Professional Documents
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10
MARKETING MIX:
PROMOTION
Subtopics:-
10.1 Definition And Components Of Marketing Mix
10.2 Integrated Marketing Communications
10.3 Communication Process
10.4 Steps In Developing Effective Communication
10.5 Promotion Budget
10.6 Advertising
10.7 Sales Promotion
10.8 Direct Marketing
10.9 Online Marketing
10.1 DEFINITION & COMPONENTS OF PROMOTION MIX
Definition of Promotion
Why does Mr. Lee’s business not doing well? Well, no matter how
good the restaurant is in terms of foods, price, or place, it will not
survive without effective promotion.
This is the process where the marketers not only try to lobby their potential
buyers, but also a process of reminding existing customers on the benefits
they have on their products.
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As you can see from the
introduction early on, Mr. Lee’s
business lacks one thing, which
is promotion. To boost the sales,
Mr. Lee needs to promote his
business by choosing low-
budget cost type of
advertisement as in banner, or
flyers.
Do you realize that these two words carry the same meaning?
Promotion mix
Marketing communication mix
The proper promotional mix is the one that management believes will meet
the needs of the target market and fulfils the organizational goals
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Both the companies Pepsi and Coke are famous for their
promotions. The rivalry was first started when Pepsi started with its
blind taste tests known as the Pepsi Challenge.
In the blind taste tests, more consumers prefer the taste of Pepsi to
that of Coca-Cola. Because Coke was the historical leader, more
people expected that they would prefer and select Coke.
Their surprise at picking Pepsi in the blind taste test helped change
their minds about which product they prefer. Capturing this on film,
Pepsi turned this into a memorable TV campaign that lasted many
years.
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Components of Promotion Mix
Listed below are some of the tools which belong to each of the
promotional mix. Put a tick in the space provided.
1. Advertising
Description
Any paid form of non-personal
presentation and promotion of
ideas, goods, or services by an
identified sponsor.
A benefit of advertising is its
ability to communicate to a
large number of people at one
time.
Examples
Traditional media that are
commonly used to transmit
advertisements to consumers:
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Television
o
Radio
o
Newspapers
o
Magazines
o
Books
o
Catalogues & Brochures
o
Direct mail
o
Billboards
o
Transit
o cards
(advertisement on buses
and taxis and at bus
stops)
Contemporary media that are
used to send their
advertisements to consumers:
o Internet
o Web sites,
o E-mail,
o Interactive video
technology located in
department stores and
supermarket.
2. Public Relations
Description
Building good relations with
the company’s various publics
by obtaining favourable
publicity, building up a good
corporate image, and
handling or heading off
unfavourable rumours, stories,
and events.
Marketers use public relations
not only to maintain a positive
image but also to educate the
public about the company’s
goals and objectives,
introduce new products, and
help support the sales effort.
Examples
Press releases
Sponsorships
Special events
Web pages
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3. Personal Selling
Description
Personal presentation by the firm’s
sales force for the purpose of
making sales and building
customer relationships.
Likes advertising, personal selling
has shift from traditional method
to a new method such as using
the Web sites. This is use to attract
potential buyers seeking
information on products and
services.
Examples
Face-to-face sales presentation
Telemarketing
Trade shows
Incentive programs
4. Sales promotion
Description
Short-term incentives to
encourage the purchase or sale
of a product or service.
Sales promotion can be aimed at
end consumers, trade consumers,
or a company’s employees.
Examples
Coupons and rebates
Contests
Premiums
Sampling
Point-of-purchase promotion
Price packs
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10.2 INTEGRATED MARKETING COMMUNICATIONS
The IMC concept has been growing in popularity for several reasons. The
reasons are:
The rise of media choices beyond traditional television has made
promotion a more complicated task such as Internet.
The fragmentation of mass markets into more segmented niches
The decrease in advertising spending in favour of promotional
techniques that generate an immediate sales response such as direct
marketing.
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on the Internet and television. Along with the release of the trailer,
the movie was supported by numerous merchandising efforts.
