MKTG 3310 Exam 4 Wolter Auburn

parts of the communication process

sender

encoding

message

media

decoding

receiver

response

feedback

noise

How do the parts of the communication process translate into marketing promotions?

For the message to be effective, the senders encoding process must mesh with the receiver's decoding process.

The more the sender's field of experience overlaps with that of the receiver, the more effective the message is likely to be.

What must marketers understand to communicate with customers?

identify a target audience

determine the communication objectives

design a message

choose the media outlet to send the message

select the message source

collect feedback

Explain why the KFC ad on Walking Dead could have been potentially troubling.

If the ad is followed by the wrong thing or if it is seen at an inconvenient time, it can change the way people feel about the product or brand.

5 main categories of the promotion mix

advertising

sales promotion

personal selling

public relations

direct and digital marketing

Advertising

non-personal presentation

Advertising strengths

can reach masses all over at low cost

enables seller to repeat message many times

large-scale says positive things about seller's size, popularity, and success

Advertising weaknesses

impersonal

lacks direct persuasiveness of salespeople

one-way communication with no prompt for response

expensive

Sales Promotion

limited time offer on product

ex: BOGO

Sales Promotion strengths

attract customer attention

engage customers

strong incentives to purchase

invite a reward and a quick response

Sales Promotion weaknesses

effects can be short-lived

not as effective in building long-run brand preference and customer relationships

Personal Selling

personal presentation of the firm's sales force for the purpose of engaging customers, marketing sales, and building customer relationships

Personal Selling strengths

most effective in certain stages of buying process

builds buyer preferences

one-on-one so they can assess each person's needs and characteristics

allows customer relationships

buyer feels greater need to listen and respond

Personal Selling weaknesses

size of sales force is harder to change

expensive

Public Relations

building good relationships with the company's consumers

publicity, good corporate image, handling unfavorable rumors

Public Relations strengths

very believable

can reach people who avoid salespeople and advertisements

seen as news and events instead of ads

Public Relations weaknesses

can dramatize a company or product

tend to be under-used

Direct and Digital Marketing

engaging directly with carefully targeted individual customers and consumer communities to obtain immediate response and build lasting customer relationships

Direct and Digital Marketing strengths

more targeted

intermediate and personalized

messages prepared quickly and tailored to appeal to specific brand groups

interactive: allows for dialogue

Direct and Digital Marketing weaknesses

dont reach the masses

methods of promotion budgeting

Affordable

Percentage-of-sales

Competitive Parity

Objective-and-task

Affordable method

setting promotional budget at the level management thinks the company can afford

Affordable method deficiencies

ignores the effects of promotion sales

places promotion last among spending priorities

leads to uncertain annual promotion budget, which makes long-term planning difficult

can result in overspending on advertising, but more often under-spending

Percentage-of-Sales method

setting the promotion budget at a certain percentage of the current or forecasted sales as a percentage of the unit sales price

Percentage-of-Sales method deficiencies

wrongly views sales as the cause of promotion rather than the result

based on availability of funds rather than opportunities

may prevent increased spending sometimes needed to turn around falling sales

long-term planning difficult bc it varies year to year

doesnt provide basis for choosing a specific percentage, except what has been done in the bast or what is being done by competitors

Competitive Parity method

setting promotion budget to match competitor's outlays

Competitive Parity method deficiencies

no grounds for believing that the competition has a better idea of what a company should be spending on promotion that the company does itself

no evidence that budgets based on this method prevent promotion wars

Objective-and-task method

developing the promotion budget by:

1: defining specific promotion objectives

2: determining the tasks needed to achieve those objectives

3: estimating the costs of performing these tasks

the sum of these is the proposed budget

Objective-and-task method deficiencies

most difficult method to use

hard to figure out which specific tasks will achieve the objectives

Which promotion budgeting method is most representative of the marketing concept?

Objective-and-task

Push strategy

producer directs marketing activities toward channel member to introduce them to carry the product and promote it to final customers.

ex: John Deere doesn't advertise for themselves. They get Lowe's, Home Depot, etc. to advertise their products for them.

