MARK3321

Promotion

communication by marketers that informs, persuades, and reminds potential buyers of a product 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

Competitive advantage

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

Communication

the process by which we exchange or share meaning through a common set of symbols

Interpersonal Communication

Direct, face-to-face communication between two or more people. 

• Marketing example (business-to-consumer): A consumer speaking face-to-face with a salesperson at a car dealership.

• Marketing example (business-to-business): A team of salespeople from a furniture company giving a sales presentation to the furniture buyer at Costco. 

Mass Communication

Communicating a concept or message to large audiences, usually through mass media, such as television, newspapers, and online. 

• Marketing example (television): Pepsi airing a commercial during the Super Bowl, which will be watched by over 100 million people. 

• Marketing example (online): TikTok video app running ads on Facebook and Snapchat

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

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 the message

Decoding

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

Feedback

The receiver’s response to a message

Goals of Promotion: Informing

• Promotions intended to convert an existing need into a want or to stimulate interest in a new product

• Often used during the introductory phase of a product’s life cycle

Goals of Promotion: Persuading

• Promotions focused on stimulating a purchase or some other action

• Focused on product benefits and a call to action to the consumer

• Main promotional goal when a product enters the growth stage of the product life cycle

Goals of Promotion: Reminding

• Promotions to keep products and brand names in the public’s mind

• Often used during the maturity stage of a product’s life cycle to maintain market share

Goals of Promotion: Connecting

Promotions meant to form a relationship with consumers, usually through social media and other online platforms

Paid media

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

• Paid media would include ads on television and radio, in magazines, and paid ads on social media.

Earned media

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

• Earned media would include media coverage of news and events and free mentions by social media influencers and other word of mouth.

Owned media

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

AIDA concept

• Attention

• Interest

• Desire

• Action

a model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message; the acronym stands for attention, interest, desire, and action

Integrated Marketing Communications (IMC)

the careful coordination of all promotional messages for a product or a service to ensure the consistency of messages at every point at which a company has contact with the customer

Institutional Advertising

a form of advertising designed to enhance a company's image rather than promote a particular product

Advocacy Advertising

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

Product Advertising

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

Pioneering advertising

a form of advertising designed to stimulate primary demand for a new product or product category

• Intended to stimulate demand for a new product or category.

• Heavily used during the introductory stage of the product life cycle.

Competitive Advertising

a form of advertising designed to influence demand for a specific brand

• Designed to influence demand for a specific brand.

• Used during the growth phase of the product life cycle.

Comparative Advertising

 a form of advertising that compares two or more specifically named or shown competing brands on one or more specific attributes

• Directly compares two or more brands on specific attributes.

• Used during the growth and maturity phase of the product life cycle.

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 first step before creating an advertising campaign is to identify an advertising objective

• Example would be identifying target audience and the revenue or market share goals of the campaign. 

Advertising Appeal

a reason for a person to buy a product

• goes beyond simple benefits and often taps into the emotional needs and wants of the consumer

Unique Selling Proposition

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

• The unique selling proposition often becomes all or part of the campaign’s slogan.

Executional Style: Slice-of-life and lifestyle

Depicts people in normal settings and shows the product fitting into their lives

Spokesperson

Utilizes a celebrity, real customer, or some other trusted voice to credibly deliver the message

Humor

Making the presentation of the appeal fun and lighthearted

Mood or Image

Uses visuals and sounds to create a particular emotion, such as beauty or adventure

Demonstration

Showing consumers the benefit of the product or how the product performs in comparison to competitors

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 communicate the message optimally and cost-effectively to the target audience

Cooperative Advertising

an arrangement in which the manufacturer and retailer split the costs of advertising the manufacturer's brand

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

Life Span

How long a consumer is exposed to a given ad.

Media Schedule

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

Continuous Media Schedule

a media scheduling strategy in which advertising is run steadily throughout the advertising period; used for products in the later stages of the product life cycle

Flighted Media Schedule

a media scheduling strategy in which 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

a media scheduling strategy that uses continuous scheduling throughout the year coupled with a flighted schedule during the best sales periods

Seasonal Media Schedule

a media scheduling strategy that runs advertising only during times of the year when the product is most likely to be used

Public Relations

the element in the promotional mix that evaluates public attitudes, identifies issues that may elicit public concern, and executes programs to gain public understanding and acceptance

Publicity

an effort to capture media attention, often initiated through press releases that further a corporation's public relations plans

New-product Publicity

publicity focused specifically on new products.

Product Placement

a public relations strategy that involves getting a product, service, or company name to appear in a movie, television show, radio program, magazine, newspaper, video game, video or audio clip, book, or commercial for another product, on the internet, or at special events

Consumer Education

Free workshops or classes that educate consumers but typically don’t directly sell them on a product. 

Sponsorship

a public relations strategy in which a company spends money to support an issue, cause, or event that is consistent with corporate objectives, such as improving brand awareness or enhancing corporate image

Experiential Marketing

Events and experiences created by the company that are available either in person or online.

Company websites and Social Media

These sites allow the company to showcase new products, promote events, and interact with their customers.

Crisis Management

a coordinated effort to handle all the effects of unfavorable publicity or another unexpected unfavorable event

Sales Promotion

is a short-term incentive that motivates consumers or members of the distribution channel to purchase a product immediately. The general objectives of sales promotion are to speed up the sales process and increase sales volume

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 Allowances

Price reductions offered to wholesalers and retailers that purchase or promote specific products

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

Training

Manufacturers may offer training to intermediary personnel—especially if the product is complex

Free Merchandise

Manufacturers may offer free merchandise instead of quantity discounts

Store Demonstration

Manufacturers paying for an in-store demonstration

Business Meetings, Conventions, and Trade Shows

Product exhibition organized by industry trade associations to showcase goods and services

Coupons

Written price reductions used to encourage consumers to buy a specific product

Cents-off Offers

Promotions that allow buyers to pay less than the regular price to encourage purchase

Money Refunds

Sales promotion that offers consumers a specified amount of money when they mail in a proof of purchase

Rebates

Sales promotion techniques in which a consumer receives a specified amount of money for making a single product purchase

Shopper loyalty, and Frequent-user Incentives

Rewarding loyal customers for making repeat purchases

Point-of-purchase Materials

Signs, window displays, display racks, and similar devices used to attract customers

Demonstrations

Show how a product works to encourage use of a product

Free Samples

Samples of a product given out to encourage trial and purchase

Premiums

Items offered for free or at a minimal cost as a bonus for purchasing a product

Consumer Contests

Individuals compete for prizes based on their analytical or creative skills

Consumer Games

Individuals compete for prizes based primarily on chance

Consumer Sweepstakes

Sales promotion in which entrants submit their names for inclusion in a drawing for prizes

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

Profit

revenue minus expenses

Return on Investment

net profit after taxes divided by total assets

Demans

the quantity of a product that will be sold in the market at various prices for a specified period

Supply

the quantity of a product that will be offered to the market by a supplier at various prices for a specified period

Elasticity of Demand

consumers' responsiveness or sensitivity to changes in price

Elastic Demand

a situation in which consumer demand is sensitive to changes in price

Inelastic Demand

a situation in which an increase or a decrease in price will not significantly affect demand for the product

Dynamic Pricing

the ability to change prices very quickly, often in real time using software programs

Surge Pricing

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

Retail Price = Cost / ( 1 - Desired return on sales )

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

Break-Even Point = Total fixed costs / Gross margin per unit

Extranets

a private electronic network that links a company with its suppliers and customers

Price Strategy

a basic, long-term pricing framework that establishes the initial price for a product and the intended direction for price movements over the product's life cycle

Price Skimming

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