M_4.01_A-CLARK.pptx

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4.01 Acquire a foundational

knowledge of promotion to understand its nature and scope. PR:001

Performance Indicator

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The role of promotion is to help a

business/company achieve its marketing

goals. For most businesses the basics

marketing goals are to sell products and

make a profit. Promotion helps businesses

reach their goals by communicating with

potential customers. Companies rely on

promotion to inform people about their

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Lesson opener: Choose a product you’ve

purchased within the last several months. What made you want or need to buy it? How did you hear about the product? How did you know

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Promotion is:

1. Promotion is marketing communication. In other words, promotion is the business of

communicating with customers. It will provide

information that will assist them in making a decision to purchase a product or service. The razzmatazz, pace and creativity of some promotional activities are

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2. Promotion is a marketing function needed to communicate information about goods, services, images, and/or ideas to

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3. Promotion is the element of the marketing mix that

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Activities

• _{Explain the phrase,} “promotion is

communication.”

• _{Answer: Promotion can} be described as

marketing

communication because it involves sending a

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• _{What does promotion} communicate?

• _{Answer: Businesses}

communicate messages to their customers who receive the message. The message is to tell customers about certain goods, services, or

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• _{Have students describe} a commercial or ad that they have seen recently, and explain what the

commercial or ad

communicated to them.

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. List users of promotion

• _{Any organization that has something to sell uses}

promotion at one time or another. Nearly all

organizations, whether for-profit or not-for-profit, in all types of industries, must engage in some form of promotion. Such efforts may range from

multinational firms spending large sums on securing high-profile celebrities to serve as corporate

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• _Activities

• _{What does your school sell?}

• _{What does a university sell?}

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Describe the benefits of using promotion

• _{1. Promotion benefits:}

• _{a. Companies/organizations/businesses}

• _{b. Customers}

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• _{2. Promotion benefits by:} • _{a. Creating increased sales}

• _{b. Giving a company or product a strong position}

• _{Companies use product promotion to convince potential}

customers to select their products or services instead of a competitor’s brands.

• _{c. Increasing customer loyalty}

• _{Product promotion helps companies’ foster good}

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• _{d. Increasing the awareness of a}

company/product

• _{Through a company’s web site, promotion}

provides customers with product and general information, answers questions, provides news, and sometimes shows the product in detail.

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g. Increased employment opportunities

• _{Promotion provides job opportunities to millions.}

While many companies hire staff and maintain their own in-house promotions, others hire the services of professional public relations and advertising

agencies. Promotion also creates demand for

products and with demand comes mass production. Mass production in turn creates more jobs.

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• _{h. Increased media support}

• _{Promotion helps to pay for mass media,}

meaning television, radio, billboards, Internet,

magazines, newspapers, etc. Without

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D. Describe the cost associated with the use of promotion

• _{Companies use many methods of promotion.}

Some are free or nearly free, such as issuing a

press release about a new or improved

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• _{The cost associated with promotion or}

advertising goods and services often

represents a sizeable proportion of the overall

cost of producing an item. Considering costs

involved ahead of time helps marketers create

reasonable promotional budgets for each

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• _{Costs include:}

• _{a. Advertising fees}

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Describe types of promotional objectives

Companies and organizations have three main promotional objectives.

• _{To inform}_{: Potential customers must know something}

about a product if they are to buy at all. A firm with a really new product may not have to do anything but

inform consumers about it - and show that it meets

consumer needs better than other products.

• _{For example, when Mazda introduced its stylish and affordable}

Miata roadster, the uniqueness of the car simplified the

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• _{To persuade}_{: When competitors offer similar}

products, the firm must not only inform

customers that its product is available but also persuade them to buy it. A 'persuading'

objective means the firm will try to develop a

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• _{For example, to help convince consumers to buy Tylenol}

rather than some other firm's brand, Johnson & Johnson's ads tout Tylenol as the pain relief medicine most often

used in hospitals. Companies often use tools such as coupons, free samples, rebates, and contests as part of their persuasive promotions. These incentives may

provide a boost to the customer to choose one product over the other. Other methods of persuasion include emphasizing the product to be “new and improved,”

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• _{To remind}

_{: If target customers already have}

positive attitudes about a firm's marketing

mix, a 'reminding' objective might be suitable.

This objective can be extremely important in

some cases. Even though customers have

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Examples

• _{Campbell realizes that most people know about}

its soup - so much of its advertising is intended to remind.

• _{State Farm is reminding the customers that they}

are always there for them with the slogan, “like a good neighbor State Farm is there.”

• _{Restaurants that give customers matchbooks}

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Companies may go into detail and consider the following (more specific objectives):The possible objectives for marketing promotions may include the

following:

• _{Build Awareness}_{– New products and new}

companies are often unknown to a market, which means initial promotional efforts must focus on establishing an identity. In this situation the

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• _{Create Interest}_{– Moving a customer from awareness of}

a product to making a purchase can present a

significant challenge. As we saw with our discussion of consumer and business buying behavior, customers must first recognize they have a need before they actively start to consider a purchase. The focus on

creating messages that convince customers that a need exists has been the hallmark of marketing for a long

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• _{Provide Information}_{– Some promotion is designed} to assist customers in the search stage of the

purchasing process. In some cases, such as when a product is so novel it creates a new category of

product and has few competitors, the information is simply intended to explain what the product is and may not mention any competitors. In other

situations, where the product competes in an

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• _{Stimulate Demand}_{– The right promotion can}

drive customers to make a purchase. In the case of products that a customer has not previously purchased or has not purchased in a long time, the promotional efforts may be directed at

getting the customer to try the product. This is often seen on the Internet where software

companies allow for free demonstrations or

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• _{For products with an established customer-base,}

promotion can encourage customers to increase their purchasing by providing a reason to

purchase products sooner or purchase in greater quantities than they normally do. For example, a pre-holiday newspaper advertisement may

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• _{Reinforce the Brand}_{– Once a purchase is made, a}

marketer can use promotion to help build a strong relationship that can lead to the purchaser

becoming a loyal customer. For instance, many

retail stores now ask for a customer’s email address so that follow-up emails containing additional

product information or even an incentive to

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Discuss the relationship of promotion and marketing

• _{1. Promotion is the element of the marketing mix}

that encourages customers to buy a product or to have certain views or opinions.

• _{2. Promotion is a marketing function needed to}

communicate information about goods, services, images, and/or ideas to achieve a desired outcome. Before a business can be successful, it must

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• _{3. Promotion is sometimes described as}

marketing communication because it involves sending a message to a target audience.

• _{a. Tell customers that the product is available}

• _{b. Tell customers about the features and benefits}

of the product.

• _{c. Tell customers where the product can be}

purchased.