Pull strategy

producer directs its marketing activities toward final customers to induce them to buy the product

ex: Old Spice is sold by retailers like CVS and Walk-Mart, not the manufacturer themselves

Integrated Marketing Communications (IMC)

carefully integrating and coordinating the company's many communication channels to deliver a clear, consistent, and compelling message about the organization and its products

What are the two things that IMC helps a firm obtain?

clarity (clear and consistent message)

synergy (across their channels)

How is the overall use of promotion changing?

consumers are better informed (we don't rely on marketer-applied information - thank you internet)

marketing strategies are changing (shifting away from mass marketing to programs that build closer relationships)

advances in technology (changing how customers communicate with each other)

What does advertising spending fluctuate with?

overall economic growth

What does the fluctuation of advertising spending tell us about a firm's view of it?

As the economy moves, it changes how companies advertise.

If the economy dips, companies withdraw ads.

What is AIDA?

Attention

Interest

Desire

Action

Do all advertisements have to have all of the AIDA parts to be good?

no, but it has to have a call to action.

using all parts of AIDA helps make good advertising but doesn't need every part.

What are the different types of advertising appeals?

Rational

Moral

Emotional

Sex

Can you identify an appeal based on seeing an ad?

usually

What happens if fear, humor, and sex appeals do not have a link with why someone buys a product?

it won't encourage purchase within a short time frame afterward

Can appeals like fear, humor, and sex go too far?

no, just avoid corniness

myth based on bad science: if it is too scary, people tune out

Reach

number of different people exposed to an ad

Frequency

average number of times a person is exposed to an ad

What is CPM?

cost per 1000 impressions

- how much we're paying to reach 1000 people

How is CPM calculated?

cost of ad/audience size x 1000

Is a Super Bowl ad considered a good buy?

yes, for large companies who can afford it

Why may the Super Bowl be considered a bad buy?

waste: the number of people that your ad gets in front of that aren't in your target market

What percentage of advertising spending is generally considered wasted?

about half

content marketing

marketing technique of creating and distributing valuable, relevant, and consistent content to attract and acquire a clearly defined audience - with the objective of driving profitable customer action

Paid media

impressions gained through paid media (ads, sponsorships, display ads, paid search)

Owned media

impressions gained through media (company website, blogs, Facebook, Twitter)

Earned media

impressions gained through others' media (word of mouth, "viral")

Inbound marketing

earning a customer's attention

Outbound marketing

traditional

finds customers and grab their attention is a specific moment

How is the effectiveness of inbound marketing typically measured?

are people interested in your products?

permission to have a conversation with them

people who talk about a company on their channels

earned media

components of the Hubspot model

attract (strangers to visitors)

convert and engage (visitors to leads)

close (build trust) (leads to customers)

delight (customers to promoters)

What is viral marketing?

a promotional strategy that encourages individuals to forward marketer-initiated messages to others via email, social media networking websites, and blogs

What kind of tie must viral marketing pass between in order to be successful?

Word of mouth/amount of people that are talking about the product or company

weak ties

What is STEPPS?

social currency

triggers

emotions

public

practical value

stories

Social Currency (STEPPS)

people care about how they look to others

strong ties have access to valuable info and makes you look like an insider

ex: live-strong bracelet, yeti cups

Triggers (STEPPS)

the extent your message gets tied to something periodically, in a routine, are more likely to share

ex: Hump Day Geico commercial

Emotions (STEPPS)

extent that it produces some kind of emotion other than sadness

Public (STEPPS)

people have a public piece to it and catch on

Practical Value (STEPPS)

extent that it will solve problems

Stories (STEPPS)

anecdotes

ex: Wendy's twitter

Why didn't Starbucks have to advertise for their first 25 years of existence?

huge social currency

recognizable logo and cups

used all the STEPPS

What does good social media marketing require?

fast content and response - flattening the organization and stripping the layers of quality control

methods: content creation, customer interaction, and advertising

Is there a difference between SMM and traditional advertising in terms of amount of mistakes?

traditional advertising has less mistakes bc of all the approvals it has to acquire

SMM has more mistakes

Why cant firms avoid SMM?

because the conversation is already happening and they can't stop it, so they either have to help it or ignore it.