Introduction to Promotion

Management
 Marketing
Marketing can be defined in social and managerial point of view.

From social point of view, according to Philip Kotler, Marketing is

a social process by which individuals and groups obtain what they
need and want through creating, offering and finally exchanging
products and services of value with others.

From managerial point of view, Marketing is the art of selling

products.

According to the American Marketing Association, Marketing is

the process of planning and executing the conception, pricing,
promotion and distribution of ideas, goods and services to create
exchanges that satisfy individual and organizational goals.

Marketing Management can be defined as, The analysis,

planning, implementation and control of programs designed to
create, build and maintain beneficial exchanges with target buyers
for the purpose of achieving organizational objectives.
 Demand Management in
Marketing
Negative Demand: A market is in a state of negative demand if a
major part of the market dislikes the product and may even pay
a price to avoid it. The marketing task is to analyze why the
market dislikes the product and whether a marketing program
consisting of product redesign, lower prices and more positive
promotion can change the market beliefs and attitudes.

No Demand: Target customers may be unaware of or

uninterested in the product. The marketing task is to find ways
to connect the benefits of the product with the persons natural
needs and interests.

Latent Demand: Many consumers may share a strong need that

cannot be satisfied by any existing product. The marketing task is
to measure the size of the potential market and develop
effective goods and services that would satisfy the demand.

Decline Demand: Every organization, sooner or later, faces

declining demand for one or more of its products. The marketing
task is to reverse the declining demand through creative
remarketing of the product.
 Demand Management in
Marketing
Irregular Demand: Many organizations face demand that varies on a
seasonal, daily or even hourly basis, causing problems of idle or
overworked capacity. The marketing task, is to find ways to alter the
same pattern of demand through flexible pricing, promotion and other
incentives.

Full Demand: Organizations face full demand when they are pleased
with their volume of business. The marketing task is to maintain the
current level of demand in the face of changing customer preferences
and increasing competition. The organization must maintain or
improve its quality and continually measure consumer satisfaction to
make sure it is doing a good job.

Overfull Demand: Some organizations face a demand level that is

higher than they can or want to handle. The marketing task, called
demarketing, requires finding ways to reduce the demand temporarily
or permanently. Demarketing aims not to destroy demand but only to
reduce its level temporarily or permanently.

Unwholesome Demand: Unwholesome products will attract organized

efforts to discourage their consumption. The marketing task is to get
people who like something to give it up, using such tools as fear
messages, price hikes, and reduced availability.
 Marketing
Mix
The Marketing Mix is the set of marketing tools
the firm uses to pursue its marketing objectives in
the target market.

Mc.Carthy classified these tools into four broad

groups that he called the four Ps of marketing:
product, price, place and promotion.

Robert Lauterbom suggested that the sellers four

Ps corresponded to the customers four Cs.

Four Ps Four Cs

Product Customer solution

Price Customer cost
Place Convenience
Promotion Communication
 Promotion
The word promotion is used specifically to
refer to a particular activity that is intended to
promote the business, product or service.
Promotion includes all the ways available to
make a product and/or service known to and
purchased by customers and clients.
Promotion is a process of communication
involving information, persuasion, and
reminder. Promotion keeps the
product/service in the minds of the customer
and helps stimulate demand for the
product/service.
 Promotion
OBJECTIVES OF PROMOTION :

To inform
To remind
To motivate in the market

FACTORS EFFECTING PROMOTION MIX :

1. Nature of the product

2. Nature of the market
3. Stage of PLC [product life cycle]
4. Availability of funds
5. Nature of techniques of promotion
6. Promotional strategy
7. Readiness of buyer
 Promotion Mix
Promotion or Communication mix is
the name given to the combination of
methods used in communicating with
customers. This essentially brings
together the various promotional tools
used in the marketing programmed in a
coordinated and controlled way.

Promotion keeps the product in the

minds of the customer and helps
stimulate demand for the product.

The ongoing activities of advertising,

sales promotion, Public Relations
,personal selling and direct marketing
are often considered aspects of
promotion.
 Advertising

Sales Promotion
Ingredients
of the
Promotion Public Relations
Mix
Personal Selling

Direct Marketing
 Advertisement

DEFINITION:
Any paid form of non personal presentation
and promotion of goods & services or ideas by an
identified sponsor

OBJECTIVES OF ADVERTISING :

To make an immediate sale

To built primary demand
To introduce price deal
To inform about a product availability
To build brand recognition or brand insistence
 Sales Promotion

Short-term incentives to encourage the

purchase or sale of a product or
services.
Makes use of a variety of formats:
discounts, buy one get one free,
coupons, contests, etc.
Attracts attention, offers strong
purchase incentives
Stimulates quick response.
 Personal selling

The personal presentation by the

firms sales force for the purpose
of making sales and building
strong customer relationships.

Most effective tool for building

buyers preferences, convictions,
and actions.

Personal interaction allows for

feedback and adjustments.

Relationship-oriented.
 Public Relations

Building good relationships with

the companys various publics
(stakeholders) building up a
good corporate image.

The major tools are Press

Releases, Sponsorships , Special
Events, Web Pages.

To enhance the positive aspects

and minimize negative factors
related to products and
organization.
 Direct Marketing

Involves making direct

connections with
carefully targeted
individual consumers to
both obtain an
immediate response
and cultivate lasting
customer relationships.

Many forms: Telephone

marketing, direct mail,
online marketing, etc.
Communication Process
 Communication
Process

The model emphasizes the key factors in

effective communication.

Senders must know what audiences they

want to reach and what responses they
want to get. They must encode their
messages so that the target audience can
decode them. They must transmit the
message through channels that reach the
target audience and develop feedback to
monitor the responses.

