

 In this session
1. Intro Marketing Communications
2. The Elements of Communication Theory
3. Promotions and Consumer Decision-Making
4. Know your target audience: key rule of
communications
5. Mass promotions: Advertising objectives and
the message
6. The Promotion Mix
7. In action
8. Summary
The 4Ps: P for Promotion

Product Price

Place Promotion
 Promotions defined

“Communications designed and implemented to

persuade others to do, think or feel something.”
(source: Masterson & Pickton 2014)
 The marketing tree
The Marketing Mix (4Ps)

Product Price Promotion Place

Promotion Mix
(the traditional tools)
Advertising

Public Relations “Mass promotions”

Sales Promotions

Personal Selling “One to One promotions”

But also: Direct Marketing,

Marketing Communications

2. THE COMMUNICATION PROCESS

 Communication Theory

Claude Shannon Warren Weaver

(1916 – 2001) (1894 – 1978)
Mathematician, Computer Scientist Scientist, Mathematician
 Communication Theory
• Shannon and Weaver 1949 model of communication

Noise

Source Encoder channel Decoder Receiver

Feedback
 Perception Checking

• How we perceive words, images, and even nonverbal cues (gestures, facial
expressions) can vary from one person to another

• Message accuracy: Sender anticipates how Receiver would perceive message and
checks for communication distortions- unfamiliar or ambiguous words, multiple
meanings of symbols, etc

• Examples:
– “Tired” = negative feeling vs. “Resting” = re-energizing body
– Climate change talks in Paris: Should media communicate 2 degrees C to American Public
or use Fahrenheit? For American public, 2 degrees still minimal but 3.6 F would arouse
more serious attention
 The Elements of the Communication Process

1. Source: The company, business, marketer or advertising agency that

originates message

1. Encoder: Convert message into signals (symbols, text, audio sounds,

images…)

1. Channel: Media platforms (TV, radio, Internet) to transmit message

1. Noise: Distractions that interfere with message (spam, pop-up ads, graffiti)

1. Decoder: Interpretation and understanding of the symbols of the message

1. Receiver: Consumer, target audience

1. Feedback: Interaction and responses between Source and Receiver

 Troubleshooting Communications
• What you can control
– Initial Message
– Encoding of message
– Channel to deliver message
• What you cannot control, but can anticipate
– Capacity of the decoder / decoding skills
– Noise and perception that can interfere or distort message
Communication breakdown: Receiver’s interpretation
differs from Sender’s intentions
Difference between Receiver’s interpretation and
Sender’s
Troubleshoot: Right channel?
Media choices
Message Choices
Target Audience
Marketing Communications

3. CONSUMER DECISION-MAKING PROCESS & PROMOTIONS

Linking Advertisements according to Consumer Behavior

• The marketing funnel represents the flow of

potential customers thru the decision making
process towards a final goal, e.g. product
purchase

• Concept used in marketing to help create

promotional campaigns or advertisements
that are specifically aligned with the different
stages of the “customer’s journey” from Need
Recognition to Evaluation of Alternatives to
Purchase…

 Different marketing objectives and promotion

strategies for the different phases of the
consumer decision-making process
 Product Product Product Product Post
Awareness Interest Desire Purchase purchase

• Qualified lead • Customer • Loyal customer

• Targeted market
segment • Social media • Coupons • Fidelity card
• Target mailing • Sample trial • Special events
• Broad audience • In-store displays • Telemarketing offers • Customer service
• Product info on • Testimonials • Rebates • Premium status
• TV or print ads website
• Online ads
Examples of promotional advertisements for different phases
A basic model: AIDA
• Attention – grab attention by
product samples, large visuals,
sensory techniques
• Interest – trigger interest thru
product demos, product
specification brochures
• Desire – develop customer
preference towards a
particular brand or product
• Action – persuade consumer
to make purchase or take
action, ie. price discounts,
point-of-sale visuals
 AIDA: Infiniti commercial
• Competing for Attention & Interest
– Infiniti Q50 vehicle
– Teaser ad
 Other models
Stage / Model AIDA DAGMAR Hierarchy of Innovation
(1) (2)
Effects (3) Adoption (4)
Cognitive Awareness Awareness Awareness Awareness
(thinking)
Comprehension Knowledge
Affective Interest Conviction Liking Interest
(feeling)
Desire Preference Evaluation
Behavior Action Action Conviction Trial
(doing)
Purchase Adoption
(1) Introduced by Lewis and first published in 1904 by Dukesmith
(2) Russel Colley, 1961
(3) Lavidge and Steiner, 1961
(4) Rogers, 1962
 Model limits
• Limits of AIDA and similar approaches
– Assumes the purchasing journey is linear

Source: Forrester (2007)

– Today, with the Internet and various connectivity

devices, the landscape has changed
 New evolutions
• In reality, the models are a lot more complex

