L12 Promotion in the marketing mix

Promotion

form of communication within the marketing mix that informs, persuades, and reminds potential buyers of a product to influence an opinion or elicit a response

Primary goal of promotion:

- Informs potential buyers that a product or service exists and why they should consider it. Convert an existing need into a want or stimulate interest in a new product.

- Persuade to buy or a specific action.

- Reminding: Remind them to keep it in mind about the product or brand.

- Additional - connecting: Involves forming relationships with customers.

Promotional strategy

Plan for the optimal use of the elements of promotion: advertising, public relations, personal selling, sales promotion, and social media. + decide which tools to use, how to conduct activities.

Promotion communicates competitive advantage:

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

Promotion - marketing communication and types of communciation:

Process by which meanings are exchanged or shared through a common set of symbols.

- Interpersonal communication: Direct, face-to-face communication between two or more people e.g. a salesperson speaking directly to a customer

- Mass communication: Communication of a concept or message to a large audience through a mass medium e.g. social media, TV advertising - more frequent used.

Communication process: 1-4

1. Involves a sender (like a company or a teacher) who informs, persuades, and reminds the target market. Origin of the message e.g. marketing manager, advertising agency, or even customers sharing their experiences.

2. Encoding: The sender turn ideas into works e.g. ads, social media posts, press releases, or sales presentations, store display, coupon.

3. The message travels through a message channel: Can be verbal, visual or like social media, tv, personal selling or animation. (Media, salesperson, retail store, local news show).

4. Decoding: The receiver (like a consumer or a student) interprets the message based on knowledge and experience.

Communication process:

1. Receiver: Customers, viewers, listeners, news media and clients.

2. Feedback: Are done to understand if meaning is being shared and can be observed through consumer actions like rushing to stores or commenting, or analyzing sales results, change in market share, market research.

3. Noise: Challenge in communication. Represents anything that interferes with or distorts the message e.g. physical distractions, psychological distractions (like thinking about other things), or the sheer volume of competing advertisements and news articles, other store displays.

The role of promotion in the marketing mix - marketing communication mix includes 5 elements:

- Advertising

- Public relations

- Sales promotion

- Personal selling

- Content marketing and Social media

Advertising

o An impersonal, one-way form of mass communication e.g. magazines, TV, radio, or outdoor advertising.

o Paid for by an identifiable sponsor with purpose of communicating sponsor information to the consumer to purchase.

o Overall high cost but low per person when reaching a large audience.

o Consumers, including children, may perceive credibility issues with advertising, feeling that ads might "lie"

Public relations

- Involves building a favorable perception and image of the organization or brand in the minds of consumers e.g. reviews. Might develop public relation campaigns.

o It evaluates, identifies, and executes actions aimed at building positive images which can include:

§ Managing what people say about the company.

§ Dealing with bad situations or crises to avoid damaging the reputation e.g. KFC dealing with running out of chicken.

Public relation key point

o Public relation coverage (attention or mentions in media) might be free compared to advertising requiring payments to advertise. However the public relations efforts that leads to coverage, costs in the organization.

Sales promotion

- Activities designed to stimulate consumer purchase, identify and do the right sales tasks to achieve best outcome (dealer effectiveness).

o Usually short-term and encourage sales.

o Goal: To get you to buy now e.g. buy one get one free offers, free samles, coupons, limited offers and competitions.

Personal selling

- Involves a personal, paid-for communication situation e.g. salesperson directly interacts with a customer and adapts their message based on the questions asked or the context. Both interact and explore needs which lead to relationship development.

Content marketing

o Involves creating valuable content for an interested market and distributing it through social media e.g. creating information and a blog post showing how a product is used e.g. Microsoft.

Social media

Promotional tools that encourage conversations and interactions between people and the organization.

Social media combines digital media which include:

- Owned media: Controlled by the company e.g. blogs, social media presence and websites. Control content and messaging.

- Paid media: Media that you pay for e.g banner ads, sponsored posts or higher search results to help expand quickly.

- Earned media: Organically gained e.g. SEO through word of mouth, public relations, customer reviews. Free but harder to control. (media coverage, seo, publicity activities).

- Social media: Concentrated in the middle.

Mode of communication:

- Advertising: Indirect and impersonal

- Public relations: Usually indirect and impersonal

- Sales promotion: Usually indirect and impersonal

- Personal selling: Direct and face-to-face.

- Social media: Indirect but instant.

Mode of communication

- Advertising, PR and sales promotion: Indirect and impersonal

- Personal selling: - Direct and face-to-face.

- Social media: - Indirect but instant.

