Description
Setting of communication objectives, identifying target audience, modes of communication, designing message, choosing tool for communication, Media decisions, evaluating various media, Advertising management, Managing sales promotions, evaluating results, integrating the entire communication, role of public relations and publicity, significance and managing communication through direct marketing and personnel selling, role of internet marketing, emerging communication trends
Managing the Integrated Communication What is communication? Setting of communication objectives, identifying target audience, modes of communication, designing message, choosing tool for communication, Media decisions, evaluating various media, Advertising management, Advertisement management, Managing sales promotions, evaluating results, integrating the entire communication, role of public relations and publicity, significance and managing communication through direct marketing and personnel selling, role of internet marketing, emerging communication trends.
1
“Science
of tough cleaning” means that its concept is based on the oxidization that oxidizes the stains
2
Promotions
Mahinder singh Dhoni (45%) 24 Brands Shahrukh khan 16 Brands Sachin Tendulkar 15 Brands - Adex Survey of TAM Research Kareena kapoor, Sonam kapoor, Kajol, Aishwarya Rai were the most popular faces. Bollywood Actors (42%) & Sports personality (10%) are associated for the celebrity endorsements on TV. Top 5 categories endorsed by celebrities are: Aerated soft drinks, Cellular phone services, Toilet Soaps, Shampoos & Tele Vision. Brands endorsed by celebrities are: Lux, Pepsi, Airtel, Panasonic, Coca- cola.
3
• Emami is making Bipasha Basu as their brand ambassader. • Boroplus Amitabh Bachan • Navratan Oil SRK • Zandu Balm Mallaika Arora khan (4550%)
4
Dabur India has roped in Ravi Kishan to endorse Chawanprash brands for localized promotions. (UP & Bihar) Mr.Amitabh Bachchan & Mr. Dhoni for national Campaigns. Airtel, Parle Monaco, Marico Thanda Tel had also signed him For promotions.
5
• E-coupon 20-25 Crore market in total $1 bn advertising market. • Sms, Emails, Snap deal.com,Open 2save.com, Dealpals, Coupon seva. • Kellogg’s chocos Rs 10 range (K-pak) is a low fat product with the goodness of wheat, vitamins and minerals. Roped Karishma kapoor for endorsement. • They also tied up with Mobile 2 win for mobile gaming. Choco race for Kellogg’s chocos. It is instant hit for target group (6-14 yrs of kids).
6
Mr Anupam Dutta MD of Kellogg’s is hopeful of increasing their market share in breakfast cereals in India.
7
• Promotion: function of informing, persuading, and influencing the consumer’s purchase decision
• Marketing Communications: transmission from a sender to a receiver of a message dealing with the buyer-seller relationship
8
Marketing Communications
The means by which firms attempt to inform, persuade, and remind consumers, directly or indirectly, about the products and brands they sell.
