PROMOTION

Presented by:
Sushil Nirbhavane
Assistant Professor, MIT-DMSR
 Contents

1. Concept and role in marketing

2. Promotional Mix – Advertising, Sales Promotion, Personal

Selling, Public Relations.

3. Impact of technology & internet on Promotion.

 Introduction
1. Modern marketing calls for more than developing good
product, pricing it attractively, and making it accessible. The
value created for the customers must be communicated to
them.
2. For most companies, the question is not whether to
communicate but rather what to say, how to say it, to
whom, and how often.
3. But communication gets harder and harder as more and
more companies clamor to grab the consumer’s increasingly
divided attention.
4. To reach target markets and build brand equity, holistic
marketers are creatively employing multiple forms of
communications.
Marketing Communication Mix
Marketing Communication Mix or Promotional Mix
consists of following modes of communication:

1. Advertising: Any paid form of non-personal presentation

and promotion of ideas, goods, or services by an identified
sponsor.

2. Sales Promotion: A variety of short-term incentives to

encourage trial or purchase of a product or service.

3. Events & Experiences: Company-sponsored activities

and programs designed to create daily or special brand-
related interactions.
Marketing Communication Mix

4. Public Relations & Publicity: A variety of programs

designed to promote or protect a company’s image or its
individual products.

5. Direct Marketing: Use of mail, telephone, fax, e-mail, or

internet to communicate directly with or solicit response or
dialogue from specific customers or prospects.

6. Personal Selling: Face-to-face interaction with one or

more prospective purchasers for the purpose of making
presentations, answering questions, and procuring orders.
 Common Communication
Platforms
Advertising:
- Print and broadcast ads
- Packaging
- Motion pictures/ Audiovisual material
- Brochures and booklets
- Posters and leaflets
- Directories
- Billboards
- Point-of-purchase displays
- Symbols and logos
- Display signs
Print Ad
Packaging
Directories
Billboards
Posters
Logo
Symbol
POP Displays
Display Signs
 Common Communication
Platforms

Sales Promotion:
- Contests, games, lotteries
- Premiums and gifts
- Sampling
- Fairs and trade shows
- Exhibits
- Demonstrations
- Coupons
- Rebates
- Low-interest financing
 Common Communication
Platforms

Events/Experiences:
- Sports
- Entertainment
- Festivals
- Arts
- Causes
- Factory tours
- Company museums
- Street activities
 Common Communication
Platforms

Public Relations:
- Press kits
- Speeches
- Seminars
- Annual reports
- Charitable donations
- Publications
- Community relations
- Lobbying
- Identity media
- Company magazine
Press kits
 Press kits
A press kit, often referred to as a media kit in business
environments, is a pre-packaged set of promotional
materials of a person, company, or organization distributed
to members of the media for promotional use. They are
often distributed to announce a release or for a news
conference.

Uses: Press kits are commonly used for

- Product launches
- New company launch
- Mergers and acquisitions
- News conferences
- Large events / Industry trade shows
 Press kits
- Backgrounder with historical information on the company
or individual
- Fact sheet listing specific features, statistics, or benefits
- Biographies of key executives, individuals, artists, etc.
- Past press coverage
- Photos or other images (high resolution) of key executives,
logos, products, etc.
- A press release detailing the current news the media kit is
sent in reference to
- Media contact information (usually of a public relations
department or spokesperson)
- A CD, DVD, software title, video, etc. as appropriate for
the sender of the release
- Collateral advertising material, such as: postcard, flier,
newspaper ad, etc.
 Common Communication
Platforms
Public Relations:
Press relations – Presenting news and information about
the organization in the most positive light.
Product publicity – Sponsoring efforts to publicize specific
product.
Corporate communications – Promoting understanding of
the organization through internal and external
communication.
Lobbying – Dealing with legislators and government
officials to promote or defeat legislation and regulation.
Counseling – Advising management about public issues
and company positions and image during good times and
bad...
 Common Communication
Platforms
Personal Selling:

- Sales presentations

- Sales meetings

- Incentive programs

- Samples

- Fairs and trade shows

 Common Communication
Platforms
Direct Marketing:

- Catalogues
- Mailings
- Telemarketing
- Electronic shopping
- TV shopping
- Fax mail
- E-mail
- Voice mail
Marketing Communication Mix
 Setting the Promotion Mix
When deciding how to properly utilize the marketing
communications mix to meet your marketing objectives, it is
important to consider the relative strengths and weaknesses
of each component of the mix.

