Unit-II Elements of market promotion mix

B.B.A-IV Prepared by: Abin Varghese

Introduction ( Advertising)
It is a Paid, Non personal Communication From An Identified Sponsor Using Mass Media to Persuade or Influence an Audience. It is structured and composed non personal communication of information, It is usually paid for and usually persuasive in nature, It is about offering (goods, services, and ideas) Made by identified sponsors through various media Advertising, as a mass communication, must reach numerous publics. These include: distributors; employees customers; potential customers; stockholders (who provide operating revenue); the community-at-large (who can influence public opinion and thus help with efforts such as new manufacturing plants and warehouse locations).

Definition
Advertising is the non personal communication of information usually paid for and usually persuasive in nature about products, services or ideas by identified sponsors through the various media-Richard F Taflinger Advertising is any paid form of non-personal presentation and promotion of ideas, goods and services through mass media such as newspapers, magazines, television or radio by an identified sponsor. Philip Kotler.

Objective of advertising
(a) To inform Informative advertising, seeks to tell the market about the product, explain how the product works, provide information on pricing, and build awareness of both the product and the company. Such objectives are normally pursued at the launch of a new product, or re-launch / up-date of an existing product. (b) To persuade To encourage customers to switch to a different brand. Here objectives are to encourage the target audience to switch brands, make the purchase, and create a preference in the market for the product as opposed to its competition. Advertising of this nature is required in highly competitive markets, where a range of products compete directly with each other. In such circumstances businesses often seek to differentiate their product through Comparison Advertising either directly or indirectly comparing its product to that of its competitors.

 (c) To remind - To remind buyers where to find a product. Reminder Advertising, is used to maintain interest and awareness of a well established product in the market, often in the latter stages of its product life cycle. It is often used at the Point-of-Purchase to remind consumers of the Brand. Such advertising is used by the likes of Coca-Cola and other leading brands, to maintain their position in the market.

Advertising

Features of advertising
Advertising provides information : The basic purpose of advertising is to provide information about products/services to prospective buyers. The details of products such as features, uses, prices, benefits, manufacturer's name, and instructions to be followed while using the product are given in the advertisements. Paid form of communication : The advertiser has to pay to the media for giving publicity to his advertising message. He pays for the advertisement and naturally he decides the size, slogan, etc. given in the advertisement. Advertising is a form of paid communication. Non-personal presentation : Advertising is non-personal in character as against salesmanship which is personal (face to face communication) in character. In advertising, the message is given to all and not to one specific individual. This rule is applicable to all advertising media including press. However even in advertising target consumers or target market can be selected for making an advertising appeal. Gives publicity to goods, services and ideas : Advertising is basically for giving information to consumers. This information is always related to the features and benefits of goods and services of different types. Advertising gives new ideas to consumers as its contents are meaningful. The aim is to make the ideas popular and thereby to promote sales. For example, advertising on family planning, family welfare, and life insurance is useful for placing new ideas before the people.

Contd..
Basically for persuasion : Advertising aims at persuasion of potential customers. Advertising attracts attention towards a product, creates desire to have the same and finally induces consumers to visit the market and purchase the same. Advertising has psychological impact on consumers. It influences the buying decisions of consumers. Target oriented : It is possible to make intensive advertising by selecting a specific market or specific segment of consumers (e.g. children, housewives, etc.) for the purpose of advertising. This selection of a specific market is called target market. An Art, Science and Profession : It is now universally accepted that advertising is an art, science and a profession. It is an art as it needs creativity for raising its effectiveness. Advertising is a science as it has its principles and rules. Advertising is now treated as a profession with its professional bodies and code of conduct for members. Advertising agencies and space brokers function as professionals in the field of advertising. Important element in marketing mix : Advertising is an important element in marketing mix. It supports the sales promotion efforts of the manufacturer and makes positive contribution in sales promotion provided other elements in the marketing mix are reasonably favorable. This is natural as advertising alone is not adequate for promoting sales. Many companies now spend huge funds on advertising and public relations Creativity - the essence of advertising : Advertising is a method of presenting a product in an artistic, attractive and agreeable manner. This is possible through the element of creativity which is the essence of advertising. Creativity can be introduced by creative people (professionals) in the field of advertising.

Advertising media
The advertiser has to take decision about the media to be used for advertising purpose. Media differ as regards cost, coverage, effectiveness and so on. The selection of media depends on the budget provided, products to be advertised, and features of prospective buyers and so on. Wrong decision on media may make advertising ineffective and money spent will be wasted. This suggests that media should be selected properly and decision in this regard is important and critical.

