Marketing exam 3

promotion mix: advertising

(Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor)

promotion mix: direct and digital marketing

(Engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships) (direct mail, email, catalogs, social media, mobile marketing, etc.)

promotion mix: public relations

(PR) (Building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events)

promotion mix: personal selling

(Personal customer interactions by the firm's salesforce for the purpose of engaging customers, making sales, and building customer relationships) (used mainly with expensive or complicated products) (car, computer, house)

promotion mix: sales promotion

(Short-term incentives to encourage the purchase or sale of a product or service)

trends in wholesaling

-need for greater efficiency -demands for lower prices -sorting out supplies who are not adding value based on cost and quality -Blurring distinction between large retailers and wholesalers(Many retailers now operate formats such as wholesale clubs and supercenters that perform many wholesale functions) Super Value - wholesaler and retailer of grocery products) (Closest one to UD is in Harrisburg PA) -increased use of technology to contain costs and boost productivity

retail marketing strategies

-retail segmentation and targeting -store differentiation and positioning

promotion mix

A promotion mix, or marketing communications mix, is a specific blend of promotion tools: (five of them)

new marketing communications model example

Adidas now uses only digital channels to engage its younger consumers. (Adidas has now abandoned TV altogether and uses only digital channels to reach younger consumers. It's clear that the younger consumer engages with us predominantly over their mobile device.)

new marketing communication model

Factors changing the face of today's marketing communications:- Changing consumers (In this digital, wireless world, consumers are better informed and more communications empowered. Rather than relying on marketer-supplied information, they can use the Internet, social media, and other technologies to find information on their own)- Changing marketing strategies (Marketers are developing focused marketing programs designed to engage customers and build customer relationships in more narrowly defined micro markets)- Advancements in digital technology (This is causing remarkable changes in the ways companies and customers communicate with each other) (smartphones, tablets, the Internet(Brand websites, emails blogs, streamed content, social media, etc.)

segmentation, Targeting, Differentiation, and Positioning Decisions (2 of 2)

Furnishings retailer Restoration Hardware has unleashed a new generation of furniture where you don't just seethe furnishings, you experience them (we wanted to blur the lines between residential and retail, and to create a sense of place that is more home than store)

irritation, unfairness, deception, and fraud

Irritation • Loud, long, and insistent TV commercials • Junk mail and spam Unfairness • Taking unfair advantage of impulsive buyers (huh?) (through television shopping channels, enticing Web sites, and program-long infomercials targeting television-addicted shoppers. They feature smooth talking hosts, elaborately staged demonstrations, claims of drastic price reductions, time limitations, and ease of purchase)Deception and fraud • Investment scams or phony collections for charity • Internet fraud (phishing) (a type of identity theft that uses deceptive emails and fraudulent online sites to fool users into divulging their personal data) • Online and digital security (personal information, credit cards, etc.) (unscrupulous snoopers will eavesdrop on their online transactions and social media postings, picking up personal information or intercepting credit and debit card numbers) • Access by vulnerable or unauthorized groups (alcohol, porn) (have found it difficult to restrict access by minors)

wholesaling 2/2

Many of the nation's largest and most important wholesalers—like Grainger—are largely unknown to final consumers. (Grainger may be the biggest market leader you've never heard of. It's a $10 billion business that offers more than 1.6 million maintenance, repair, and operating(MRO) products from 5,000 manufacturers to more than 3.2 million active customers) (100,000 transactions a day)

integrated marketing communications

Objective - to deliver a clear, consistent, and compelling message about the company and brands) -carefully blended mix of the five promotional tools

nature of tool: personal selling

Personal interaction between two or more people• Allows all kinds of customer relationships to spring up• Buyer feels a greater need to listen and respond• Most expensive promotion tool

social media marketing 2/2

The JetBlue social media team responds to every single Twitter mention it receives, with an impressive average response time of 10minutes. (beyond engaging customers and keeping them happy, such social media interactions provide valuable customer feedback)

