Chp 15: advertising, sales promotion, personal selling Flashcards
LO1: define AIDA model
common model of series of mental stages through which consumers move as a result of marketing communications: attention leads to interest which leads to desire which leads to action
LO1: what does consumer do at each stage of AIDA model
At each stage, consumer makes judgements about whether to take next step in process
LO1: 3 types of responses of consumers and AIDA model
Customers have 3 types of responses: so AIDA is also known as think, feel, do model, but these steps don’t always follow AIDA order
LO1: attention: 2 types of awareness metrics
aided recall and top of mind awareness
LO1: attention: define aided recall
occurs when consumers recognize brand when its name is presented to them
LO1: attention: define top of mind awareness
prominent place in people’s memories that triggers a response without them having to put any thought into it
LO1: attention: 3 points to top of mind awareness
1) Example: immediately thinking of harley when asked about motorcycles
2) Can be built through memorable names, repeatedly exposing their name to customers through advertising, locations + sponsorships, and using memorable symbols
3) Highest level of awareness
LO1: attention: 2 points to attention
1) Need to gain attention of consumer
2) Brand awareness refers to potential consumer’s ability to recognize or recall that brand name. It is the strength of the link between brand name and type of goods/services in minds of consumers
LO1: interest: 3 points
1) Once consumer knows company or product exists, communication must work to increase his interest level
2) Consumers must be persuaded that it is a product worth investigating
3) Ensure ad’s message includes attributes of interest to target audience
LO1: desire: 1 point
Goal of subsequent messages after firm has piqued interest of target market is moving consumer from i like to i want it
LO1: action: 1 point
If message has caught consumer’s attention and made them interested enough to consider the product as a means to satisfy a specific desire of theirs, they likely will act on that interest by making a purchase
LO1: define lagged effect
delayed response to a marketing communication campaign
LO1: 1 point to lagged effect
Generally takes multiple exposures to an ad before consumer fully processing its message and acts - they don’t act immediately sometimes
LO1: define advertising
paid form of communication from an identifiable source, delivered through communication channel and designed to persuade receiver to take some action, now or in future
LO1: 2 points to advertising
1) Advertising must be carried by some medium like print, tv, radio etc
2) Ads represent a persuasive form of communication, designed to get consumer to take some action
LO1: what do ad campaigns try to achieve
All advertising campaigns aim to achieve certain objectives: to inform, persuade and remind customers
LO1: 3 types of advertising
1) informative
2) persuasive
3) reminder
LO1: define informative advertising
communication used to create + build brand awareness, with ultimate goal of moving consumer through buying cycle to a purchase
LO1: 2 points to informative advertising
1) Helps determine some important early stage of PLC, especially when consumers have little info about product
2) Can be used to tell customers about upcoming sale or arrival of new goods
LO1: define persuasive advertising
communication used to motivate consumers to take action
LO1: 2 points to persuasive advertising
1) Generally occurs in growth + early maturity stages of PLC when competition is most intense and helps to accelerate market’s acceptance of product
2) Later stages, can be used to reposition an established brand by persuading consumers to change their existing perceptions of advertised product
LO1: define reminder advertising
communication used to remind consumers of a product or to prompt repurchases, especially for products that have gained market acceptance and are in maturity stage of life cycle
LO1: 2 focus of advertisements
1) product focused
2) institutional ads
3) product category, industry, firm etc
LO1: define product focused ads
used to inform, persuade or remind consumers about specific product/service
LO1: define institutional ads
used to inform, persuade and remind consumers about issues related to places, politics, an industry or a particular corporation
LO1: 1 point to focus of ads
Can also generate demand for product category, entire industry, specific brand, specific firm, specific item
LO1: define product placement
inclusion of a product in nontraditional situations like in a scene in a movie or tv program
LO1: define public service announcement
advertising that focuses on public welfare and generally is sponsored by non-profit institutions, civic groups, religious orgs, trade associations or political groups; form of social marketing
LO1: 1 point to product placement
Sometimes firms don’t pay for product placements
LO1: define social marketing
application of marketing principles to a social issue to bring about attitudinal and behavioural change among general public or specific population segment
LO1: what must ad campaign objectives be?