Further, you must always define your total budget first

(generally defined in the Marketing and/or Business Plan)
and then decide upon the best way to leverage the different
elements of the mix to maximize the return on your
investment. You will balance the various parts of the mix to
not only create an integrated approach to your marketing
communications but you must also devote enough resources
for each component to be successful.
 Setting the Promotion Mix
Advertising:

1. Reaches large, geographically dispersed audiences, often

with high frequency.
2. Low cost per exposure, though overall costs are high
3. Consumers perceive advertised goods as more legitimate
4. Dramatizes company/brand
5. Builds brand image
6. May stimulate short-term sales
7. Impersonal, one-way communication
8. Expensive
 Setting the Promotion Mix
Sales Promotion:

1. May be targeted at the trade or ultimate consumer

2. Makes use of a variety of formats: premiums, coupons,
contests, etc.
3. Attracts attention, offers strong purchase incentives,
dramatizes offers, boosts sagging sales
4. Stimulates quick response
5. Short-lived
6. Not effective at building long-term brand preferences
 Setting the Promotion Mix
Personal Selling:

1. Most effective tool for building buyers’ preferences,

convictions, and actions
2. Personal interaction allows for feedback and adjustments
3. Relationship-oriented
4. Buyers are more attentive
5. Sales force represents a long-term commitment
6. Most expensive of the promotional tools
 Setting the Promotion Mix
Public Relations:

1. Highly credible
2. Very believable
3. Many forms: news stories, news features, events and
sponsorships, etc.
4. Reaches many prospects missed via other forms of
Promotion
5. Dramatizes company or product
6. Relatively inexpensive (certainly not 'free' as many people
think--there are costs involved)
 Setting the Promotion Mix

Direct Marketing:

1. Many forms: Telephone marketing, direct mail, online

marketing, etc.

2. Four distinctive characteristics: Non-public, Immediate,

Customized, Interactive

3. Well-suited to highly-targeted marketing efforts

 Assignment

1. “Swadishta” is a local instant food manufacturing

company. Their brand of Gulab Jamun Mix is highly
successful in local market. They want to expand their
network nationwide. Design a distribution channel and
promotional mix for them. Make necessary assumptions.
 Advertising
Any paid form of non-personal presentation and promotion
of ideas, goods, or services by an identified sponsor.

1. Can be used to build up a long-term image for a product

or trigger quick sales.

2. Advertising can efficiently reach geographically dispersed

buyers.

3. Consumers might believe that a heavily advertised brand

must offer “good value.”
 Advertising
Characteristics:
1. Pervasiveness – Advertising permits the seller to repeat a
message many times. It also allows the buyer to receive and
compare the messages of various competitors. Large-scale
advertising says something positive about the seller’s size,
power and success.

2. Amplified expressiveness – Advertising provides

opportunities for dramatizing the company and its products
through the artful use of print, sound, and color.

3. Impersonality – The audience does not feel obligated to

pay attention or respond to advertising. Advertising is a
monologue in front of, not dialogue with, the audience.
 Functions/Objectives

1. To inform

2. To persuade

3. To remind
 Functions/Objectives
1. To inform:

- A new product may be introduced

- Shows new uses for an old product

- Shows a price change in a product

- Shows how a product works

- Builds an image for the company

- Describes available services

 Functions/Objectives
2. To Persuade:

- Persuading ads try to convince a buyer to purchase the

product or service NOW.

- Encourages switching to an identified brand instead of a

lesser-known brand.

- Confirm a purchase so the customer comes back again and

again.

- May want to personally talk to the customer

 Functions/Objectives

3. To remind:

- Identifies where the product or service may be purchased.

- Shows a need the customer already knows for the product.

- Reaffirms the importance of the product or service.

Advertising
Advertising
Advertising
 Importance of Advertising

1. Benefits to Manufacturers

2. Benefits to Retailers

3. Benefits to Customers
 Benefits to Manufacturer
1. It increases the demand of the products.
2. It create pressure on the retailer to stock the goods
which have demand.
3. Mass production needs mass selling efforts which are
possible only by advertising.
4. It protects manufacturer against unfair competition
because customer learn to recognize the brand with the
name of the manufacturer.
5. It tends to stabilize the selling price and this can create
confidence in the public.
6. It helps in providing necessary information very quickly to
customers like changes in products or product features or
new outlets etc.
 Benefit to Retailer

1. It help retailer to create awareness of their existence and

the types of products available with him.

