marketing management 8

Goal of marketing communication

Communicate with target customers for the obvious goal of increased sales and profits

Positive images

When products or bands have distinct images in the minds of customers , the customers better understand the value that is being offered

Identify prospects

Marketers can maintain records of consumers who have expressed interest in a product, then more efficiently direct future communication

Build channel relationships

When producers use marketing communications to generate awareness, they are also helping the retailers who carry the product

Retain customers

It costs far more to attract a new customer than to retain an existing one

Promotion mix concept

Refers to the combination and types of nonpersonal and personal communication the organization puts forth during a specified period

How many elements of the promotion mix ?

Five

nonpersonal forms of communication in promotion mix

Advertising , sales promotion, public relations , and direct marketing

Personal selling of the promotion mix

Personal selling , personal form of communication

Advertising

Paid form of non personal communications about an organization, its products , or its activities that is transmitted through a mass medium to a target audience. The mass medium might be TV, radio , newspapers, internet magazines , outdoor displays , car cards , or directories

Sales promotion

An activity or material that offers customers , sales personnel, or resellers a direct inducement for purchasing a product. This inducement , which adds value to or incentive for the product, might take the form or a coupon sweepstakes refund or display

Public relations

Non personal form or communication that seeks to influence the attitudes, feelings, and opinions of customers, non customers, stockholder, suppliers, employees, and political bodies about the organization. A popular form is publicity

Publicity

A nonpaid form of nonpersonal communication about the organization and its products that is transmitted through a mass medium in the form of a news story. Marketers seek positive publicity

Direct marketing

uses direct forms of communication with customers. It can take the form of direct mail, online marketing, catalogs, telemarketing, and direct response advertising. Similar to personal selling, it may consist of an interactive dialog between the marketer and the customer. Its objective is to generate orders, visits to retail outlets, or requests for further information. Obviously, personal selling is a form of direct marketing, but because it is a very personal form of communication, we place it in its own category.

Personal selling

face-to-face communication with potential buyers to inform them about and persuade them to buy an organization's product.

Goal of integrated marketing communications

is to develop marketing communications programs that coordinate and integrate all elements of promotion-advertising, sales promotion, personal selling, and publicity— so that the organization presents a consistent message.

Integrated marketing communications seeks to

Manage all sources of brand or company contacts with existing and potential customers

Advertising seeks to

Promote the sellers products by means of printed and electronic media

From a marketing management perspective, advertising is …

An important strategic device for maintain a competitive advantage in the marketplace

Advertising budget

Represents a large and growing element in the cost of goods and services

How many viewpoints are there about the contribution of advertising to the economic health of the firm ?

Three

Generalist viewpoint

Concerned with sales , profits , roi , and so forth

Specialist viewpoint

Represented by advertising experts who are primarily concerned with measuring the effects of specific ads or campaigns

Middle view

One that might be classified as more of a marketing management approach, understands and appreciates the other two viewpoints but , in addition sees advertising as a competitive weapon, emphasis in this approach is given to the strategic aspects of the advertising function

Objectives of advertising

• creating awareness for potential buyers

• Aiding comprehension

• Developing conviction

• Encouraging ordering

Ultimate objective of the business advertiser

Make sales and profits , to achieve this customers must purchase and repurchase the advertised product

Two key advertising decisions made by a marketing manager

1. Determines the size of the advertising budget

2. How the advertising budget should be allocated

Discounting

Cutting ad budgets to fund price promotions or fatten quarterly earnings

Percent of sales

One of the most popular rule-of-thumb methods. The firm simply takes a percentage figure and applies it to either past or future sales. Popular in retailing.

Per- unit expenditure

A fixed monetary amount is spent on advertising for each unit of the product expected to be sold. Method is popular with higher-priced merchandise like cars or appliances.

Problem with per unit expenditure and percent of sales method

They view advertising as a function of sales rather than sales as a function of advertising

All you can afford

The advertising budget is established as a predetermined share of profits or financial resources. The availability of current revenues sets the upper limit of the ad budget. The only advantage to this approach is that it sets reasonable limits on the expenditures for advertising.

Advantage of all you can afford method

It sets reasonable limits on the expenditures for advertising

Competitive party

This approach is often used in conjunction with other approaches such as percent of sales method. basic philosophy underlying this approach is that advertising is defensive

What are advertising budgets based on ?

Competitors or other members of the industry

Strategy standpoint of competitive parity

a “followership” technique that assumes that the other firms in the industry know what they are doing and have similar goals

The research approach

The advertising budget is argued for and presented on the basis of research findings

Advertising media is studied in terms of ?