9
Elements in the Communications Process • • • • • • Sender Message Receiver Response Feedback Noise
10
The Communications Process
• An effective promotional message accomplishes three tasks:
– It gains the receiver’s attention – It achieves understanding by both receiver and sender – It stimulates the receiver’s needs and suggests an appropriate method of satisfying them
11
• AIDA concept (Attention-InterestDesire-Action) – an explanation of the steps through which an individual reaches a purchase decision
– Sender – Encoding – Channel – Decoding – Response – Feedback – Noise
12
13
The Communications Process
• Selective attention • Selective distortion • Selective retention
14
Objectives of Promotion
• Provide Information
– Inform the market about the availability of a particular good or service
• Increase Demand
– Some promotions are aimed at increasing primary demand, the desire for a general product category – More promotions are aimed at increasing selective demand, the desire for a specific brand
15
• Differentiate the Product
– Homogenous demand for many products results when consumers regard the firm’s output as virtually identical to its competitors’– then, the firm has virtually no control over marketing variables
• Accentuate the Product’s Value
– Promotion can explain the greater ownership utility of a product to buyers, thereby accentuating its value and justifying a higher price
16
• Stabilize Sales
– For the typical firm, sales fluctuations may result from cyclical, seasonal, or irregular demand – Stabilizing these variations is often an objective of promotional strategy
17
Elements of the Promotional Mix
• Promotional mix: blend of personal selling and non personal selling designed to achieve promotional objectives
– Personal selling: interpersonal promotional process involving a seller’s person-to-person presentation to a prospective buyer – Nonpersonal selling includes: Advertising, Product placement, Sales promotion, Direct marketing, Public relations
18
• Advertising
– Paid, nonpersonal communication through various media by a business firm, not-for-profit organization, or individual identified in the message with the hope of informing or persuading members of a particular audience
• Product Placement
– Marketer pays a motion picture or television program owner a fee to display his or her product prominently in the film or show
19
• Sales Promotion
– Marketing activities that stimulates consumer purchasing (includes: displays, trade shows, coupons, premiums, contests, product demonstrations, and various non recurrent selling efforts) – Trade promotion
20
• Direct Marketing
– Direct communications other than personal sales contact between buyer and seller, designed to generate sales, information requests, or store visits
21
• Public relations: firm’s communications and relationships with its various publics • Publicity: stimulation of demand for good, service, place, idea, person, or organization by unpaid placement of commercially significant news or favorable media presentations
22
Sponsorships
• Provision of funds for a sporting or cultural event in exchange for a direct association with the events or activity
23
A significant number of premium car buyers today use online channels to become familiar with the features of a car even before they step into the showrooms . 2-3% of sales from digital marketing in 2005. 18-20% of sales from digital marketing in 2010.
24
• Tata Motors will launch premium car “ARIA”. Priced at rs 12-13 lakh. • Competitors Xylo, Innova. • Company will invest Rs.1.5 cr in online campaign (Online game at buildadreamcar.com) in five stages.
25
• • • •
Stallio 110 cc bikes priced at Rs.44,699. Mozo 390 cc bikes priced at Rs.1.79 lakh. Competitors are Hero Honda, Bajaj Auto. In 2008, M & M acquired Kinetic motors and launched Rhodeo scooters.Two wheelers sales during april-august 2010 jumped 27%at 46.21 lakh units & Bikes grew at 35.35 lakh units (24% jump) • Aamir Khan as brand ambassador.
26
Characteristics of Marketing Communications Mix
Advertising • Pervasiveness • Amplified expressiveness • Impersonality
Sales Promotion • Communication • Incentive • Invitation
27
Characteristics of Marketing Communications Mix
Public Relations and Publicity • High credibility • Ability to catch buyers off guard • Dramatization Events and Experiences • Relevant • Involving • Implicit
28
Characteristics of Marketing Communications Mix
Direct Marketing • Customized • Up-to-date • Interactive Personal Selling • Personal interaction • Cultivation • Response
29
The Battle
• Future group operates over 120 Big Bazaar stores, 170 Food Bazaar stores. • Future group’s ecommerce venture future bazaar.com has revamped its online business portfolio (Started 4 years ago) and expects an around Rs 1,000 crore revenue over the next 18-24 months. • Attractive deals are available on TVs, phones, laptops, apparels, home, kitchen appliances and home furnishings.
30
Integrated Marketing Communications
• Coordination of all promotional activities – media advertising, direct mail, personal selling, sales promotion, and public relations – to produce a unified customer-focused promotional message
– Success of any IMC program depends critically on identifying the members of an audience and understanding what they want
31
Developing an Optimal Promotional Mix • Factors that influence the effectiveness of a promotional to mix:
– Nature of the market – Nature of the product – Stage in the product life-cycle – Price – Funds available for promotion
32
33
• Nikon corporation will spend Rs.62 crore on brand promotion in 2010-11. • Nikon India will launch its new television commercial this week & is targeting 1800 retail outlets for in-store branding. • Company has converted 70-80% of grey marketer into authorized Nikon camera dealers.
