Marketing Chapter 14

Promotion objectives should possess three important qualities

(1) be designed for a well-defined target audience, (2) be measurable, and (3) cover a specified time period.

sales promotion

A short-term offer designed to arouse interest in buying a product or service. -offered to intermediaries as well as to ultimate consumers. Coupons, rebates, samples, contests, and sweepstakes

receivers

Consumers who read, hear, or see the message

Which of the following statements regarding direct marketing is most accurate?

Many customers believe direct marketing saves time, is entertaining, and offers privacy.

lead generation

The result of a direct marketing offer designed to generate interest in a product or a service and a request for additional information. -Four Seasons Hotels

___ refers to the process by which the receiver takes a set of symbols and transforms them back to an idea.

decoding

In the communication process, the information sent by the source forms the ___.

message

Cost per contact is high with the ___ element of the promotional mix.

personal selling

Decline stage

phase-out for the product, and little money is spent in the promotional mix.

Maturity stage

to remind buyers of the product's existence. Sales promotion, in the form of discounts, coupons, and events, is important in maintaining loyal buyers. -to maintain existing buyers.

indirectly paid dimension

A difference between publicity and both advertising and personal selling

public relations

A form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, potential customers, stockholders, suppliers, employees, and others about a company and its products or services.

five stages of the hierarchy of effects

Awareness, Interest, Evaluation, Trial, Adoption

The __________audit analyzes the internal communication network of the company; identifies key audiences; evaluates customer databases; assesses messages in recent ads, public relations releases, packaging, video news releases, signage, sales promotion pieces, and direct mail; and determines the expertise of company and agency personnel.

IMC

Introduction stage

Informing consumers in an effort to increase their level of awareness is the primary promotional objective in the introduction stage of the product life cycle. In general, all the promotional mix elements are used at this time.

Product Life Cycle

Introduction stage, Growth stage, Maturity stage, Decline stage

Promotion Budget

Percentage of sales, Competitive parity, All you can afford, Objective and task budgeting -only the objective and task method takes into account what the company wants to accomplish and requires that the objectives be specified.

direct marketing

Promotional element that uses direct communication with consumers to generate a response in the form of an order, a request for further information, or a visit to a retail outlet. -including face-to-face selling, direct mail, catalogs, telephone solicitations, direct response advertising , and online marketing -fastest-growing forms of promotion DISADVANTAGES -require a comprehensive and up-to-date database with information about the target market - privacy has led to a decline in response rates among some customer groups.

promotional mix

The combination of one or more of the communication tools used to (1) inform prospective buyers about the benefits of the product, (2) persuade them to try it, and (3) remind them later about the benefits they enjoyed by using the product.-advertising, personal selling, public relations, sales promotion, and direct marketing

message

The information sent by a source, such as a description of a new cellular telephone

traffic generation

The outcome of a direct marketing offer designed to motivate people to visit a business. -Home Depot uses an opt-in e-mail alert to announce special sales that attract consumers to the store

direct orders

The result of direct marketing offers that contain all the information necessary for a potential buyer to make a decision to purchase and complete the transaction. -Priceline.com will send PriceBreaker RSS alerts to people in its database

publicity

a nonpersonal, indirectly paid presentation of an organization, product, or service.

field of experience

a similar understanding and knowledge they apply to the message. -

five promotional alternatives

advertising, personal selling, public relations, sales promotion, and direct marketing.

promotional activities

advertising, personal selling, sales promotion, public relations, and direct marketing

Three of these elements that are often said to use mass selling because they are used with groups of prospective buyers.

advertising, sales promotion, and public relations

Mass selling refers to

advertising, sales promotions, and public relations activities that are used with groups of prospective buyers.

Mass selling includes which elements of the promotional mix?

advertising; sales promotion; public relations

Percentage of sales budgeting

amount of money spent on promotion is a percentage of past or anticipated sales. -common budgeting method -"our promotion budget for this year is 3 percent of last year's gross sales."

Interest

an increase in the consumer's desire to learn about some of the features of the product or brand.

advertising

any paid form of nonpersonal communication about an organization, product, service, or idea by an identified sponsor. -the space for advertising messages must be bought (paid).

behavioral targeting

collecting information about your web-browsing behavior to determine the banner and display ads that you will see as you surf the Web

feedback loop

consists of a response and feedback -made up of a response from the receiver, and feedback, the interpretation of the same by the source.

