Promotion Decisions

Presented by
M S Balaji
Icfai Business
School
 Recap
 Promotion – Informing, persuading, & reminding.

 The new elements in promotional mix –

events/experiences and direct marketing.

 The macromodel of communication process.

 The micromodels of consumer response – AIDA

 Promotion - Effectiveness
 Big TV1

 Big TV2

 Big TV3
 Effective Communications
Step
Step 1.
1. Identifying
Identifying the
the Target
Target Audience
Audience

Step
Step 2.
2. Determining
Determining the
the Communication
Communication Objectives
Objectives

Category Need

Brand Awareness

Brand Attitude

Brand Purchase intention

Step
Step 3.
3. Designing
Designing the
the Message
Message

Message Content
Rational Appeals
Emotional Appeals
Moral Appeals

Message Format
Headline, Layout,
Words, & Sounds,
Body Language

Message Source
Expertise,
Trustworthiness,
Congruity
Step
Step 4.
4. Select
Select Communications
Communications Channel
Channel

Personal Communication
Channels

Nonpersonal Communication
Channels
 Step
Step 5.
5. Establish
Establish the
the Budget
Budget

The All-
Percent-of- The Marginal
You-Can-
Sales Method Approach
Afford

Cooperative
Competitive- Objective-and-
Promotional
Parity Task
Program
Step
Step 6.
6. Decide
Decide on
on the
the Communication
Communication Mix
Mix

Step
Step 7.
7. Measure
Measure Results
Results

Step
Step 8.
8. Manage
Manage the
the IMC
IMC Process
Process
 IMC
 “A planning process designed to assure that
all brand contacts received by a customer or
prospect for a product, service, or organization
are relevant to that person and consistent over
time.”
 Factors affecting Promotional Mix
Nature
Nature of
of Product
Product

Stage
Stage in
in PLC
PLC

Target
Target Market
Market Factors
Factors
Factors
Factors
Type
Type of
of Buying
Buying Decision
Decision
Affecting
Affecting
Choice
Choice of
of Promotion
Promotion Funds
Funds
Promotional
Promotional Mix
Mix Push or Pull Strategy
Push or Pull Strategy
10
 Nature of the Product

Factors that influence promotional mix

 Product characteristics
 Business product vs. consumer product

 Product complexity

 Social risk – Melina Gates Foundation + BBC

11
 PLC and the Promotional Mix
Sales ($)

Decline
Introduction Maturity Saturation
Growth

Time
Light Heavy use Advertising, Ads AD/PR
Advertisi of PR, Brand decrease. decrease
ng, pre- advertisin loyalty Sales Limited
introduct g, Personal Promotion, Promotio
ion PR for Selling for Personal n,
Publicity awareness distribution Selling Personal
; Reminder Selling
sales & for
Target Market Characteristics

FOR:

 Widely scattered
market

 Informed buyers
Advertising
Sales Promotion
 Repeat buyers
Less Personal Selling
13
 Type of Buying Decision
Advertising
Routine
Routine
Sales Promotion
Type
Type of
of
Buying
Buying Decision
Decision
Advertising
affects
affects Not
Not Routine
Routine
Promotional
Promotional or
or Complex
Complex Public Relations
Mix
Mix Choice
Choice

Complex
Complex Personal Selling

14
Available Funds

 Trade-offs with funds available

 Number of people in target market

 Quality of communication needed

 Relative costs of promotional elements

15
 Push and Pull Strategies

Manufacturer
Manufacturer Wholesaler
Wholesaler Retailer
Retailer Consumer
Consumer
promotes
promotesto
to promotes
promotesto to promotes
promotesto to buys
buysfrom
from
wholesaler
wholesaler retailer
retailer consumer
consumer retailer
retailer

Orders to manufacturer

Consumer
Consumer Retailer
Retailer Wholesaler
Wholesaler
Manufacturer
Manufacturer demands
demands demands
demands demands
demands
promotes
promotesto
to product
product product
product product
productfrom
from
consumer
consumer from
fromretailer
retailer from
fromwholesaler
wholesaler manufacturer
manufacturer

Orders to manufacturer

16
 Identify the Target Audience
 Profile the target audience or the target segment.
 Who are they? What experiences do they have? What
do they want to accomplish?
 Product usage - light/moderate/heavy user
 Brand loyalty – loyal or switcher
 New to category or current user
 Image Analysis – Assess the current image of the
company, its products, and its competitors
 Communication Objective
 Category Need:- Establish a product or service
category to remove or satisfy a perceived
discrepancy between a current motivational
state and a desired emotional state e.g.
Reliance Net Connect.
 Brand Awareness:- Ability to identify (recall or
recognize) the brand within the category in
sufficient detail to make a purchase.
 Communication Objective
 Brand Attitude:- Evaluation of the brand with
respect to its perceived ability to meet a current
relevant need. E.g. Anacin
 Brand Purchase Intention:- Self-instructions to
purchase the brand or to take purchase related
action. E.g. coupons

Promotional offer (coupon)

of 15-25% off on the
Electrolux range of products
received from Westside.
 Message Content
 Relates to how you
communicate the product or
service.
 Rational appeal – elaborates on
product or service attribute
 Emotional appeal – Non-product
related benefit or image.

 Moral appeal – Social

responsibility towards the society or
public
 Communication Channels
 Personal communication channel involves two or
more persons communicating directly face-to-
face, person-to-audience, over the telephone, or
through e-mail.
 Advocate channels, Expert channels or social channels
are examples of personal communication channels.
 Nonpersonal communication channel are
communication directed at more than one person
and includes media, sales promotion, etc.
Personal channels
 Steps to stimulate personal communication channels
to work on the companies’ behalf
• Devote extra effort to influential individuals and
companies e.g. Ms. Sheila Dixit with the pulse polio
immunization.

• Create opinion leaders by sampling or

other product usage e.g. Film critic – Taran
Adarsh

• Work through community influentials such as local radio

jockeys, municipal corporators, and presidents of local
business organizations e.g. Melina Gates Foundation + BBC for
AIDS awareness with Radio Channels
Personal channels
 Use influential or believable people in testimonial
advertising

 Develop advertising with high “conversation

value”.

 Establish an electronic forum e.g. Zapak

 Use viral marketing - uses social networks to
create and spread brand awareness e.g. Hotmail
signed up 12 million accounts within its first 18 months
www.zapak.com/forum_index.zpk