PROMOTION MANAGEMENT

Farid Ashraf Priyanka Dang Subrata Jadon Anurag Prashant Prashant Gupta

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Contents :What Why Factors Tools Processes

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Case Study

What is Promotion Management ?

Promotion is communicating information between seller and potential customer to influence their attitudes and behavior. The main aim is to tell the customer that the right product is available at the right place at the right Price. Promotion is the power to influence 4/23/12 consumers to inform them, to

What is Promotion Management ?

v

An activity designed to boost the sales of a product or service. It may include an advertising campaign, increased PR activity, a free-sample campaign, offering free gifts or trading stamps, arranging demonstrations or exhibitions, setting up competitions with attractive prizes, temporary price reductions, door-todoor calling, telemarketing, personal letters on other methods.

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PROMOTION means all those tools that a marketer uses to take his product from the factory to the customer and hence involves advertising, sales promotion, personal selling, public relations, publicity and merchandizing. All have the same essence in them-buy me. All communications are action oriented. It is important to note that in the communication process there are two individuals- the sender and the receiver. For communication to be effective, both have to be actively involved

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Types of Promotion

Above the line Promotion: Promotion in mass media (e.g. TV, radio, newspapers, internet) in which an advertising agency is hired to place the advertisement.

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Below the line Promotion: All other promotion. Much of this is intended to be subtle enough for theconsumerto be unaware that promotion is taking place.

E.g.sponsorship,productplacement ,testimonials,sales promotion,merchandising,direct mail, personal selling,public relations,trade shows

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Why Promotion

Attract new customers Increase usage among existing customers Aid distributors Stabilize sales Boost brand-name recognition Create sales leads Differentiate the product 4/23/12

IPR Model
The aim is to inform, persuade and remind customers about all aspects of the firm and its products and services.

PLC Stages: Informing Introduction Early Growth

Target Audience

Reminding

PLC Stages: Maturity

PLC Stages: Growth Maturity

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Persuading

Informative

Informing the market about a new product Suggesting new features/uses for a product Informing the market of a price change Explaining how the product works Reducing customers fears Building a company image

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Launch of Nano Vehicle

INFOR M
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Persuading

Encouraging brand switching Changing customers perception of product attributes Persuading customer to purchase now

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Tide se kahin behatar safedi de Rin

PERSUA DE
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Reminding

Reminding customer that the product may be needed in the near future Reminding customer where to buy it Keeping it in customers mind during off seasons Maintaining its top off mind awareness
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REMIN D
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Response Hierarchy Models

STAGES AIDA MODEL Levidge & Steiner Model InnovationAdoption

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Awareness Knowledge Liking Preference Conviction

Target audience not aware about brand Might have brand awareness but not too much Have brand awareness, how they feel about it? Might like the products but not prefer to others. Prefer a product but not develop a conviction to buy it. Might have conviction but not get round to making the purchase.

Purchase
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Promotion Opportunity Analysis

Process of discovering the organizations strengths, weaknesses, opportunities and threat present in a firms external environment via a communication prospective. Comprises of: Competitors
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1.

1. Competitors Analysis
Objective of this is to discover :
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Who are the competitors ? What are they doing in the areas of advertising and communication It is helpful to know what potential customers see, hear, and read about the competition. Analyze secondary and primary data.

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2. Opportunities Analysis

This includes carefully watching for new market opportunities examining all of the available data and info. about the market.

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3. Target Market Analysis

Requires the marketing department to recognize the needs of various consumer and business groups. Try to decipher needs and wants of individual groups

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4. Customers Analysis

Conducting an in-depth analysis of customers. There are three types of customers to study: Current company customers Competitors customers Potential new customers The point is to understand how people in each group think, why they buy , where they buy, and how they evaluate a product after purchase.

1)

2)

3)

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to know whats going on in the minds of

5. Product Positioning Analysis

Examining the position a firm has relative to its competition

It is important to make sure the position being promoted is consistent with the current views by the various constituencies and is also coherent
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with

various

elements

of

the

PROMOTION MIX

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Promotional Mass vs Payment Strengths element Customize d Advertising Mass Fees paid for space or time

Weaknesses

Good for building awareness Effective at reaching a wide audience

Impersonal: cannot answer all customer questions Not good at getting customers to make a final purchasing decision.