Their productivity by the use of media reports and research studies

The task approach

Formulated the advertising goals and defines the tasks to accomplish these goals. Once this is done, management determines how much it will cost to accomplish each task and adds up the total. This approach is often in conjunction with the research approach

The expenditure question

Most firms determine how much to spend on advertising by one of the following methods

The allocation question

Question deals with the problem of deciding on the most effective way of spending advertising dollars

General answer to allocation question

Managements choice of strategies and objectives determines the media and appeals to be used ; in other words the firms or products divisions overall marketing plan will function as a general guideline for answering the allocation question

A successful ad campaign has two related tasks which are

1. Say the right things in the ads themselves

2. Use the appropriate media in the right amounts at the right time to reach the target market

Advertising process

Involves creating messages with words , ideas , sounds , and other forms of audiovisual stimuli that are designed to affect consumer or distributor behavior

To be effective , the advertising message should meet two general criteria

1. Should take into account the basic principles of communication

2. It should be predicated upon a good theory of consumer motivation and behavior

Basic communication process involves three elements

1. The sender or source of the communication

2. The communication or message

3. The receiver or audience

Advertising agencies

Are considered experts in the communications field and are employed by most large firms to create meaningful messages and assist in their dissemination

encoding

translating the product idea or marketing message into an effective ad

goal of encoding in advertising

generate ads that the audience understands

advertising media

what advertising messages must be trasmitted and carried by; communication channels

why are some media or channels preffered to others ?

because they have less “noise: and thus messages are more easily recieved and understood

end goal of advertising

move the buyer to a decision to purchase the advertised brand

CPMs (cost per thousands)

a common measure of effeciency or productivity in the advertising industry

CPM generally refers to…

dollar cost of reaching 1000. prospects; simplicitiy and alllowance for a common base of comparison between differing media types

reach

number of different targeted audience members exposed at least once to the advertisers message within a predetermined time frame

average frequency

number of times on average that people are exposed to an advertismenet within a given time period

why has sales promotion become more popular ?

increased pressure on management for short-term results and the emerggence of new purchase tracking technology

push strategies

involve aiming promotional efforts at distributors, retailers, and sales personnel to gain their cooperation in ordering, stocking, and accelerating the sales of a product

pull strategies

involve aiming promotional efforts directly at customers to encourage them to ask the retailer for the product

trade promotions

those promotions aimed at distributors and retailers of products who makeup the distribution channel

major objectives of trade promotions

1. convince retailers to carry the manufacturers products

2. reduce the manufacturers inventories and increase the distrubutors or retailers inventories

3. support advertising and consumer sales promotions

4. encourage retailers either to given the product more favorable shelf space or to place more emphasis on selling the product

5. servce as a reward forpast sales efforts

promotions built around price discounts and advertising or other allowances are more likely to…

have higher distrubutor/retailer participation levels than other type promotions because a direct economic incentive it attached to the promotion

sampling

customers are offered regular trial sizes of the product either free or at a nominal price

price deals

customers are offerred discounts from the products regular price

bonus packs

additional amounts of the product are given to buyers when they purchase the product

rebates and refunds

customers are given reimbursements for purchasing the product either on the spot or through the mail

sweepstakes and contests

prizes are avaliable either through chance selection or games of skill

premium

a reward or gift can come from purchasing a product

coupons

probably the most familiar and widely used of all consumer pro-motions, now often avaliable at point of purchase

public relations

a nonpersonal form of communication that tries to influence the overall image of the organization and its products and services among its various stakeholder groups

PR managers prefer to focus on…

communicating positive news about the organization

news release

An announcement regarding changes in the organization or the product line, sometimes called a press release.The objective is to inform members of the media of a newsworthy event in the hope that they will convert it into a story

news conference

A meeting held for representatives of the media so that the organization can announce major news events such as new products, technologies, mergers ,acquisitions, and special events, or, in the case of a crisis or problem, present its position and plans for dealing with the situation

sponsorship

providing support for and associating the organizations name with events, programs, or even people such as amateur athletes or teams.; besides publicity, sponsorship can also include advertising and sales promotion activities. many organizations sponsor sporting events, art festivals, and public radio and televsion programs

public service announcements

many nonprofit organizations rely on the media to donate time for advertising for contributions and donors. many nonprofit organizations cannot afford the cost of advertisingor in some cases are prohibitied from doing so

direct marketing

organization communicates directly with customers either online or through direct mail, catalogs, direct response advertising, or personal selling