Marketing Notes
The Promotion Mix
Building customer relationships requires more than just good products, pricing, and availability; it requires communication.
A company's promotion mix (or marketing communications mix) includes advertising, public relations, personal selling, sales promotion, and direct marketing tools.
These tools communicate customer value and build relationships.
Promotion Mix (Marketing Communications Mix): The specific blend of promotion tools that the company uses to communicate customer value and build customer relationships.
Advertising: Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor.
Sales Promotion: Short-term incentives to encourage the purchase or sale of a product or service.
Personal Selling: Personal customer interactions by the firm’s sales force for the purpose of engaging customers, making sales, and building customer relationships.
Public Relations (PR): Building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events.
Direct and Digital Marketing: Engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships.
Each promotional category utilizes specific tools; for instance, advertising involves broadcast, print, online, and mobile formats.
Marketing communication extends beyond promotion tools to include product design, price, packaging, and retail locations.
The entire marketing mix should be coordinated for maximum impact.
Integrated Marketing Communications
Mass marketing has given way to focused programs designed to engage customers in narrowly defined micromarkets.
Digital technology has significantly changed marketing communications.
Consumers are better informed and empowered in the digital age.
The digital age has spawned new communication tools, leading to a more targeted and engaging marketing communications model.
Traditional mass media are declining in dominance, with advertisers shifting to specialized and targeted media.
Digital ad spending is growing rapidly, surpassing TV spending.
Mobile advertising is the fastest-growing digital category.
Some marketers are adopting a "digital-first" approach.
Integrated Marketing Communications (IMC): Integrating coordinating the company’s many communications channels to deliver a clear, consistent, and compelling message about the organization and its products.
Method's "Clean happy" campaign began as an online-only effort, relying heavily on digital and social media.
New media formats enable marketers to reach smaller communities in engaging ways.
Consumers can watch programs on various devices and without commercials.
The key is to integrate all media to engage customers, communicate brand messages, and enhance brand experiences.
Marketing communicators are now viewed as content marketing managers, sharing brand messages across paid, owned, earned, and shared channels.
The shift towards a richer mix of media and content approaches poses a problem for marketers.
Consumers are bombarded with messages, and companies often fail to integrate communication channels.
Conflicting messages from different sources can confuse brand images and customer relationships.
Integrated marketing communications (IMC) is crucial to deliver a clear and consistent message.
Different media play unique roles in engaging and persuading consumers.
Pokémon Go's success is attributed to its smart target market selection, targeting Millennials who had childhood memories of Pokémon.
The game combines online and offline platforms, encouraging users to explore and socialize.
It promotes a healthy lifestyle by encouraging players to walk and explore.
The game has created spontaneous congregations, resulting in a network effect in cities worldwide.
Pokémon Go leveraged community engagement and user-generated content to promote the game, integrating marketing into the gameplay.
The game relied heavily on buzz marketing and word-of-mouth, with minimal paid advertising.
The summer of 2016 saw a global cultural and social phenomenon with Pokémon Go, reaching 25 million daily active users (DAU).
Developing Effective Marketing Communication
Content marketing involves creating, inspiring, and sharing brand messages across paid, owned, earned, and shared channels.
IMC ensures a consistent, clear, and compelling message delivered through a carefully blended mix of promotion tools.
IMC involves identifying the target audience and shaping a coordinated promotional program.
Communications should focus on managing ongoing customer engagement and relationships.
Programs need to be developed for specific segments and individuals.
Companies must allow customers to engage them.
The communications process should start with an audit of all potential touchpoints.
To communicate effectively, marketers must understand how communication works.
Sender: The party sending the message to another party -- here, McDonald’s.
Encoding: The process of putting thought into symbolic form -- for example, McDonald’s ad agency assembles words, sounds, and illustrations into a TV advertisement that will convey the intended message.
Message: The set of symbols that the sender transmits -- the actual McDonald’s ad.
Media: The communication channels through which the message moves from the sender to the receiver -- in this case, television and the specific television programs that McDonald’s selects.
Decoding: The process by which the receiver assigns meaning to the symbols encoded by the sender -- a consumer watches the McDonald’s commercial and interprets the words and images it contains.
