Chapter 16: Promotion Strategies

• Chapter 16 discusses effective promotional strategies used in business
• It covers traditional and modern tools for promotions and integrated marketing communications
• It also considers advertising, personal selling, public relations, and sales promotions

Learning Objectives

• Identify new and traditional tools in the promotion mix
• Contrast the advantages and disadvantages of various advertising media, including internet and social media
• Illustrate the steps of the B2B and B2C selling processes
• Describe the role of public relations and how publicity fits in that role
• Assess the effectiveness of various forms of sales promotion, including sampling
• Show how word of mouth, viral marketing, social networking, blogging, podcasting, email marketing, and mobile marketing work

Huda Kattan, Founder of Huda Beauty

• Huda Kattan, of Iraqi parents, felt out of place growing up in Oklahoma City
• She began her career in finance after obtaining her degree
• She moved to Dubai to start her career in finance
• She later moved to Los Angeles to study make-up artistry
• She moved back to Dubai and started her beauty blog there, which went global
• Huda Beauty now earns an estimated $250 million annually, and offers over 140 products

Traditional Promotion Mix

• The traditional promotion mix includes advertising, personal selling, public relations, and sales promotion with the product at the center

Promotion and Promotion Mix

• Promotion is techniques sellers use to motivate people to buy their products or services
• Promotion mix is the combination of promotional tools an organization uses

Integrated Marketing Communication (IMC)

• IMC combines all promotional tools into a unified strategy
• IMC is used to create a positive brand image, meet consumer needs, and meet strategic marketing/promotional goals
• It includes modern/digital promotional tools

Steps in a Promotional Campaign

• Identify a target market
• Define objectives for each element of the promotion mix
• Determine a promotional budget
• Develop a unifying message
• Implement the plan
• Evaluate effectiveness

Advertising

• Advertising is a paid, nonpersonal communication through various media by identified organizations and individuals
• Propaganda is nonpersonal communication without an identified sponsor

Major Categories of Advertising

• Online advertising appears on websites
• Mobile advertising reaches people on smartphones
• Interactive advertising is customer-oriented communication allowing customers to choose the information they receive
• Retail advertising advertises to consumers by retail stores
• Trade advertising advertises to wholesalers and retailers by manufacturers
• Business-to-business advertising is advertising from manufacturers to other manufacturers
• Institutional advertising creates an attractive image for an organization
• Product advertising advertises a good or service to create interest
• Advocacy advertising supports a view of an issue
• Comparison advertising compares competitive products

Impact of Advertising

• Total advertising volume is estimated at $509 billion in 2023
• Digital media is the number one medium at 60% of advertising spending
• Consumers benefit from ads because advertisers pay for production costs of media like TV, radio, newspapers, and magazines
• Marketers choose ad media that will reach the target market
• Mobile marketing, email ads, and social media marketing are rapidly growing

Estimated worldwide advertising spending in 2023 in billions

• Digital (Connected television, social media, search engine, digital out-of-home, other digital ads) - $307b
• Analog (Traditional media, linear television, newspapers, magazines, radio, out-of-home ads, direct mail) - $202b

Advantages and disadvantages of various advertising media

• Internet offers inexpensive global coverage and is interactive, but customers may leave the site before buying
• Social media offers wonderful communication tools, but is a time drain
• Mobile advertising has great reach among younger shoppers, but is easy to ignore
• Newspapers cover local markets well and ads can be placed quickly, but ads compete with other features
• Television uses sight, sound, and motion to reach all audiences, but is costly and has short exposure time
• Radio is low cost, can target specific audiences, and is good for local marketing, but depends on one sense and has short exposure time
• Magazines can target specific audiences, are good for color, and ads can be clipped, but is inflexible and costly
• Digital out-of-home advertising and billboards offer high visibility, are low cost, and have local market focus, but has limited message
• Direct mail targets specific markets and ads can be saved, but consumers may reject ads as junk mail
• Directories have great coverage of local markets, but compete with other ads

Online Advertising

• Online ads get potential customers to a website to learn about a product
• Advertisers can see how many people have clicked on the ad
• Interactive promotion allows marketers to create mutually beneficial relationships with customers

Social Media Advertising

• Social media advertising allows organizations to test ads and promotions and learn why people like and dislike them
• It also links companies with users and content creators

Digital Out-of-Home Advertising

• Located in malls, gas stations, taxis, public transit, and airports, and billboards on buildings or along highways
• Intelligent targeting and programmatic technology gets message on the right screen at the right time

Television Advertising

• TV advertising is expensive, but dominant
• DVRs, on-demand, and streaming services challenge TV advertising

Product Placement

• Putting products into TV shows, movies, and video games

Advancing Ads to Connected Television

• Advertisers are rethinking television advertising strategies and advertising on streaming services
• With "advanced TV," marketers can tailor an advertising experience to each user
• Successful ad campaigns use data to hit the right customer with the right product at the right time

Infomercials

• A full-length TV program devoted exclusively to promoting a good or service

Global Advertising

• Requires a single product and promotional strategy implemented worldwide
• Can save money but may not be successful everywhere due to differing cultures, languages, and buying habits
• Many marketers are moving from globalism to regionalism

Personal Selling

• Personal selling is the face-to-face presentation and promotion of goods and services
• Salespeople need to listen to customer needs, help reach a solution, and simplify the transaction process

Steps in the Selling Process

• Prospect and qualify
• Preapproach
• Approach
• Make a presentation
• Answer objections
• Close the sale
• Follow up

Personal Selling

• Prospecting involves researching potential buyers and choosing those most likely to buy
• Qualifying ensures people need the product, have authority to buy, and are willing to listen to a sales message
• This is sometimes called lead generation
• A prospect is a person with means to buy a product, authority to buy, and willingness to listen to a sales message
• A trial close is a question or statement that moves the selling process toward the actual close

Business-to-Consumer (B2C) Sales Process

• Most B2C sales take place in retail stores
• The salesperson does not have to do much prospecting or qualifying
• Retail salespeople usually don't need a preapproach step
• After-sale follow-up is important, especially if a product must be delivered or installed

Public Relations (PR)

• Public Relations is the management function that evaluates public attitudes, changes policies, and executes a program to earn public understanding and acceptance

A good PR program involves these steps

• Listen to the public
• Change policies and procedures
• Inform people that you're responsive to their needs

Publicity

• Publicity is information about an individual, product, or organization that is distributed to the public through the media that is not paid for or controlled by the seller
• Publicity is a major function for almost all organizations

Advantages of Publicity

• Free
• Reaches people who would not look at an advertisement
• More believable than advertising

Disadvantages of Publicity

• No control over whether the media will use a story or when they may release it
• Can be good or bad
• Once a story has run, it is not likely to run again