2. It reduces risk on dead stock hence reduction of overhead

expenses.

3. Retailer is afraid of fluctuations in prices. Advertising

normally aims stabilization of price.

4. Looking at current demand of product, retailer can easily

estimate sales & accordingly plan the stock.
 Benefits to Customer

1. Advertising act as an information and educate the

customers.

2. Advertising stimulates demand thereby production and

hence reduces the cost per unit. This benefit goes to
customers.

3. Advertising goods generally bear quality and thus

consumers get quality matching to the price.

4. It makes it possible to sell direct to the consumers by

mail order like Asian Sky Shop. This reduces commission
payable to intermediaries and hence less price.
 Advertising
The Five Ms of Advertising:

1. Mission – What are the advertising objectives.

2. Money – How much can be spent.

3. Message – What message should be sent?

4. Media – What media should be used?

5. Measurement – How should the result be evaluated?

 Advertising
1. Mission
- Sales goals
- Advertising objectives

2. Money
- Factors to consider
- Stage in PLC
- Market share and consumer base
- Competition
- Advertising frequency
- Product substitutability
 Advertising
3. Message
- Message generation
- Message evaluation and selection
- Message execution
- Social-responsibility review

4. Media
- Reach
- Frequency
- Impact
- Major media types
- Specific media vehicles
- Media timing
 Advertising
5. Measurement
- Communication impact
- Sales impact
 Mission
Setting the Objectives: An advertising goal (or objective)
is a specific communication task and achievement level to be
accomplished with a specific audience in a specific period of
time.
- Informative advertising aims to create brand awareness
and knowledge of new features of existing products.
- Persuasive advertising aims to create liking, preference,
conviction and purchase of a product or service.
- Reminder advertising aims to stimulate repeat purchase of
products and services.
- Reinforcement advertising aims to convince current
purchasers that they made the right choice.
 Money
Deciding on Advertising Budget

1. Stage in PLC – New products typically receive large

advertising budget to build awareness and to gain consumer
trial. Established brands usually are supported with lower
advertising budgets as a ratio to sales.

2. Market share and consumer base – High-market-share

brands usually require less advertising expenditure as a
percentage of sales to maintain share. To build share by
increasing market size requires larger expenditures.
 Money

3. Competition – In a market with a large number of

competitors and high advertising spending, a brand must
advertise more heavily to be heard.

4. Advertising frequency – The number of repetitions

needed
to put across the brand’s message to consumers has an
important impact on the advertising budget.
 Message
Developing the Advertising Campaign
1. Message generation and evaluation – fresh insights, positioning
statement, alternative ad themes
2. Creative development and execution
a) Television ads – most powerful, highest reach, fleeting nature
of message, media fragmentation
b) Print ads – detailed product information but no dynamic
presentation, short shelf life (newspapers), picture-headline-copy
c) Radio ads – cheaper, radio penetration low, lack of visual image
d) Film ads – Film crazy population, mood of audience conducive,
flexibility to advertisers, cost of developing prints and monitoring
the screening of the advertisement
3. Social Responsibility Review – ASCI, MRTP
 Media
Deciding on Reach, Frequency, and Impact
Reach (R) - The number of different persons or households
exposed to a particular media schedule at least once during
a specified time period.
Frequency (F) – The number of times within the specified
time period that an average person or household is exposed
to the message.
Impact – The qualitative value of an exposure through a
given medium.
Total Number of Exposures (E) or GRP – This is the reach
times the average frequency…E = R X F
 Media
Major Media Types:
Target audience media habits – Radio and television are the
most effective media for reaching teenagers.
Product characteristics – Media types have different
potential for demonstration, visualization, explanation,
believability, and color. Women’s dresses are best shown in
color magazines, and Kodak cameras are best demonstrated
on television.
Message characteristics – Timeliness and information
content will influence media choice. A message announcing a
major sale tomorrow will require radio, TV, or newspaper. A
message containing a great deal of technical data might
require specialized magazines or mailings.
 Media
Cost – Television is very expensive, whereas newspaper
advertising is relatively inexpensive.