Sales Mass Promotions

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Wide range of fees paid dependin g on promotio n selected

Can stimulate quick increase in sales by targeting promotional incentives on particular products.

If used over the long term, customers may get used to the effect Too much promotion may damage brand

Promotional Element

Mass vs. Payment Customized

Strenghts

Weaknesses

Personal selling CustomizedFees paid to salesperson as either salaries or commissions

Highly interactive and persuasive Immediate feedback Excellent for communicating complex product information

Expensive Message may differ between salespeopl e

Public relations Mass

No direct payment to media

Often most credible source in consumers mind

Difficult to get media cooperatio n Higher costs per recipient but cheaper than personal

Direct Marketing

CustomizedCost of communication through mail, telephone or computer

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Person-to-person interactive communications, facilitates relationship with customers

Factors guiding the selection of a Promotion Mix

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Overall Marketin g Strategy

Whether the firm wishes to push the product or create a pull for the product Managing distribution channels: Personal selling and trade promotion. Creating consumer demand for products: Advertising and sales promotion

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Product Life Cycle Stage

In the introduction stage , informative advertising, sales promotion and publicity play a significant role. In growth stage, persuasive advertising and personal selling play important role. In the maturity stage, personal selling , sales promotion and reminder advertisements help the product steer through the competition maze.

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Promotional Management

Conventional tools TV Radio Cinema Print Hoardings

Unconventional tools Web 2.0 Events & PR Buzz Marketing Ambush Marketing Direct Marketing Other Innovations

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Conventional Media - TV

Creative & Impact Sight & Sound Demonstrate Experiential Cost Effective for Mass Audience Focus Day, Programme, Content Women, Children, Men

Intrusive Viewers avoid TVC 1/3 Audience lost during Commercial Break Limited Viewers Attention/Fleeting Message Clutter Zapping Changing Channel to avoid TVC

Branded Entertainment: Form of Advertising that blends Marketing Entertainment in TV & Fims through sponsorships. Product Placement: Placement of Brands with in the TV Programs & Movies that cater to similar audience the Brand wants to target.

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Innovations in Mass Media Promotions

Coca Colas product placement at American Idol Coke Studio is a popular Music Show on MTV, where Coke connects directly with the youth through Branded Entertainment

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Innovations in Mass Media Promotions

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Events

Active Immersion Live Participations! 2 Way Interactions! Opportunity for Product Placement Branded Entertainment Sensory Branding Good Control over Marketing Elements! Localized similar to Hoardings

Creates Buzz / Peer to Peer Opens up PR opportunities Non Intrusive! Clutter Free! Possibilities of opening up additional Revenue Streams! I. Merchandise II. Contest with Co Sponsor III. TV Rights IV. Mobile Rights V. Gaming Right

Events are generally used for q Launch of New Brands, Rejuvenate Brands & Reposition Brands q Image Building q Creating & Reinforcing Brand Identity q Test Marketing of Products & Communication q Relationship Mgmt with Trade Partners & Channel Members 4/23/12

Events - Examples

Launch of New Brand: Tata Nano by Ratan Tata, created a lot of PR 4/23/12

Events - Examples

Creating & Reinforcing Brand Identity: By sponsoring the Australian Cricket Teams tour of India and highlighting the Australianess 4/23/12

Events - Examples

Image Building: LA Galaxy signs David Beckham Godrej sponsoring Miss World Event in India after split with 4/23/12 P&G

Buzz Marketing

Media Consumption habit has changed qCustomer have become Migrant / Mobile qPutting more Media Budget in Traditional Media produces diminishing returns. qAlternative mediums like Buzz is Cost effective & retentive
q

In Traditional Advertising Company talks about its Brands whereas Buzz makes Customer talk about the Brand Buzz starts conversation: Captures attention of Consumers & Media to the Point where they start Talking about the Brand or Company Geometric Progression of Spread People talk about it, tell other people if the content is amusing, catchy & remarkable Did you hear this..? Media writes about it- So leads to PR Buzz can happen overnight but it takes long time to Plan Negative Buzz spreads faster than Positive Buzz

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Buzz - Examples
Fight b/w Ambani brothers - Print Ad created overnight Buzz & controversy Question in Parliaments? Other Media Vehicles are talking about it TV Channels! People are discussing it!

