Marketing mix part 2 (06) Flashcards
SUMMARY
In summary, the following are covered in this topic:
1. Promotion is about communicating with actual or potential customers.
2. Promotion benefits a business by increasing brand awareness, increasing
customer traffic, building sales and profits, and identify with market segment.
3. Advertising, sales promotion, personal selling, publicity and public relations,
and online promotion are the major elements of the promotion mix of a
business.
4. Integrated Marketing Communications is an approach to achieve the objectives
of a marketing campaign, through a well-coordinated use of different
promotional methods that are intended to reinforce one another.
5. Businesses must consider several factors in deciding on the choice of
promotional tools, including the nature of product and the stage in product life
cycle.
6. Place decisions are concerned with how products should pass from the
manufacturer to the end consumer.
7. Place decisions are important to businesses as they determine market coverage,
and allows ease of access for customers to make purchases.
8. The types of distribution channel can be classified into direct and indirect. This
includes direct selling, one-intermediary channel and two-intermediaries
channel.
9. The marketer may need to consider several factors in deciding the choice of
distribution channel, including product, costs involved, nature of markets and
locations as well as competition
Personal selling
Personal selling is where a member of the sales staff communicates with one
consumer with the aim of selling the product and establishing a long-term
relationship between company and consumer.
Advantages of personal selling over other promotional tools
-Personal selling results in immediate feedback from the customer.
The salesperson can listen directly to the feedback, objections, and concerns the
customer has.
This allows the salesperson to adjust the sales presentation
accordingly and provide detailed and customised solutions that can generate
more sales.
-Personal selling allows the business to develop a personal relationship with the
customer.
time. Relationship selling is increasingly
important since very few businesses can survive on profits generated from one-
time transactional sales.
Public relations
Public relations refer to the deliberate use of free publicity provided by newspapers,
television or other media to communicate with and achieve understanding by the
public.
Disadvantages of public relations
The major disadvantage of public relations and publicity is that businesses have less
control over how the information is presented because they do not pay for it. Bad
publicity and negative news can harm the reputation and image of a business.
Integrated Marketing Communications
IMC is an approach to achieve the objectives of a marketing
campaign, through a well-coordinated use of different promotional methods that
are intended to reinforce each other.
IMC process
Identify the target audience
Recognise all contact points where the target audience may encounter the
business and its brands
Assess the influence each of these contact points will have at different stages of
the buying process
Tie together all the messages and images of the business (same message, look
and feel)
Deliver a clear, consistent, and compelling message about the business and its
brands
Factors affecting choice of promotional tool
-Nature of product
-Stage in product life cycle
Possible benefits of direct selling
no intermediaries, so no mark-up or profit margin is taken by other businesses
producer has complete control over the marketing mix – how the product is
sold, promoted and priced to consumers
quicker than other channels
may lead to fresher food products
direct contact with consumers offers useful market research
Possible limitations of direct selling
all storage and stock costs have to be paid for by producer
no retail outlets limits the chances for consumers to see and try before they buy
may not be convenient for consumer
no advertising or promotion paid for by intermediaries and no after-sales
service offered by shops
can be expensive to deliver each item sold to consumers
One-intermediary channel
A one-intermediary channel is when a producer/ manufacturer sells to retailers,
which then sells to customers
Possible benefits of one-intermediary channel
retailer holds inventory and pays for storage and inventory-holding costs
retailer has product displays and offers after-sales service
retailers are often in locations that are convenient to consumers
producers can focus on production, not on selling the products to consumers
Possible limitations of one-intermediary channel
intermediary takes a profit mark-up and this could make the product more
expensive to final consumers
producers lose some control over marketing mix
retailers may sell products from competitors too, so there is no exclusive outlet
producer incurs delivery costs to retailer
Two-intermediary channel
A two-intermediaries channel is where a producer/ manufactuer sells to a
wholesaler, which in turn sells to a retailer which finally sells to the end
consumer.
Possible benefits of two-intermediary channel
wholesaler holds goods and buys in bulk from producer
reduces stock-holding costs of producer
wholesaler pays for transport costs to retailer
wholesaler ‘breaks bulk’ by buying in large quantities and selling to retailers in
small quantities
may be the best way to enter foreign markets where producer has no direct
contact with retailers