Amount of service

Self-service retailers • Serve customers who are willing to perform their own locate-compare-select process (supermarket) (self-service is the basis of all discount operations and is typically used by retailers selling convenience goods and nationally branded, fast-moving shopping goods) Limited-service retailers • Carry more shopping goods about which customers need information • Provide more sales assistance (Macy's) (their increased operating costs result in higher prices) Full-service retailers • Carry more specialty goods (Cartier) (Tiffany) (Bergdorf Goodman department store) • Assist customers in every phase of the shopping process (customers need or want assistance or advice)

new direct marketing model1/2

The Expedia Group's Travelocity.com unit and the famous Roaming Gnome make it easy for customers to "Wander Wisely." (Expedia Group is a huge collection of online-only travel businesses, including such familiar brands as Expedia, Travelocity, Hotels.com, Hotwire, trivago, Orbitz, and Home Away) (the company does business through more than 200 travel booking sites and over 150 mobile websites)

social media marketing advantages and challenges

advantages: -targeted and personal -interactive -immediate and timely -cost effective -engagement and social sharing capabilities challenges -effective usage uncertain -difficult to measure results -largely user controlled

possible advertising objectives: persuasive advertising

becomes more important as competition increases - discount at hotels

major types of retail organization

corporate chain- Two or more outlets that are commonly owned and controlled. Corporate chains appear in all types of retailing but they are strongest in department stores, discount stores, food stores, drugstores, and restaurants voluntary chain-Wholesaler-sponsored group of independent retailers engaged in group buying and merchandising Retailer cooperative-Group of independent retailers who jointly establish a central buying organization and conduct joint promotion efforts. franchise organization- Contractual association between a franchisor (a manufacturer, wholesaler, or service organization) and franchisees (independent businesspeople who buy the right to own and operate one or more units in the franchise system) (about 45% of all retail sales in US

possible advertising objectives: informative advertising

introducing a new product category- burger king hot dogs

possible advertising objective: reminder advertising

is important for mature products - email from Fairmont Hotel)

profiles of major media types pt 2

magazines- adv: high geographic and demographic selectivity- dis: long ad purchase lead time, high cost radio- adv: local acceptance, high geographic and demographic selectivity, dis: audio only, fleeting only outdoor- adv: flexibility, high repeat exposure, dis: little audience selectivity

new Marketing Communications Model (3 of 3

marketers reach smaller consumer segments in interactive and engagingways.• Mix of traditional mass media and a wide array of online, mobile, and socialmedia (engage highly targeted consumer communities in a more-personalized way)• Content marketing managers create, inspire and share brand messagesand conversations. (versus just creating and placing "TV ads" or "print ads")(Paid media - tv, radio, print, outdoors, mobile ads, email marketing) (Ownedmedia - channels owned by the company, including websites, blogs, socialmedia pages, etc.) (Earned media - tv, newspapers, online video sites, etc.,not paid for or controlled by the marketer, but who carry the messagebecause it's of interest to consumers) (Shared media - media shared byconsumers with other consumers, such as social media, blogs, mobile media,word of mouth, etc.)

major types of wholesalers

merchant wholesalers: independently owned businesses that take title to all merchandise handled brokers and agents: do not take title to goods, the main function is to facilitate buying and selling, for which they earn a commission on the selling price (stock brokers, real estate agents)

major advertising decisions

objective setting: communication objectives, sales objectives Budget decisions: affordable approach, percent of sales, competitive parity, objective and task message decisions: message strategy, message executions, impact, engagement advertising evaluation: communication impact, sales and profit impact, return on advertising

