Level

3.0 PROFESSIONAL DIPLOMA IN SALES AND MARKETING MANAGEMENT

Module

12 PROMOTIONAL PRACTICE MANAGEMENT

Professional Diploma in Sales and Marketing Management

Content

1 IMPLEMENTATION OF THE PROMOTIONAL MIX 3

Promotion 3

The Promotional tools 10

2 PUBLIC RELATIONS TECHNIQUES20

Public Relation 20

The Scope of Public Relations 26

3 THE NATURE OF PRODUCTS COMPONENTS AND LIFE CYCLES33

Direct Marketing 42

4 PLACE OPERATIONS 60

How to Design a Distribution 60

5 INTERGRATION, IMPLEMENTATION AND EVALUATION 75

Budgeting and Evaluation 75

6 CURRENT AND FUTURE ISUES 82

Law and Ethical issues 82

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

Promotion

Marketing Communications

In marketing we need to communicate with our customers. We also need to tell and show them our products, the prices and the channels of distribution. This means that modern marketing calls for more than just developing a product or service.

In communicating with the customer, the company needs to establish what to say, to whom and how often, with what effect and what media. The marketing communications mix (also called the promotion mix) consists of five major models of communication. These are:

  1. Advertising

This is defined as any paid form of non-personal presentation and promotion of ideas, goods and services by an identified sponsor.

  1. Sales Promotion

A variety of short-term incentives to encourage trial or purchase or a product or service are known as sales promotion. They also cost money as advertising.

  1. Public Relations and Publicity

A variety of programs designed to promote and/or protect a company’s image or its individual product are known as public or publicity.

  1. Personal Selling

Fact to face interaction with one or more prospective purchasers for the purpose of making presentations, answering questions, and procuring orders is known as personal selling.

  1. Direct Marketing

Use a mail, telephone, fax, e-mail, Internet and other non-personal contacts tools to communicate directly with or solicit a direct responses form specific customers or prospects.

Due to current technological breakthrough people can now communicate through verymany tools. For example, people can mow communicate through media (newspaper, radios, television, telephone) as well as through other media forms (computers, fax machine, mobile cellular phones and pagers). By decreasing communications costs, the new technologies have encouraged more companies to move form mass communication to more targeted communication and one to one dialogue.

Also note that a product/service style, price, package, shape and colour, the sales representatives manner and dressing, the place of business, etc, all communicates something to the buyer or customer. In promotion/communication, the whole marketing mix and marketing strategy must be orchestrated to deliver and establish the company’s intended strategic positioning.

Examples of Communications Modes

  1. Advertising
    this as defined above includes:
  • Print and broadcast advertisements
  • Motion pictures

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

  • Brochures and booklets
  • Posters and leaflets
  • Billboards, neon signs
  • Point of purchase display

2. Sales Promotion

  • Games, contests, lotteries
  • Fairs and exhibitions
  • Trade in allowances
  • Entrainment
  • Sampling

3. Public Relations

  • Press kit releases
  • Speeches
  • Seminar, annual shareholders meetings
  • Annual reports
  • Charitable donations
  • Publications, company magazines

4. Personal Selling

  • Sales presentations
  • Sales meetings
  • Sales incentive programs
  • Sales samples
  • Fairs and trade shows
  • Sales plans, routes, implementation and results

5. Direct Marketing

  • Catalogs
  • Mailing
  • Telemarketing, electronic shopping
  • Fax
  • E-mail, internet
  • Voice mail

Communication Process

In most cases the marketing communication focuses on:

  1. Creating awareness
  2. Creating an image
  3. Persuading target customers to buy or respond as planned

Since consumers and target marketers differ, communication to be tailored for specific segments, niches and even individuals. Given the new electronic technologies, companies must ask not only “how can we reach our customers?” but also “how can we find ways to let our customers reach us?”

Starting point in the communications process is thus an audit of all the potential interactions target customers may have with the product and company.

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

For example, someone purchasing a new computer would talk to others, see television ads, read articles in newspaper and magazines, and observe computers in the dealers or merchants shops. The marketer needs to assess which stages of he buying process. This understanding will help marketers allocate their communication money or shilling in the right communication tool.

General Factors that Influence Communication

  1. The greater the monopoly of he communication source over the recipient, the greater the recipients change or effect in favour of the source.
  2. Communication effects are greatest where the message is in line with the receivers existing opinions, beliefs and dispositions.
  3. Communication can produce the most effective shifts on unfamiliar, lightly felt, peripheral issues, which do not lie at the centre of he recipients value system. In other words, it can change an individuals attitude and perception.
  4. Communication is more likely to be effective where the source is believed to have expertise; high status, objectivity or likeability and particularly where the source has power it can be identified with.
  5. The social context, group or reference group will mediate the communication and influence other whether or not the communications is accepted.