34
Influencing Factors Nature of the market Number of buyers Geographic concentration Type of customer Nature of the product Complexity Service requirements Type of good or service Use of trade-ins Stage in the product life cycle
Personal Selling Limited number Concentrated Business purchaser Custom-made, complex Considerable Business Trade-ins common
Advertising Large number Dispersed Ultimate consumer Standardized Minimal Consumer Trade-ins uncommon
Often emphasized at every stage; heavy emphasis in the introductory and early growth stages in acquainting marketing intermediaries and potential consumers with the new good or service High unit value
Often emphasized at every stage; heavy emphasis in the latter part of the growth stage, as well as the maturity and early decline stages, to persuade consumers to select specific brands Low unit value
35
Price
Pulling and Pushing Promotional Strategies
• Pulling strategy: promotional effort by a seller to stimulate demand among final users, who will then exert pressure on the distribution channel to carry the good or service, pulling it though the marketing channel • Pushing strategy: promotional effort by a seller to members of the marketing channel intended to stimulate personal selling of the good or service, thereby pushing it through the marketing channel
36
Communication Platforms
Advertising • Print and broadcast ads • Packaging inserts • Motion pictures • Brochures and booklets • Posters • Billboards • POP displays • Logos • Videotapes Sales Promotion • Contests, games • Premiums • Sampling • Trade shows, exhibits • Coupons • Rebates • Entertainment • Continuity programs • Tie-ins
37
Communication Platforms Events/ Experiences Public Relations • Sports • Press kits • Entertainment • Speeches • Festivals • Seminars • Arts • Annual reports • Causes • Charitable donations • Factory tours • Publications • Company museums • Community relations • Street activities • Lobbying • Identity media • Company magazine
38
One in five US Kids aged six to 19 are obese, where BMI is greater than 30.
• The Walt Disney company had started “the Magic of healthy living” campaign. • It will feature public service announcements by Michelle Obama, teen idols Nick Jonas, TV Star Brenda Song and other celebrities, all seeking “to inspire kids” to lead healthy lives and their parents to instill good habits in them. • Disney will grant one million dollar to build play spaces and gardens in 10 undeserved communities nationwide.
39
Communication Platforms
Personal Selling • Sales presentations • Sales meetings • Incentive programs • Samples • Fairs and trade shows Direct Marketing • Catalogs • Mailings • Telemarketing • Electronic shopping • TV shopping • Fax mail • E-mail • Voice mail
40
Figure 17.4 Steps in Developing Effective Communications Identify target audience Determine objectives Design communications
Select channels
Establish budget Decide on media mix Measure results Manage IMC
41
Image
The set of beliefs, ideas, and impressions a person holds regarding an object.
42
Communications Objectives
• • • • Category need Brand awareness Brand attitude Purchase intention
43
Designing the Communications
• Message strategy • Creative strategy • Message source
44
Selecting the Communications Channels • Personal communication channels • Non personal communication channels • Integration
45
Creative Strategy
• Informational and transformational appeals • Positive and negative appeals
– – – – – – – Fear Guilt Shame Humor Love Pride Joy
46
The Importance of Taglines
Brand Theme • Our car is more spacious • It is prestigious to own our brand of TV • Our butter is tasty and fun to eat • Our motorbike is fuel efficient Ad Tagline
“More Car per Car” (Tata Indica) “Neighbor’s Envy; Owner’s Pride” (Onida TV) “Utterly Butterly Delicious” (Amul Butter) “Fill it, shut it, Forget it” (Hero Honda motorcycle)
47
Message Source
Celebrity Characteristics
– Expertise – Trustworthiness – Likeability
48
Personal Communications Channels • Advocate Channels • Expert Channels • Social Channels
49
Stimulating Personal Influence Channels
• Identify influential individuals and devote extra attention to them • Create opinion leaders • Use community influentials in testimonial advertising • Develop advertising with high “conversation value” • Develop WOM referral channels • Establish an electronic forum • Use viral marketing
50
Non personal Communication Channels
• • • • Media Sales Promotion Events and Experiences Public Relations
51
Budgeting for Promotional Strategy
• Percentage-of-sales method • Fixed-sum-per-unit method • Meeting competition method • Task-objective method
52
Method
Percentage-of-sales method
Description
Promotional budget is set as a specified percentage of either past or forecasted sales.
