promotion and selling pricing.ppt

7/28/2019 promotion and selling pricing.ppt

1/33


2/33


3/33

Goals and Tasks of Promotion

Informing Reminding

Persuading

TargetAudience


4/33

AIDA and the Hierarchy of Effects

Attention Interest Desire Action

Awareness

Knowledge

Liking

Preference

Conviction

Purchase


5/33

When Elements of Promotion Are Most Useful

Advertising

Personalselling

Salespromotion

Publicrelations

Either not effective or inefficient

Very effective

Somewhat effective

Awareness Knowledge Liking Preference Conviction

E f f e c

t i v e n e s s

Purchase


6/33

Factors that Affect the Promotion Mix

Push and Pull Strategies

Nature of the Product

Stage in the ProductLife Cycle

Target Market Characteristics

Type of Buying Decision

Available Funds $ $ $


7/33

Creating a Promotion Plan

Choose Promotion Mix

Develop Promotion Budget

Set Promotion Objectives

Identify Target Market

Analyze the Marketplace


8/33

Criteria for Setting Promotion Objectives

Promotion objectives should:

be measurable, concrete

be based on sound research, with awell-defined target audience

be realistic

reinforce the overall marketing plan andrelate to specific marketing objectives


9/33

Examples of Promotion Objectives

Objective: To RemindTo remind consumers that Peter Pan peanut butter is thecreamiest peanut butter and is available at their nearest groceryand convenience stores

Objective: To Inform (Awareness)To increase the top-of-mind awareness level for Peter Panpeanut butter from 16 percent to 24 percent

Objective : To Persuade (Attitudinal)To increase the percentage of parents who feel that Peter Panpeanut butter is the best peanut butter for their children from22 percent to 35 percent


10/33

Techniques for Setting Promotion Budgets

Arbitrary Allocation

All - You - Can - Afford

Competitive Parity

Percent of Sales

Market Share Objective and Task


11/33

Regulation of Promotion

Self-Regulation National Advertising Division (NAD)

National Advertising Review Board (NARB)

Federal Regulation Federal Trade Commission (FTC)


12/33

Effects of Advertising

Advertising Spending

R e

t u r n o n

A d v e r t

i s i n g

E x p e n

d i t u r e s

Increasing efficiencyas ad budget becomessufficient

Diminishingreturnson additionalspending


13/33

Major Types of Advertising

Corporate Image

Advocacy Advertising

Typesof Advertising

Pioneering

Competitive

Comparative

ProductAdvertising

InstitutionalAdvertising


14/33

Advertising Campaign Decision Process

Determine the campaign objectives.

Make creative decisions. Make media decisions.

Evaluate the campaign.


15/33

Common Advertising Appeals

Profit

Health

Love or Romance

Fear

Admiration

Convenience

Fun and Pleasure

Vanity and Egotism

Save money, keep from losing money

Body-conscious, healthy

Sell cosmetics and perfumes

Social embarrassment, growing old, losinghealth, power

Celebrity endorsement effective

Fast-food and microwave products

Vacations, beer, amusement parks

Expensive, conspicuous items


16/33

Executional Styles for Advertising

Mood or Image

Musical

Demon-stration

Scientific

Real/AnimatedProduct

Symbols

Fantasy

Lifestyle

Spokes-person/

Testimonial

Slice-of-Life

Humorous

CommonExecutional

Styles


17/33


18/33


19/33

Types of Consumer & Sales Promotion GoalsType of buyer Des i red resul t s Sa les prom ot ion examples

Loyal customers Reinforce behavior, Loyalty marketing programs,People who buy your increase consumption, such as frequent-buyer cardsproduct most or all change purchase timing or frequent-shopper clubsof the time Bonus packs that give loyal

consumers an incentive tostock up or premiums offeredin return for proofs-of-purchase

Competitors Break loyalty, persuade Sampling to introduce your customers to switch to your brand products superior qualities

