CH5:- Managing the marketing mix elements
5.4. Promoting the product
Modern marketing calls for more than just developing a good product, pricing it attractively, and making it
available to target customers. Companies must also communicate with their customers and there should be
controlled direction to those communications. Promotion provides the primary communication function. As
one of the four major elements of the marketing mix, promotion uses advertising, sales promotion, public
relations, direct marketing, and personal selling to achieve the company's communication objectives
5.4.1. Meaning of Promotion
Promotion is the process of marketing communication involving information, persuasion, and influence.
Promotion has been defined as “coordinated, self-initiated efforts to establish channels of information and
persuasion to facilitate to foster the sale of goods or services, or the acceptance of ideas or points of view”.
Thus, promotion is persuasive communication to inform potential customers of the existence of products,
to persuade them that those products have want- satisfying capabilities. Promotion is a form of corporate
communication that uses various methods to reach a targeted audience with a certain message in order to achieve
specific organizational objectives.
5.4.2. The purpose of promotion
Promotion is responsible for awakening and stimulating consumer demand for the product. After product
development, it is introduced in the market and its demand is created through different promotional
activities. Promotion is just like the spark plug in the marketing-mix of a firm. Promotion message has
basic purposes:
Build Awareness & Provide Information
New products and new companies are often unknown to a market, which means initial promotional
efforts must focus one establishing an identity.
Create Interest – Moving a customer from awareness of a product to making a purchase can present
a significant challenge.
Stimulate Demand – The right promotion can derive customers to make a purchase.
Reinforce the Brand – Once a purchase in made, a marketer can use promotion to help build a
strong relationship that can lead to the purchaser becoming a loyal customer.
Promotion mix strategies
Marketer can choose from two basic promotion strategies: push and pull strategies.
1. A push strategy involves pushing the product through distribution channels to final
consumers. The producer directs its marketing activities (primarily personal selling and trade
promotions) toward channel members to induce them to carry the product and to promote it to
the final consumers.
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2. Pull strategy, producer directs its marketing activities (primarily advertising and consumer
promotion) toward the final consumer to induce them to buy the product. If the pull strategy is
effective, consumers will then demand the product from channel members, who will in turn
demand it form producers. Thus under pull strategy, consumers demand pulls the product
through the channel.
5.4.3. Factors affecting the promotion mix
Companies must consider several factors in developing their promotion mix:
(a) Type of Product Market
Promotional tool utilization varies between consumer and business market.
Consumer-goods companies spend on sales promotion, advertising, personal selling, and public relations in
that order. Business – goods companies spend on personal selling, sales promotion, advertising & public
relations in that order. In general, personal selling is more heavily used with complex, expensive, and risky
goods and in markets with fewer and larger sellers (hence, business markets).
(b) Push Versus Pull Strategy
A push strategy involves manufacturers marketing activities (primarily sales force and trade promotion)
directed at channel intermediaries. The goal is to induce the intermediaries to order and carry the product
and promote it to end-users. Push strategy is especially appropriate where there is low brand loyalty in a
category, brand choice is made in the store, the product is an impulse item, and product benefits are well
understood.
A pull strategy involves marketing activities (primarily advertising and consumer promotion) directed at
end users. The purpose is to induce them to ask intermediaries for the product and thus induce the
intermediaries to order the product from the manufacturer. Pull strategy is especially appropriate when
there is high brand loyalty and high involvement in the category; people perceive differences between
brands, and people choose the brand before they go to the store.
(c) Buyer-Readiness Stage
Advertising and publicity play the most important roles in the awareness stage, much more important the
roles played by “cold calls” from sales representatives or by sales promotion. Customer comprehension is
primarily affected by advertising and personal selling. Customer conviction is influenced mostly by
personal selling and less by advertising sales promotion. Closing the sale (ordering) is influenced mostly
by personal selling and sales promotion. Reordering is also affected mostly by personal selling and sales
promotion, and somewhat by reminder advertising. Advertising and publicity are most cost effective at the
early stages of the buyer decision process, and personal selling and sales promotion are most effective at
the later stage.
