PROMOTION

Advertising
Sales Promotion
Public Relations
Personal Selling
Direct Marketing

Elements of the Promotion Mix
Advertising
Ingredients
of the
Promotion
Mix
Public Relations
Personal Selling
Sales Promotion
Advertising
Any paid form of
nonpersonal
presentation and
promotion of ideas,
goods, or services by an
identified sponsor.

Advertising Decisions
There are four important decisions.

Setting Advertising Objectives.
Setting the Advertising Budget.
Developing Advertising Strategy.
Evaluating Advertising Campaign.

Setting Advertising Objectives

A specific communication task to be
accomplished with a specific target audience
during a specific period of time.
Classification of Advertising
Objectives

Informative Advertising
Persuasive Advertising
Reminder Advertising
Informative Advertising
Telling the market about a new product
Suggesting new uses for a product
Explaining how the product works
Describing available services
Reducing consumers fears
Building a company image
Persuasive Advertising

Building brand preference
Encouraging switching to your brand
Changing customers perception of product
attributes
Persuading customer to purchase now
Reminder Advertising
Reminding consumer that product may be
needed in the near future
Keeping it in consumers mind during off-
seasons
Reminding consumer where to buy it
Maintaining its top-of- mind awareness

I know that half of my advertising
budget goes wasted, but I dont know
which half.

John wanamaker
Setting the advertising budget
After determining the advertising objectives,
the company next sets its advertising budget
for each product.
There are four common methods used to set
the total budget for advertising.

Affordable method
Percentage-of-sales method
Competitive-parity method
Objective-and-task method
Affordable method
Setting the advertising budget at the level
management thinks the company can
afford.
Small business often use this method.
Percentage-of-sales method
Setting the advertising budget at a certain
percentage of current or forecasted sales
or a percentage of the unit sales price.

Pharmaceutical companies use 20% of
their sales in advertising.
Competitive-parity method

Setting the advertising budget to match
competitors outlays.
Objective-and-task method
Developing the advertising budget by

Defining specific objectives
Determining the; tasks that must be
performed to achieve these objectives and
Estimating the cost of performing these
tasks
The sum of these tasks is the proposed
advertising budget.
Factors affecting advertising
budget

Following are some specific factors that
should be considered when setting the
advertising budget.
Product life cycle stage
New product typically need large
advertising budget to build awareness and
to gain consumer trial.
Aag TV channel (musical channel)
Mature brand usually require lower
budgets as a ratio to sales.
Automobiles such as Honda CD 70
Market share
Building the market or taking share from
competitors requires large advertising
spending than simply maintaining current
share.
Low-share brand usually need more
advertising spending as a percentage of
sales.
Telenor, warid are trying to capture market share
from Mobilink.
Competitors

Brands in a market with many competitors
and high advertising clutter must be
advertised more heavily to be noticed
above the noise in the market.

Home appliances such as waves, Pel,
Dowlance used heavy advertising budget
because of strong competition.
Product differentiation
Undifferentiated brands may require heavy
advertising to set them apart.
Soft drinks, laundry, detergents need large
advertising budget.
In differentiated brands the advertising can only
be used to point out the differences to
consumers.
Siemens used marketing for its home appliances
to just pin point the difference because it is
completely different brand from others home
appliances.
Type of product/market
Business to consumers(B2C) firms tend to spend
too much o advertising.

Unilever, Nestle, Procter & Gamble use strong
advertising budget.

Business to business(B2B) firms generally
underspend on advertising and relay too heavily
on their sales forces to bring in orders.

Huawe, Nokia, Ericson used almost no
advertisements.

Developing Advertising
Strategy
Advertising Strategy
Advertising strategy consist upon both Art &
Science of advertising
Art of Advertising
The art comes from writing, designing &
producing the message.
Science of Advertising
The science comes from Strategy Thinking.


Strategy Thinking

The way through which we achieve our
advertising goals.
For example Increase of Sales.

Developing Advertising strategy consists of
two major elements:

Creating advertising message.
Selecting advertising media.
Creating Advertising Message

Our message must be well
Communicated & gain Attention of Viewers.

Breaking Through The Clutter

Confusion (Disorder) creates problem for
the consumers as well as for the advertisers,
on the other hand Viewers want commercial
free program. e.g.
Commercial during a popular Prime-time
program
How the advertiser can achieve his
advertising goals?

Advertisement should be entertaining, more
rewarding, imaginative & better planned. e.g.
U Phone Co. Starting their commercial by
saying that now you can SMS only for 12
paisa
Message Strategy

To decide what general message will be
communicated to consumers.

