exam 3 (15-20) Flashcards
marketing communications
- all communcation that informs and persuades buyers idea is to get all promotional mix elements to work tgt
promotional strategy
plan for optimal use of all elements of promotion to elicit a particular response
- convince buyers that company product has a competitive advantage
Promotional Mix (PM) 5 elements
- advertising (mass communication)
- public relations (unpaid; effective but limited control)
- sale promotions (can have variety of objectives)
- personal selling (expensive; face to face; high impact)
- social media
PM 1st element
- advertising
any form of impersonal, paid, mass communication
- marketers use this to reach large audiences
- high cost due to mass appeal
- low cost per person
- marketers have complete control over message
- lower credibility (buyers realize this is paid communication
PM 2nd element
- public relations
communications w customer, suppliers, employees, n community w intent of creting favorable publicity
- not paid communication
- try to get exposure
- media stories are done in their own words but lack of control = buyers trust
PM 3rd element
- sale promotions
all activities that focus on promoting sales w intent of inducing trial for new products, increasing sales, or getting rid of extra inventory
- except ads + public relation
- short term orientation (coupons, rebates, discounts)
PM 4th element
- personal selling
in person selling for big purchases or business markets
- effective, esp in bus market
- give opportunity to impress customers w the value of offering n to negotiate deals
- expensive (justified by size of transactions)
PM 5th element
- social media
shifted controls to consumers
- control info one wish to see
- control content they can share
- info moves at accelerated pace n amplified
- marketers can succeed by facilitating this communication instead of dictating the content
3 promotional goals (PG)
- informing
- persuading
- reminding
- successful promotion = move consumers through all stages
informing
- done in early stage of the product life cycle
- occurs when new brands are introduced n market is not aware of what brand has to offer
persuading
- in late introduction growth n early maturity stages
- marketers shift focus to persuading market to buy products
- may emphasize superiority of product to convince buyers
reminding
- later stage of life cycle
- goal: remind consumers in creative ways to stay on top of their minds
- all brand have well established images
- market is familiar w what they have to offer
- connect to create ongoing relationship w customers
- hard to achieve, social media makes it easier
AIDA concept
- Attention
- Interest
- Desire
- Action
attention (AIDA)
gain attention of market, create awareness
- creative helps draw attention (flood consumer w commercial messages)
desire (AIDA)
create a message to be convincing enough to create consumer preference for the brand
interest (AIDA)
create an appealing enough to capture consumer’s interest
action
communication should have a call to action, prodding consumers to purchase product
Factor affecting promotional mix
- nature of product
- stages in product life cycle
- types of buying decisions
- push n pull strategies
nature of product
(business vs consumer)
(mass vs customized)
CONSUMERS products are often MASS produced
- little to no customization
- mass media like ads works well
BUS products are often CUSTOMIZED
- requires fair amount of customization
- must explain customization to buyers
- personal selling is effective
stages of product life cycle (PLC)
- early stage:
- ads n public relation to build awareness
- sale promotion to induce trial
- personal selling for obtaining distribution - growth stage:
- ads n public relations use to emphasize product’s differential advantage
- sale promo induce trial can be reduced - maturity
- high awareness
- intense competition
- continue persuasive n reminder ads
- sale promo to increase sales - decline
- ads is severely curtailed
- personal efforts continue at retail lvl
types of buying decisions
- simple decision
- elaborate
simple buying decisions
routine purchase of low $, no deliberation
- reminder ads (consumer are aware of brands)
- sale promo increase sales
elaborate buying decisions
- elaborate - no routine, consumer asks for assistance
- personal selling
- same for shopping good
push n pull strategies
- product flow down the channel from manufacturers -> wholesalers -> retailers
1. push
2. pull
PUSH strategies
force product through channel
- done through incentives (ex: trade discounts)
- continue pushing until it reach end consumer
- personal selling n trade + sales promo are used
advertising
impersonal, one way mass communication paid for by marketer to increase sales in long run
- ads increase sales
- ads response function looks like elongated S
- increase ads = difficult to gauge when response slow down
S shaped curve (advertising)
bottom (5,0): there are little sales even in the absence of ads
flat curve + moving up: increase ads has little affects in sale cuz its unnoticeable before it hits a certain threshold level
middle: relatively high effectiveness
- increase ads = increase sales
- most company operate here
end: towards higher lvl of ads, sale curves flat
institutional (corporate) ads
focus on promoting corp as a whole
- for firm that use parent brand name for all products
- use to promote positive image
- use to overcome negative perceptions
product ads
focus on individual products
- 3 types
1. pioneer ads
2. competitive ads
3. comparative ads
pioneer ads (product)
focus on explaining benefits of new products n not on promoting
- used during early states of PLC
competitive ads (product)
focus on convincing customers to buy their own brands by creating valuable attitude toward brand
- product enters growth stage when competitor comes into the market
comparative ads (product)
explicitly compare them w competitors brands
- useful for smaller brands
- rare for bigger brands
- illegal in many countries
ways to set ad budgets
- follow % of sales: firm assign fixed % of sales for ads budgets
- cons: downturn = decrease ad budget - competitive parity: spending at lvl comparable to competitor
- gives sense of equity to all participants - DAGMAR