Example
“Last year we spent $10,500 on promotion and had sales of $420,000. Next year we expect sales to grow to $480,000, and we are allocating $12,000 for promotion.”
Fixed-sum-per-unit method
Promotional budget is set as a predetermined dollar amount for each unit sold or produced.
Promotional budget is set to match competitor’s promotional outlays on either an absolute or relative basis. Once marketers determine their specific, promotional objectives, the amount (and type) of promotional spending needed to achieve them is determined.
“Our forecast calls for sales of 14,000 units, and we allocate promotion at the rate of $65 per unit.”
“Promotional outlays average 4 percent of sales in our industry.”
Meeting competition method
Task-objective method
“By the end of next year, we want 75 percent of the area high-school students to be aware of our new, highly automated fast-food prototype outlet. How many promotional dollars will it take, and how should they be spent?”
53
Measuring the Effectiveness of Promotion
• Two basic measurement tools:
– Direct sales results measures the effectiveness of promotion by revealing the specific impact on sales revenues for each dollar of promotional spending – Indirect evaluation concentrates on quantifiable indicators of effectiveness like:
• Recall - how much members of the target market remember about specific products or advertisements • Readership – size and composition of a message’s audience
54
• Measuring Online Promotions
– Early attempts at measuring online promotional efforts involved counting hits and visits – Incorporating direct response and comparing different promotions for effectiveness – Two major techniques for setting online advertising rates:
• Cost per impression (CPM), technique that related the cost of an ad to every thousand people who read it • Cost per response (click-throughs), which assumes that those who actually click on an ad want more information
55
Factors in Setting Marketing Communications Mix
• Type of Product Market • Buyer Readiness to Make a Purchase • Stage in the Product Life Cycle
56
doc_206683980.pptx
Setting of communication objectives, identifying target audience, modes of communication, designing message, choosing tool for communication, Media decisions, evaluating various media, Advertising management, Managing sales promotions, evaluating results, integrating the entire communication, role of public relations and publicity, significance and managing communication through direct marketing and personnel selling, role of internet marketing, emerging communication trends
Managing the Integrated Communication What is communication? Setting of communication objectives, identifying target audience, modes of communication, designing message, choosing tool for communication, Media decisions, evaluating various media, Advertising management, Advertisement management, Managing sales promotions, evaluating results, integrating the entire communication, role of public relations and publicity, significance and managing communication through direct marketing and personnel selling, role of internet marketing, emerging communication trends.
1
“Science
of tough cleaning” means that its concept is based on the oxidization that oxidizes the stains
2
Promotions
Mahinder singh Dhoni (45%) 24 Brands Shahrukh khan 16 Brands Sachin Tendulkar 15 Brands - Adex Survey of TAM Research Kareena kapoor, Sonam kapoor, Kajol, Aishwarya Rai were the most popular faces. Bollywood Actors (42%) & Sports personality (10%) are associated for the celebrity endorsements on TV. Top 5 categories endorsed by celebrities are: Aerated soft drinks, Cellular phone services, Toilet Soaps, Shampoos & Tele Vision. Brands endorsed by celebrities are: Lux, Pepsi, Airtel, Panasonic, Coca- cola.
3
• Emami is making Bipasha Basu as their brand ambassader. • Boroplus Amitabh Bachan • Navratan Oil SRK • Zandu Balm Mallaika Arora khan (4550%)
4
Dabur India has roped in Ravi Kishan to endorse Chawanprash brands for localized promotions. (UP & Bihar) Mr.Amitabh Bachchan & Mr. Dhoni for national Campaigns. Airtel, Parle Monaco, Marico Thanda Tel had also signed him For promotions.