Forrester (2007) McKinsey (2009): Customer Decision Journey

• Lots of ways consumers can come in contact with a

brand. Therefore, promotions must address and
coordinate the consistency of multiple consumer touch
points.
 Integrated Marketing Communication
Marketing Communications

4. KNOW YOUR TARGET AUDIENCE

 Target audience
From generic…
• Define the most suitable
market audience for your
product
• Based on research, statistics,
demographic segmentation etc
• Audience can be segmented by:
– Age
– Gender
– Race
– Income
– Occupation, status, etc
… to personal
• Define “buyer personas” :
portraits of individuals who
would likely buy products
• Based on potential buyer, user
interviews, workshops, focus grps
• Know your audience:
– Who they are?
– What drives their behavior?
– How they think?
– What are they trying to accomplish?
– How, where and when they buy?

 Fundamental theme of marketing communications: know your audience

 Buyer Personas

– Gives a picture, face, profile to the abstract customer

targets
– Represents consumers who buy or might buy a company’s
product or service
– Helpful for designing communications that appeal to target
audience. Effective for promotions targeting
– Some key characteristics to include: likes, attitudes, beliefs,
concerns, frustrations, needs…
Develop Personas of Customer Targets

Katie Jane Christine David

Income $35K $40K $60K $50K
Profession Young homemaker Teacher Art Director Graphic Designer
# of children 2 – in home 1- in college 3 – not in home 0
Age 18 – 30 35 – 50 50+ 35 – 45
Marital Status Married Divorced Single Single
Gender Female Female Female Male
Primary interest Shopping Politics Art Nature
Location California Florida Paris Barcelona
Media consumption TV/Web/Email Magazines/newspapers TV/Email/Radio Web/Email
Preferred promotions Email/Direct mail Email, sampling Direct mail Email/Mobile

Source: VPDM digital marketing

 The Media Selection
Cable Magazine Newspaper The Internet

 Select media channel according to its attractiveness,

frequency, relevancy to a particular segment
 Target audience: what TV channels they watch, radio stations
they listen, newspapers/magazines they prefer to read
Marketing Communications

5. CRAFTING THE MESSAGE

 Advertising objectives
• What kind of promotional message?
• Three main advertising objectives:
– Educate / inform
• Inform consumers about brand, e.g.
Launch new product, educate
customers about enhanced features,
benefits
– Persuade
• Persuade consumer to select or switch
brand, try to differentiate from
competition, e.g. highly competitive
market with similar products
– Remind
• Encourage and remind consumers why
they should buy or continue to buy
product, e.g. during holiday season buy
chocolates, show how to use product in
diff ways, for different purposes
 Example: Reminder Promotion
 Established product: promotion focused on
triggering mental reminder to purchase
 Don’t forget the ketchup:
- Use ketchup to flavor hamburger
- Use ketchup to make salsa dip for chips
- Use ketchup for heart-warming tomato
soup
 Appeal tactics: helpful for crafting the message

• Three types of message appeals:

1. Rational: advertisement that reasons with facts on
product’s features, benefits or performance.
2. Emotional: advertisement that evokes feelings- fear,
humor, love, guilt, anger
3. Moral: reach viewer’s principles of right and wrong, e.g.
support for public cause- environment, public health
• Keep in mind:
– Communication objectives
– Buyer personas
– Types of message appeals
Marketing Communications

6. THE PROMOTION MIX

 How to Promote
The Promotion Mix
• The traditional tools:
1. Advertising
2. Public relations “Mass promotions”
3. Sales promotions
4. Personal selling “One to one promotions”
• But also:
– Direct Marketing
– Sponsorship
– Packaging
– Post Sales

 Can tailor tools towards a mass or one-to-one promotion approach

 Selection of promotional tools: strategic theories

Producer Reselling
markets to Marketing
members of Wholesaler, Activities
Producer distribution Agent / Retailer
Consumer
channels
PUSH Strategy

Demand Demand
Producer Retailer Consumer

Producer markets directly to final customer

PULL Strategy
Armstrong & Kotler: Marketing An Introduction, 2015
 Advertising A
I
“Persuasive communications paid for by a source and aimed D
at whole audience without personal identification.”
(source: Masterson & Pickton 2014) A

• Mass media channel options:

– Broadcast: TV, cable, radio, Internet
– Print: newspapers, magazine, trade journals
– Special display: cinema, billboards, outdoor signs, transit

• Key points
– Paid for presentation of ideas, goods, and services
– Advertiser or sponsor identified
– Message content controlled
– Non-personalized communications (impersonal, lacks interaction)
– Mass promotion: typically message one-way to large audience
 Public Relations A
“Public relations is the effort to establish and I
maintain goodwill and understanding between an D
organization and its publics.”
(source: Chartered Institute of PR)
Goodwill = positive feelings about company: its business, products, services, activities, etc. A
Publics: customers, communities, news media members, stake/stockholders, etc.

