Unit 6 - Promotion

Chapter 19 – What is Promotion?

Objectives 19.1

Marketing uses promotion to inform, persuade and inform the public about goods and services a company has to offer.

3 Characteristics of Advertising:

·  The time or space devoted to it is paid for.

·  It uses a set format to carry a message rather than, 1 on 1 selling.

·  If identifies the sponsor or the message.

Terms 19.1

·  Promotion – is any form of communication a business or organization uses to inform, persuade or remind people about its products and improve its public image.

·  Product Promotion – convinces potential customers to buy products from it instead of from a competitor.

·  Institutional promotion – is used by business to create a favorable image for itself.

·  Advertising – is any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor.

·  Publicity – involves placing any newsworthy information about a company, product, or person in the media.

Objectives 19.2

Characteristics of Sales Promotion:

·  It usually involves short term activities.

·  It usually involves some type of incentive to make a purchase.

·  It can be used in all channels of distribution with manufacturers, wholesalers, retailers and consumers.

Concept of promotional mix – is a combination of different types of promotions.

Terms 19.2

·  Sales Promotion – represents all marketing activities other than personal selling, advertising and publicity that stimulate consumer purchasing and sales effectiveness.

·  Slotting Allowance – is a cash premium paid by the manufacturer to a retail chain for the cost involved in placing a new product on its shelves.

·  Sales Incentives – are the awards given to managers and employees who successfully meet or exceed their company’s set sales quota for a particular product.

·  Licensing – occurs when entities license their logo or trademark to a business to be used in promoting the businesses product.

·  Promotional Tie-Ins – are sales promotional arrangements between retailers or manufacturers.

·  Premiums – are usually low cost items given away free to customers as a condition of a purchase.

·  Incentives – generally refer to high priced products earned thru contests or sweepstakes.

·  Promotional Mix - is a combination of different types of promotions.