MKTG101

Week 09
Promotion
Session 9: Promotion

Learning objectives:
• explain promotion and its role in the marketing mix
• understand the IMC approach to marketing promotion and
the major elements of the promotion mix
• describe different types of advertising and the steps in
creating an advertising campaign
• outline the role of public relations in promotion
• explain how sales promotion activities can be used
• understand the nature of personal selling
• discuss a range of marketing communication options
additional to the traditional promotion mix.
The marketing process

https://www.bloomberg.com/news/videos/2016
-04-14/nestle-sales-beats-estimates-here-s-how
Communication process

Figure 9.1
Objectives of promotion:

• To support the organisation's

overall marketing objectives
• To demonstrate features and
benefits
• To encourage product trial and
create demand

http://www.ogilvy.com.au/our-
work/share-coke
Objectives of promotion (2)

• To reinforce the product or brand

and encourage repeat purchase
• To increase support offered by
retailers
• To retain loyal customers
Objectives of promotion (3)

• Marketing communications can be

designed to increase general awareness
about and goodwill towards an
organisation.
• Cause-related marketing
 Philanthropic activities tied to the
purchase of a product.
Haagen-Dazs – Help the Honey Bees
https://www.youtube.com/watch?v=OPpLUQ
EObhA
Integrated marketing
communications

• Integrated marketing communications (IMC)

The coordination of promotional efforts to maximise the
communication effect.

• Promotion mix
⁻ Combinations of methods used to promote a
product or idea
⁻ The four elements of a promotion mix are:
• advertising https://www.bloomberg.com/news/article
• public relations s/2016-06-05/nestle-ramps-up-online-
sales-to-bolster-turnaround-in-china
• sales promotion
• personal selling.
 Advertising

• The transmission of paid messages about an organisation,

brand or product to a mass audience.
• Worth over $12 billion/year in Australia

• Benefits: Reaches many people at relatively low cost per

person
• Limitation: Difficult to measure effectiveness
“Half the money I spend on advertising is wasted; the trouble
is I don't know which half.” - John Wanamaker US department
store merchant (1838 – 1922)
Public relations

• Communications aimed at creating and maintaining

relationships between the marketing organisation and its
stakeholders.
• Effective PR messages are timely, engaging, accurate and in the
public interest.

• Benefits: Credibility, resulting word-of-mouth, low- or no-cost,

effectively combat negative perceptions or events.

• http://lifesaving.com.au/wlrhs/
• https://westpacrescue.com.au/
Sales promotion

• Offers of extra value to resellers, salespeople and consumers

in a bid to increase sales.
• Used irregularly to smooth demand
• Rewards the sale of company’s products
• Resellers and sales people

• Limitations: Can lose effectiveness if overused, easily copied,

public becoming increasingly cynical about whether they offer
real value.

http://smallbusiness.chron.com/role-
sales-promotion-promoting-business-
development-78064.html
Personal selling

• Personal communication efforts that seek to persuade

consumers to buy products.
• Expensive, high-involvement or industrial products favour
personal selling
• Prestige brands, cars, fashion, home furnishings, B2B

• Benefits: Can be specifically tailored to individuals, so has

greater influence than advertising, sales promotions and PR
strategies.
• Limitations: Expensive, limited reach, labour intensive, time-
consuming.
Integrating promotion mix
elements

• Marketing organisations have different promotional

needs and finite financial and other resources, so must
choose from options in the promotion mix.
• Those with large promotion budgets usually use
multiple strategies.
• Small budgets will rely on fewer, simpler strategies.
• Best promotion mix will change over time
Push and pull promotion

Push
• An approach in which a product is promoted to the next
institution to “push” goods through the marketing
channel. Generally B2B.
• Greater reliance on personal selling and sales
promotion https://www.youtube.com/watch?v=7Y-dzMS0rVQ
https://www.youtube.com/watch?v=ej7DVIMTJ24
Pull
• An approach in which a product is promoted to
consumers to create demand to “pull” goods through
the marketing channel. Generally B2C.
• Greater reliance on advertising
https://www.youtube.com/watch?v=t0wh
9i-5qiE
Creating an advertising campaign

• Key steps in creating an advertising campaign:

1 Understand the market environment
2 Know the target market (audience)
3 Set specific objectives
4 Create the message strategy
5 Allocate resources
6 Select media
7 Produce the advertisement
8 Place the advertisement
9 Evaluate the campaign
https://vimeo.com/174915666
These …support these Specific Communication
advertising Objectives
functions...
To Inform - to increase brand awareness (esp new brand)
- to educate target consumers about brand feature/benefits/new
product usage (usage expansion), brand improvements
- to facilitate the creation of positive brand image

To Remind - to maintain the brand in target consumers’ evoked set

- to maintain / increase target consumers’ interest in a mature brand
- to influence brand switching through reminders of our brand’s benefits
and features

To Persuade - to persuade trial for new product (build primary demand)

- to provide reasons to try Brand A over B (build secondary demand)
and reasons for buying immediately, instead of delaying
- to convince target consumers of product quality hence the relatively
higher price

To Add Value - to add value to product offering via changing consumer perceptions
(esp, perceived quality)