Developing Effective Communications

In order to develop effective communication and promotion programme, the marketer needs to:

  1. Identify the target audience
  2. Determine the communication objectives
  3. Design the message
  4. Select the communication channels
  5. Establish the total promotion budget
  6. Decide on the promotion mix
  7. Measure the promotion result
  8. Manage and co-ordinate the integrated marketing communications process.
  1. Identifying the Target Audience

A marketer must start communication with a clear target audience in mind. The audience could be potential buyers of the company’s products, current users, deciders, or influencers. The audience could be individuals, groups, and particular groups among the public or the general public. The target audience will influence the communicator’s decisions on what to say it, when to say it, where to say it, and to whom to say it to.

In analyzing the target audience the marketer needs to establish the audience current image of the company, its products and its competitors.

Note that image is the set of beliefs, ideas, and impressions that a person holds regarding an object. People’s attitudes and auctions towards an object are highly conditioned by their image.

A company could develop a simple questionnaire to test image or impressions a target market has about a product, or a company.

2. Determining the Communications Objectives

If the target market and its characteristics have been identified, the marketing communicator must decide on the desired audience response.

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

The desired ultimate responses are purchase, high satisfaction, and favourable word of mouth. But purchase behaviour is the end result of a long process of consumer decision-making. The marketing communicator needs to know how to influence the target audience to buy a product/service.

Other communication objectives could be to put in consumer’s mind, change the consumer’s attitude or get the consumer to act favourably.

In attempting to get consumer response, such response can be classified into the following response hierarchy models.

Communication creates:

  1. Awareness
  2. Knowledge
  3. Liking
  4. Preference
  5. Convincing
  6. Purchase in marketing, purchase of products/services is the main expected result of communication. The target audience is expected to purchase the products and/or services. Before purchasing, depending on circumstances, they may wait for more information, or plan to act later. The communicator must lead the consumer to take the final step (action). Action here means making a purchase.

3. Designing the Message

A marketer should design a good and effective, message. Ideally the message should conform to the model of creating attention. Desire and action. In practice, few message go through this process but this is the idea situation. Formulating the message would require solving the following four problems:

  • What to ay (message content)
  • How to say it logically (message structure)
  • How to say it symbolically (message format)
  • Who should say it (message source)

Message Content

The marketer has to consider or figure our what to say to the target audience in order to get the desired audience response. In the age of mass marketing, it was thought that one would work for everyone. However, today different seek different benefits from the same product. People are paying les attention to mass advertising. Even TV channels have different advertisements for different to consumer segments.

The challenge therefore is to create message that will get the attention of specific targets groups. For example, Cola-Cola’s advertising agency, creative artists, ahs global Coca-Cola managers decide which commercials would work best with each market segment.

In determining the best message content, management searches for an appeal, theme, idea and unique selling proportion. The appeals can be rational or emotional. It could also be moral appeal.

Companies that sell similar products their message contents to magnify differences.

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

Message Structure

A message’s effectiveness depends on its structure as well as it’s content. The structure could be that of conclusion drawing, one versus two sided arguments and any other order of presentation.

Recent research however, indicates that eh best ads ask questions and allow the audience, readers or viewers to form their own conclusions. Conclusion drawing might cause negative reactions in the following situations:

  • If the communicator is seen as untrustworthy, the audience members might resent the attempt to influence them.
  • If the issue is simple or the audience is intelligent, the audience members might resent the attempt to influence them.
  • If the issues is highly personal, the audience recent the communicator’s attempt to draw a conclusion e.g. O.B tampons, always etc.

Drawing too explicit a conclusion can also limit a product’s appeal or acceptance. Conclusion drawing is better suited for complex and specialized products where single and clear use is intended.

Over the years, findings on communications as far as message structure is concerned is that:

  • One-sided messages work best with audiences that are initially predisposed to the communicator’s position, and two-sided arguments work best with audiences who are opposed.
  • Tow sided messages tend to be more effective with better-educated audiences.
  • Two sided messages tend to be more effective with audience that are likely to be exposed to counter propaganda.

Finally, the order in which arguments are presented is important. In the case of one-sided message, presenting the strongest argument first has the advantage of establishing attention and interest.

Also, in the case of two sided messages, the issue is whether to present the positive argument first or last. If the audience is initially posed, the communicator might start with the other side’s argument and conclude with his or her strongest argument.

Message Format

The marketing communicator must develop a strong format for the message. In print advert, the communicator has to decide on the headline, copy, illustration and colour. If the message is to be carried over radio, the communicator has to carefully choose words, voice qualities (speech rate, rhythm, pitch, and articulation), and vocalization (pause, signs, and yawns. For example the sound of an announcer for baby care products is different form that of vehicle spare parts salesman. If the message is to be carried on television, the personalities must also be different. The television presenters must pay attention to their facial expressions, gestures, dress, posture and attire.