Bookstores and gift shops stocked hardback, paperback, and
special illustrated editions, as well as Da Vinci Code walking tours
of key cities in the story, playing cards, calligraphy sets, music CDs,
video games, podcasts
and more.
Google and Sony
launched a game called
“The Sony Ericsson Da
Vinci Code Trail” in 22
languages. Finally, before
the movie’s release, there
were over 500,000 English
language posts on blogs like Technorati, Google, Icerocket, and
BlogPulse.
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10.3 COMMUNICATION PROCESS
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usually in the form of words or signs, advertisement that will
and organizing them into a convey the intended
message. message.
In encoding, the most important
principle is not what the source says
but what the receiver hears. Thus,
concrete words and pictures are
vital.
Message refers to the set of symbols The actual McDonald’s
that the sender transmits – what the advertisement
marketers would like to inform the
Message
people with their advertisement.
The marketing manager decides
this after marketing research is
done.
The communication channels Television and the
through which the message moves specific televisions
from sender to receiver. programs that
Media It consists of various types of media McDonald’s selects
such as electronic media;
television, radio, Internet, mobile,
and printed media; magazine,
newspaper, and billboards.
The process of transforming A consumer watches
messages of another person back the McDonald’s
into one’s own ideas and feelings is advertisement and
called decoding. interprets the words and
Decoding
Receiver gets the message and images it contains.
decodes it.
The process by which the receiver
assigns meaning to the symbols
encoded by the sender.
Receiver refers to the person who The customer who
gets and interprets the message. watches the
In promotional strategy, the McDonald’s
receivers are the customers, advertisement.
viewers, listeners, or clients.
The receiver interprets the
Receiver language and symbols sent through
a channel.
The marketing manager must
monitor the message to be
conveyed and the target market’s
attitudes and ideas in order to
develop a common understanding
in promotional strategy.
In the process of transmitting The customer is
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Noise messages, the senders might face distracted while
some noise problem. watching the
Noise refers to anything that commercial misses its
interferes with, distorts, or slows key points.
down the transmission of
information.
Noise can be visual distractions or
sights, sounds, and other stimuli
messages.
Other form of noise can be
thoughts and feelings that interfere
with the process of message
transmission.
A different interpretation by the
receiver which may not comply
with what the sender intends to
deliver.
Feedback refers to the receivers’ Customer who likes the
response to a message. Feedback McDonald’s
may be verbal, such as saying, ‘I advertisement will crave
agree’ – or non-verbal, such as for the meals, is more
nodding or smiling. likely to eat at
Feedback is the final stage in the McDonald’s next time,
process of transmission. It is the or does nothing.
response to a message. It reflects
what meaning has been created
Feedback and shared through the original
message.
The receiver sends a feedback to
the sender.
Feedback may also experience
interference with noise that may
distort the feedback.
When the feedback has reached
the sender of the original message,
the process of message transmission
has come to a full circle.
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10.4 STEPS IN DEVELOPING EFFECTIVE COMMUNICATION
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Step 1: Identifying the Target Audience
A marketer has to start with a clear target audience in mind.
The audience maybe current users or potential users, those who make
the buying decisions or those who influence it.
The target audience will heavily affect the marketer’s decisions on
what, how, when, where it will be said, and who will say it.
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illustrating how the product’s features will satisfy the consumer’s
needs, arouses desire.
o Finally, a special offer or a strong closing sales pitch may be used
to obtain purchase action.
The communicator has to figure out an appeal or theme that will
produce the desired response. There are three types of appeals:
o Rational appeals relate to the audience’s self-interest. They show
that the product will produce the desired benefits.
o Emotional appeals attempt to stir up either negative or positive
emotions that can motivate purchasing decision.
o Moral appeals refer to what is ‘right’ and ‘proper’. They are often
used to urge people to support social causes such as a cleaner
environment, better racial relations, equal rights for women, and
aid to the disadvantaged.
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they felt about the message, and their past and present attitude
toward the product and the company.