(d) Product-Life-Cycle Stage
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Promotional tools also vary in their cost effectiveness at different stages of the product life cycle.
- In the introduction stage, advertising and publicity have the highest cost effectiveness, followed
by personal selling to gain distribution coverage and sales promotion to induce trial.
- In the growth stage, all the tools can be toned down because demand has its own momentum
through word-of mouth.
- In the maturity stage, sales promotion, advertising, and personal selling all grow more
important, in that order.
- In the decline stage sales promotion continues strong, advertising and publicity are reduced, and
salespeople give the product only minimum attention.
(e) Company Market Rank
Top-ranking brands derive more benefit from advertising than sales promotion. For the top three brands,
return on investment (ROI) rises with a rising ratio of advertising spending to sales promotion. For brands
ranked fourth or worse, profitability decreases in moving from low to high advertising.
5.4.4. Promotional Mix Elements:
Promotion mix is a blend of communication tools that help to achieve the promotion objectives inCone
way or another. It includes advertising, personal selling, sales promotion and [Link] marketing
communication mix (also called the promotion mix) consists of five major modes of communication.
I. Advertising
Mass selling is communicating with lager number of customers at the same time. The main form of mass
selling is advertising – any paid form of non personal presentation and promotion of ideas, goods or
services by an identified sponsor. Advertising has the following qualities:
9 Pervasiveness: advertising permits the seller to repeat the message many times. It also allows the buyer
to receive and compare the message of various competitors.
9 Amplified expressiveness: advertising provides opportunities for dramatizing the company and its
products through the artful use of print, sound and color.
9 Impersonality: the audience does not feel obligated to pay attention or respond to advertising
In developing an advertising program, marketing managers must make five major decisions known
as “The five M’s”: Mission: what are the advertising objectives? Money: how much can be spent?
Message: what message should be sent? Media: what media should be used? Measurement: How
should the results be measured?
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A. Mission –advertising objectives
An advertising goal or objective is a specific communication task and achievement level to be
accomplished with a specific audience in a specific period of time. Advertising objectives can be classified
according to whether their aim is to inform, persuade, remind or reinforce.
1. Informative advertising: aims to create brand awareness and knowledge of new products or new
features of existing products. It is usually preferred in the introduction stage of the product life-cycle.
2. Persuasive advertising: aims to create liking, preference, conviction and purchase of a product or
service. Persuasive advertising is specially used in growth and maturity stages of the product life cycle
where competition is stiff.
3. Reminder advertising: aims to stimulate repeat purchase of products and services. As there is a threat of
competitors, the firm should keep reminding about its products.
4. Reinforcement advertising: aims to assure customers (who bought previously) that they have made the
right choice and to encourage them to purchase again.
B. Money – the advertising budget
In setting an advertising budget, the company must make internal and external considerations.
Internal considerations:
a) Product differentiation: similarity in product offering among firms forces the industry to spend high
advertising budget to show the customers the difference among brands.
b) Stage in the product life cycle: new and modified products typically receive large advertising budget to
build awareness and to gain consumer trial in the introduction stage.
c) Advertising frequency: if the firm plans to advertise often, its advertising budget will be high.
External consideration:
a) Competition: in a market with a large number of similar or none resembling and high advertising
spending, a company must advertise more heavily to be heard.
b) Market share: high-market-share brands usually require less advertising expenditure. It is less expensive
to reach consumers if a widely used brand than to reach consumers of low-
share brands.
c) Product substitutability: it is somewhat related with competition. Some products stay in the market with
a strong in hold in technology, quality and other distinctive feature.
There are four methods in establishing the total advertising budget.
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1. Affordable method: is assigning a budget at a point where the company can afford. It ignores the
immediate impact of advertising on sales volume. It views advertising as an investment rather than
expenditure.
