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MGTA02H3 (361)
Chapter 8

Chapter 8

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University of Toronto Scarborough
Management (MGT)
Chris Bovaird

Chapter 8: The 4 Ps- Promotion Purpose: 1. Identify the important objectives of promotion and discuss the considerations in selecting a promotional mix. 2. Discuss the most important advertising startegiesstrategies and describe the key adversitingadvertising media. 3. Outline the tasks involved in personal selllingselling and list the steps in the personal selling process. 4. Describe the various types of sales promotions, and distinguish between publicity and public relations. Purpose 1: Identify the important objectives of promotion and discuss the considerations in selecting a promotional mix. PROMOTING PRODUCTS AND SERVICES Promotion: Any technique designed to sell a product. – promotionPromotion is the part of the communication mix: the total message a company sends to consumers about its product – Promotional techinquestechniques must communicate the uses, features, and benefits – Sales promotion also include various programs that add value beyond the benefits inherent in the product – In this section: ○ We look at Different objectives of and approaches to promotion ○ Show when and why companies use particular startegiesstrategies and tools and then describe the special promotional problmesproblems faced by both international and small businesses ○ Explain two general values added from promotional activities Information and Exchange Values – theThe purpose of promotion is to influence purchase decisions and businesses use promotionaluse promotional methods to communicate to consumers and industrial buyers – Promotions seek to accomplish four things with potential customers: ○ Make them aware of the products, make the knowledgeable about products, persuade them to like products, persuade them to purchase products – A succesfulsuccessful promotion provides communication about the product and create exchange that statifiesstratifies the buyer and seller – Promotions are expensive and choosing the right promotional mix becomes critical, also promotional program can determine the success or failure of the product at any stage ( stage (introductinointroduction stage or maturity stage) Promotional Objectives – ultimateUltimate objective of any promotion is to increase sales, but marketer also use promotion to :to: CommunicationgCommunicating Information – Consumers cannot buy a product unless they have been informed about it – Information may be communicated in writing, verbally, or visually – Today communication of information is so important that marketers try to place it wheverwhoever conumsersconsumers may be and an average consumers comes in contact with approximately 1,500 bits of promotional communication per day PositionigPositioning Products Product Positioning: The establishment of an easily identifiable image of a product in the minds of conusmersconsumers. – withWith product positioning the company is trying to appeal to a specific segment of the market rather than to the market as a whole Adding Value – Today’s value-conscious customers gain benefits when the promotional mix is shifted so that it communicates value- added benefits in its products (BK) Controlling Sales Volume – increasingIncreasing promotional activities in slow periods, firms can achieve more stable sales volume throughout the year; promotion can even turn slow seaonsseasons into peak sales periods Promotional Strategies Push Strategy: A promotional strategy in which a company aggresivelyaggressively pushes its product through wholesales and retailers, which persuade customers to buy it. Pull Strategy: A promotional strategy in which a company appeals directly to customers, who demand the product from retailers, which deamnddemand the product from wholesalers. – Firm must develop a promotional strategy (push or pull variety) to achieve these objectives after promotional objective are clear – Advertising “pulls” while personal selling “pushes” – Rare cases a company may purposely do very little promotion of its products – Markets of indutrialindustrial products most often use push and marketers of consumer products most often use a pull strategy – Many large firms use a combination of the two strategies ( General(General Foods) The Promotional Mix Promotional Mix: That portion of marketing concerned with choosing the best combination of advertising, personal selling, sales promotions, and publicity and public relations to sell a product. – fourFour types of promotional tools: adversitingadvertising, personal selling, sales promotions, and publicity and public relations – bestBest combination of these, the best promotional mix, depends on many factors but most important is target audience The Target AudieneceAudience: Promotion and the Buyer Decision Process – In establishing a promotional mix, marketers match promotional tools with five stages in the buyer decision process: 1. Buyers first recognize the need to buy, and marketers want to make sure the buyers are aware of their products. (Advertising and publicity) 2. Buyers want to learn more about the avaliableavailable products. (Advertising and personal selling) 3. Buyers compare competing products. (Personal Selling) 4. Buyers choose products and purchase them. (Sales Promotion and Personal Selling) 5. Buyers Evaluate products after purchase. (Advertising and Personal Selling) Purpose 2: Discuss the most important advertising startegiesstrategies and describe the key adversitingadvertising media. ADVERTISING PROMOTIONS Advertising: Promotional tools consisting of paid, non-personal communication used by an identified sponsor to inform an audieneceaudience about a product. – Consumers remember brand names more easily if the company has a catchy advertising slogan – As important and high profile as adversitingadvertising is, it has limits; adversitingadvertising might convince a consumer to try a product or service, but it’s the experience with the product or servicive that determines if they will purchase again Advertising Strategies – startegiesStrategies depend on which stage of the product life cycle the product is in Information Advertising: An adversitingadvertising strategy, appropriate to the introuctionintroduction stage of the product life cycle, in which the goal is to make potential customers aware that a product exists. Persuasive adversitingadvertising: An advertising startegystrategy, appropriate to the growth stage of the product life cycle, in which the goal is to nfluenceinfluence the customer to buy the firm’s product ratehrate rthenthen the similar product of a competitor. Comparative AdveritisingAdvertising: An adversitingadvertising strategy, appropriate to the maturity stage of the product life cycle, in which the goal is to influence the customer to switch from a competitior’scompetitor’s similar product to the firm;s product by directly comparing the two products. Remind Advertising: An adversitingadvertising strategy, appropriate to the latter part of the mautirymaturity stage of the product life cycle, in, in which the goal is to keep the product’s name in the minds of customers. AdversitingAdvertising Media – Consumers tend to ignore the bulk of adveristingadvertising around themaround them, therforetherefore marketers must find out who their customers, which media they pay attention to what messages appeal to them and how to get their attention Advertising Medium: The specific communication device- television, radio, newspapers, direct mail, magazines, bills boards- used to carry a firm’s adversitingadvertising messages to potential customers. Newspapers – areAre widely used advertisingused advertising medium, but in recent years the volume has decresaseddecreased due to internet – offerOffer excellent coverage, many people read the papyerpaper every day, ad can change from day to dad, ad are presented side by side with news, but – theyThey are thrown out after one day, don’t print in colour and have poor reproduction quality; moreover, they don’t allow advertisers to target their audience well Television – allowsAllows advertisers to combine sight, soungsound and motion – informationInformation on viwerviewer demographics for a particular program allows adverisersadvertisers to promote to their target audiences – disadvantageDisadvantage is that there are too many commercials which can cause viewers to be confused, also commercials are expensive and very short Direct Mail Direct Mail: Printed advertisements, such as flyers, mailed directly to consumers’ homes or places of business – allowsAllows company to select
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