must be specific and measurable
LO2: what does regulation of ad involve
complex mix of formal laws and informal restrictions designed to protect consumers from deceptive practices
LO2: primary federal agencies that regulate ad activities
1) competitive bureau canada/competition act
2) CRTC
3) health canada/food and drugs act
4) advertising standards canada
LO2: 2 points to competition bureau canada and their competition act
1) Enforces federal laws that ensure business in canada operate in fair + equitable manner
2) Enforces laws relating to misleading ads and deceptive marketing practices
LO2: 3 points to CRTC
1) Regulates and supervises all aspects of canadian broadcasting system
2) Enforces restrictions on broadcasting material and administers codes that have an impact for specific categories of advertising like code for ad of alcohol beverages
3) Must approve all tv and radio ads before they can be broadcast
LO2: 2 points to health canada and their food and drug act
1) Regulates food, drug, cosmetics and medical devices
2) Establishes standards + requirements for safety and sanitation of products. Regulates labelling of food products pertaining to nutrition labelling, nutrient content, health claims
LO2: 2 points to advertising standards canada
1) Monitors voluntary ad industry codes
2) Administers canadian code of advertising standards, gender portrayal guidelines, broadcast code for advertising to children
LO2: define puffery
legal exaggeration of praise, stopping just short of deception, lavished on a product
LO2: 2 points to puffery
1) Legal in canada as consumers viewed as rational and capable of evaluating advertising claims
2) In EU, puffery considered deception
LO3: define sales promotion
special incentives or excitement building program that encourage consumers to purchase particular product. Typically used with other ads or personal selling programs
LO3: what is value in sales promotion
closing the deal rather than generates attention, interest, desire in ads
LO3: 2 types of sales promotion
Can be pull or push strategy (for consumer or trade)
LO3: 9 types of consumer sales promotion
1) coupons
2) deals
3) premiums
4) contests
5) sweepstakes
6) samples
7) loyalty programs
8) point of purchase displays
9) rebates
LO3: objective, benefit, bad of coupons
Objective: stimulate demand
Benefit: encourage retailer support, allow for direct tracing of sales
Bad: have low redemption rates, have high cost
LO3: 2 points to coupons
1) Coupons offer discount on price of items when purchase
2) Coupons sent to mobile phones or printed from internet may contain info about consumer who uses them
LO3: objective, good, bad of deals
1) Objective: encourages trial
2) Good: reduces consumer risk, retaliate against competitive action
3) Bad: may reduce perception of value
LO3: define deals
type of short term price reduction like featured price (price lower than regular price), buy one get one free, certain % more free offer contained in larger packaging, special financing arrangement
LO3: 2 points to deals
1) Lower risk by reducing cost of good
2) Price reduction can signal different price/quality relationship
LO3; objective, good, bad of premiums
1) Objective: build goodwill
2) Good: increase perception of value
3) Bad: result in consumers who buy for premium, not product & have to be carefully managed
LO3: define premium
item offered for free or at bargain price to reward some type of behaviour like buying, sampling or testing
LO3: objective, good, bad of contests
Objective: increase consumer involvement
Good: generate excitement
Bad: require creativity, must be monitored
LO3: define contests
brand sponsored competition that requires some form of skill or effort
LO3: goal, good, bad of sweepstakes
1) Goal: encourage higher consumption
2) Good: minimize brand switching among existing consumers
3) Bad: sales often decline after
LO3: define sweepstakes
offers prizes based on chance drawing of entrant’s name
lO3: goal, good, bad of sampling
1) Goal: encourage trial
2) Good: offer direct involvement
3) Bad: high cost to firm
LO3: define sampling
offers potential customers opportunity to try product/service before making buying decision
LO3: goal, good, bad of loyalty programs
Goal: encourage repurchase
Good: create loyalty
Bad: high cost to firm
LO3: define loyalty programs
specifically designed to retain customers by offering premiums or other incentives to customers who make multiple purchases over time
LO3: goal, good, bad of point of purchase displays
Goal: increase brand trial
Good: provide high visibility, provide in store support
Bad: difficult to get good location in store, can be costly to firm
LO3: define point of purchase displays
merchandise display located at point of purchase, such as checkout counter
LO3: goal, good, bad of rebates
Goal: stimulate demand
Good: increase value perception
Bad: easily copied by competitors, may just advance future sales
LO3: 1 point to rebates
Portion of purchase price is return by seller to the buyer
LO3: explain trade channel sales promotions
Help convince retailers + wholesaler to stock a new brand, give it eye level shelf space and promote it in flyers and other advertisements
LO3: 3 types of trade channel sales promotions
1) discounts and allowances
2) cooperative ads
3) sales force training
LO3: explain discounts and allowances
Used to maintain or increase levels in distribution channel
LO3: 2 points to cooperative advertising
1) Helps compensate trade channel members for money they spend promoting products and encourages them to feature products more often
2) Manufacturers helps pay for the retailers ads
LO3: 2 points to sales force training
1) Retailers have contact with end consumer are responsible for selling the products they carry, manufacturers sometimes offer to train retailers staff
2) More in depth product knowledge for sales person which enhances confidence in product and increases likelihood of future sales
LO3: what to be careful with for sales promotions
Be careful in promotions that lower prices, when they are offered consumers may just stock up now which simply shifts sales from future to now and leads to short run benefits at expense of long term sales stability