The target audience may not receive the

intended message for selective attention,
selective distortion and selective retention.
Components of Communication Process

Source/Encoder is the
person or organisation that
has information to share with
another person or group.
Encoding leads to
development of a message
that
contains the information of
meaning that the source
hopes to convey.
Channel/Media is the
method by which
communication travels from
the source or sender to the
receiver
 Components of
Communication Process
Decoding is the process of
transforming the senders
message back into thought
Receiver is the person(s) with
whom the sender shares
thoughts of information.
Noise includes all external factors
that create unplanned distortion
Feedback means receivers
response by hearing, seeing or
reading which is sent back to the
sender.
 Steps in developing effective
communication process.
Identify Determine Design Select
target objectives message channels
audience

Manage Measure Decide on Establish

integrated results media mix budget
marketing
comm.
 Steps in developing effective
communication

Identify the target audience: The process must start with a

target audience. These target audience may be the potential
buyers, current users, deciders, influencers, individuals,
groups, particular public or general public. The target
audience sets the communicators decisions on what, how,
when, where and whom to say.

Determine the communication objectives: The marketers

set the objectives to put something into consumers mind,
change an attitude or get the consumer to act. The
objectives are set to create awareness, make knowledgeable,
get affinity or likings, create preferences and finally make
them to purchase.

Design the message: After defining the desired response, the

communicator moves to develop an effective message.
Ideally the message should gain attention, hold interest,
arouse desire and elicit action. In designing the message,
four things should be considered such as message content,
message structure, message format and message source.
 Steps in developing effective
communication
Select the communication channel: The communicator
must select efficient channels to carry the message.
The channels may be placing ads, using sales forces,
agents, distributors or dealers, direct mail,
telemarketing etc. The channels may be personal or
non-personal.
Establish the marketing communication budget: It is
one of the most difficult marketing decisions to
determine how much to spend on promotion. The
companies normally think about four methods to
decide on the promotional budget; the affordable
method, percentage of sales method, competitive
parity method and objective & task method.
Deciding on media mix: Companies must allocate the
promotion budget over the five promotional tools;
advertising, sales promotion, public relations &
publicity, sales force and direct marketing. Companies
can differ considerably in their media and channel
choices. They are searching for new ways to gain
efficiency by replacing one promotional tool with
others.
 Steps in developing effective
communication

Measure the communications results: Company

management wants to know the results coming from
the communication investments. After implementing
the promotional plan, the communicator must
measure its impact on the target audience. The
communicator collects behavioral measures of
audience response or asks the audience whether
they can recognize or recall the message.

Managing the integrated marketing

communications process: The wide range of
communication tools, messages and audiences
makes it imperative that companies move toward
integrated marketing communications (IMC). It is a
concept of marketing communications planning that
recognizes the added value of a comprehensive plan.
 Integrated marketing
communications (IMC)
Integrated marketing communications (IMC), involves
coordinating the various promotional elements and
other marketing activities that communicate with a
firms customers.

IMC is a concept of marketing communications planning

that recognizes the added value of a comprehensive
plan that evaluates the strategic roles of a variety of
communication disciplinesfor example, general
advertising, direct response, sales promotion, and public
relationsand combines these disciplines to provide
clarity, consistency, and maximum communications
impact.
 Relationship
Marketing
Relationship marketing
It refers the long-term
relationship with the
customers. It emphasizes
on creating, maintaining
and developing a long
term value laden or value
based relationship with
the target customers
benefits and costs.
The Customer-Development Process

Suspects

Prospects First-time Repeated Clients Advocates Partners

customer customer

Disqualified Inactive or
prospects Ex-customers
 The Customer-Development
Process
Suspects: The starting point is suspects, everyone
who might conceivably buy the product or service.

Prospects: Prospects are those who have strong

potential interest in the product and the ability to
pay for it.

Disqualified prospects: Disqualified prospects are

those whom the company rejects because they
have poor credit or would be unprofitable.

First-time customer: The Company hopes to

convert many of its qualified prospects into first-
time customers.

Repeat customer: Then the company hopes to

convert them into repeat customers. Both first-time
and repeat customers may continue to buy from
competitors as well.
 The Customer-Development
Process
Client: The Company then acts to convert repeat customers
into clients, who buy only from the company in the relevant
product categories.

Advocate: The next challenge is to turn clients into

advocates; customers who praise the company and
encourage others to buy from it.

Partner: The ultimate challenge is to turn advocates into

partners, where the customer and the company work
actively together.

Inactive & Ex-customer: At the same time, it must be

recognized that some customers will inevitably become
inactive or drop out, for reasons of bankruptcy, moves to
other locations, dissatisfaction and so on. The companys
challenge is to reactivate dissatisfied customers through
customer win-back strategies. It is often easier to reactivate
ex-customers than to find a new one.
 5 levels of relationship
marketing
Basic Marketing The salesperson
sells to the final customers. This is also
known as direct sales.

Reactive Marketing The sales

person sells the product and
encourages the customer to call for
any comments or enquiries.

Accountable Marketing The sales

person calls the customers to ensure
whether the product is working as per
satisfaction and if there is any
problem in the product. Furthermore
he also asks the customer for any
suggestions / feedback to improve the
service / product. Thus he is taking
responsibility for the sale.
 5 levels of relationship
marketing
Proactive marketing The
company salesperson contacts
the customer from time to time
with suggestions about improved
product uses or helpful new
products.

Partnership Marketing
The Company works continuously
with the customer to discover
ways to effect customer savings
or help the customer perform
better.