Marketing - Lecture 12 - Promotion

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BUS10311 Marketing (2017-18B)
Lecture 12
Promotion
Strategies
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Copyright © Pearson + Mosquito LEUNG’s + Michael WU’s Modifications BUS10311 Lecture 12-1
Lecture 11 Review
• Market-skimming pricing vs Market-penetration pricing
• Conditions favoring Market-skimming pricing and Market-
penetration pricing
• Product mix pricing strategies
• Price adjustment strategies
• Price change
• Company response to a competitor’s price cut
Lecture 12 Outline (CILO b)
1. The promotion / marketing communications mix

2. Integrated marketing communications
3. Steps in developing effective communication
4. Setting the total promotion budget and mix
12.1 The Promotion / Marketing Communications (MC) Mix
• The promotion / marketing communications mix is the

specific blend of promotion tools that the company uses to
engage customers, persuasively communicate customer value
and build customer relationships.
• The promotion mix / MC mix traditionally
includes:
1. Advertising
2. Sales promotion
3. Personal selling
4. Public relation
5. Direct and digital marketing
12.1 The Promotion / Marketing Communications Mix
1. Advertising
• Advertising is any paid form of nonpersonal presentation and

promotion of ideas, goods, or services by an identified sponsor.
• It involves:
- Broadcast
- Print
- Online
- Mobile
- Outdoor
- etc.
2. Sales Promotion
• Sales promotion is a short-term incentive to encourage the

purchase or sale of a product or service.
• It involves:
- Discounts
- Coupons
- Displays
- Demonstrations
- Sampling
- Etc.
3. Personal Selling
• Personal selling is the personal interaction by the firm’s sales

force for the purpose of engaging customers, making sales, and
building customer relationships.
• It involves:
- Sales presentations
- Trade shows
- Incentive programs
- Etc.
4. Public Relations
• Public relations involves building good relations with the

company’s various publics by obtaining favorable publicity,
building up a good corporate image, and handling or heading
off unfavorable rumors, stories, and events.
• It involves:
- Press releases
- Sponsorships
- Special events
- Web pages
- Features articles
- etc.
5. Direct and Digital Marketing
• Direct and digital marketing involves engaging directly with

carefully targeted individual consumers and customer
communities to both obtain an immediate response and build
lasting customer relationships.
• It involves:
- Catalog - Fax
- Direct mail - Telemarketing
- E-mail - Direct Response TV
- Internet - SMS through mobile phone
- Kiosks - etc.
12.2 Integrated Marketing Communications
The New Marketing Communications Model
• Empowerment of customers
- Consumers are better informed and more communications empowered.
- Information technologies enable customers to gain more information in
additional to the marketer-supplied information.
• Marketing strategies are changing
- More fragmented marketing  Marketing
strategies are moving from mass marketing to more
narrowly defined micromarketing
• Advances in digital technology
- It changes the ways companies and customers communicate and interact.
- New tools: e.g., smartphones, tablets, satellite and cable television
systems, Internet - Web sites, e-mail, blogs, social media and online
communities, the mobile Web, etc.
• Marketing. communication is through ALL elements of the Marketing Mix
• Product, price, place, and promotion, must be coordinated for greatest
communication impact.
• All communications must be planned and blended into carefully
integrated programs.
11
The Need for Integrated Marketing Communications
• Integrated marketing
communications (IMC) involves
carefully integrating and
coordinating the company’s many
communications channels to deliver
a clear, consistent, and compelling
message about the organization and
its products.
In all contact points

FIGURE | 14.1
Integrated Marketing Communications
Communication Process
Elements in the Communication Process
FIGURE | 14.2
Elements in the Communication Process
Communication Process
Elements Explanations
Sender Elements
The party in the
sending the Communication
message Process
to another party.
Encoding The process of putting thought into symbolic form.
Message The set of symbols the sender transmits.
Media The communications channels where the message moves from sender to
receiver.
Decoding The process by which the receiver assigns meaning to the symbols.
Receiver The party receiving the message sent by another party.
Response The reaction of the receiver after being exposed to the message.
Feedback The part of the receiver’s response communicated back to the sender.
Noise The unplanned static or distortion during the communication process which
results in the receiver getting a different message than the one the sender sent.
12.3 Steps in Developing Effective Marketing Communication
1. Identify the target audience
2. Determine the communication objectives
3. Design the message
4. Choose the media to send the message
5. Select message source and collect feedback
1. Identifying the Target Audience
• A marketing communicator starts with a clear target audience in mind.
• The audience may be current users or potential buyers, those who make
the buying decision or those who influence it.
• The audience may be individuals, groups, special publics, or the general
public.
• The target audience affect the decisions on:
What will be said Where it will be said

When it will be said Who will say it How it will be said
2. Determining the Communication Objectives
• The marketing communicator must decide what response is sought
• The target audience may be in any of six buyer-readiness stages, the stages
consumers normally pass through on their way to making a purchase.
FIGURE | 14.3 Six Buyer-Readiness Stages
+ve feeling Call

