Promotions Flashcards
What are the five key elements of the promotion mix? List them from higher control to lower control?
1) Advertising: Paid form of non-personal communication.
Includes: TV commercials, magazine and newspaper ads, online ads, outdoor (“out-of-home”) displays, and social media.
2) Direct Marketing: Direct connections with carefully targeted customers.
Includes: Catalogues, flyers, telephone marketing, and email marketing.
3) Sales promotions: Short term inentives to encourage purchase.
Includes: discounts, coupons, in-store displays and demonstrations.
4) Personal selling: personal presentation by sales force to make sales and build customer relationships. It includes 2-way communication. E.g. Pearson sales job.
Includes: sales presentations and trade shows.
5) Public relations: The company doesn’t directly pay for it(although indirectly they may pay to be in this space).
Includes: press releases, sponsorships, and special events.
What are the five elements of integrated marketing communications?
1) Advertising
2) Direct marketing
3) Sales promotions
4) Personal selling
5) Public relations
Explain the difference between push and pull promotional strategies?
-With the push strategy, the manufacturer tries to get the wholesaler to carry their product, with the hopes that will encourage the retailer to buy the product, which means the customer is more likely to buy the product.
-With the pull strategy, manufacturers direct attention to customers, and by winning over the customers, the customers goes to the retailer, and the retailer goes to the wholesaler… everyone looking for your product. Now the wholesalers want to ask you for the product.
Why are push promotional strategies are used? When is it most effective?
-Push strategy is used to incentivize retailers to carry your product.
-Push strategy is effective when: 1) there is no brand loyalty in a category
2) when the brand choice is made in the store
3) when it’s an impulse purchase
4) if the product benefits are clearly understood.
Examples include: discounts to retailers to be featured, and for their shelf price to be lowered. Or payment to obtain preffered shelf space.
Why are pull promotional strategies used? When is it most effective?
-Pull promotional strategies are used to excite customers.
-Pull strategy is effective when:
1) there is high brand loyalty
2) the decision is high involvement
3) people perceive differences between the brands
4) people choose brand before they go to the store.
-Examples include: offer free samples, promotional coupons, or in-store demonstrations.
What are the four advertising objectives ordered based on how early they would be released into the products life-cycle?
1) Informative Advertising:
-Helps to build brand image
-Introduces new products
-Provides explanations for information.
-Example: Fiat Ad.
2) Persuasive Advertising:
-Helps to build brand preference.
-Becomes more important as competition increases.
-Example: Mac vs PC
3) Reminder Advertising:
-Helps to keep the brand top of mind.
-Maintains customer relationships.
-Helps to encourage repeat purchase.
-Most important for mature products.
-E.g. Oreo rainbow ad.
4) Reinforcement:
-Helps to fonvince purchasers they made the right choice.
-Example: Showing satisfied consumers enjoying their new car.
What are the four key ways to set a budget?
1) Affordable method
2) Percentage of sales method
3) Competitive-Parity Method
4) Objective-and-Task Method
Explain to me the affordable method when setting a budget?
-The affordable method involves devoting a portion of remaining funds to promotions after other costs have been deducted from revenue.
-It’s based on what managers think they can afford.
-Disadvantages include:
1) It ignores the effects of promotions on sales
2) Promotion is the last priority. Although that can occasionally lead to overspending, that more often leads to underspending
3) There will be an uncertain annual promotion budget.
Explain to me the percentage of sales method when setting a budget?
-The promotion budget is a percentage of current or forecasted sales.
-Advantages include:
1) It’s simple to use
2) The cost of advertising is directly linked to sales income, meaning that it self adjusts.
-Disadvantages include:
1) It wrongly views sales as a cause of promotion, rather than as the result of it.
2) It’s based on the availability of funds rather than the market opportunity or long-term plans.
3) There is uncertainty of what percentage to use.
Explain to me the competitive-parity method when setting a budget?
-The competitive parity method involves simply using the exact same budget as a particular competitor.
-Disadvantages include:
1) There’s no reason to assume that the competition knows better.
2) Competitors may have different goals, and different resources(corporation life stage and position relative to competitors should shift the budget)
3) There is no evidence that this method discourages communication wars. What that means is that what if the other companies marketing budget misrepresents their actual spending.
Explain to me the objective and task method?
-With the objective and task method, the promotion budget is set by:
1) defining speciificc promotion objectives (e.g., increase brand awareness by 20%)
2) Determining tasks needed to achieve objectives (e.g., targeted social media ads)
3) Estimating costs.
-Advantages include:
1) It emphasizes the relationship between cost and outcome(what is the point of diminishing returns) and is goal oriented.
2) It requires managers to tell their staff about their assumptions related to spending, exposure, trial, and usage.
-The key disadvantage is that it’s difficult to use. It’s not immediately clear past what point extra ad dollars are not going to lead to more profitability.
What are the pros and cons of each of the five elements of integrated marketing communications?
1) Advertising.
-It’s for mass audiences. The fees are paid in exchange for space(whether on print or digital) or time (TV, radio, or online videos).
-Pros: It can be efficient for reaching large, geographically diverse audiences. It can also be used short term quick sales, or for long term brand building.
