Textbook Notes (369,072)
Canada (162,367)
RSM100Y1 (431)
Chapter 13

RSM100Y1 Chapter 13 Notes

6 Pages
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Department
Rotman Commerce
Course Code
RSM100Y1
Professor
Michael Khan

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RSM100Y1 Textbook Notes Chapter 13  Promotion: the function of informing, persuading, and influencing a purchase decision.  Promotional strategies try to develop: o Primary Demand: objective is to stimulate sales for an entire industry so that individual firms benefit from the total market growth (i.e. Get Cracking). o Selective Demand: create desire for a specific brand.  Integrated Marketing Communications (IMC): the coordination of all promotional activities – media advertising, direct mail, personal selling, sales promotion, and public relations – to produce a unified, customer-focused promotional strategy.  The IMC strategy focuses on customer needs to create a unified promotional message in the firm’s ads, in-store displays, product samples, and presentations by company sales representatives.  Promotional Mix: the combination of personal and nonpersonal selling that marketers use to meet the needs of a firm’s target customers and to effectively and efficiently communicate its message to them.  Personal Selling: the most basic form of promotion; a direct person-to-person promotional presentation to a potential buyer (B2B).  Nonpersonal Selling: forms of selling such as advertising, sales promotion, direct marketing, and public relations (C2B).  Common objective of promotional strategy: o Provide Information (i.e. credit cards providing info about benefits/rates) o Differentiating a Product (i.e. an ad comparing two laundry detergents)  Positioning: a concept whereby marketers try to establish their products in the minds of customers by communicating to the buyers the meaningful differences about the attributes, price, quality, or use of a good or service. o Increasing Sales Volume o Stabilizing Sales  It evens out the production cycle and reduces some management and production costs along with simplifying financial, purchasing, and marketing planning. o Highlighting the Product’s Value  Explains the hidden benefits of the ownership of a product/service.  Product Placement: a form of promotion where marketers pay placement fees to have their products featured in various media, from newspapers and magazines to television and movies (i.e. Coke on American Idol).  Guerrilla Marketing: innovative, low-cost marketing efforts designed to get customers’ attention in unusual ways (i.e. Coke vending machine).  Advertising: paid nonpersonal communication usually targeted at large numbers of potential buyers.  Product Advertising: messages designed to sell a particular good or service.  Institutional Advertising: messages that promote concepts, ideas, or philosophies. It can also promote goodwill toward industries, companies, organizations, or government entities.  Cause (advocacy) Advertising: a form of institutional advertising that promotes a specific viewpoint on a public issue as a way to influence public opinion and the political process.  Informative Advertising: tries to build initial demand for a product in the introductory phase of the product cycle.  Persuasive Advertising: tries to improve the competitive status of a product, institution, or concept and is usually used in the growth and maturity stages of the product cycle.  Comparative Advertising: compares products directly with their competitors – either by naming the competing product or by suggesting it.  Reminder-oriented Advertising: used to maintain awareness of the importance and usefulness of a product, concept, or institution and is usually used in the late maturity to decline stages.  Marketers must choose how to distribute their advertising budgets among the various media: o Television  Television ads can be classified as network ads, national ads, local ads, or cable ads. o Newspapers o Radio o Magazines o Direct Mail  Includes physical mail received or email. o Outdoor Advertising  Includes billboards; signs in sports venues, airports etc.; computerized paintings; billboards on trucks etc. o Internet Advertising  Includes search engine marketing, display ads, and even classified ads.  Viral Advertising: creates a message that is novel or entertaining enough for consumers to forward it to others, spreading like a virus. o Sponsorship  Involves providing funds for a sporting or cultural event in exchange for a direct association with the event. o Other Media Options  Infomercials (Direct Response Television): a form of broadcast direct marketing; 30-minute programs resemble regular TV programs, but sell goods or services.  ATM advertisements  Directory advertising in the Yellow Pages listings in telephone books.  Consumer-oriented promotions include: o Premiums  Items given away for free or at a reduced price when another product is purchased (i.e. happy meal toys). o Coupons  Offer small price discounts when consumers purchase the promoted products. o Rebates  Offer cash back to consumers who mail in required proofs of purchase. o Sample  A gift of a product distributed by mail, door to door, in a demonstration, or inside packages of another product. o Games and Contests  Require entrants to solve problems or write essays, and they must sometimes provide a proof of purchase. o Sweepstakes  Choose winners by chance and require no product purchase. o Specialty Advertising  Promotional items that prominently display a firm’s name, logo, or business slogan (i.e. complementary pens).  Trade Promotion: sales promotion geared to marketing intermediaries, not to final consumers.  Major trade promotions include: o Point-of-Purchase (POP) Advertising  Displays or demonstrations that promote products when and where consumers buy them, such as in retail stores. o Trade Shows  Shows that allow manufacturers and other sellers to promote their goods or services to members of their distribution channels (i.e. Consumer Electronic Show in LV).  Personal selling refers to a person-to-person promotional presentation to a potential buyer.  Firms are likely to focus on personal s
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