People who buy a compared to their brandcompetitors product Sweepstakes, contests, or most or all of the time premiums that create interest

in the productBrand switchers Persuade to buy your Any promotion that lowers thePeople who buy a brand more often price of the product, such asvariety of products coupons, price-off packages,in the category and bonus packs

Trade deals that help make theproduct more readily availablethan competing products

Price buyers Appeal with low prices Coupons, price-off packages,People who or supply added value refunds, or trade deals thatconsistently buy the that makes price less reduce the price of brand toleast expensive brand important match that of the brand that

would have been purchased

Source: From Sales Promotion Essentials, 2E by Don. E. Schultz, William A. Robinson, and Lisa A. Petrison. Reprinted by permission of NTC Publishing Group, Lincolnwood , IL.


20/33

Tools for Consumer Sales Promotion

Coupons

Premiums

Frequent Buyer Programs

Contests andSweepstakes

Samples

Point-of-PurchaseDisplays

Six

Categoriesof Consumer

Sales

Promotions


21/33

Tools for Trade Sales Promotion

Trade Allowances

Push Money

Training

Free Merchandise

Store Demonstrations

Business Meetings,Conventions, Trade-Shows

Six

Categoriesof TradeSales

Promotions


22/33

Advantages of Personal Selling

Cost Control

Message Control

Targeted

DetailedInformation

Closing Sales


23/33

Advertising Versus Personal Selling

Personal Selling is more important if...

The product has a high value.It is a custom-made product.There are few customers.The product is technically complex.

Customers are geographically concentrated.

Advertising/Sales Promotion is more important if...

The product has a low value.It is a standardized product.There are many customers.The product is simple to understand.Customers are geographically dispersed.


24/33

Differences Between Traditional & Relationship Selling

Traditional Personal SellingSell products (goods and services)

Focus on closing sales

Limited sales planning

Spend most contact time tellingcustomers about product

Conduct product -specific needsassessment

Lone -wolf approach to the account

Proposals and presentations basedon pricing and product features

Sales follow-up focused on productdelivery

Relationship SellingSell advice, assistance, and counsel

Focus on improving the customers bottom line

Considers sales planning as top priority

Spend most contact time attempting to build aproblem-solving environment with the customer

Conduct discovery in the full scope of thecustomers operations

Team approach to the account

Proposals and presentations based on profitimpact and strategic benefits to the customer

Sales follow-up is long term, focused onlong-term relationship enhancement

Source: Robert M. Peterson, Patrick L. Shul, and George H. Lucas, Jr., Consultative Selling: Walking the Walk in the New Sel ling Environment, National Conference on Sales Management, Proceedings, March 1996.


25/33

Steps in the Selling Process

BasicSteps in

theSelling

Process

Generating Sales Leads

Qualifying Sales Leads

Making the Sales Approach

Making the SalesPresentation

Handling Objections

Closing the Sale

Following Up


26/33


27/33


28/33

Break-Even Analysis

Quantity (units)

P r i c e (

$ )

Fixed Costs

Total Revenue

Total Costs

Profits

Losses

Break Even


29/33

Steps in Setting the Right Price

$ $ $ $ $ $ $ $

Fine-Tune Base Price

Choose Strategy

Estimate Demand, Costs,and Profits

Establish Pricing Goals

Right Price


30/33

Legal and Ethical Issues in Pricing

Unfair Trade Practices

Key Legaland EthicalIssuesRelated to

Price

Price Fixing

Price Discrimination

Predatory Pricing


31/33

CashDiscount

Quantity

Discount

FunctionalDiscount

Trade Loading

EDLP

Seasonal

Discounts

PromotionalAllowances

Rebates

Discounts, Allowances, and Rebates

PriceReductions


32/33


33/33

Special Pricing Tactics

Odd-EvenPricing

Two-PartPricing

BundlePricing

BaitPricing

PriceLining

FlexiblePricing

ProfessionalServices

Leader Pricing

SinglePrice

CommonSpecial Pricing

Tactics

promotion and selling pricing.ppt

Documents