The purpose of advertising is to get
customers to think about or react to the
product in a certain way.
Message Strategy (Contd)
Message must be Straight Forward
e.g.
Call Rate of Mobilink

Advertising must be Appealed something
Meaningful
Believable
Must be distinctive from Competitors


Message Execution Styles
The impact of an advertisement depends not
only upon what is said but also upon how it is
said. It is the task of the creative people in the
advertising agency to find the style, tone,
words, and format factors that make or an
effect message execution strategy.
Executional Styles for Advertising
Mood or
Image
Musical
Demon-
stration
Scientific
Real/
Animated
Product
Symbols
Fantasy
Lifestyle
Spokes-
person/
Testimonial
Slice-of-Life
Humorous
Common
Executional
Styles
Slice-of-Life
This shows one or more persons using the product in a
normal setting.

Life Style
This emphasizes how a product fits in with a life style.

Fantasy
This creates a fantasy about what might happen in
connection with the use of a product.

Mood or Image
This builds an evocative mood or image around the
product - beauty, love or serenity. No claim is made about
the product except through suggestion.

Musical
This shows one or more persons or characters singing a
song or jingle involving the product.


Personality Symbol
This creates a character that represents or
personifies the product.

Technical Expertise
This features the care that the company
exercises and the experience it has in selecting
the ingredients for this product or in
manufacturing the product.

Scientific Evidence
This presents survey or scientific evidence
that the brand is preferred to or outperforms one
or more other brands.

Testimonial Evidence
This features a highly credible or likable
source endorsing the product.
Humor
This execution is designed to attract attention
using humorous illustrations or humorous
messages appropriate to the message strategy.
Words & Tones
The advertisers must also use memorable
and attention-getting words and tones in the
ads.
Selecting Advertising Media
Business owners and managers must
advertise to create product and service
awareness, built their company image and
reputation, and generate sales leads and
revenues.
Major steps in media selection are:

Deciding on reach, frequency and impact
Choose among the major media types
Selecting specific media
Deciding on media timing
Deciding on reach, frequency and
impact

Reach is a measure of percentage people in the
target market who are exposed to the ad campaign
during a given period of time.

Frequency is a measure of how many times the
average person in the target market is exposed to
the message.

Impact is the qualitative value of a message
exposure through a given medium.

Choose among the major media types
By considering:

Consumer media habits, nature of the product,
types of messages, and costs
Major Media Types
Newspapers
Television
Direct Mail

Radio
Magazines
Outdoor
Internet
Profiles of major media types
Medium
Newspaper

Television

Direct mail

Radio

Magazines


Out door

Internet
Advantages Limitations
Flexibility ;timeless; good local mkt Short life; poor production quality; small pass
Coverage; broad acceptability; high -along audience
believability
Good mass mkt coverage; low cost per High absolute cost; high culture; fleeting
Exposure; combine sight, sound and exposure; less audience selectivity
Motion; appealing to the senses
High audience selectivity; flexibility; no Relatively high per exposure; junk mail
Ad competition within the same medium; image
Allows personalization
Good local acceptance; high geographic Audio only, fleeting exposure; low attention
And demographic selectivity; low cost (the half heard medium); fragmented
audience
High geographic and demographic Long ad purchase lead time; high cost; no
Selectivity; credibility and prestige; high guarantee of position
Quality reproduction; long life and good
Pass-along readership
Flexibility; high repeat exposure; low Little audience selectivity; creative limitations
Cost, low message competition; good
Positional selectivity
High selectivity; low cost; immediacy; Small demographic skewed audience;
Interactive capabilities relatively low impact; audience controls
exposure
Selecting specific media vehicles
The media planner now must choose the best media
vehicles-specific media within general media type.
Media planner must compute the cost per thousand
persons reached by vehicle.
The media planner must also consider the costs of
producing ads for different media.
The planner should balance costs against the media
vehicles audience quality.
The media planner should consider audience attention.
The planner should assess the vehicles editorial quality.
Deciding on media timing
The advertiser must also decide how to schedule the
advertising over the course of year.
Some marketers do only seasonal advertising.
The advertiser has to choose the pattern of ads;
Continuity means scheduling ads evenly within a
given period.
Pulsing means scheduling ads unevenly over a given
time period.
Sales Promotion

Sales promotions are short-term
incentives to encourage the purchase or
sale of a product or service.
Sales Promotion
Examples

Hello calling cards
Ufone package
HKB & Sons


Rapid Growth of Sales Promotions
There are some factors which contribute to
the rapid growth of sales promotion.