2. Percentage of sales method: many companies set advertising expenditures at a specific percentage of
sales (either current or expected) or of the sales price. It views sales as the determiner of advertising rather
than the result. It leads to budget set the availability of funds rather than by market opportunities.
3. Competitive-parity method: is determining an amount equal or approximate to competitors’ spending.
However, company reputation, resource, opportunities and objectives differ so much that advertising
budgets rarely become similar.
4. Objective-and-task method: a firm defines a set of objectives to attain, develop tasks (strategies) of
achieving the objectives and finally estimate the total expenditure required for performing these tasks. The
sum of these costs is the proposed promotion budget.
C. Media selection
Media is finding the most cost-effective media to deliver the desired number and type of exposure to the
target audience. There are two categories of media: broadcast and print media. In the broadcast media, we
have TV and Radio while the print media comprises newspapers, direct mail, magazines and outdoor
(billboards and painted bulletins) advertising. Media timing or media scheduling is an issue to be
considered before advertising through selected media. This is influenced by sales trend, competitors’
activities and repurchase cycles
The major steps in selecting the media are deciding on reach, frequency, and, impact.
a) Reach is the percentage of people in the target market exposed to an ad campaign during a
given period of time.
b) Frequency is the number of times the average person in the target market is exposed to an
advertising message during a given period of time.
c) Media Impact - is the qualitative value of an exposure through a given medium
D. Message
Advertising message is what the advertising attempts to convey about the brand. The message should be:
x Meaningful: pointing out benefits.
x Believable: persuading customers that the firm really provides the stated benefits.
x Distinctive: depicting the firm is better than competitors.
In developing advertising message, it is important to generate fresh insights and avoid using the same
appeals and positions as others. The firm should also know how to transmit the message. In such category,
format color combination, illustrations and headlines should be there in an attractive way.
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To be socially responsible, advertisers must be careful not to offend the general public as well as any
ethnic groups, racial minorities or special-interest groups.
E. Measurement – evaluating the advertising effectiveness
Most advertisers try to measure the communication effect and the sales effect of the
[Link]-effect research seeks to determine whether advertising is communicating
effectively. Advertising sales-effect is generally harder to measure than its communication effect since
sales are influenced by many factors such as features, price and availability as well as competitors’ actions.
But it can be measured by comparing past sales with historical advertising spending or through
experiments by injecting advertising budget in different segments and observing their respective sales
trend. The sales impact is easier to measure in direct-marketing situations.
II. Sales promotion
Sales promotion consists of a collection of short term incentives designed to stimulate quicker or greater
purchase of a particular product or service by consumers. Whereas advertising offers a reason to buy, sales
promotion offers an incentive to buy.
The objectives of sales promotion
™ To stimulate trial purchase
™ To enable manufacturers to adjust to short-short term variations in supply and demand
™ To encourage repurchase
™ To increase quality of purchase
™ To support advertising
Sales promotion may be aimed at consumers, middlemen or a firm’s own employees. It includes
tools for consumer promotion, trade promotion and business and sales force promotion.
III. Public Relations (Publicity)
A public is any group (stockholders and stakeholders) that has an actual or potential interest in or impact on
a company’s ability to achieve its objectives. Public relations, quite known as publicity, involves a variety
of programs and activities designed to promote or protect a company’s image and its individual products by
planning and releasing news or information in mass-media not paid by the sponsor. It is any unpaid form of
non personal presentation of ideas, goods and services.
Public relations is a marketing function that evaluates public attitudes, identifies areas within the
organization that the public may be interested in and executes a program of action to earn public
understanding and acceptance. Even though activities in PR require minimal cost, publicity in general is
not cost free. There is at least printing and social responsibility cost.
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And of course publicity people are paid. But they try to attract attention to the firm and its offering without
having to pay media costs. Movie studios for example, try to get celebrities on TV talk shows because this
generates a lot of interest and sells tickets to new movies without the studio paying for TV time.