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Buzz - Examples

SRK frisked at an American Airport because his Sir name is Khan before the release of his movie Created enormous controversy & Buzz 4/23/12

Aamir Khan goes to the same Airport before the release of 3 Idiots and is not frisked??? Aamir says, They dont frisk idiots

Buzz Marketing - Examples

This Print Ad by South West Airlines against Facebook Airlines Northwest initially started only claim created a lot through invitation of Buzz with in India Created Electronic Media Buzz through it the talking about on Aspirational value 4/23/12 Air. attached to it

Ambush Marketing

Ambush marketing refers to the means by which companies not officially associated with an event ride on its popularity and get themselves subtly associated with it. The ambushers often gain as much mileage as the event's official sponsors.

also known as Zero Cost Promotional Marketing & Guerilla Marketing

Coke-Pepsi War of World Cup 1996, where Coke became the official sponsor but Pepsi launched the campaign Nothing official about it and captured consumers imagination Samsung in an all out effort to undermine LG's sponsorship is launching a campaign saying `Official sponsor of the digital passion 4/23/12

Ambush Marketing- Examples

30 Dutch women attended Netherlands-Denmark game at Soccer City wearing orange dresses (House Colour of Bavaria) paid for by brewing company Bavaria during the World Cup, Bavaria was not sponsoring the event but got great mileage out of it. 4/23/12

Ambush Marketing through Hoardings

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Ambush Marketing through Hoardings

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Ambush Marketing through Hoardings

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Direct Marketing

Directly Communicate with TG One or more Communication vehicles Generate a Response / Transaction Measurable Build Profitable Relationship Selective Targeting More Effective; Flexible, Customized & Personalized Helps in Cross Selling of Products

Communication Vehicles used Direct Mail & E Mail Mobile SMS Telemarketing Catalog Marketing Use of TV /Press which has Toll Free Number, SMS, E Mail

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Web 2.0

Media Consumption Habit is Social Media Vehicles that are Changing used Young adults are Media Migrant Internet Users are spending less User Creation Media time watching TV YouTube, Blogs Internet is for Information & TV is for Entertainment User Connection Media Young Adult choose (50%) Facebook, Orkut Internet over TV (20%) : 2 Way Communication User Collaborative Media Yong Adult cannot survive Wikipedia without Net. Paid Advertising: Whenever a Surfer types in a Key Word, the Paid Advertiser links are generated & displayed. Provides list of related websites of interest based on Key Word e.g. Google Ad sense Advergame / Advertainment: Advertising approach in video games/ Interactive Internet sites. Basically, they are games/ interactive entertainment produced for the sole purpose of promoting a product. E.g. Nike Photo iD 4/23/12

Web 2.0 - Examples

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Web 2.0 - Examples

Consumers to use their mobile phones to choose colours they liked from the world around them, and have these colours incorporated into a customized pair of Nike running shoes.

Once the consumer had received the special image, they could save it to use as wallpaper, forward it on to a friend to see, or go to the NIKEiD website and enter a unique DESIGNiD code to actually purchase the specially designed shoe.

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Web 2.0 - Examples

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Web 2.0 - Examples

Googles maximum Revenue comes from Adsense & Adwords that it sells to Internet Marketing Companies used for Pin point promotional Activities 4/23/12

Public Relations

Companies generally go for paid PR; Events & Buzz (Controversies, issues etc) also are a prequel to PR Activities Business units these days have a dedicated PR Department which deals directly with the PR Agencies

PR Activites help in pushing up the Sales, e.g.

Blink made it to Best seller list when Bill Clinton was seen carrying it. Film nominated to Oscar Business goes up NYT Best Seller List Sales of the Book goes up!