major store retailer type

specialty store-A store that carries a narrow product line with a deep assortment, such as apparel stores, sporting-goods stores, furniture stores, florists, and bookstores department store-A store that carries several product lines—typically clothing, home furnishings, and household goods—with each line operated as a separate department managed by specialist buyers or merchandisers. supermarket- a relatively large, low-cost, low-margin, high-volume, self-service operation designed to serve the consumer's total needs for grocery and household products convenience store-A relatively small store located near residential areas, open 24/7, and carrying a limited line of high-turnover convenience products at slightly higher prices superstore- a very large store that meets consumers' total needs for routinely purchased food and nonfood items. This includes supercenters, combined supermarket and discount stores, and category killers (An example of a category killer superstore is Home Depot, which has almost seven times the square footage and inventory of a local hardware store and offers more choice in product variety.) which carry a deep assortment in a particular category discount store-A store that carries standard merchandise sold at lower prices with lower margins and higher volumes Off price retailer-A store that sells merchandise bought at less-than-regular wholesale prices and sold at less than retail. These include factory outlets owned and operated by manufacturers; independent off-price retailers owned and run by entrepreneurs or by divisions of larger retail corporations; and warehouse (or wholesale) (clubs selling a limited selection of goods at deep discounts to consumers who pay membership fees

profiles of major media types

television- adv: low cost per exposure, appeals to all senses, dis: high absolute cost social media- adv: high selectivity, low cost, dis: potentially low impact direct mail- adv: high audience selectivity, dis: relativity high cost per exposure

pull promotion strategy

the company promotes directly to final consumers, creating a demand vacuum that pulls the product through the channel. Most companies use some combination of push and pull

push promotion strategy

the company pushes the product to resellers, which in turn push it to consumers

advertising strategy

• Accomplishes the company's advertising objectives • Major advertising strategy elements:- Creating advertising messages- Selecting advertising media(next two slides)

Retail: connecting brands with consumers

• Activities involved in selling goods or services directly to consumers for their personal use- Retailer: Business whose sales come primarily from retailing (Best Buy)

selecting advertising media

• Advertising media: Vehicles through which advertising messages are delivered to their intended audiences • Steps in advertising media selection: - Determining reach, frequency, impact and engagement (Reach is a measure of the percentage of people in the target market exposed to thead campaign during a given period of time. Frequency is a measure of how many times the average person in the target market is exposed to the message) - Choosing among major media types (must consider each medium's impact, message effectiveness, and cost) (broadcast, print, outdoor, etc.) - Selecting specific media vehicles (if tv, what show? If a magazine, which magazine?) - Choosing media timing (follow the seasonal pattern - Christmas, oppose the seasonal pattern - Peeps, or be the same all year)

methods of setting the advertising budget

• Affordable Method (sets the promotion budget at the level management thinks the company can afford)• Percentage-of-Sales Method (sets the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales price) (easiest method, not great!)• Competitive-Parity Method (sets the promotion budget to match competitors' outlays. It's an estimate)• Objective-and-Task Method (involves developing the promotion budget by defining specific objectives, determining the tasks that must be performed to achieve these objectives, and estimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget) (I like this the best!)

creating the advertising message and content

• Breaking through the clutter (Clutter in television and other ad media has created an increasingly hostile advertising environment) • Merging advertising and entertainment (Madison and Vine) (Advertainment aims to make ads so entertaining that people want to watch them. 1. Product placement -America's Got Talent, 2. Product Integration - Wilson Volleyball that has meaning in a movie, 3. Brand integrations (or branded entertainment) involve making the brand an inseparable part of some other form of entertainment or content - Short movie or series by BMW, involving BMW at times) https://www.deptofmarketing.com/madison-vine-creation-advertainment/ • Message and content strategy (1. the general message that will be communicated to consumers 2. the advertiser must next develop a compelling creative concept—or big idea— that will bring the message strategy to life in a distinctive and memorable way) • Message execution (can be presented in various execution styles: slice of life, lifestyle, fantasy, mood or image, musical, personality, etc.) • Consumer-generated content (can incorporate the voice of the customer into brand messages and generate greater customer engagement)

benefits of direct and digital marketing to buyers and sellers

• Buyers - Convenient, easy, and private - Easy buyer-seller interaction(give buyers anywhere, anytime access to an almost unlimited assortment of goods and a wealth of products and buying information) - Quick access to products and relevant information - Brand engagement and community • Sellers ‒ Low-cost, efficient, and speedy ‒ Build close, personalized, interactive, one-to-one customer relationships(companies can interact with customers by phone or online, learn more about their needs, and personalize products and services to specific customer tastes) ‒ Greater flexibility

