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Chapter 8
PROMOTION
STRATEGIES
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Contents
Definition of promotion
Advertising
Sales promotion
Public relations
Personal selling
Direct and digital marketing
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1. Definition of promotion
• In marketing, promotion refers to any type of marketing
communication used to inform or persuade target
audiences of the relative merits of a product, service,
brand or issue.
• The promotion mix is the specific blend of promotion
tools that the company uses to persuasively communicate
customer value and build customer relationships.
1. Definition of promotion
5 major promotion tools
• advertising
• sales promotion
• public relations
• personal selling
• direct and digital marketing
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2.1. What is advertising?
• Advertising: any paid form of nonpersonal presentation
and promotion of ideas, goods, or services by an
identified sponsor.
• The firm must pay for advertising.
2.1. What is advertising?
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2.2. Advertising objectives
• Types of advertising:
– Informative advertising is used when introducing a
new product category to build primary demand.
– Persuasive advertising is important with increased
competition to build selective demand.
– Comparative advertising is when a company
compares its brand with other brands.
– Reminder advertising is important with mature
products to help maintain customer relationships and
keep customers thinking about the product
2.2. Advertising objectives
2.3. Setting ad buget
Factors to Consider
• Stage in product life cycle
• Market share
• Competition
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2.4. Developing ad strategy
• Creating advertising messages
• Selecting advertising media
2.4.1. Creating advertising messages
Consumers often avoid watching ads.
Merging advertising and entertainment:
• Madison & Vine
• Native advertising
2.4.1. Creating advertising messages
Message and content strategy: the general message
that will be communicated to consumers.
• Identifies consumer benefits
• Follows from company’s broader positioning and
customer value creation strategies
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2.4.1. Creating advertising messages
The creative concept is the compelling “big idea” that
will bring an advertising message strategy to life in a
distinctive and memorable way.
Characteristics of the appeals should be:
• Meaningful
• Believable
• Distinctive
Message execution is when the advertiser turns the big
idea into an actual ad execution that will capture the
target market’s attention and interest.
2.4.1. Creating advertising messages
Message Execution Styles
Slice of life Lifestyle Fantasy
Mood or Musical Personality
image symbol
Technical Scientific Testimonial or
expertise evidence endorsement
2.4.2 Selecting advertising media
Television
• Advantages: good mass-marketing coverage; low
cost per exposure; combine sight, sound and motion;
appealing to the sense
• Limitations: high absolute costs; high clutter; fleeting
exposure; less audience selectivity
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2.4.2 Selecting advertising media
Radio
• Advantages: good local acceptance; high geographic
and demographic selectivity; low cost
• Limitations: audio only; fleeting exposure; low
attention (the half-heard medium); fragmented
audience
2.4.2 Selecting advertising media
Newspapers
• Advantages: flexibility; timeliness;
good local market coverage;
broad accpetability; high
believability
• Limitations: short life; poor
reproduction quality; small pass
along audience
2.4.2 Selecting advertising media
Magazines
• Advantages: high geographic and
demographic selectivity; credibility
and prestige; high-quality
reproduction; long life and good
pass-along readership
• Limitations: long ad purchase lead
time; high cost; no guarantee of
position
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2.4.2 Selecting advertising media
Digital, mobile and social media
• Advantages: high selectivity;
low cost; immediacy;
engagement capability
• Limitations: potentially low
impact; high audience control
of content and exposure
2.4.2 Selecting advertising media
Direct mail
• Advantages: high audience
selectivity; flexibility; no ad
competition within the
same medium; allow
personalization
• Limitations: relatively high
cost per exposure; “junk
mail” image
2.4.2 Selecting advertising media
Outdoor
• Advantages: flexibility; high
repeat exposure; low cost;
low message competition;
good positional selectivity
• Limitations: little audience
selectivity; creative
limitation
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2.5. Advertising evaluation
• Return on advertising investment is the net return
on advertising investment divided by the costs of the
advertising investment.
• Communication effects indicate whether the ad and
media are communicating the ad message well and
can be tested before or after the ad runs.
• Sales and profit effects compare past sales and
profits with past expenditures or through
experiments.
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3.1. Sales promotion
• Sales promotion refers to the short-term
incentives to encourage purchases or sales of
a product or service now.
• 3 sales promotion targets:
– consumers
– intermediaries (resellers)
– sales force
3.2. Sales promotion tools
Consumers:
• display and demonstration at points-of-sales
• samples (a trial amount of a product)
• coupons, vouchers, etc.
• buy 3 get 1 free, gifts, sweepstake,etc.
3.2. Sales promotion tools
Intermediaries and sales force
• quantity discount: buy in a great quantity and get a
discount
• delivery support: if the reseller buys more than a
certain quantity, the manufacturer will deliver the
goods to the destination for them
• price cut in the next buy
• display support: provide or award money to
intermediaries who have really beautiful display of
the manufacturer's products
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3.2. Sales promotion tools
Intermediaries and sales force
• free goods: give products to shop owners for free
trial use and they will voluntarily sell and promote
the manufacturer's products
• Sales contests are effective in motivating salespeople
or dealers to increase performance over a given
period.
• Conventions and trade shows are effective to reach
many customers not reached with the regular sales
force.
4.1. Definition
• Public relations (PR) involves 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.
“Advertising is what you pay for;
publicity is what you pray for.”
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4.1. Definition
Advertising vs PR
Advertising PR
Paid Spreading
Demonstrating products Focusing on building trust
More reliable due to the third
The public doubts
confirmation
No guarantee, must persuade the
Select where to appear
media
The third party control the final
Free creativity
content
Mostly use the visual
PR uses words
element
Costly Less costly
“Buy the product” “This is very important”
Source: Forbes
4.2. Functions of PR
• Press relations or press agency involves the creation
and placing of newsworthy information to attract
attention to a person, product, or service.