Receiver: The party receiving the message sent by another party -- the customer who watches the McDonald’s ad.
Response: The reactions of the receiver after being exposed to the message -- any of hundreds of possible responses, such as the consumer likes McDonald’s better, is more likely to eat at McDonald’s next time, hums the “i’m lovin’ it” jingle, or does nothing.
Feedback: The part of the receiver’s response communicated back to the sender -- McDonald’s research shows that consumers are either struck by and remember the ad or they email or call McDonald’s, praising or criticizing the ad or its products.
Noise: The unplanned static or distortion during the communication process, which results in the receiver getting a different message than the one the sender sent -- the consumer is distracted while watching the commercial and misses its key points.
The sender's encoding process must mesh with the receiver's decoding process.
Marketing communicators must understand the customer’s field of experience.
Steps in Developing Effective Marketing Communication
Identify the target audience.
Determine the communication objectives.
Design a message.
Choose the media through which to send the message.
Select the message source.
Collect feedback.
The target audience affects decisions on what, how, when, where, and who will say it.
Marketers must determine the desired response and the stage the target audience needs to be moved to.
Buyer-readiness stages: The stages consumers normally pass through on their way to a purchase: awareness, knowledge, liking, preference, conviction, and, finally, the actual purchase.
The marketer must first build awareness and knowledge.
Designing a Message
The message should get attention, hold interest, arouse desire, and obtain action (the AIDA model).
The communicator must decide on message content, structure, and format.
There are three types of appeals: rational, emotional, and moral.
Rational appeals relate to the audience’s self-interest.
Emotional appeals stir up emotions to motivate purchase.
Moral appeals are directed to an audience’s sense of what is right.
Choosing Communication Channels and Media
Personal communication channels involve direct communication between two or more people.
Personal communication channels Channels through which two or more people communicate directly with each other, including face-to-face, on the phone, via mail or email, or even through an internet “chat.”
Word-of-mouth influence: The impact of the personal words and recommendations of trusted friends, family, associates, and other consumers on buying behavior.
Buzz marketing: Cultivating opinion leaders and getting them to spread information about a product or a service to others in their communities.
Nonpersonal communication channels carry messages without personal contact or feedback.
Nonpersonal Communication Channels: Media that carry messages without personal contact or feedback, including major media, atmospheres, and events.
Messages delivered by credible or popular sources are more persuasive.
Collecting Feedback
After sending the message, research its effect on the target audience.
Setting the Total Promotion Budget
Affordable method: Setting the promotion budget at the level management thinks the company can afford.
Percentage-of-sales method: Setting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales price.
Competitive-parity method: Setting the promotion budget to match competitors’ outlays.
Objective-and-task method: Developing the promotion budget by (1) defining specific promotion objectives, (2) determining the tasks needed to achieve these objectives, and (3) estimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget.
Shaping the Overall Promotion Mix
Advertising: can reach masses, is expressive, but impersonal. TV has vast reach.
Personal Selling: effective at building buyer preference and involves personal interaction
Sales Promotion: attracts consumer attention with incentives to purchase
Public relations: very believable with news stories, features, and sponsorships.
Direct and Digital Marketing: targeted with a custom message and is well-suited to one-to-one customer relationships.
Promotion Mix Strategies
Push strategy: A promotion strategy that calls for using the sales force and trade promotion to push the product through channels. The producer promotes the product to channel members who in turn promote it to final consumers.
Pull strategy: A promotion strategy that calls for spending a lot on consumer advertising and promotion to induce final consumers to buy the product, creating a demand vacuum that “pulls” the product through the channel.
Companies consider many factors when designing their promotion mix strategies, including the type of product and market.
Integrating the Promotion Mix
The various promotion elements should work together to carry the firm’s unique brand messages and selling points.
An integrated promotion mix ensures that communications efforts occur when, where, and how customers need them.
Socially Responsible Marketing Communication
Companies must communicate openly and honestly and avoid false or deceptive advertising.
Sellers must avoid bait-and-switch advertising.
A company’s trade promotion activities also are closely regulated.
Personal selling also has rules that should be followed. For example, salespeople may not offer bribes.