To Assist Other - to facilitate other marketing efforts (Remember the marketing Mix,
4P? “Promotion” is only a part of the total marketing programs)
Marketing - Advertising is just one element of marketing communications – may
Efforts lend credibility to salespeople’s claims 19
- to reduce the effectiveness of competitors’ communication effects
 Advertising

• Competitive advertising
Using advertising to promote the features and benefits of a product
relative to competing products.
https://www.youtube.com/watch?v=FZu8kAVnJJU 1989
https://www.youtube.com/watch?v=4UDSFUuq7u8 1960s
Advertising

• Comparative advertising
• Using advertising to directly compare a product
against a competing product.
Advertising media options

Table 9.3
Advertising media options cont.
Advertising media options cont.
Advertising media options cont.
Public relations

• Public relations
Promotional efforts designed to build and sustain good relations between an
organisation and its stakeholders.
• Publicity
Unpaid exposure in the media.
Positive preferred, but ‘any publicity is good publicity’
Often better received by public who are increasingly sceptical about PR and
paid-for advertising
Media release, press conference – something newsworthy
• Sponsorship
A paid association with an event or a person.
https://www.youtube.com/watch?v=4He3CfQJLCA The Block
https://www.youtube.com/watch?v=ARrMcsX8FI0 Sports
Consumer sales promotions

Free samples
• Sample of a product provided for free so that
consumers can experience it without committing
to a purchase.

Premium offers
• Given as a bonus for purchasing a product.

Loyalty programs
• Schemes that reward customers
based on the amount they spend.
http://www.smh.com.au/business/retail/woolworths-loyalty-program-comes-up-short-
20160413-go5axt.html
Consumer sales promotions

Contests
• Effective in promoting product benefits and
allow organisations to build a database of
members of their target market.

Coupons
• Vouchers that offer consumers a discount price
on a product or service e.g. ‘Shop-A-Docket’.

Discounts
• A certain amount off the regular price.
Consumer sales promotions

Rebates
• Return of some of purchase price upon
presentation of proof of purchase.

Point of purchase promotions

• Includes in-store signage and display, and free
product trials or demonstrations in stores.

Event sponsorships
• E.g. Exclusive merchandise deal, where sponsor
has sole right to sell products at venue.
 Personal Selling

• Use of personal communication with consumers to persuade them

to buy products.
• Almost all businesses will require personal selling (either face to
face, telesales or on-line)
• Models of personal selling include INPLCF:
• Information, Needs, Product, Leverage, Commitment/close,
Following up
• Information: What benefits, features and strengths should be promoted
to prospect – i.e. what are their particular needs?
• Needs: Salesperson should begin building up relationship with customer
by finding out more and more of customer’s needs
• Product: Highlight how product features match customer needs, to
stimulate and hold interest in product. Demonstrate product
https://www.youtube.com/watch?v=zlkYX
PN-qdE
Personal selling cont’d

• Leverage: highlight comparative and competitive

advantages.
• Deal with objections or any hesitation from customer
• salesperson should treat objections as requests for further
information
• If needs analysis performed well, should be possible to anticipate
likely objections and have prepared responses
• Commitment or close: The stage in the selling process
when the salesperson asks the prospect to buy the
product.
• Following up: Customer loyalty and repeat business can
be encouraged by following up with customers
• Follow up should determine if the delivery and setup of the order was
completed to the customer’s satisfaction
• Follow-up also helps reduce post-purchase dissonance.
Additional forms of promotion

Ambush marketing
• The presentation of marketing messages at an event that is
sponsored by an unrelated business or a competitor.
• Marketers considering sponsoring events need to defend
themselves against ambush marketing, including assessing
risk and sponsorship value.
• Major events (eg Olympics, World Cup) will take steps to
reduce impact and protect sponsors.

• https://www.youtube.com/watch?v=bOA5GI1AV3Q
Additional forms of promotion

Product placement
The paid inclusion of products in movies, television
shows, video games, songs and books.
http://www.007.com/#
http://www.bbc.com/culture/story/20151001-does-
bonds-product-placement-go-too-far
Additional forms of promotion

A plug
• When the media overtly promotes a product
within a program rather than as a separate
advertisement.
 Additional forms of promotion

• Guerrilla marketing
The use of an aggressive and unconventional marketing approach to grab
attention.
• Viral marketing
Using social networks to spread a marketing message. Can fail to fire or
backfire. Commercial benefits hard to measure.
https://www.youtube.com/watch?v=7fXEgO2iL7Y
https://www.youtube.com/watch?v=we1c5uzYsTI
• Permission marketing
Marketing that aims to build on an ongoing relationship with customers
e.g. ‘opt-in’ email or social media (“friending”, “liking”, and “following”).
• Clearly advertising/marketing can achieve a range of objectives and the
traditional lines are blurring
http://www.youtube.com/watch?v=MmQndanKkRI
Summary

• explain promotion and its role in the marketing mix

• understand the IMC approach to promotion and the major
elements of the promotion mix
• describe different types of advertising and the steps in
creating an advertising campaign
• outline the role of public relations in promotion
• explain how sales promotion activities can be used
• understand the nature of personal selling
• discuss a range of marketing communication options
additional to the traditional promotion mix.