Message Source

Experience has shown that messages delivered by attractive or popular sources achieve higher attention and recall. Advertisers often use celebrities as spokes people. Examples are many in Kenya and aboard, e.g. Michael Jordan and Nike, Michael Jackson and Pepsi cola, mama kayai and Raymond Blankets etc.

Furthermore what is equally important is the spokesperson’s credibility. Messages delivered by highly credible sources are more persuasive.

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

For example, pharmaceutical companies want doctors to testify on their product’s benefits because doctors have highly credibility as far as medicine is concerned.

Credibility comes about due to expertise, trustworthiness and likeability of the source.

4. Selecting the Communication Channels

The marketing communicator must select efficient channels of communication to carry the message. In many cases, many different channels must be used. For example, a Unilever Kenya salesperson when making a presentation to a wholesaler, the presentation must be crisp, quick and convincing. These called by sales representatives are expensive and the company must support them by adding other communication tools. The other communication tools include placing advertisement of the products in journals, sending direct mail, passing out free samples, and even telemarketing. Communication channels are of two broad types. These are:

  1. Personal communication channel
  2. Non-personal communication channel

Personal Communication Channels

Personal communication channels involve two or more persons communicating directly with each other. They might communicate face-to-face, person to audience directly with each other. They might communication channels derive over telephone, or through the mails. Personal communication channels derive their effectiveness through the opportunities for individualizing presentation and feedback.

Companies can take several steps personal communication channels to work on their behalf. These include:

  • Use influential or believable people in testimonial advertising
  • Develop advertising that has high “conversation value”.
  • Develop word of mouth referral channels to build business.
  • Establish electronic forum, e.g. e-mail fax voices, on line discussions, etc for communicating with customers and prospects.

Non-Personal Communication Channels

Non-personal communication channels messages without personal contact or interaction. They include media, atmosphere and events.

Media- consists of print media (newspapers, magazines, direct mail), broadcast media (radio, television), electronic media (audio tape, video tape, video disc, CD-ROM (compact Disc Read Only Memory) and display media (billboards, neon signs, posters). Most non-personal messages came through paid media.

Atmosphere- are “packaged environments” that create or reinforce the buyer’s learning toward product purchase. Thus law firms and offices are usually decorated with oriental rugs and oak furniture to communicate “stability” and “success”. The banks also do the same. A luxury hotel will incorporate elegant chandeliers, marble columns and other tangible signs of luxury.

Events- are occurrences designed to communicate particular messages to target audiences. Public relations departments arrange news conferences, grand openings and sports sponsoring to achieve specific communication effects with a target audience.

Module 12 Promotional Practice Management 1 Implementing of the Promotional Mix

Establishing the Total Promotion Budget

One of the most difficult marketing decisions companies is how much to spend on promotion. Some say that in promotion expenditure, over one half is wasted unless someone is careful. The budget should reduce the half that is wasted.

Promotion expenditure might amount up to between 20% to 30% of he sales in a cosmetic industry and only 5% - 10% in the industrial equipment industry.

In the cigarette brands industry, Philip Morris the owners of Marlboro are big advertisers. They have also acquired certain brands and spend a lot in advertising their brands. Other firms like Unilever Kenya, Kenya Breweries ltd, Proctor $ Gamble etc also allocate large percentage of their earning in promotion.

How do companies decide on their promotion budget? Four common methods used to set up promotion budget are affordable method, percentage of sales method, competitive parity method and, objective and task method.

Affordable Method

Many companies set the promotion budget at what they think the company can afford. The affordable method of setting budgets completely ignores the role of promotion as an investment and the immediate impact of promotion slaw volume. It leads to an uncertain annual promotion budget, which makes long range planning difficult. Most parastatals in Kenya practice this method.

Percentage of Sales Method

A number of companies set their promotion expenditures at a specific percentage of sale (either current or anticipated) of the sales price. A Kenya Railways business executive responsible for promotion would set a percentage of each years revenue for promotion, say 2% or 3%. Vehicle firms would also set a percentage of expected sales as promotional budget. The oil companies equally set their promotion budget based on expected litres of fuel to be sold in a year. This method is rational and result oriented.

The percentage of sales method seems to be a good method of promotional expenditure, which is justifiable. It views sales as eh determinant of promotion. It leads to a budget set by the availability of funds rather than by market opportunities. The promotional budget therefore depends on year-to-year sale fluctuations.

Competitive Parity Method

Some companies set their promotion budget to achieve share of voice parity with their competitors. They try to spend as much as competitor does. This is so because of he belief that you might retain your market a share as the competitor if you industry advertises, you also do the same. If they conduct some sales promotion, you equally do the same.

Two arguments are made in support of he competitive parity method. One is that the competitors’ expenditures represent the collective wisdom of the industry. The other is that maintaining a competitive parity helps prevent promotion wars.