• Product publicity involves publicizing specific
products.
• Public affairs involves building and maintaining
national or local community relations.
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4.2. Functions of PR
• Lobbying involves building and maintaining relations
with legislators and government officials to influence
legislation and regulation.
• Investor relations involves maintaining relationships
with shareholders and others in the financial
community.
• Development involves public relations with donors
or members of nonprofit organizations to gain
financial or volunteer support.
4.3. The Role and Impact of PR
• Lower cost than advertising
• Stronger impact on public awareness than
advertising
• Has power to engage consumers and make
them part of the brand story
4.4. PR tools
News Speeches Special events
Corporate
Written Public service
identity
materials activities
materials
Buzz Social
marketing networking Internet
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5.1. Definition
• Personal selling is the interpersonal part of the
promotion mix and can include:
– Face-to-face communication
– Telephone communication
– Video or Web conferencing
• Characteristics: face-to-face, building relationships,
interactives
• Drawbacks: costly, hard to change immediately due
to signed contracts with sales teams
5.1 Definition
• Salespeople are an effective link between the
company and its customers to produce customer
value and company profit by
– Representing the company to customers
– Representing customers to the company
– Working closely with marketing
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5.2. Process
5.2.1. Prospecting and qualifying
• Prospecting identifies qualified potential customers
through referrals from: customers, suppliers,
dealers, Internet
• Qualifying involves identifying good customers and
screening out poor ones by looking at: financial
ability, volume of business, needs, location, growth
potential
5.2.2. Preapproach
• Preapproach is the process of learning as much as
possible about a prospect, including needs, who is
involved in the buying, and the characteristics and
styles of the buyers
Objectives Approaches
• Qualify the prospect • Personal visit
• Gather information • Phone call
• Make an immediate sale • Letter/e-mail
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5.2.3. Approach
• Approach is the process where the salesperson
meets and greets the buyer and gets the relationship
off to a good start and involves the salesperson’s:
– Appearance
– Opening lines
– Follow-up remarks
5.2.4. Presentation
• Presentation is when the salesperson tells the
product story to the buyer, presenting customer
benefits and showing how the product solves the
customer’s problems.
5.2.5. Handling objections
• Handling objections is the process where
salespeople resolve problems that are logical,
psychological, or unspoken.
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5.2.6. Closing
• Closing is the process where salespeople
should recognize signals from the buyer—
including physical actions, comments, and
questions—to ask for a order and finalize the
sale.
5.2.7. Follow-up
• Follow-up is the last step in which the
salesperson follows up after the sale to ensure
customer satisfaction and repeat business.
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6.1. Definition
• Direct and digital marketing involve engaging
directly with carefully targeted individual
consumers and customer communities to both
obtain an immediate response and build lasting
customer relationships.
6.2. Benefits
• Convenience
• Ready access to many products
• Access to comparative information about companies,
products, and competitors
• Interactive and immediate
• Tool to build customer relationships
• Low-cost, efficient, fast alternative to reach markets
• Flexible
• Access to buyers not reachable through other
channels
6.3. Forms of Direct and Digital
Marketing
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6.3.1. Digital and social media
marketing
• Online marketing is marketing via the Internet using
company Web sites, online ads and promotions, e-
mail, online video, and blogs.
• Online marketing forms: Marketing websites,
branded community websites, online advertising,
email marketing, spam, online video, viral marketing,
blogs
6.3.1. Digital and social media
marketing
Social Media Marketing
Advantages:
• Targeted and personal
• Interactive
• Immediate and timely
• Real-time marketing
• Cost effective
• Engagement and social sharing capabilities
6.3.1. Digital and social media
marketing
• Mobile marketing delivers messages, promotions,
and other content to on-the-go consumers through
mobile phones, smartphones, tablets, and other
mobile devices.
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6.3.2. Traditional Direct Marketing
Forms
• Direct-mail marketing
• Catalog direct marketing
• Telemarketing
• Direct-response television
• Kiosk Marketing
6.4. Public Policy Issues in
Direct and Digital Marketing
• Irritation includes annoying and offending
customers.
• Unfairness includes taking unfair advantage of
impulsive or less-sophisticated buyers.
• Deception includes “heat merchants” who design
mailers and write copy designed to mislead
consumers.
• Fraud includes identity theft and financial scams.
• Consumer privacy involves concerns that marketers
may have too much information and use it to take
unfair advantage.
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Above vs Below the line
Above vs Below the line
• ATL (Above The Line) - PULL MARKETING: consist of
advertising activities that are largely non-targeted
and have a wide reach. ATL communication is done to
build the brand and inform the customers about the
product.
• BTL (Below the line) - PUSH MARKETING or BRAND
ACTIVATION consists of very specific, memorable and
direct advertising activities focused on targeted
groups of consumers.
Above vs Below the line
Above the line Below the line
Target
Objectives
Interaction
Result
measuring
Activities
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Product or market type
• Consumer goods:
• Industrial goods:
Readiness to buy
Effectiveness
Sales
promotion
Personal
selling
Advertising,
PR
Know Understand Trust Buy
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Product life cycle stage
Effectiveness
Sale promotion
Advertising,
PR
Personal selling
Introduction Growth Maturity Decline
Pull/push strategy choice
• Push strategy:
– focus on personal selling
– sales promotion for intermediaries and sales force
• Pull strategy:
– a lot of advertsing and sales promotion for
consumers
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