The marketers need to measure the behaviour resulting from the
message – how many people bought a product, talked to others
about it, or visited the store.
The feedback may suggest changes in the promotion programme or in
the product offer itself.
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10.5 Promotion Budget
The simplest method for determining the promotion budget is often merely
using a percentage of last year’s sales or the projected sales for the next
year. This method does not take into account any changes in the market or
unexpected circumstances. However, many firms use this method because it
is simple and straightforward.
The affordable method, or what you think you can afford, is a method used
often by small businesses. Unfortunately, things often cost more than
anticipated, and you may not have enough money. Many small businesses
think they’re going to have money for promotion, but they run out and
cannot spend as much on promotion as they had hoped. Such a situation
may have happened to you when you planned a weekend trip based on
what you thought you could afford, and you did not have enough money. As
a result, you had to modify your plans and not do everything you planned.
Other companies may decide to use competitive parity; they try to keep their
promotional spending comparable to the competitors’ spending level. This
method is designed to keep a brand in the minds of consumers.
During a recession, some firms feel like they must spend as much if not more
than their competitors to get customers to buy from them. Other companies
are forced to cut back on their spending or pursue more targeted
promotions.
A more rational and ideal approach is the objective and task method,
whereby marketing managers first determine what they want to accomplish
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(objectives) with their communication. Then they determine what activities—
commercials, sales promotions, and so on—are necessary to accomplish the
objectives. Finally, they conduct research to figure out how much the
activities, or tasks, cost in order to develop a budget.
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10.6 ADVERTISING
Definition of Advertising
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The ten top brands which spending a lot on advertising are:
Top brand in H1 Rank H1 2007 H1 2008
2008 (RM’000) (RM’000)
Celcom 1 48,069 94,984
Digi 2 74,181 51,004
Maxis 3 52,403 44,771
Barisan Nasional 4 47 27,893
Grand Brilliance 5 5,387 22,932
Telekom Malaysia 6 27,367 22,530
Petronas 7 21,503 21,175
KFC 8 15,688 20,166
Air Asia 9 10,146 18,992
Giant 10 13,668 18,018
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Types of Advertising
Advertising are closely related to the firm’s promotional objectives. Two types
of advertising are:
institutional advertising
product advertising
1. Institutional advertising
Advocacy advertisements
Used to protect the credibility of a Example
company against negative A company might come up with an
consumers and highlight the advertisement as a response to the
company’s credibility among criticisms.
those who favour them
Pioneering advertisements
Used for a new announcement Example
about what a company is, what it “Apple” has been earning good
can do, or where it is located. money for years now through its AIO
line of iMacs. AIO means the new all-
in-one PC with its touch screen
functionality gives the users direct
control.
Competitive advertisements
Used to promote the advantages Example
of one product class over another The American Dairy farmers and Milk
and is used in markets in which Producers use their “Got Milk?”
there are different product classes campaign to increase demand for
competing for the same buyers milk as it competes against other
beverages.
Reminder advertisements
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Like the product form, simply bring Example
the company’s name to the Examples of reminder advertisement
attention of the target market are by RHB Bank ads, Johnson and
again. Johnson’s ads, and Maxis ads.
2. Product advertising
Product advertising promotes the benefits of a specific goods or services.
Pioneering advertisements
It intends to stimulate primary Example
demand for a new product or Microsoft used pioneering advertising
product category. to introduce its new Windows and
Heavily used during the office software products. The goal of
introductory stage of the product Microsoft’s pioneering campaign was
life cycle. to convince PC users to buy the
It also seeks to create interest upgrade because of the more
intuitive interfaces and the ability to
work seamlessly and easily with digital
photographs, music files, and video.
Competitive advertisements
When a product is gaining Example
popularity or growing, and other Companies that usually use this type
companies enter the market of advertising are car companies,
place, competitive advertising is and they usually promote their distinct
designed to influence demand for features from their competitors.
a specific brand.