Product manager face greater pressure to
increase their sales.
Because of high competitive environment,
competitors are using sales promotion as
a tool to differentiate their offers.
Advertising efficiency has been decline
because of rising costs, media culture and
large restaurants.
Consumers have become the deal
oriented and ever larger retailer are
demanding more deal from manufacturer.
Rapid Growth of Sales Promotions
Sales Promotion
Objectives:

Increase distribution of a product.
Dispose of inventories currently held by the
company's distribution channels in order to make
room for new products.
Introduce a new image, logo or product.
Improve competitive standing of an already-
accepted product.
Amplify results of concurrent advertising
campaign.

Sales Promotion Tools

Many tools can be used to accomplish sales
promotion objectives. some of which are as
follows.

Consumer Promotion Tools
Trade Promotion Tools
Business Promotion Tools
Consumer Promotion Tools

Sales promotions targeted at the consumer are called
consumer sales promotions







Samples
Coupons
Cash Refunds
(Rebates)
Price packs (cents-
off deals)
Advertising
Specialties

Premiums
Patronage Rewards
Point-of-Purchase
Communications
Contests, Games, and
Sweepstakes
Samples

A small amount of a product offered to
consumers for trial. Sampling is most
effective but most expensive way to introduce
a new product.

Example:
Pharmaceutical Companies, Olpers milk

Sales Promotion Tools
Coupon

Certificate that gives buyers a saving when they
purchase a specified product.

Example:
Paints, PTC
Sales Promotion Tools
Cash refunds offer

Offer to refund part of the purchase price of a
product to consumers who send a proof of
purchase to the manufacturer.


Sales Promotion Tools
Price packs (cents-off deal)

Reduce price that is marked by the producer directly
on the label or package.

Examples:
Two for the price of one

Sales Promotion Tools
Premium

Goods offered either free or at low cost as
an incentive to buy a product.

Sales Promotion Tools
Example of Premium
In an exhibition at Alhamra Complex,
if you buy a TV costing Rs. 95,000, a 14
TV will be given to you as a free.
14
Advertising specialty

Useful article imprinted with an
advertisers name, given as a gift to
consumers.
Sales Promotion Tools
Example of Advertising Specialty
BATA & Service offers a tennis ball
with shoes printed with the
advertisers name on the ball.
Patronage reward

Cash or other awards for regular use
of a certain companys product or
services.
Sales Promotion Tools
Example of Patronage reward
Mobilink is offering an indigo package in
which if you call an amount of 50 rupees
then you are awarded with an amount of
0.5 rupees. When you will pay the bill then
Mobilink will give a card through which you
can purchase some things from
recommended shops.
Point Of Purchase (POP) Promotion

Display & demonstration that take
place at the point of purchase or sale.
Sales Promotion Tools
Example of Point-of-purchase
To promote the sales,
Ufone fixes the
cardboard, signboard
and posters on the
shops.
Pepsi and Mountain
Dew.

Contests, sweepstakes, games

Promotional events that give
consumers the chance to win
something-such as cash, trips, or
goods-by luck or through extra efforts.
Sales Promotion Tools
Example of Contests, sweepstakes,
games
WARID

Win 50 Motorola SLRV L6 & L7 everyday
(for info sms MOTO to 7070)
L7 L6
Sales Promotion Tools
Trade Promotion Tools

Discounts: (also called price-off, off-list, and
off-invoice)

A Straight reduction in price on
purchases during a stated period of time.
Examples Of Discounts:

HANGTEN introduced
50%
Off on it's Entire stock.

PEPSI recently introduced
5% per litre
price-off.



Trade Promotion Tools
Allowances:

Promotional money paid by manufacturers
to retailers in return for an agreement to
feature the manufacturers products
in some way.

Trade Promotion Tools
Types Of Allowances:

Advertising allowances
Display allowances
Free goods
Push money
Specialty advertising items


Trade Promotion Tools
Business Promotion Tools

Includes many of the same tools used in
consumer and trade promotions
Two additional tools:

Conventions and trade shows
Sales contests

Sales Promotion Tools
Trade Shows:
An event at which goods & services
in a specific industry are exhibited
and demonstrated.
Many organizations uses trade shows to
promote their product sales.
Karachi EXPO promotion centre held
The exhibition on ELECTRONICS
From 9th to 11th sep this year.
Business Promotion Tools


Sales contest:
A trade tool for sellers or dealers to
motivate them to increase their sales
performance over a given period.
Work best when tied to measurable and
achievable sales objective.
e-g LAKSON TOBACCO.
Business Promotion Tools
Sales Promotion Tools
Trade Promotion Tools

Discounts: (also called price-off, off-list, and
off-invoice)

A Straight reduction in price on
purchases during a stated period of time.
Examples Of Discounts:

HANGTEN introduced
50%
Off on it's Entire stock.