5
• E-coupon 20-25 Crore market in total $1 bn advertising market. • Sms, Emails, Snap deal.com,Open 2save.com, Dealpals, Coupon seva. • Kellogg’s chocos Rs 10 range (K-pak) is a low fat product with the goodness of wheat, vitamins and minerals. Roped Karishma kapoor for endorsement. • They also tied up with Mobile 2 win for mobile gaming. Choco race for Kellogg’s chocos. It is instant hit for target group (6-14 yrs of kids).
6
Mr Anupam Dutta MD of Kellogg’s is hopeful of increasing their market share in breakfast cereals in India.
7
• Promotion: function of informing, persuading, and influencing the consumer’s purchase decision
• Marketing Communications: transmission from a sender to a receiver of a message dealing with the buyer-seller relationship
8
Marketing Communications
The means by which firms attempt to inform, persuade, and remind consumers, directly or indirectly, about the products and brands they sell.
9
Elements in the Communications Process • • • • • • Sender Message Receiver Response Feedback Noise
10
The Communications Process
• An effective promotional message accomplishes three tasks:
– It gains the receiver’s attention – It achieves understanding by both receiver and sender – It stimulates the receiver’s needs and suggests an appropriate method of satisfying them
11
• AIDA concept (Attention-InterestDesire-Action) – an explanation of the steps through which an individual reaches a purchase decision
– Sender – Encoding – Channel – Decoding – Response – Feedback – Noise
12
13
The Communications Process
• Selective attention • Selective distortion • Selective retention
14
Objectives of Promotion
• Provide Information
– Inform the market about the availability of a particular good or service
• Increase Demand
– Some promotions are aimed at increasing primary demand, the desire for a general product category – More promotions are aimed at increasing selective demand, the desire for a specific brand
15
• Differentiate the Product
– Homogenous demand for many products results when consumers regard the firm’s output as virtually identical to its competitors’– then, the firm has virtually no control over marketing variables
• Accentuate the Product’s Value
– Promotion can explain the greater ownership utility of a product to buyers, thereby accentuating its value and justifying a higher price
16
• Stabilize Sales
– For the typical firm, sales fluctuations may result from cyclical, seasonal, or irregular demand – Stabilizing these variations is often an objective of promotional strategy
17
Elements of the Promotional Mix
• Promotional mix: blend of personal selling and non personal selling designed to achieve promotional objectives
– Personal selling: interpersonal promotional process involving a seller’s person-to-person presentation to a prospective buyer – Nonpersonal selling includes: Advertising, Product placement, Sales promotion, Direct marketing, Public relations
18
• Advertising
– Paid, nonpersonal communication through various media by a business firm, not-for-profit organization, or individual identified in the message with the hope of informing or persuading members of a particular audience
• Product Placement
– Marketer pays a motion picture or television program owner a fee to display his or her product prominently in the film or show
19
• Sales Promotion
– Marketing activities that stimulates consumer purchasing (includes: displays, trade shows, coupons, premiums, contests, product demonstrations, and various non recurrent selling efforts) – Trade promotion
20
• Direct Marketing
– Direct communications other than personal sales contact between buyer and seller, designed to generate sales, information requests, or store visits
21
• Public relations: firm’s communications and relationships with its various publics • Publicity: stimulation of demand for good, service, place, idea, person, or organization by unpaid placement of commercially significant news or favorable media presentations
22
Sponsorships
• Provision of funds for a sporting or cultural event in exchange for a direct association with the events or activity
23
A significant number of premium car buyers today use online channels to become familiar with the features of a car even before they step into the showrooms . 2-3% of sales from digital marketing in 2005. 18-20% of sales from digital marketing in 2010.
24
• Tata Motors will launch premium car “ARIA”. Priced at rs 12-13 lakh. • Competitors Xylo, Innova. • Company will invest Rs.1.5 cr in online campaign (Online game at buildadreamcar.com) in five stages.