international advertising decisions

• Degree of adaptation (most basic issue concerns the degree to which global advertising should be adapted to the unique characteristics of various country markets) • Standardization benefits- Lower advertising costs- Greater global advertising coordination- More consistent worldwide image • Standardization drawbacks- Ignores the fact that country markets differ in their cultures, demographics, and economic conditions (most international advertisers think globally but act locally)

marketing, the internet and the digital age

• Digital and social media marketing: Using digital marketing tools to engage consumers anywhere, anytime via their digital devices (fastest-growing form of direct marketing. It uses digital marketing tools such as Web sites, online video, email, blogs, social media, mobile ads and apps) • Digital age: Changing customers' notions of convenience, speed, price, product information, service, and brand interactions (it has given marketers a whole new way to create customer value, engage customers, and build customer relationships) • Omni-channel retailing: Creating a seamless cross-channel buying experience that integrates in-store, online, and mobile shopping

Direct and digital marketing

• Engage directly with targeted individual consumers and customer communities to obtain an immediate response • Build lasting customer relationships, engagement, brand community, and sales (Companies use direct marketing to tailor their offers and content to the needs and interests of narrowly defined segments or individual buyers) • (A customer community is defined as places or platforms for customers, experts, partners, and others to discuss a product, marketplace, post reviews, brainstorm new product ideas and engage with one another about a company's products/services/brands.)

rapid growth of direct and digital marketing

• Fastest-growing form of marketing • Direct marketing becoming more Internet-based • Direct marketing claims a surging share of marketing spending and sales (expenditures are running 20% ahead of spending on the runner-up: television!) - Includes online display and search advertising (search advertising is a method of placing online advertisements on web pages that show results from search engine queries) video, social media, mobile, email (Ad spending on mobile media is exploding. Mobile ad spending now accounts for 70% of all digital ad spending)

consumer privacy

• Fear of invasion of privacy • Ready availability of information leaves consumers open to abuse (don't be foolish and put out your info on lots of websites, social media, etc.!)

a need for action 1/2

• Government actions - Do-not-call, do-not-mail, do-not-track online lists (DNT is a web browser setting that requests that a web application disable its tracking of an individual user. When you choose to turn on the DNT setting in your browser, your browser sends a special signal to websites, analytics companies, ad networks, plug in providers, and other web services you encounter while browsing to stop tracking your activity) - Can Spam legislation (a law that sets the rules for commercial email, establishes requirements for commercial messages, gives recipients the right to have you stop emailing them, and spells out tough penalties for violations) - Congressional legislation—Give more control to consumers over how online information is used - Federal Trade Commission (FTC) —Policing online privacy

retailing trends and developments 4/4

• Green retailing- Promoting more environmentally responsible products- Launching programs to help customers be more responsible (no plastic bags at checkout)- Working with channel partners to reduce their environmental impact• Global expansion of major retailers- Escaping saturated home markets (expanding internationally)

retailing trends and developments 3/4

• Growing importance of retail technology- Produce better forecasts- Control inventory costs (RFID) (Radio frequency identification)- Interact digitally with suppliers- Send information between stores (the lawnmower you want is not at your local Home Depot, but it's in another Home Depot 15 minutes away)

Omni-Channel Retailing: Blending In-Store, Online, Mobile, and Social Media Channels (1 of 2

• In this age of websites, smartphones, mobile apps, social media, and other things digital—shopping typically involves a dazzling array of channels and platforms .• Omni-channel consumers readily research products and prices online, shopping digitally from home, from work, in stores, or anywhere in between.• The boundaries between in-store and online retailing are rapidly blurring

wholesaling 1/2

• Involves all the activities in selling goods and services to those buying for resale or business use- Wholesaler: A firm engaged primarily in wholesaling activities (Wholesalers buy mostly from producers and sell mostly to retailers, industrial consumers, and other wholesalers)

public policy issues in direct and digital marketing

• Irritation, Unfairness, Deception, and Fraud • Consumer Privacy • A Need for Action