PEPSI recently introduced
5% per litre
price-off.



Trade Promotion Tools
Allowances:

Promotional money paid by manufacturers
to retailers in return for an agreement to
feature the manufacturers products
in some way.

Trade Promotion Tools
Types Of Allowances:

Advertising allowances
Display allowances
Free goods
Push money
Specialty advertising items


Trade Promotion Tools
Business Promotion Tools

Includes many of the same tools used in
consumer and trade promotions
Two additional tools:

Conventions and trade shows
Sales contests

Sales Promotion Tools
Trade Shows:
An event at which goods & services
in a specific industry are exhibited
and demonstrated.
Many organizations uses trade shows to
promote their product sales.
Karachi EXPO promotion centre held
The exhibition on ELECTRONICS
From 9th to 11th sep this year.
Business Promotion Tools


Sales contest:
A trade tool for sellers or dealers to
motivate them to increase their sales
performance over a given period.
Work best when tied to measurable and
achievable sales objective.
e-g LAKSON TOBACCO.
Business Promotion Tools
Public Relations

Building good relations with the
companys various publics by
obtaining favorable publicity and
handling or heading off unfavorable
rumors
Public relations departments
Press relations or press agency:
Creating and placing news worth
information in the news media
product publicity:
Publicizing specific products
public affairs:
Building and maintaining national
or local community relations
Public relations departments
Lobbying:
Building relations with legislators
and government officials
Investor relations:
Maintaining relationship with
shareholders and other in financial
community
Public relations departments

Development:
Public relations with donors or
members of not-for-profit
organizations to gain financial
support
The Communication Process
Receiver Decoding Channel Encoding Sender
Noise
Channel
Goals and Tasks of Promotion
Informing






Reminding










Persuading
Target
Audience
AIDA and the Hierarchy of Effects
Attention Interest Desire Action
Awareness
Knowledge
Liking
Preference
Conviction
Purchase
When Elements of Promotion Are Most Useful













Advertising
Personal
selling
Sales
promotion
Public
relations
Either not effective or inefficient
Very effective
Somewhat effective
Awareness Knowledge Liking Preference Conviction
E
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e
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t
i
v
e
n
e
s
s

Purchase
Factors that Affect the Promotion Mix
PushandPull Strategies
Nature of the Product
Stage in the Product
Life Cycle
Target Market Characteristics
Type of Buying Decision
Available Funds
$ $ $
Creating a Promotion Plan
Choose Promotion Mix
Develop Promotion Budget
Set Promotion Objectives
Identify Target Market
Analyze the Marketplace
Criteria for Setting Promotion Objectives



Promotion objectives should:
be measurable, concrete
be based on sound research, with a
well-defined target audience
be realistic
reinforce the overall marketing plan and
relate to specific marketing objectives
Examples of Promotion Objectives
Objective: To Remind
To remind consumers that Peter Pan peanut butter is the
creamiest peanut butter and is available at their nearest grocery
and convenience stores
Objective: To Inform (Awareness)
To increase the top-of-mind awareness level for Peter Pan
peanut butter from 16 percent to 24 percent
Objective: To Persuade (Attitudinal)
To increase the percentage of parents who feel that Peter Pan
peanut butter is the best peanut butter for their children from
22 percent to 35 percent
Techniques for Setting Promotion Budgets
Arbitrary Allocation

All - You - Can - Afford

Competitive Parity

Percent of Sales

Market Share

Objective and Task
Regulation of Promotion
Self-Regulation

National Advertising Division (NAD)

National Advertising Review Board (NARB)
Federal Regulation

Federal Trade Commission (FTC)

Effects of Advertising
Advertising Spending
R
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n

o
n

A
d
v
e
r
t
i
s
i
n
g

E
x
p
e
n
d
i
t
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r
e
s

Increasing efficiency
as ad budget becomes
sufficient
Diminishing
returns
on additional
spending
Major Types of Advertising
Corporate Image
Advocacy Advertising
Types
of
Advertising
Pioneering
Competitive
Comparative
Product
Advertising
Institutional
Advertising
Advertising Campaign Decision Process
Determine the campaign objectives.
Make creative decisions.
Make media decisions.
Evaluate the campaign.
Common Advertising Appeals
Profit
Health
Love or Romance
Fear
Admiration
Convenience
Fun and Pleasure
Vanity and Egotism
Save money, keep from losing money
Body-conscious, healthy
Sell cosmetics and perfumes
Social embarrassment, growing old, losing
health, power
Celebrity endorsement effective
Fast-food and microwave products
Vacations, amusement parks
Expensive, conspicuous items
Executional Styles for Advertising
Mood or
Image
Musical
Demon-
stration
Scientific
Real/
Animated
Product
Symbols
Fantasy
Lifestyle
Spokes-
person/
Testimonial
Slice-of-Life
Humorous
Common
Executional
Styles
Methods Used to Evaluate Advertising Campaigns
Pretests