25
• • • •
Stallio 110 cc bikes priced at Rs.44,699. Mozo 390 cc bikes priced at Rs.1.79 lakh. Competitors are Hero Honda, Bajaj Auto. In 2008, M & M acquired Kinetic motors and launched Rhodeo scooters.Two wheelers sales during april-august 2010 jumped 27%at 46.21 lakh units & Bikes grew at 35.35 lakh units (24% jump) • Aamir Khan as brand ambassador.
26
Characteristics of Marketing Communications Mix
Advertising • Pervasiveness • Amplified expressiveness • Impersonality
Sales Promotion • Communication • Incentive • Invitation
27
Characteristics of Marketing Communications Mix
Public Relations and Publicity • High credibility • Ability to catch buyers off guard • Dramatization Events and Experiences • Relevant • Involving • Implicit
28
Characteristics of Marketing Communications Mix
Direct Marketing • Customized • Up-to-date • Interactive Personal Selling • Personal interaction • Cultivation • Response
29
The Battle
• Future group operates over 120 Big Bazaar stores, 170 Food Bazaar stores. • Future group’s ecommerce venture future bazaar.com has revamped its online business portfolio (Started 4 years ago) and expects an around Rs 1,000 crore revenue over the next 18-24 months. • Attractive deals are available on TVs, phones, laptops, apparels, home, kitchen appliances and home furnishings.
30
Integrated Marketing Communications
• Coordination of all promotional activities – media advertising, direct mail, personal selling, sales promotion, and public relations – to produce a unified customer-focused promotional message
– Success of any IMC program depends critically on identifying the members of an audience and understanding what they want
31
Developing an Optimal Promotional Mix • Factors that influence the effectiveness of a promotional to mix:
– Nature of the market – Nature of the product – Stage in the product life-cycle – Price – Funds available for promotion
32
33
• Nikon corporation will spend Rs.62 crore on brand promotion in 2010-11. • Nikon India will launch its new television commercial this week & is targeting 1800 retail outlets for in-store branding. • Company has converted 70-80% of grey marketer into authorized Nikon camera dealers.
34
Influencing Factors Nature of the market Number of buyers Geographic concentration Type of customer Nature of the product Complexity Service requirements Type of good or service Use of trade-ins Stage in the product life cycle
Personal Selling Limited number Concentrated Business purchaser Custom-made, complex Considerable Business Trade-ins common
Advertising Large number Dispersed Ultimate consumer Standardized Minimal Consumer Trade-ins uncommon
Often emphasized at every stage; heavy emphasis in the introductory and early growth stages in acquainting marketing intermediaries and potential consumers with the new good or service High unit value
Often emphasized at every stage; heavy emphasis in the latter part of the growth stage, as well as the maturity and early decline stages, to persuade consumers to select specific brands Low unit value
35
Price
Pulling and Pushing Promotional Strategies
• Pulling strategy: promotional effort by a seller to stimulate demand among final users, who will then exert pressure on the distribution channel to carry the good or service, pulling it though the marketing channel • Pushing strategy: promotional effort by a seller to members of the marketing channel intended to stimulate personal selling of the good or service, thereby pushing it through the marketing channel
36
Communication Platforms
Advertising • Print and broadcast ads • Packaging inserts • Motion pictures • Brochures and booklets • Posters • Billboards • POP displays • Logos • Videotapes Sales Promotion • Contests, games • Premiums • Sampling • Trade shows, exhibits • Coupons • Rebates • Entertainment • Continuity programs • Tie-ins
37
Communication Platforms Events/ Experiences Public Relations • Sports • Press kits • Entertainment • Speeches • Festivals • Seminars • Arts • Annual reports • Causes • Charitable donations • Factory tours • Publications • Company museums • Community relations • Street activities • Lobbying • Identity media • Company magazine
38
One in five US Kids aged six to 19 are obese, where BMI is greater than 30.
• The Walt Disney company had started “the Magic of healthy living” campaign. • It will feature public service announcements by Michelle Obama, teen idols Nick Jonas, TV Star Brenda Song and other celebrities, all seeking “to inspire kids” to lead healthy lives and their parents to instill good habits in them. • Disney will grant one million dollar to build play spaces and gardens in 10 undeserved communities nationwide.
