MKTG Final Set 2

promotion

communication by marketers that informs, persuades and reminds potential buyers of a product in order to influence an opinion or elicit a response

Promotional strategy

a plan for the optimal use of the elements of promotion: advertising, public relations, personal selling, sales promotion, and social media

The main function of a marketer's promotional strategy is to:

convince target customers that the goods and services offered are superior to the competition

Competitive advantage

one or more unique aspects of an organization that cause target consumers to patronize that firm rather than competitors

Interpersonal communication

direct, face-to-face communication between two or more people

Sender

the originator of the message in the communication process

Encoding

the conversion of a sender's ideas and thoughts into a message, usually in the form of words or signs

Transmission of a message...

requires a channel

Channel

a medium of communication—such as a voice, radio, or newspaper—for transmitting a message

Noise

anything that interferes with, distorts, or slows down the transmission of information

Receiver

the person who decodes a message

Decoding

interpretation of the language and symbols sent by the source through a channel

Feedback

the receiver's response to a message Mass communicators are often cut off from direct feedback, so they must rely on market research, social media, or analysis of viewer responses for indirect feedback.

Digital platforms and social media have had an impact on the communication model in two major ways:

Consumers are now able to become senders (as opposed to only brands being senders). The feedback channel is no longer as impersonal and numbers driven as it once was

Informative promotion...

-seeks to convert an existing need into a want, or to stimulate interest in a new product.
-Generally more prevalent during the early stages of the product life cycle
-Important for promoting complex and technical products such as automobiles, computers, and investment services

Persuasive promotion...

-is designed to stimulate a purchase or an action.
-Typically used during the growth stage, when the target market is already aware of how the product can fulfill its wants
-Messaging often appeals to emotional needs
-For highly competitive products, the promotional message often encourages brand switching and aims to convert some buyers into loyal users

Reminder promotion...

-is used to keep the product and brand name in the public's mind.
-Assumes that the target market has already been persuaded of the merits of the good or service, so used during maturity stage
-Purpose is to trigger a memory that leads to a purchase

The focus of social media is...

-to form relationships with customers and potential customers through technological
- goal is to lead to customer engagement with the products or services, and ultimately to purchases.
-Brands are increasingly connecting with their customers in hopes that they become brand advocates who promote the brand through their own social networks

Promotional mix

the combination of promotional tools—including advertising, public relations, personal selling, sales promotion, and social media—used to reach the target market and fulfill the organization's overall goals

Advertising

impersonal, one-way mass communication about a product or organization that is paid for by a marketer

Public relations

the marketing function that evaluates public attitudes, identifies areas within the organization the public may be interested in, and executes a program of action to earn public understanding and acceptance

Sales promotion

marketing activities—other than personal selling, advertising, and public relations—that stimulate consumer buying and dealer effectiveness

personal selling

a purchase situation involving a personal, paid-for communication between two people in an attempt to influence each other

Content marketing

developing valuable content for interested audience members, and then using digital means to pull customers to that informative content

Promotional mix: Paid media

a category of promotional tactics based on the traditional advertising model, whereby a brand pays for media space

Promotional mix: Earned media

a category of promotional tactics based on a public relations or publicity model that gets customers talking about products or services

Promotional mix: Owned media

a new category of promotional tactics based on brands becoming publishers of their own content in order to maximize the brands' value to customers

AIDA

-Attention, Interest, Desire, and Action
-a model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message

Push strategy

a marketing strategy that uses aggressive personal selling and trade advertising to convince a wholesaler or a retailer to carry and sell particular merchandise

Pull strategy

a marketing strategy that stimulates consumer demand to obtain product distribution

The main focus of a promotional strategy is to convince buyers that their products offer a ___________________ over others' offerings.

competitive advantage

_______________ is a form of impersonal, paid, mass communication.

advertising

Which group of countries are the top five spenders on advertising?

U.S., China, Japan, the United Kingdom, and Germany

Institutional advertising

-Is designed to establish, change, or promote the corporation's identity as a whole.
-The purpose is simply to maintain a favorable attitude toward the advertiser and its goods or services in the minds of consumers rather than promote a particular product.

Product advertising

a form of advertising that touts the benefits of a specific good or service

Advocacy advertising

a form of advertising in which an organization expresses its views on controversial issues or responds to media attacks

Pioneering advertising

-a form of advertising designed to stimulate primary demand for a new product or product category
-heavily used during the introductory stage of the product life cycle
-in-depth information about a product and its benefits

Competitive advertising

-a form of advertising designed to influence demand for a specific brand
-In the growth phase, competitive advertising often focuses less on being informative and more on emotions

Comparative advertising

-compares two or more specifically named or shown competing brands on one or more specific attributes
-used for products experiencing slow growth or for those entering the marketplace against strong competitors

Advertising campaign

a series of related advertisements focusing on a common theme, slogan, and set of advertising appeals

Advertising objective

a specific communication task that a campaign should accomplish for a specified target audience during a specified period

The DAGMAR approach...

(defining advertising goals for measured advertising results) is one method of setting objectives

Advertising appeal

-a reason for a person to buy a product
-usually general
-based on findings from data analytics and typically play off consumers' emotions or address some need or want consumers have

Unique Selling Proposition (USP)

a desirable, exclusive, and believable advertising appeal selected as the theme for a campaign

Medium

the channel used to convey a message to a target market

Media planning

the series of decisions advertisers make regarding the selection and use of media, allowing the marketer to optimally and cost-effectively communicate the message to the target audience

out-of-home media

billboards, skywriting, signs in sports arenas, ads painted on cars, etc.