Although publicity and advertising both depend on mass media, they differ in several aspects.
x Advertising message tend to be informative or persuasive whereas publicity is primarily informative.
x Advertisements are sometimes designed to have an immediate impact on sales while publicity messages
are more subdued.
x Publicity releases do not identify sponsors, advertisements do.
x The sponsor pays for media time and space for advertising, but not for publicity. I.e. while advertising
must be paid for, publicity is “free”.
x Communications through publicity are usually separated from the broadcasts program or editorial
portions of print media so that the audiences or readers can easily recognize (or ignore) them.
x Publicity may have greater credibility than advertising among customers because as a news story, it
appears more objective.
x Finally, a firm can use advertising to repeat the same message as many ties as desired; publicity is
generally not subjective to repetition.
Kinds of Publicity
1. News release (Press release): is usually a single page of type written copy containing fewercthan three
hundred words. It also gives the firm’s name, its address and phone number, andcthe contact person.
Automobile companies often use news release to introduce new products.
2. A Feature Article: is a longer manuscript (up to 3000 words) that is usually prepared for specific
publication.
3. A Captioned Photograph: is a photograph with a brief explaining the picture’s content. Captioned
photographs are especially effective for illustrating a new or improved product with highly visible features.
4. A Press Conference: is a meeting called to announce major news events. Media personnel are invited to
a press conference and are usually supplied with written materials and photographs.
A marketer’s choice of specific types of publicity depends on considerations the include the type of
information being transmitted, the characteristics of the target audience, the receptivity of media personnel,
the importance of them to the public and the amount of information that needs to be transmitted.
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IV. Personal Selling
Personal selling is a direct (personal) spoken communication between sellers and one or more prospective
or potential buyers for the purpose of making presentations, answering questions, processing orders,
making sales and developing relationship between a salesperson and a potential buyer.
A personal selling usually happens face-to-face, but sometimes the communication occurs over the
telephone or even via video conference over the internet. The use of telephone and call centers to attract
prospects, selling to existing customers and provide service by taking orders and answering questions is
referred to as telemarketing. It helps the company increase revenue, reduce selling costs and improve
customer satisfaction. There are two forms telemarketing: inbound telemarketing – receiving calls from
customers; and, outbound telemarketing – initiating calls to prospects and customers.
Salespeople get immediate feedback, which helps them to adapt the firm’s marketing mix to each potential
customer. Personal selling builds-up long-term personal relationship with customers and helps firms
customize their offer (if possible economically and technically) according to the customer demand.
Personal selling can be very expensive. So it has to be combined with mass selling and sales promotion.
Personal selling has some unique benefits:
x Personal confrontation: helps understand each other’s needs and make immediate adjustment.
x Cultivation: the tendency to create a deep personal friendship.
x Response: the buyer feels obliged to listen and respond to the sales talk.
V. Direct marketing
Direct marketing is an interactive marketing system that uses one or more media to effect a measurable
response or transaction at any location. Direct marketing especially electronic marketing is showing
explosive growth. Companies are recognizing the importance of integrating their marketing
communications in systems called integrated marketing communications, and integrated direct marketing.
The aim is to establish the right overall communications budget and the right allocation of funds to each
communication tool.
Direct marketers must plan campaigns by deciding on objectives, target markets and prospects, offers and
prices, followed by testing the comparing and establishing measures to determine the campaign's success.
Major channels for direct marketing include face-to-face selling, direct mail, catalog marketing, and
telemarketing, direct-response marketing, kiosk marketing, and e-marketing.
The different forms of direct marketing share four distinctive characteristics.
Non-public. The message is normally addressed to a specific person.
Customized. The message can be customized to appeal to the addressed individual.
Up-to-date. A message can be prepared very quickly for delivery to an individual.
Interactive. The message can be altered depending on the person’s response.
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