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Public Relations

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Out of Home (OOH) Promotions

OOH Placements: Focused Coverage of Target Market High frequency Geography Flexibility On Mobile Vans Creativity Technology Reproduction & Color Creates Instant Awareness Closer to Fructification sales More Effective & Efficient

Furniture: Benches & Posts Convenience Store

Dealer Sign Board Wall Painting

Shopping Mall

Inside & Out side

Subway Tunnel Taxi Top, Side, Inside Wrapped Vehicle Van / Truck Side, Top Stadiums Campuses Digital Media BSE Stock Exchange Sky Writing Beach Advertising

Buses, Trains & Aircrafts

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Out of Home Promotions

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Out of Home Promotions

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PROMOTION PROCESS

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PROMOTION PROCESS FLOWCHART

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The aim is to Inform, Persuade and Remind customers about all aspects of the firm and its products and services. The objective of promotion marketing is a specific communication task to be achieved with a specific target audience during a specified period of time.

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Promotion Objectives
Corporate Objectives ( Relates to image, reputation )

Marketing Objectives ( Relates to sales volume, market share, profitability and revenue)

Communication Objectives ( Relates to communication impact on the target audience)

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Identifying the target market and the target audience

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Identifying the target market

Properly identifying and understanding the target audience are essential elements for planning a campaign.

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At least the following questions should address the target audience

Who / where are they (demographics)? How do they obtain daily information? Who are their role models? What are their current perceptions, knowledge, needs, wants, preferences, and behavior in relation to the issue addressed by the campaign? What prevents them adopting the alternative behavior promoted by the campaign? What would motivate them to adopt the promoted behavior?
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Target Market should focus on : Current customer Potential customer Customer & aspect who need special attention Prospects who never bought the brand but might buy it

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Factors should also be taken into account while selecting target audience

Demographic (Age, Gender, Income, Education etc)

Psychographic (Social Class, Lifestyle, Personality etc) Behavioral (Occasions, Benefits etc) Geographical (Metro based, Rural market base etc) Mediagraphics (Social Message space like TWITTER,

FACEBOOK )

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Demographic

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Psychographic

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Behavioral

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Geographical

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Mediagraphics

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Informing

Informing the market about a new product Suggesting new features/uses for a product Informing the market of a price change Explaining how the product works Reducing customers fears
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Building a company image

Persuading

Encouraging brand switching Changing customers perception of product attributes Persuading customer to purchase now

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Reminding

Reminding customer that the product may be needed in the near future Reminding customer where to buy it Keeping it in customers mind during off seasons Maintaining its top off mind awareness
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PROMOTION BUDGET

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Methods of Budgeting
There are 4 main methods of budgeting:

All you can afford method Unit of sales method Competitive Parity Method Objective and task method
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All you can Afford

Allocates its financial resources among:

Manufacturing R&D Trade discounts Remaining to Marketing

The management perceives Marketing as a non-revenue generating activities.

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Unit of sales method

Past sales or projected future sales is used as the base Inclined to finance oriented management who believe that expenses should be closely related to the movement of corporate sales over the business cycle Percentage chosen varies from company to company
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Inherent disadvantages:

It views sales as the determiner of communications rather than the result It doesnt allocate money for special needs or to combat competitive pressures During the growth periods budgets may not be increased
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COMPETITVE PARITY METHOD

Also known as FOLLOW THE CROWD Logic followed is that collective wisdom is better than an individual firms ideas. Leads to a near optimal advertising budget Creates a misconception that parity will help in avoiding communication 4/23/12 wars.

DISADVANTAGES

It doesnt take into account that company reputation, resources, opportunities and objectives differ There is no evidence to suggest that parity will not lead to communication wars.