Alternative Media

Includes shopping carts in grocery stores, computer screen savers, interactive kiosks, advertisements run before movies , posters on bathroom stalls

Media mix

the combination of media to be used for a promotional campaign

Cost per contact

the cost of reaching one member of the target market

Cost per click

the cost associated with a consumer clicking on a display or banner ad

Reach

the number of target consumers exposed to a commercial at least once during a specific period, usually four weeks

Frequency

the number of times an individual is exposed to a given message during a specific period

Audience selectivity

the ability of an advertising medium to reach a precisely defined market

Flexibility

ability to schedule or alter an ad in a short amount of time

Noise level

the amount of distraction experienced by the target audience in a medium

Life span

how long the marketing message lasts

Media schedule

designation of the media, the specific publications or programs, and the insertion dates of advertising

Interpersonal communication.

direct, face-to-face communication between two or more people

Mass communication

the communication of a concept or message to large audiences When a company advertises, it generally does not personally know the people with whom it is trying to communicate

Continuous media schedule

advertising is run steadily throughout the advertising period; used for products in the later stages of the product life cycle

Flighted media schedule

ads are run heavily every other month or every two weeks to achieve a greater impact with an increased frequency and reach at those times

Pulsing media schedule

continuous scheduling throughout the year coupled with a flighted schedule during the best sales periods

Seasonal media schedule

runs advertising only during times of the year when the product is most likely to be used

Trade sales promotion

promotion activities directed to members of the marketing channel, such as wholesalers and retailers

Consumer sales promotion

promotion activities targeted to the ultimate consumer market

Trade allowance

a price reduction offered by manufacturers to intermediaries such as wholesalers and retailers

Push money

money offered to channel intermediaries to encourage them to "push" products—that is, to encourage other members of the channel to sell the products

Rebate

a cash refund given for the purchase of a product during a specific period

Premium

an extra item offered to the consumer, usually in exchange for some proof of purchase of the promoted product

Loyalty marketing program

a promotional program designed to build customer loyalty

Frequent-buyer program

a loyalty program in which loyal consumers are rewarded for making multiple purchases of a particular good or service

Point-of-purchase (POP) display

a promotional display set up at the retailer's location to build traffic, advertise the product, or induce impulse buying

Lead qualification

determination of a sales prospect's
(1) recognized need
(2) buying power
(3) receptivity and accessibility

Steps in the Selling Process

1: Generating Leads
2: Qualifying Leads
3: Approaching the Customer and Probing Needs
4: Developing and Proposing Solutions

Preapproach

a process that describes the "homework" that must be done by a salesperson before he or she contacts a prospect

Needs Assessment

a determination of the customer's specific needs and wants and the range of options they have for satisfying them

Sales proposal

a formal written document or professional presentation that outlines how the salesperson's product or service will meet or exceed the prospect's needs

Sales presentation

a meeting in which the salesperson presents a sales proposal to a prospective buyer

Customer Relationship Management (CRM) System

-Customers take center stage in any organization.
-The business must manage the customer relationship across all points of customer contact throughout the entire organization.
-building lasting and profitable relationships
-can be directly measured by the effectiveness of the interaction between the customer and the organization.

Customer-centric

a philosophy under which the company customizes its product and service offerings based on data generated through interactions between the customer and the company

Knowledge Management

the process by which customer information is centralized and shared in order to enhance the relationship between customers and the organization

Touch points

areas of a business where customers have contact with the company and from which data might be gathered

Campaign management

developing product or service offerings customized for the appropriate customer segment and then pricing and communicating these offerings for the purpose of enhancing customer relationships

Social commerce

a subset of e-commerce that involves the interaction and user contribution aspects of social online media to assist online buying and selling of products and services

price

that which is given up in an exchange to acquire a good or service

Revenue

the price charged to customers multiplied by the number of units sold

Return on investment (ROI)

net profit after taxes divided by total assets

Market share

a company's product sales as a percentage of total sales for that industry

Status quo pricing

a pricing objective that maintains existing prices or meets the competition's prices

Surge pricing

occurs in a fluid market, where demand changes rapidly, often hourly. When demand increases, so do prices and vice versa.

Markup pricing

the cost of buying the product from the producer, plus amounts for profit and for expenses not otherwise accounted for

Keystoning

the practice of marking up prices by 100 percent, or doubling the cost

Break-even analysis

-a method of determining what sales volume must be reached before total revenue equals total costs
-Advantage: provides a quick estimate of how much the firm must sell to break even and how much profit can be earned if a higher sales volume is obtained
-Limitations: hard to know whether a cost is fixed or variable; hard to know if there is sufficient demand

Product Life Cycle

development, introduction, growth, maturity, and decline

Price skimming

a pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion

Penetration pricing

a pricing policy whereby a firm charges a relatively low price for a product when it is first rolled out as a way to reach the mass market

Cumulative quantity discount

a deduction from list price that applies to the buyer's total purchases made during a specific period

Noncumulative quantity discount

a deduction from list price that applies to a single order rather than to the total volume of orders placed during a certain period

Cash discount

a price reduction offered to a consumer, an industrial user, or a marketing intermediary in return for prompt payment of a bill