Communicator control over situation:

- Advertising: Low

- Public relations + Sales promotion: Moderate to low

- Personal selling: High

- Social media: Moderate

Amount of feedback:

- Advertising, PR and sales promotion (moderate): Little

- Personal selling, social media: Much

Speed of feedback:

- Advertising, PR: Delayed

- Sales promotion: Varies

- Personal selling, social media: Intermediate

Direction of message

- Advertising, PR and sales promotion (mostly): One-way

- Personal selling, social media (multiple way): Two way

Control over message content

- Advertising, SP, Personal selling: Yes

- PR and social media (mostly): No

Identification of sponsor

- Advertising, SP, Personal selling, social media: Yes

- Public relations: No

Speed in reaching large audience

- Ads, PR, SP, social media: Fast

- Personal selling: slow

Message flexibility

- Advertising: Same message to all audiences

- Public relations: Usually no direct control over messages to audiences.

- Sales promotion: Same message to varied targets.

- Personal selling: Tailored to prospective buyer.

- Social media: Some of the most targeted opportunities.

Promotional mix and AIDA

- Attention: Advertising, public relations and social media very affective. Sales promotion and personal selling abit.

- Interest: Advertising, public relations, personal selling, social media very effective. Sales promotion a bit.

- Desire: Sales promotion and personal selling most effective while other are abit.

- Action: Personal selling and sales promotion very effective, social media a bit. Other not.

AIDA model

Advertising effect model - the stages consumers go through before making a purchase—Attention, Interest, Desire, and Action—helping marketers guide them effectively. It serves as a communication framework for achieving promotional goals by engaging consumers at different levels.

AIDA process

1. Attention: Get market aware that the product/service exists and capture attention e.g through public relations, social media and advertising. - external media

2. Interest: After gaining attention we need to stimulate interest. It´s a low chance simple awareness can lead to sale therefor need to create interest e.g. with social media and salespeople.

3. Desire: Involves converting the interest into a preference or desire for the product or service e.g. salespeople are good at stimulating desire. Key at this stage: Create brand preference which means make so the brand will be part of their purchasing routine.

4. Action: Final stage is motivating the consumer to take action e.g. going to the store and buy. Salespeople can help guide consumers through the process.

- Salespeople good at sharing messages and stimulate desire, they think about the message and interest you and stimulate you. They take this theory; attention comes from external media.

Integrated marketing communication (IMC):

It´s important to have consistent messaging across all marketing and social media channels (all promotional mix. Each element from each promotional mix should be integrated.

Factors affecting the promotional mix:

-nature of the product

-stages in the product life cycle

-target market characteristics

-type of buying decision

-available funds

-push and pull strategies

Nature of the product

Characteristics of the product itself can influence the promotional mix:

o Business products: Rely heavy personal selling and not suited for mass promotion. B2B.

o Consumer products: Not custom-made, are promoted more through advertising to build familiarity. Some products might be more suited for selling but not social media.

Stage in the product lifecycle

-Introduction, Growth and Maturity: advertising and personal selling

-Maturity and Early: Reduction in advertising and sales promotion

Stage in the product lifecycle - detailed

- The promotional strategy changes throughout the product´s life.

o Introduction stage: The goal is to inform the target audience that the product exists, often require extensive advertising.

o Growth stage: As it moves to this stage the promotion blend shifts.

o Maturity stage: Competition increases - need to emphasize more on the persuading and reminding ads.

o Decline stage: Overall promotion, especially advertising is reduced because product is dying.

Target market characteristics

More advertising and sales promotion and less personal selling are required for a target market characterized by:

-Widely scattered potential customers

-Highly informed buyers

-Brand loyal repeat purchases

Types of buying decision

o Routine consumer decisions: Tools such as advertising and sales promotion are effective at bringing attention to the brand e.g. buying yoghurt.

o Complex decisions: Require large information to help them reach a purchase decision - that makes personal selling more valuable.

o Neither routine nor complex: Where advertising and public relations help establish awareness. E.g. limited decisions like appliances.

Business decisions:

· Routine decisions use: advertising and sales promotion.

· Neither routine nor complex decisions: Use advertising and public relations.

· Complex decisions: Rely on personal selling and print advertisements.

Available funds

influence the choice of promotional methods, as businesses seek to maximize return while minimizing cost per contact.

Cost per contact:

High for personal selling, PR, and sales promotions.

Low for national advertising due to broader reach.

Social media: Often perceived as a low-cost option, but when budgets are tight, companies may use sponsorships to balance costs and target the right audience.

Push vs. Pull Strategy influences the marketing tools businesses use:

Push Strategy: Manufacturers promote aggressively to wholesalers or retailers using personal selling and trade advertising, ensuring they stock and sell the product.

Pull Strategy: Focuses on creating consumer demand through promotional efforts, influencing end customers or opinion leaders so that demand naturally "pulls" the product through the supply chain.