Types of media.

Personal Selling. An Introduction

The In-Face, Face to face, convincing to buy a product/ service between a potential-buyer and seller is appropriately called personal selling. Personal selling is more effectively used for the sale of certain kind of products. Personal selling is best suited for the products where a demonstration of the features is an important part of selling.

 Personal selling refers to personal communication with a an audience through paid personnel of an organization or its agents in such a way that the audience perceives the communicators organization as being the source of the message. Avila Schwepker Jr. Personal selling involves oral presentation in conversation with one or more prospective purchaser for the purpose of making sales-AMA

Definition

Features of personal selling

Problem solving approach: Personal selling involves face to face presentation of goods, services or ideas by a sales representative with prospective customers. Therefore he can identify problem Persuasion: Personal selling involves the ability to influence or persuade people. It is the skill of handling people which makes a person a successful salesman. Winning the buyers confidence: With easy enough persuasion skills one cannot in normal case use misleading tools like misrepresentation or fraud but guide buyer in a useful and productive way.

 Providing Services to the buyer: modern salesmanship is based on the idea of the service. A sales person always tries to find out the wants of his customers and provide the product that will satisfy their wants. Every buyer has a problem and the problem lies in the use of certain product or service. Personal Selling tries to do that only. Mutual Benefit: Personal selling is not the art of earning profit at the cost of the customers. On the contrary personal selling should benefit both buyer and seller. Educative process: It Educates people about their needs. Very often people are not aware about their need. A salesperson has to make them aware.

Importance of personal selling

Personal Selling is extremely important as it helps in increasing sales. But there are other features as well which make it important. Let us discuss the importance of personal selling from the point of view of manufactures as well as consumers. From manufacturers point of view i. It creates demand for products both new as well as existing ones. ii. It creates new customers and, thus help in expanding the market for the product. ii. It leads to product improvement. While selling personally the seller gets acquainted with the choice and demands of customers and makes suggestions accordingly to the manufacturer. iv. It creates more regular demand thus makes planned and regular mass production possible.

From customers point of view i. Personal selling provides an opportunity to the consumers to know about new products introduced in the market. Thus, it informs and educates the consumers about new products. ii. It is because of personal selling that customers come to know about the use of new product From society point of view i. Personal selling improves the standard of living ii. It largely makes aware the society about the pros and cons of product or services at large

Difference between advertising and personal selling

Personal selling

Advertising
Advertising is non personal and is addressed to the customers in general Advertising is generally found to cover a larger number of people. In advertising there is one way communication; the targeted persons' reactions cannot be known immediately. Advertising offers a wide choice of channels, visual, audio such as radio and audiovisual such as television. Advertising creates desire to buy

Personal selling involves direct interaction of salesmen with individuals. Personal selling is confined to a particular area In personal selling there is a two way communication. The salesman explains his viewpoint to the potential buyer and knows about his/ her reaction. In Personal selling there is only one channel of transmission of messages i.e., personal talk of the salesman with the potential buyers; Salesmanship converts the potential demand created by advertisement into actual sale.

Sales promotion
Sales promotion is any initiative undertaken by an organization to promote an increase in sales, usage or trial of a product or service (i.e. initiatives that are not covered by the other elements of the marketing communications or promotions mix).

Definition
Sales promotion refers to any steps that are taken for the purpose of obtaining or increasing sales, often this term refers specially to selling efforts that are designed to supplement personal selling and advertising and by co-ordination, help to become effective A.H.R. Delena

Features of sales promotion

Initiates customers for purchase or trial through attractive offers After changed with various time It offers a link between personal selling and advertising Uses various tools of promotion in effect It is used for consumers, distributors and salesmen alike.

Objectives of sales promotion

To introduce new products: Perhaps you know that many companies distribute free samples while introducing new products. The consumers after using these free samples may develop a taste for it and buy the products later for consumption. To attract new customers and retain the existing ones: Sales promotion measures help to attract or create new customers for the products. While moving in the market, customers are generally attracted towards the product that offers discount, gift, prize, etc on buying. These are some of the tools used to encourage the customers to buy the goods. Thus, it helps to retain the existing customers, and at the same time it also attracts some new customers to buy the product. To maintain sales of seasonal products: There are some products like air conditioner, fan, refrigerator, cooler, winter clothes, room heater, sunscreen lotion, glycerin soap etc., which are used only in particular seasons. To maintain the sale of these types of products normally the manufactures and dealers give off-season discount. For example, you can buy air conditioner in winter at a reduced price. Similarly you may get discount on winter clothes during summer.