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OBJECTIVE AND TASK METHOD

Budgets are made by defining specific objectives Determining the tasks that must be done to achieve these objectives Estimating the costs involved in performing these tasks

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Budget is allocated to the following

Advertising Sales promotion Public relations and Publicity Events and experiences Direct marketing Interactive marketing Word of mouth Sales force

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MESSAGE

Message Consideration
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Content of a Message
Theme Central idea of the message q Tone o Positive Dove o Negative Rin vs Tide o Neutral Raymonds qAppeal o Rational Nano, Medicines o Emotional (Share, Care , Joy etc) Ad for Voltas Ac o Moral Blood donation ad for Thalassemia
q

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Style of the Message

Colloquial Demonstration Slice of Life Fantasy Dramatization Lifestyle Technical Testimonial

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Message In a Promotional campaign

Content Words play a key role

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MESSAGE STRUCTURE
Refers to the body of the message

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MESSAGE FORMAT
It involves size, color , background, visuals for a print copy etc

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Message spokesperson

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CELEBRITY

EXPERT

CEO
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Media Planning
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Importance

To apportion the budget appropriately To convey the intended message To select proper channels of communication

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Terminologies
Media Planning: Media plan:
The process of deciding the exact media vehicles to be used for delivering the message for target audience. It is the plan that details the usage of media in an advertising campaign including costs, running dates, markets, reach, frequency, rationales, and strategies

Media strategies: Plan of action to achieve

the objectives

Medium:
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It consists of print, broadcast, Internet

MEDIA CHANNE L

PERSON AL
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NON PERSON AL

PERSONAL CHANNEL
It involves communication on one-toone basis
EXPER T

Person al channe l

ADVOCAT E SOCIAL

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Expert Channel
Adopted by pharmaceutical companies

Royal Sundaram organises free health camp for RSBY beneficiaries 7 July 2011 Health insurance initiatives 4/23/12 awareness drive in Vaishali and

ADVOCATE
A person is hired by the company advocates its cause or product

Personal selling is a part of it

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SOCIAL
Refers to word of mouth communication
Identifying an opinion leader and penetrate the segment

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NON PERSONAL CHANNEL

Channels communicate the desired message without a personal interaction with target customer group

It includes media, radio, print etc

NON PERSONAL CHANNEL

NOISE
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ATMOSPHER ICS

NOISE
Space in newspapers and magazines are so cluttered that sometimes they go unnoticed

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ATMOSPHERICS

It refers to packaged environment that creates or reinforces the buyers perception of firm and its products

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Media

Advantage

Disadvantage

Television

Mass Coverage High reach Impact of sound, sight & motion Attention getting

Low selectivity Short message life High absolute cost High production cost

Radio

Low coverage & low cost High frequency Flexible Low production cost

Audio only Clutter Low attention getting Fleeting message

Magazines

Segmentation potential Quality reproduction High performance content Longetivity Multiple readers

Long lead time for ad placement Visual only Lack of flexibility

Newspapers

High coverage & Low cost Timely Ads can be placed in interest section Reader control exposures

Short life Low-attention getting Poor reproduction quality Selective reader exposure

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EVALUATION
Parameters on which campaign effectiveness is measured?

Brand awareness Knowledge about the brand Preference for the brand Sales effect

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Volkswagen

Challenge : While the brand is a household, its awareness in India was very low

Objective:- The objective of the Roadblock campaign was primarily to build awareness and affinity for the brand in India, as well as underlie the brands unique heritage.

The times of India, was blocked nationally by a single advertiser Volkswagen. (On Nov 11th, 2009)

Across 16 editions of the paper, ranging from 16 to 32 pages, over nine pages of each edition was dedicated to Volkswagen. 4/23/12

Results:Within Just a day Volkswagen was the No-1 search on Google India. Hundreds of comments registered on Auto Blog, Team BHP in matters of hours The phones at dealership have been ringing off the hook with enquiries about the Volkswagen product portfolio.

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VW Talking newspaper

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Insight, Strategy and the Idea

In 2010 VW entered the sedan market with its Vento VW is a relative newcomer, with brand awareness at only 39%, while established rivals had awareness in excess of 80%. To deliver instant sales, VW introduced Talking Newspaper ad. As readers opened the newspaper a light-sensitive chip attached to the page 4/23/12

Results & Effectiveness

In one day, VW achieved 12% of Ventos annual sales target. 200% increased in dealer enquiries. 100% spike in Google searches for VW Vento

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