Mktg chap 16
§ Demand for a specific brand
Promotion and the Communication Process
Communications
§ A sharing of meaning through the
transmission of information
Source
§ A person, group, or organization with a
meaning it tries to share with a receiver or an
audience
Receiver
§ The individual, group, or organization that
decodes a coded message
Coding Process (Encoding)
§ Converting meaning into a series of signs or
symbols
Decoding the Message
Communication Channel
§ The medium of transmission that carries
coded message from the source to the
receiver
Decoding Process
§ Converting signs and symbols into concepts
and ideas
Noise
§ Anything that reduces communication’s clarity
and accuracy
Feedback
§ Receiver’s response to a decoded message
Channel Capacity
§ The limit on the volume of information a
channel can handle effectively
Promotion - Communication that builds and
maintains favorable relationships by informing and
persuading one or more audiences to view an
organization positively and to accept its products
Create Awareness
§ Awareness is crucial to initiating the product
adoption process for new products
Stimulate Demand
Primary Demand
§ Demand for a product category rather than a
specific brand
Pioneer Promotion
§ A way to stimulate primary demand
§ Promotion that informs consumers about a
new product
Selective Demand
Encourage Product Trial
 If customers stall in the evaluation stage,
marketers can use methods to encourage
product trial in order to move them to product
adoption
Identify Prospects
§ Some promotional efforts aim to locate and
identify customers who are interested in the
firm’s products and are most likely to buy
Retain Loyal Customers
§ The primary goal of marketing is to maintain
long-term customer relationships
Customer Retention
§ Listening to the customer
§ Loyalty programs to reward most-valued
customers
Facilitate Reseller Support
§ Strong relationships with resellers are
important to an organization’s ability to
maintain a sustainable competitive advantage
Combat Competitive Promotional Efforts
 used most often by firms in highly competitive
consumer markets
Reduce Sales Fluctuations
§ A business cannot operate at peak efficiency
when sales fluctuate widely
4 Elements of the promotion mix
1. Advertising - paid nonpersonal
communication about an organization and its
products transmitted to through mass media.
2. Personal Selling - paid personal
communication seeks to inform customers
and persuade them to purchase products in
an exchange situation.
3. Public Relations - broad set of
communication efforts used to create/maintain
favorable relationships between organization
and stakeholders
4. Sales Promotion - Activities or materials that
act as a direct inducement, offering added
value or incentive for the product .
Types of Interpersonal Communication:
Kinesic
§ Body language; communicating through the
movement of head, eyes, arms, hands, legs,
or torso
 Proxemic
§ Communicating by varying the physical
distance between two parties in face-to-face
interactions
Tactile
§ Communication through touching
Selecting Promotion Mix Elements
1. Resources, Objectives, policies.
 The size of an organization’s promotional budget
affects the number and intensity of promotional
methods used
2. Characteristics of the Target Market.
Size
§ Often drives what promotional elements
are chosen
§ Small target markets often rely on
personal selling
Geographic distribution
§ Dispersed customers often rely more
heavily on advertising
Demographic characteristics
§ Age, income, education, etc. will affect
consumers’ media consumption patterns
3. Characteristics of the Product.
§ Business products concentrate on:
ü Personal selling
ü Sales promotion
§ Consumer products concentrate on:
ü Convenience goods = advertising
ü Durables and expensive products =
personal selling
ü Both = public relations
§ Product price is an important factor
4. Cost and Availability of Promotional Methods.
National Advertising / Sales Promotion
§ Have higher expense but low cost per
individual
International Promotion
§ Can be difficult because of lack of
promotional channels
Personal selling
§ Is dependent on recruiting and hiring
qualified sales people
5. Push and Pull Channel Policies.
Push Policy
§ Promoting a product to the next institution
down the marketing channel
Pull Policy
§ Promoting a product directly to consumers
with the intention to develop strong
consumer demand for products
Stage of the Product Life Cycle
Introduction
• Advertising plus personal selling and sales
promotion to generate awareness
Growth/Maturity
• Consumer goods = advertising
• Business advertising = personal selling
and sales promotion
Decline
• Reduction of all promotional activities
Distribution Intensity of the Product
Intensive Distribution
• Advertising, sales promotion
Selective Distribution
• Promotion mixes vary
Exclusive Distribution
• Personal selling
Word-of-Mouth (WOM) Communication
§ Personal, informal exchanges of
communication that customers share with one
another about products, brands and
companies
Buzz Marketing
§ An attempt to incite publicity and public
excitement surrounding a product though a
creative event
Viral Marketing
§ A strategy to get consumers to share a
marketer’s message, often through email or
online video, in a way that spreads
dramatically and quickly.
Product Placement - form of advertising that
strategically locates products or product promotions
within entertainment media to reach a product’s target
market