• Element of the promotion mix that evaluates public opinions/attitudes and

identifies issues to promote as well as issues that may elicit public concern
• Business has little or no control over resulting publicity
– Company’s business operations can generate both positive and negative ‘publicity’ from
external parties, such as journalists, reporters (who in turn determine nature, content, timing
of message- not company)
• Main goals
– Develop goodwill and improve company image
– Maintain and protect the company’s reputation
– Respond to public or consumer feedback, in turn build more personal relationships with
customers and communities
• Popular PR tools
– Press releases, community events, publicity tactics (product placement, new product
announcements, e.g. Apple Worldwide Developer Conference ), business publications
(stockholder reports, annual reports)
 Volkswagen’s crisis & PR response
• Manipulation of vehicle emissions

• Volkswagen hired PR firms to help

maintain positive image in midst of
crisis

• PR crisis management:
– Act quickly
– Be open & transparent
– Apologize “Scandal pollutes and tarnishes
– Quickly cut ties with those accused of carmaker’s reputation.”
wrongdoing
– Make amends, help for victims and
families
– Monitor situation
(source: Chartered Institute of PR)
 Sales promotions A
I
D
• Special offers that say “Buy product Now”: A
– Price deals, two for the price of one
– Discounts, coupons, rebates
– Contests, test sample offers
• Consider limitations
– Short-term gains in sales
– Cannot reverse declining sales trend
– Cannot overcome fact that company has inferior
product
– May encourage competitive retaliation
 Sponsorship A
I
• Form of advertising
• Company pays or gives other resources to be
D
associated with a specific event A
• Types of sponsorship events
• Sports, athletics, local teams, tournaments
• Charity, food drives, blood drives
• Community events, fairs, educational forums
• Advantages
• Increase brand visibility, awareness, recognition
• Community or public responds positively to
company’s participation
 These benefits help increase probability of sales
• Caution
• Do not alienate segments by sponsoring
controversial events, social issues with low or
uncertain public consensus or be perceived as
disingenuous with ulterior motives
Marketing Communications

7. IN ACTION
Marketing Campaign Development
Set objectives

Monitor, evaluate, Determine

control campaign
effectiveness budget

Schedule media Select target

channels and run
campaign
market(s)

Design marketing mix

(4Ps) & promotion mix
strategy (Advertising,
PR, etc)

Source: www.percolate.com
 Example: Marketing Objectives & Promotion Mix
Objective Promotion Tool Expected response or outcome
Reposition Mass advertising (TV Alter the way the brand is viewed by
brand commercial, Magazine target audience.
ads)
Differentiate Sponsorship (e.g. by Audience perceives product to have
celebrity endorsement) superior quality over other competing
brands.
Gather Direct marketing (e.g. Direct response advertising encourages
information hard copy mail or e- audience to send information back to
mail message) advertiser or sponsor.
Education Personal selling Sales force explains product value and
shows prospective client how to use
product.
Stimulate Sales promotions Product coupons, rebates and discounts
interest encourage product trial.
Build support & Public Relations Event creates community reaction and
acceptance attracts attention from journalists who in
turn create publicity.
Source: Masterson & Pickton 2014
Approaches for developing budget
• Affordable method
– What business can afford or allocate what is left over
• Percentage of sales
– A fixed amount of money based on past or projected
sales forecast
• Competitive parity
– Follow the competition
• Objective and task
– Determine budget that allows the achievement of
stated goals
Integrated Marketing Communication
• IMC plan
– Coordinate messages across all customer touch-points
– Ensure communications have an overall integrated
theme
• All elements of Promotion Mix (from advertising to PR, sales
promotion, and personal selling) are communicating
consistent message and are aligned with the company’s
image or brand identity
– Monitor and evaluate promotions
• For every communication outlet, check for inconsistencies,
mixed or confusing interpretations of company’s messages
Marketing Communications

8. SUMMARY
 Review of key concepts
• Communication Process model
– Model elements to help plan, troubleshoot campaigns
• Marketing funnel & similar models AIDA…
• Target audience
– Message content, promotional channels to deliver message
• The Art of the Message (appeal techniques)
• Promotion mix (tools for mass promotion)
– Advertising
– Public relations
– Sales promotions, sponsorship, packaging, etc.
• Importance of Integrated Marketing Communications
 In the next session…
• How to become more personal?
• Focus on “one to one” Marketing
– Personal Selling
– Direct Marketing
• Technologies driving more personalized
communications
• New communication landscape principles
 How to prepare for next tutorial
• Review lecture
• Recommended reading on Moodle
• Bring your laptop
Find two advertisement campaigns to
compare: one that you think is successful, and
another that you think is weak and ineffective.