To meet the challenge of competition: Todays business faces competition all the time. New products frequently come to the market and at the same time improvement also takes place. So sales promotion measures have become essential to retain the market share of the seller or producer in the product-market. To increase the usage rate: sales promotion activities sometimes tends to focus on increasing the usage of the product so that more purchases are made by the customer To increase sales: The main objective of sales promotion is to increase sales for that various tools and techniques are used

Sales promotion tools (a) consumer promotion tools

1. 2. 3. 4. 5. 6. 7. 8. 9. Free Samples Price off Bonus offer Money refund Contests Demonstrations Lucky draw Coupon After sale service

(b) Trade or business promotions

1. 2. 3. 4. 5. 6. 7. 8. Display and advertising allowance Buying allowance Buy-back allowance Dealer listed promotion Sales contests for dealers Free gifts Credit facility Advertising materials

(c) Sales force promotions

1. Bonus to sales force 2. Sales force contest 3. Sales meeting or conferences

Importance of sales promotion

From the point of view of manufacturers Sales promotion is important for manufacturers because i. it helps to increase sales in a competitive market and thus, increases profits; ii. it helps to introduce new products in the market by drawing the attention of potential customers; iii. when a new product is introduced or there is a change of fashion or taste of consumers, existing stocks can be quickly disposed off; iv. it stabilizes sales volume by keeping its customers with them. In the age of competition it is quite much possible that a customer may change his/her mind and try other brands. Various incentives under sales promotion schemes help to retain the customers.

From the point of view of consumers Sales promotion is important for consumers because i. the consumer gets the product at a cheaper rate ii. it gives financial benefit to the customers by way of providing prizes and sending them to visit different places; iii. the consumer gets all information about the quality, features and uses of different products; iv. certain schemes like money back offer creates confidence in the mind of customers about the quality of goods; and v. it helps to raise the standard of living of people. By exchanging their old items they can use latest items

Promotional strategy used by luna

Limitations
Sales promotion is an important strategy for producing quick, short-term, positive results, it is not a cure for a bad product, poor advertising, or an inferior sales team. After a consumer uses a coupon for the initial purchase of a product, the product must then take over and convince them to become repeat buyers. In addition, sales promotion activities may bring several negative consequences, including "clutter" due to the number of competitive promotions. New approaches are promptly cloned by competitors, as each marketer tries to be more creative, more attention getting, or more effective in attracting the attention of consumers and the trade. Sometimes discounts may not be real the because the real prices may already be inflated

Publicity and public relations

Publicity is a non personal communication for a product or service upon radio, TV or stage that is not paid by a sponsor- AMA

Features of publicity and public relations

Free of charge: Publicity can be obtained at no cost at all wherein the third party would be reporting any news Mass coverage through news: people normally avoid reading advertising but they are more likely to read information published in the form of news. Various means are used: Different means like newspapers, radio, TV etc are used Dependence on good Image on media: Publicity the rather depends on good relation with the media. Publicity as a part of public relations: The objective of public relations is to create good image of the company in mind of the people connected

Advantage of publicity
1. News worthiness: if a company has any specialty it becomes news worthy and suitable for publicity. Peoples attention can be easily drawn towards the product and its specialty Trustworthy: The news published in newspaper is true and the readers have unshakable faith in its truth Wide coverage: People normally avoid reading advertising but they like to read information published in newspaper High credibility: Depending on rather than advertising people tend to easily accept truth of news. Free of cost: generally public relation and publicity does not depend on marketing budget but rather depends on the local media.

2. 3. 4. 5.

Parties involved in public relations

Customers Shareholders Employees Suppliers Community Government

Methods of Public Relations

News: one of the major tools of publicity is news. Public relation professionals find or create favorable news about the company and its product or people Speeches: Speeches and various press conferences also create product and company publicity. Increasingly, company executives must give talks to media, trade associations or at sales meeting Special Events: Another common public relation tool is special events, ranging from news conference, press tours, grand openings and star studded events or educational program designed to reach and interest target publics. Written materials: Public relations people also prepare written materials to reach and influence their target markets. These materials include annual reports, brochures, articles and company newsletters and magazines Corporate identity materials: Corporate identity materials also help create a corporate identity that the public can immediately recognize. Logos, stationary, signs, business forms, business cards, uniforms become marketing tools when they are attractive, distinctive and memorable. Public Service activities: Companies can also improve public goodwill by contributing money and time to public services activities. For eg Hope, Cry etc. Companies website and networking: A companys website can be a good public relations vehicle. Consumers and members of other public can visit the site for information and entertainment.

End of unit II