Build up
Build up the brand for
awareness Action
image
3. Designing a Message
• The communicator turns to developing an AIDA model

effective message.
• Ideally, the message should get Attention,
hold Interest, arouse Desire, and obtain
Action (using the framework of AIDA model).
• In practice, few messages take the consumer
all the way from awareness to purchase, but
the AIDA framework suggests the desirable
qualities of a good message.
When putting a message together, the marketing communicator must decide
what to say (message content) and how to say it (message structure and
format).
Message An appeal or theme that will produce the
What to say content desired response
A
Message Message How to handle three message structure
structure issues
How to say it
Message Design a strong format for the message
format
Message Content
• The marketer has to figure out an appeal or theme that will produce the
desired response
• THREE types of appeals:
1. Rational appeal relates to the audience’s self-interest. It shows that
the product will produce the desired benefits
2. Emotional appeal is an attempt to stir up positive (e.g., love, pride,
humor, etc.) or negative emotions (e.g., fear, guilt, shame, etc.) to
motivate a purchase.
3. Moral appeal is directed to an audience’s sense of what is right and
proper. It is often used to urge people to support social causes (e.g.,
cleaner environment, equal rights, etc.)
Message Structure
• The communicator must also decide how to handle message structure

issues.
• THREE approaches:
- Whether to draw a conclusion or leave it to the audience.
- Whether to present the strongest arguments first or last.
- Whether to present a one-sided argument (mentioning only the
product’s strengths) or a two-sided argument (touting the product’s
strengths while also admitting its shortcomings).
Message Format
• The communicator must also needs a strong format for the message :
• Headline, copy, illustration, and color (Print ad)

• Words, sounds, and voices (Radio ad)
• Body language, facial expressions, gestures,
dress, posture, and hairstyles (Television or
in person)
4. Choosing Communication Channels and Media
Personal Non-personal
Communication Channels Communication Channels
• Word of mouth • Major media
• Buzz marketing • Atmospheres
• Events
Personal communication
• Personal communication involves two or more people communicating
directly with each other, through face to face, phone, mail or e-mail, or
texting or Internet chat, etc.
• Company control:
- Controlled directly by the company
• e.g., Company salespeople
- Not directly controlled by the company
• e.g., Consumer advocates, bloggers,
friends, family members, neighbors, etc.
 Word-of-mouth, Opinion leadership, Buzz marketing
Nonpersonal communication
• Nonpersonal communication channels are media that carry messages
without personal contact or feedback
• It includes:
- Major media: print media (e.g., newspapers, magazines, direct mail),
broadcast media (e.g., television, radio), display media (e.g., billboards,
signs, posters), and online media (e.g., e-mail, Co. websites).
- Atmospheres: designed environments that create or
reinforce the buyer’s leanings toward buying a product.
- Events: staged occurrences that communicate messages
to target audiences.
5. Selecting the Message Source and Collecting Feedback
Selecting the Message Source
• The message’s impact depends on how the target audience views the
communicator. Messages delivered by highly credible sources are more
persuasive.
• For examples:
- Celebrities: e.g., Athletes, Actors, Musicians, Cartoon characters,
etc.
- Professionals: e.g., Doctors, Dentists, etc.
5. Selecting the Message Source and Collecting Feedback
Collecting Feedback
• After sending the message, the communicator must research its effect on
the target audience by collecting feedback.
Message evaluations Behaviorial measurement
- Do they remember the - How many people bought the
message? product?
- How many times they saw it? - Did they talk to others about it
- How they felt about the - Did they visit the store?
message? Any attitude - etc.
change?
- etc.
14.4 Setting the Total Promotion Budget and Mix
Total Promotion Budgeting
• A company needs to decide how much to spend on promotion.
• FOUR common methods:
1. Affordable method - sets the promotion budget at the level
management thinks the company can afford.
2. Percentage-of-sales method - sets the promotion budget at a
certain percentage of current or forecasted sales or as a
percentage of the unit sales price.
3. Competitive-parity method - sets the promotion budget to match
competitors’ outlays.
4. Objective-and-task method - develops the promotion budget by
BEST
specific promotion objectives and the costs of tasksMethod
needed to
achieve these objectives.
Overall Promotion / Integrated Marketing Communication Mix Strategies
Overall Promotion / Integrated Marketing Communication Mix Strategies
Push strategy Pull strategy

• Producer push the product through • The producer directs its marketing
marketing channels to final activities (primarily advertising and
consumers. consumer promotion) toward final
• The producer directs its marketing consumers to induce them to buy
activities (primarily personal selling the product.
and trade promotion) toward • If the pull strategy is effective,
channel members to induce them consumers will then demand the
to carry the product and promote it brand from retailers, who will in
to final consumers. turn demand it from the producer.

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http://blog.resellerclub.com/wp-content/uploads/2016/09/1.

BUS10311 Marketing (2017-18B)

1. The promotion / marketing communications mix

• The promotion / marketing communications mix is the

• Advertising is any paid form of nonpersonal presentation and

• Sales promotion is a short-term incentive to encourage the

• Personal selling is the personal interaction by the firm’s sales

• Public relations involves building good relations with the

• Direct and digital marketing involves engaging directly with

In all contact points

1. Identify the target audience

2. Determine the communication objectives

3. Design the message

4. Choose the media to send the message

5. Select message source and collect feedback

• The target audience affect the decisions on:

What will be said Where it will be said

FIGURE | 14.3 Six Buyer-Readiness Stages

+ve feeling Call

• The communicator turns to developing an AIDA model

• The communicator must also decide how to handle message structure

• Headline, copy, illustration, and color (Print ad)

Push strategy Pull strategy

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