LO3: define pop up stores
temporary storefronts that exist for only a limited time and generally focus on new product or limited group of products offered by retailer, manufacturer or service provider; gives consumers chance to interact with brand and build brand awareness
LO3: 2 sales promotion tools
1) pop up stores
2) cross promoting
LO3: define cross promoting
efforts of 2+ firms joining together to reach specific target market
LO3: when is cross promoting effective
To be effective, the 2 products must appeal to same target market and together create value of consumers
LO3: what was traditionally sales promotions used for
Traditionally sales promotions was to generate short term results and ads for long term results but either can do both
LO3: 6 points on how to evaluate sales/trade promotion
1) realized margin from promotion
2) cost of additional inventory carried because of buying more than normal amount of product
3) potential increase in sales from promoted goods
4) long term impact on sales of promotion
5) potential loss suffered when consumers switch to promoted goods from more profitable goods
6) additional sales made to customers attracted to store by promotion
LO4: define personal selling
Personal selling is 2 way flow of communication between buyer and seller that is designed to influence buyer’s purchase decision
LO4: 3 ways personal selling contributes t 4PS and IMC
1) salesperson is in unique position to customize message for specific buyer because of one to one nature of sales - preplanned sales presentation or demonstration can be altered at any time as need arises
2) salesperson can probe buyer for his/her potential reservations about product, educate buyer when appropriate, and ask for order to appropriate time
3) sales presentation can be directed to customers with highest potential (more efficient and cost effective
LO4: 3 value added by personal selling
1) salespeople build relationships
2) salespeople educate + provide advice
3) salespeople save time + simplify buying
LO4: define relationship selling
sales philosophy and process that emphasize commitment to maintaining relationship over long term and investing in opportunities that are mutually beneficial to all parties
LO4; 4 points to salespeople build relationships
1) Good sales people take long term perspective and build relationships with customers
2) Positive customer-salesperson relationship contributes to trust, increased customer loyalty and intent to continue that relationship
3) Salesperson can record customer/purchase info into data warehouse and when data has been analyzed, CRM programs developed and salespeople can implement them to identify and focus on building loyalty with firm’s most valued customers
4) Can contact customers about new products, can ask about what they liked/disliked about product/transaction with firm, or can be social to make customer feel important
LO4; how salespeople save time and simplify buying
Can save time by doing a lot of the tasks that retail employees would do like setting up displays, assessing inventory levels, writing orders
LO5: 5 steps in personal selling process
1) generate and qualify leads
2) pre approach and use of CRM systems
3) sales presentation + overcoming objectives
4) closing the sale
5) follow up
LO5: define leads (step 1)
list of potential customers
LO5: define qualify (step 1)
process of assessing potential of sales leads
LO5: define trade shows (step 1)
major events attended by buyers who choose to be exposed to products/services offered by potential suppliers in an industry
LO5: define cold calls (step 1)
method of prospecting in which sales people phone or see customers without appointments
LO5: define telemarketing (Step 1)
method of prospecting in which salespeople phone potential customers
LO5: points to step 1: generate and qualify leads
1) Salespeople with already established relationship with customer will skip this step and not often used in retail settings
2) Can discover leads by talking to current customers, doing research at internet, networking at industry events, trade shows, cold calls, telemarketing
3) In qualify, don’t judge book by cover and assume person doesn’t fit store’s image or can’t afford to purchase there. But should assess potential customer’s needs pertain to product and if lead has financial resources to pay for product
LO5: define pre approach (Step 2)
occurs prior to meeting customer for first time and extends qualification of leads procedure
LO5: 3 points to step 2) pre approach and use of CRM systems
1) Salesperson conduct additional research + develops plans for meeting with customer
2) Important info about customer helps establish value for customers and is often stored in CRM systems
3) With research, sales person can establish goals for meeting with customer
LO5: 2 points to presentation in step 3
1) Salesperson needs to get to know customer, get their attention and create interest in presentation to follow
2) Adapt and customize presentation to match customer’s need and stage in decision process along with their knowledge based on product/industry
LO5: 2 points to handling objectives in step 3
1) Customers may raise objectives like value (price too high for level of quality/service)
2) Sales people should know types of objections buyers likely to raise to anticipate and handle them
LO5: define closing the sale (step 4)
obtaining commitment from customer to make purchase
LO5: 1 point to step 4: closing sale
Good salespeople listen to what potential customers have to say and pay attention to body language
LO5: 4 points to step 5: follow up
1) Attitudes customers develop after sale become basis for how they will purchase in the future
2) service quality dimensions (seen before)
3) Best way is to check with customer after they take possession of product, this speed demonstrates responsiveness + empathy and shows customer that sales person and firm cares about customer satisfaction
5) Post sales follow up takes salesperson back to first step in sales process for initiating new order and sustaining relationship