39
Communication Platforms
Personal Selling • Sales presentations • Sales meetings • Incentive programs • Samples • Fairs and trade shows Direct Marketing • Catalogs • Mailings • Telemarketing • Electronic shopping • TV shopping • Fax mail • E-mail • Voice mail
40
Figure 17.4 Steps in Developing Effective Communications Identify target audience Determine objectives Design communications
Select channels
Establish budget Decide on media mix Measure results Manage IMC
41
Image
The set of beliefs, ideas, and impressions a person holds regarding an object.
42
Communications Objectives
• • • • Category need Brand awareness Brand attitude Purchase intention
43
Designing the Communications
• Message strategy • Creative strategy • Message source
44
Selecting the Communications Channels • Personal communication channels • Non personal communication channels • Integration
45
Creative Strategy
• Informational and transformational appeals • Positive and negative appeals
– – – – – – – Fear Guilt Shame Humor Love Pride Joy
46
The Importance of Taglines
Brand Theme • Our car is more spacious • It is prestigious to own our brand of TV • Our butter is tasty and fun to eat • Our motorbike is fuel efficient Ad Tagline
“More Car per Car” (Tata Indica) “Neighbor’s Envy; Owner’s Pride” (Onida TV) “Utterly Butterly Delicious” (Amul Butter) “Fill it, shut it, Forget it” (Hero Honda motorcycle)
47
Message Source
Celebrity Characteristics
– Expertise – Trustworthiness – Likeability
48
Personal Communications Channels • Advocate Channels • Expert Channels • Social Channels
49
Stimulating Personal Influence Channels
• Identify influential individuals and devote extra attention to them • Create opinion leaders • Use community influentials in testimonial advertising • Develop advertising with high “conversation value” • Develop WOM referral channels • Establish an electronic forum • Use viral marketing
50
Non personal Communication Channels
• • • • Media Sales Promotion Events and Experiences Public Relations
51
Budgeting for Promotional Strategy
• Percentage-of-sales method • Fixed-sum-per-unit method • Meeting competition method • Task-objective method
52
Method
Percentage-of-sales method
Description
Promotional budget is set as a specified percentage of either past or forecasted sales.
Example
“Last year we spent $10,500 on promotion and had sales of $420,000. Next year we expect sales to grow to $480,000, and we are allocating $12,000 for promotion.”
Fixed-sum-per-unit method
Promotional budget is set as a predetermined dollar amount for each unit sold or produced.
Promotional budget is set to match competitor’s promotional outlays on either an absolute or relative basis. Once marketers determine their specific, promotional objectives, the amount (and type) of promotional spending needed to achieve them is determined.
“Our forecast calls for sales of 14,000 units, and we allocate promotion at the rate of $65 per unit.”
“Promotional outlays average 4 percent of sales in our industry.”
Meeting competition method
Task-objective method
“By the end of next year, we want 75 percent of the area high-school students to be aware of our new, highly automated fast-food prototype outlet. How many promotional dollars will it take, and how should they be spent?”
53
Measuring the Effectiveness of Promotion
• Two basic measurement tools:
– Direct sales results measures the effectiveness of promotion by revealing the specific impact on sales revenues for each dollar of promotional spending – Indirect evaluation concentrates on quantifiable indicators of effectiveness like:
• Recall - how much members of the target market remember about specific products or advertisements • Readership – size and composition of a message’s audience
54
• Measuring Online Promotions
– Early attempts at measuring online promotional efforts involved counting hits and visits – Incorporating direct response and comparing different promotions for effectiveness – Two major techniques for setting online advertising rates:
• Cost per impression (CPM), technique that related the cost of an ad to every thousand people who read it • Cost per response (click-throughs), which assumes that those who actually click on an ad want more information
55
Factors in Setting Marketing Communications Mix
• Type of Product Market • Buyer Readiness to Make a Purchase • Stage in the Product Life Cycle
56
doc_206683980.pptx