integrated social media marketing

• Large companies design social media efforts that blend with and support other elements of a brand's marketing strategy and tactics. • Firms that use social media effectively create brand-related social sharing, engagement, and customer community

place (distribution) decisions

• Locations should be accessible to the target market in areas that are consistent with the retailer's positioning(high end store in a wealthier area)• Shopping center: Group of retail businesses built on a site that is planned, developed, owned, and managed as a unit (see next slide for different types)

a need for action 2/2

• Marketers' actions- Self-regulatory principles (call for online marketers to provide transparency and choice to consumers if Web viewing data is collected or used for targeting)- Advertising option icon (a little "i" inside a triangle, that is added to most behaviorally targeted online ads to tell consumers why they are seeing a particular ad and allowing them to opt out)- Privacy rights of children (passed in 2000 - requires online operators targeting children to post privacy policies on their sites and they must notify and obtain parental consent before collecting personal information from children under age 13)

online marketing

• Marketing via the Internet using company Web sites, online ads and promotions, email, online video, and blogs • Marketing Web sites: Engage consumers to move them closer to a direct purchase or other marketing outcome • Branded community Web sites: Present brand content that engages consumers and creates customer-brand community (for example, you can't buy anything atESPN.com, but this site creates a giant branded sports community)

nature of tool: direct and digital marketing

• More targeted and interactive (direct mail, catalogs, telephone marketing, online, mobile, and social media)• Immediate and personalized

Segmentation, Targeting, Differentiation, and Positioning Decisions (1 of 2)

• Target markets must be segmented and defined .• Retailers then decide how to differentiate and position themselves in those markets

new direct model marketing 2/2

• Most companies still use direct marketing as a supplementary channel or medium. (Macy's sell the majority of their merchandise off their store shelves, but they also sell through direct mail, online catalogs, and social media pages) • For many companies today, direct and digital marketing constitute a complete model for doing business. (For example, companies such as Priceline have built their entire approach to the marketplace around direct and digital marketing)

online advertising and email marketing

• Online advertising: Appears while consumers are browsing online (display ads, search-related ads, online classifieds, and other forms) • Email marketing: Sending highly targeted, highly personalized, relationship-building marketing messages via email - Spam: Unsolicited, unwanted commercial email messages

blogs and other online forms

• Online journals of narrowly defined topics where people and companies post their thoughts and other content - Benefits: A fresh, original, personal, and inexpensive way to enter into consumer online conversations - Limitations: Cluttered, difficult to control and largely a consumer-controlled medium

online videos

• Posting digital video content on brand Web sites or social media (YouTube, Facebook, etc.) • Viral marketing: Videos, ads, and other marketing content that customers seek out or pass along to friends (digital version of word-of-mouth marketing) (can seed content online, but that does little good unless the message itself strikes a chord with consumers) (in one simple but honest McDonald's video, the company answered an online viewer's question about why McDonald's products look better in ads than in real life by conducting a behind-the-scenes tour of how a McDonald's ad is made. The award-winning three-and-a-half-minute video pulled almost 15million views and 15,000 shares, earning the company praise for its honesty and transparency)

price decision

• Price policy must fit the retailers'- Target market and positioning- Product and service assortment- Competition- Economic factors• Retailers practice either- Everyday low pricing (EDLP) (Walmart, Costco, Family Dollar)- High-low pricing (higher prices on an everyday basis, coupled with frequent sales and other price promotions)

mobile marketing

• Promotional content delivered to consumers through their mobile devices • Engages customers anywhere, anytime during the buying and relationship-building processes (retailers can use mobile marketing to enrich the customer's shopping experience at the same time they stimulate buying) • (Macy's built its recent "Brasil: A Magical Journey" promotion around a popular and imaginative smartphone app. The campaign featured apparel from Brazilian designers and in-store experiences celebrating Brazilian culture. By using their smartphones to scan codes through out the store, shoppers could learn about featured fashions and experience Brazilian culture through virtual tours)