Also consider -
- People are increasingly time-starved
- Attention is becoming scarce currency
 Profiles of Major Media Types
Medium Advantages Limitations
Newspapers Flexibility, timeliness, Short life, poor
good local market reproduction quality,
coverage, broad small pass-along
acceptance, high audience
believability
Television Combines sight, High absolute cost,
sound and motion; fleeting exposure,
appealing to senses; less audience
high attention; high selectivity
reach
Direct mail Audience selectivity; Relatively high cost,
flexibility, no ad junk mail image
competition within
the same medium,
personalization
Medium Advantages Limitations
Radio Mass use, high Audio presentation
geographic and only, lower attention
demographic than television, non-
selectivity, low cost standardized rate
structure, fleeting
exposure
Magazines High geographic and Long ad purchase
demographic lead time, some
selectivity, credibility waste circulation
and prestige, high-
quality reproduction,
long life, good pass-
along readership
Outdoor Flexibility, high Limited audience
repeat exposure, low selectivity, creative
cost, low competition limitations
Yellow pages Excellent local High competition,
coverage, high long ad purchase
believability, wide lead time, creative
reach, low cost limitations
Newsletters Very high selectivity, Costs could run away
full control,
interactive
opportunities,
relative low cost
Brochures Flexibility, full Overproduction could
control, can lead to runaway
dramatize messages costs

Telephone Many users, Relatively high costs

opportunity to give a
personal touch
Internet High selectivity, Relatively new media
interactive with a low number of
possibilities, users in some
relatively low cost countries
 Media
Selecting specific vehicles
Circulation – The number of physical units carrying the
advertising.
Audience - The number of people exposed to the vehicle. If
the vehicle has pass-on readership, then the audience is
larger than circulation.
Effective audience – The number of people with target
audience characteristics exposed to the vehicle.
Effective ad-exposed audience – The number of people with
target audience characteristics who actually saw the ad.
 Media
Media Timing and Allocation:
- Continuity
- Concentration
- Flighting
- Pulsing

Allocation:
National buys – national TV networks or nationally circulated
Magazines
Local buys – Local newspapers, radio, or outdoor sites.
 Measurement
Measurement
Communication impact – copy test, portfolio testing,
laboratory testing

Sales Impact:

Share of expenditures – share of voice – share of mind and

heart – share of market
 Sales Promotion
Objectives:

1. Trial

2. Increase the repurchase rate

3. Brand switching

4. Reward loyal customers

 Sales Promotion
Consumer Promotion Tools:
1. Samples
2. Coupons
3. Cash refund offers (rebates)
4. Price packs – reduced price pack/banded pack
5. Premiums (gifts)
6. Frequency programs
7. Prices (contests, games)
8. Free trials
9. Product warranties
10. Cross promotions
 Personal Selling
Major steps in effective selling

1. Prospecting and qualifying - leads

2. Pre-approach
3. Approach
4. Presentation and demonstration - AIDA
5. Overcoming objections
6. Closing
7. Follow-up and maintenance
 Personal Selling
Essentials of effective personal selling:

Personal selling calls for thorough knowledge about:

1. Company – image, policies, target customers,
procedures, after-sales service offered by company etc.
2. Product – qualities/features, USP, strengths, weaknesses,
pricing, etc.
3. Customers – desires, wants, demographic and
psychographic aspects, consumption patterns etc.
4. Competition – Up-to-date knowledge about different
competitors; their products, policies, pricing, etc.
5. Selling Process – various stages in selling process
 Impact of technology &
Internet on Promotion
Area Traditional Virtual Marketing
Marketing
Promotional Method Word of Mouth Viral Marketing

Product Broadcasting of Banner Ads

Communication Advertisement
Public Relations Press Releases Website
Pressrooms
Communication Direct Mail E-mail

Personal Selling Door to Door Online Events

Distribution Channel Partners Affiliated Marketing

Payment Through Paper Virtual Currency

Settlements Currency
 Personal Selling
Steps for Developing Effective Communication:

1. Identify Target Audience

2. Determine Communication Objectives

3. Design the Communication Message

4. Select Communication Channel

5. Establish Total Marketing Communications Budget

6. Select Marketing Communication Mix

7. Measure Communication Results