-Cons: There is often a high absolute cost, and it can be difficult to receive good feedback.
2) Direct Marketing.
-It’s going to be very customized for a specific audience. The fees are simply the cost of communication(the cost of sending out email, mail, telemarketing, or establishing the digital CRM).
3) Sales Promotion
-It’s for mass audiences. The fees can be determined through a wide range of ways.
-Pros: It can be effective at changing short run behaviour; it’s flexible; it gives value to the customer and draws attention.
-Cons: it’s easily abused; easily duplicated; and can lead to promotion wars.
4) Personal Selling
-It’s going to be very customized for the most specific audience(of one person). And the fees are paid to salespeople.
-Pros: you get immediate feedback while selling; it’s highly persuasive; you can select your audience; you can give personalized information; and it’s relationship oriented.
-Cons: each exposure can be expensive; different salespeople may give different messages.
5) Public Relations
-It’s for mass audiences. You cannot directly pay for the media, but a lot of spending is geared to capture media attention–so that spending is indirect.
-Pros: get marketing from sources that are considered to be reliable; and it can be effective in combination with other promotion methods.
What are the three elements of the promotion mix?
1) Events and experiences
-Seen as highly relevant by consumers.
-Customers are personally invested and engaged.
2) Online and Social Media
-Can deliver rich informational or entertainment content.
-Flexible and adaptale, allowing for quick updates.
-Easily shareable and can be rapidly diffused among audiences.
3) Mobile
-it’s often time and location sensitive, meaning that it can be tailored to a consumer’s current context.
-It’s highly influential at the point of purchase decision, offering immediate impact.
What are the pros and cons of TV Advertising?
Pros
1) High reach
2) Some targeting
3) Low cost per
exposure
4) Strong auditory
and visuals
5) Repetition
possible
Cons
1) Limited targeting
2) High total cost
3) Short exposure
time
4) Easy to avoid
seeing; clutter
5) Some distrust
What are the pros and cons of magazine ads?
Pros
1) Good targeting
2) High information
content
3) Longevity
4) Pass-along
readership
Cons
1) Long lead times
2) Limited control of
placement
3) Visual only
4) Visual clutter
What are the pros and cons of outdoor ads?
Pros
1) Low cost
2) Location specific
3) High visibility
4) Low message
competition
5) Repetition
possible
Cons
1) Low targeting
2) Short exposure
time
3) Limited content
4) Poor image quality
5) Local restrictions
What are the pros and cons of direct mail?
Pros
1) Good targeting
2) Personalizable
3) Fast
4) Flexible
5) High information
content
6) No ad competition
Cons
1) High cost per
contact
2) Clutter
3) May not read
What are the pros and cons of buzz/influencer marketing?
Pros
1) Credible endorser
2) Works well for
high-interest
product categories
(e.g., tech, status)
Cons
1) Risk of backlash –
buzz is
uncontrollable
2) Measurement of
reach lacks
precision
3) Subversive,
deceptive
What are the pros and cons of social media marketing?
Pros
1) Ability to be fast and responsive
2) Communicate directly with consumers (e.g., respond, gain feedback)
3) Build brand community
4) Consumer engagement with content, brand, and brand community
5) Consumer-generated content
6) Potential for broad reach
7) Can be less expensive (e.g., KFC 6 herbs and 5 spices), but not always.
Cons
1) Less control (e.g., potential for negative content or comments, e.g., #McDStories)
2) Cluttered environment
3) Time-consuming to monitor
What are six things that make things catch on or go viral?
1) Social Currency: People share things that make them look good, knowledgeable or cool.
2) Triggers: Ideas that stay top-of-mind because they are associated with common concepts or routines.
3) Emotion: High-arousal emotions such as excitement, surprise, anger, or humor encourage sharing more than low-arousal emotions.
4) Public: Things that are visible and widely seen are more likely to be copied and imitated (e.g., Apple AirPods).
What two things do you need to develop a creative brief?
1) Consumer Insight: Understanding the audience’s needs, pain points, or desires.
2) Single-Minded Thought: The core message that should be communicated clearly and effectively.
What are the three key appeals or themes to look at when designing a message?
1) Rational: Logical arguments, facts, and benefits (e.g., cost savings, product features).
2) Moral: Ethical or socially responsible angles (e.g., sustainability, fairness).
3) Emotional: Engaging feelings such as joy, fear, nostalgia, or excitement.
How do rational appeals work?
-Rational appeals relate to the audience self interest, showing that the product will produce the desired benefit.
-Rational appeals often highlight product quality, economy, value, or performance.
-Common formats include: problem-solution, demonstration, product comparison, or testimonials.
Which form of appeals does comparative advertising link to? How does comparative advertising work?
-With comparative advertising, competitors are directly or indirectly referred to in the ad.
-It’s more common for brands that are not the market leader.
-Works well for underdogs. But if the dominant brand does it, it’ll look like they’re being a bully.
-Strengths: helps position effectively, higher encoding and recall from consumers, and it’s attention getting.
-Weaknesses: viewers may dislike the ads tone, you may be giving advertising for the competitor, and allow for the competitor to make a counter-argument which may damage your brand.