nature of the tool: advertising

• Reaches masses of buyers at a low cost per exposure (tv)• Builds a long-term image for a product• Can trigger quick sales• Has a public nature and is viewed as legitimate• Very expressive• Impersonal and lacks the direct persuasiveness of sales people

types of shopping centers

• Regional shopping center (the largest and most dramatic shopping center. It has from 50 to more than 100 stores, including two or more full-line department stores) • Community shopping center ( has between 15 and 50 retail stores. It contains a branch of a department store or variety store, a supermarket, specialty stores, professional offices, and sometimes a bank) • Neighborhood shopping center (Strip malls) (contain between 5 and 15 stores. They are close and convenient for consumers, usually contain a supermarket, perhaps a discount store, and several service stores—dry cleaner, drugstore, hardware store, etc. ) • Power center (Power centers are huge unenclosed shopping centers consisting of a long strip of retail stores, such as Home Depot, BJ's, and BestBuy - Hamilton Mall, Hamilton NJ) (Atlantic City NJ - many retail shops)• Lifestyle center (smaller, open-air malls with upscale stores, convenient locations, and nonretail activities, such as a playground, skating rink, hotel, dining establishments, and a movie theater.)

types of retailers

• Retailer classification can be based on - Amount of service offered - Breadth and depth of the product lines - Relative prices charged - Way they are organized

Product Assortment and Services Decision

• Retailers must determine three product variables.- Product assortment (should differentiate it while matching target shoppers' expectations)- Services mix (some retailers invite customers to ask questions or consult service representatives in person or via phone or keyboard)- Store atmosphere (create a unique store experience(lighting, sound, colors, etc.) (Atmospherics -controllable characteristics of retail space which entice customers to enter the store, shop, and purchase)

promotion decision

• Retailers use various combinations of the five promotion tools:- Advertising (newspaper inserts and catalogs)- Personal selling (involves store salespeople greeting customers, meeting their needs, and building relationships)- Sales promotion (in-store demonstrations, coupons, displays, sales, and loyalty programs)- Public relations (PR) (new-store openings, special events, newsletters and blogs)- Direct and social media marketing (Web sites and digital catalogs, online ads and video, social media, mobile ads, apps, emails)

retailing trends and developments 2/4

• Rise of megaretailers (Amazon, Home Depot)- Offer better merchandise selections, good service, and strong price savings to consumers (squeeze out smaller stores)- Have shifted the balance of power between retailers and producers (Amazon and Home Depot can tell producers what they will pay)• Growth of direct, online, mobile, and social media retailing- Availability of a variety of non store alternatives

the shifting retailing model

• Shopper marketing: Focusing the entire marketing process (from product and brand development to logistics, promotion, and merchandising) toward turning shoppers into buyers as they approach the point of sale • Omni-channel retailing: Creating a seam-less cross-channel buying experience that integrates in-store, online, and mobile shopping

social media marketing 1/2

• Social media: Independent and commercial online communities where people congregate, to socialize and share messages, opinions, pictures, videos, and other content • Marketers engage social media in two ways: - Using the existing ones - Setting up their own (using existing social media seems the easiest. Most brands, large and small, have set up shop on a host of social media sites)

retailing trends and developments 1/4

• Tighter consumer spending- Impact of the Great Recession on consumers (2008-2009) (2020-2021) Changed spending patterns (Went to Costco, BJ's , etc.)- Impact of the Great Recession on retailers Cost-cutting, price promotions, bankruptcy New value pitches in positioning (Home Depot - More savings! More doing!)• New retail forms, shortening retail life cycles, and retail convergence(different types of retailers now sell the same products at the same prices to the same consumers. This means greater competition for retailers and greater difficulty in differentiating the product assortments of different types of retailers)

nature of tool: public relations

• Very believable to readers• Can dramatize a company or product• Reaches many prospects• Effective and economical when well thought out(news stories, sponsorships, events)

nature of tool: sales promotion

• Wide assortment of tools with unique qualities• Attracts attention and offers incentives to purchase• Used to dramatize product offers and boost sales• Invites and rewards quick response but has short-lived effects (coupons, contests, discounts