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Comparative advertisements
An advertisement that compares Example
two or more competing brands on For example, Vanish advertisement
one or more specific attributes is which compares the cleanliness of
adapting the comparative the detergent and brand X
advertising detergent. The result is – same level of
cleanliness but Vanish offers whiter
and cleaner shirt compared to the
other brand.
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10.7 SALES PROMOTION
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Types of Sales Promotion Tools
Many tools can be used to accomplish sales promotion objectives. They are:
Coupons and rebates
Contests
Premiums
Sampling
Point-of-purchase promotion
Price packs
Rebates
Descriptions
Rebate or cash refund are
similar to coupons except that
the price reduction occurs
after the purchase rather than
at the retail outlet.
The consumer sends a “proof
of purchase” to the
manufacturer, who then
refunds part of the purchase
price by mail.
Coupons
Descriptions
A coupon is a certificate that
entitles consumers to get an
immediate price reduction
when they buy the product.
This type of sales promotion
helps in increasing the amount
of product bought, as it gives
the consumers the opportunity
to try the product at a lower
price.
Coupons most commonly offer
a discounted price to the
consumer.
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Contest
Descriptions
Contests are promotions in
which participants use some
skill or ability to compete for
prizes.
A consumer contest usually
requires entrants to answer
questions, complete
sentences, or write a
paragraph about the product
and submit proof of purchase.
Premiums
Descriptions
A premium is an extra item
offered to the consumer
usually in exchange for some
proof that the promoted
product has been purchased.
A premium may come inside
the package (in-pack), outside
the package (on-pack), or
through the mail.
Over the years, McDonald’s
has offered a variety of
premiums in its Happy Meals
be as toys and collectibles.
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Samples
Descriptions
Samples are offers of a trial
amount of a product.
Sampling can be very
expensive.
Therefore, before the marketers
decide upon doing sampling
promotion, they need to make
sure that their product is a
whole lot better than the
existing products, and the item
must have a unique new
attribute that the consumer
must experience to believe in.
The sample might be delivered
door-to-door, sent by mail,
handed out in a store or kiosk,
attached to another product,
or featured in an
advertisement.
Point-of-Purchase Promotion
Descriptions
Point-of-purchase promotion
includes any promotional
display set up at the retailer’s
location to build traffic,
advertise the product, or
include impulse buying.
Point-of-purchase includes
o shelf “talkers” (signs
attached to store
Shelf talker shelves),
o ads on grocery carts and
bags
o demonstrators offering
free tastes of featured
food products
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Ads on grocery carts
Demonstrator
Price Packs
Descriptions
Also knows as cents-off deals
Offers consumers savings off
the regular price of a product.
The producer marks the
reduced prices directly on the
label or package.
Price packs can be single
packages sold at a reduced
price ( such as two for the price
of one), or two related
products banded together
(such as a toothbrush and
toothpaste)
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10.8 DIRECT MARKETING
Direct mail, telemarketing and email marketing can all be useful methods of
targeting the kind of customer who is likely to buy from the business. However,
each of them requires careful preparation and consideration towards the
audience, and knowledge of how to manage customer data efficiently and
within the boundaries of the law.
Direct mail
Email marketing
Use of email for direct marketing has grown rapidly. It is a very cheap and
quick method of promotion which allows the message to encourage an
instant response. For example, viral marketing is a good idea to get
customers to recommend a friend and increase the size of customer
database in return for a reward (discount etc).
However, there are many problems with email marketing. Not the least is that
the use of spam filters on many email systems makes it harder for legitimate
email marketing materials to reach the intended recipient.
Email marketing must only be sent to those who have opted into received
such promotion. However, many businesses continue to flout this golden rule,
contributing to the substantial volume of email spam.
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Telemarketing
The big downside to telemarketing is that cold calling has a very negative
perception, especially in the consumer sector.
Advantages Disadvantages
Targeted Not perfectly targeted, will
cause negative reactions
Some forms are well tested
Junk-mail clutter
Tracking can be
straightforward
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10.9 ONLINE MARKETING
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REFERENCES
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