Examples:
Consumer jury tests
Portfolio or unfinished rough tests
Physiological tests
Post-tests
Examples:
Recognition tests
Recall tests
Attitude measures
Audience size measurement
The Tools of Public Relations
Major
Tools
Used By
PR
Professionals
New Product Publicity
Product Placement
Customer Satisfaction
Phone Lines
Consumer Education
Event Sponsorship
Issue Sponsorship
Web Sites
Types of Consumer & Sales Promotion Goals
Type of buyer Desired results Sales promotion examples
Loyal customers Reinforce behavior, Loyalty marketing programs,
People who buy your increase consumption, such as frequent-buyer cards
product most or all change purchase timing or frequent-shopper clubs
of the time Bonus packs that give loyal
consumers an incentive to
stock up or premiums offered
in return for proofs-of-purchase
Competitors Break loyalty, persuade Sampling to introduce your
customers to switch to your brand products superior qualities
People who buy a compared to their brand
competitors product Sweepstakes, contests, or
most or all of the time premiums that create interest
in the product
Brand switchers Persuade to buy your Any promotion that lowers the
People who buy a brand more often price of the product, such as
variety of products coupons, price-off packages,
in the category and bonus packs
Trade deals that help make the
product more readily available
than competing products
Price buyers Appeal with low prices Coupons, price-off packages,
People who or supply added value refunds, or trade deals that
consistently buy the that makes price less reduce the price of brand to
least expensive brand important match that of the brand that
would have been purchased

Source: From Sales Promotion Essentials, 2E by Don. E. Schultz, William A. Robinson, and Lisa A. Petrison. Reprinted by permission of NTC Publishing Group, Lincolnwood, IL.
Tools for Consumer Sales Promotion
Coupons
Premiums
Frequent Buyer Programs
Contests and
Sweepstakes
Samples
Point-of-Purchase
Displays
Six
Categories
of
Consumer
Sales
Promotions
Tools for Trade Sales Promotion
Trade Allowances
Push Money
Training
Free Merchandise
Store Demonstrations
Business Meetings,
Conventions, Trade-Shows
Six
Categories
of
Trade
Sales
Promotions
Advantages of Personal Selling
Cost Control
Message Control
Targeted
Detailed
Information
Closing Sales
Advertising Versus Personal Selling
Personal Selling is more important if...

The product has a high value.
It is a custom-made product.
There are few customers.
The product is technically complex.
Customers are geographically concentrated.
Advertising/Sales Promotion is more important if...

The product has a low value.
It is a standardized product.
There are many customers.
The product is simple to understand.
Customers are geographically dispersed.
Differences Between Traditional & Relationship Selling
Traditional Personal Selling
Sell products (goods and services)
Focus on closing sales
Limited sales planning
Spend most contact time telling
customers about product
Conduct product-specific needs
assessment
Lone-wolf approach to the account
Proposals and presentations based
on pricing and product features
Sales follow-up focused on product
delivery

Relationship Selling
Sell advice, assistance, and counsel
Focus on improving the customers bottom line
Considers sales planning as top priority
Spend most contact time attempting to build a
problem-solving environment with the customer
Conduct discovery in the full scope of the
customers operations
Team approach to the account
Proposals and presentations based on profit
impact and strategic benefits to the customer
Sales follow-up is long term, focused on
long-term relationship enhancement

Source: Robert M. Peterson, Patrick L. Shul, and George H. Lucas, Jr., Consultative Selling: Walking the Walk in the New Selling Environment,
National Conference on Sales Management, Proceedings, March 1996.
Steps in the Selling Process
Basic
Steps in
the
Selling
Process
Generating Sales Leads
Qualifying Sales Leads
Making the Sales Approach
Making the Sales
Presentation
Handling Objections
Closing the Sale
Following Up
Functions of Sales Management
Motivate
Sales Force
Evaluate
Sales Force
Manage
Turnover
Train Sales
Force
Develop
Compen-
sation Plan
Structure
Sales Force
Determine
Sales Force
Size
Recruit Sales
Force
Set Sales
Objectives
Major Tasks of
Sales
Management