Factors such as differences in the availability of credit, the need for improved reliability and security in postal systems, and government regulations represent important challenges for __________ in the global market.

direct marketing

Which two of the following promotional alternatives benefit from a customized interaction between the seller and a prospective buyer?

direct marketing and personal selling

pull strategy

directing its promotional mix at ultimate consumers to encourage them to ask the retailer for a product. -retailers order the product from wholesalers and thus the item is pulled through the intermediaries. Pharmaceutical companies- designed to encourage consumers to ask their doctor for a specific drug by name—pulling it through the channel.

push strategy

directing the promotional mix to channel members to gain their cooperation in ordering and stocking the product. -personal selling and sales promotions play major roles.

pretesting

ensures that messages are decoded properly.

The third stage in the hierarchy of effects is __________.

evaluation

For the message to be communicated effectively, the sender and receiver must have a mutually shared ____.

field of experience

Noise

includes extraneous factors that can work against effective communication by distorting a message or the feedback received. -can be a simple error, printing mistake, words or pictures that fail to communicate the message clearly. -occurs when a salesperson's message is misunderstood by a prospective buyer **accent, slang, when communication style makes hearing and understanding difficult.

direct response advertising

is an important form of direct marketing

Competitive parity budgeting

matches the competitor's absolute level of spending or the proportion per point of market share.

source

may be a company or person who has information to convey.

The all-you-can afford method of promotion budgeting has been criticized for

not being based on the promotion-sales relationship nor on promotion objections.

In the percentage of sales method of promotion budgeting, funds are allocated to promotion as a percentage of either ____ sales.

past or anticipated

Developing, executing, and assessing the promotion program helps and organization by

prescribing a strategic approach that improves promotion decisions.

The first decision in executing the promotion program is to __________.

pretest the promotion

Pharmaceutical companies historically marketed only to doctors. More recently, they have spent millions of dollars to advertise prescription drugs directly to consumers. These pharmaceutical companies are using a __________ strategy.

pull

Promotion

represents the fourth element in the marketing mix. -consists of communication tools, including advertising, personal selling, sales promotion, public relations, and direct marketing.

Which of the following are benefits consumers reports regarding their experiences with direct marketing?

saving time and money, 24 hour shopping, avoids hassle with sales people, fun and entertaining, more privacy than in-store shopping.

During the planning stage of an IMC program, a firm will identify the target audience, specify the advertising objectives, __________, select the right promotional tools, and design the promotion.

set the budget

integrated marketing communications (IMC)

the concept of designing marketing communications programs that coordinate all promotional activities to provide a consistent message across all audiences. -a key element in a company's customer experience management strategy.

Awareness

the consumer's ability to recognize and remember the product or brand name.

Trial

the consumer's actual first purchase and use of the product or brand.

Evaluation

the consumer's appraisal of the product or brand on important attributes.

response

the impact the message had on the receiver's knowledge, attitudes, or behaviors.

Which of the following is NOT an extraneous factor that can work against effective communication?

the message is considered too ordinary

Decoding

the process of having the receiver take a set of symbols, the message, and transform the symbols back to an idea. -performed by the receivers according to their own frame of reference: their attitudes, values, and beliefs. -essential to communication.

Encoding

the process of having the sender transform an idea into a set of symbols. -essential to communication.

strategic marketing process

the promotion decision process is divided into (1) developing (2) executing (3) assessing the promotion program

The two promotional strategies used by a manufacturer to assist in moving a product through the channel of distribution are known as

the push strategy and the pull strategy

feedback

the sender's interpretation of the response and indicates whether the message was decoded and understood as intended.

hierarchy of effects

the sequence of stages a prospective buyer goes through from initial awareness of a product to eventual action -

personal selling

the two-way flow of communication between a buyer and seller designed to influence a person's or group's purchase decision. Unlike advertising, personal selling is usually face-to-face communication between the sender and receiver. -include face-to-face, telephone, and interactive electronic communication. uses customized interaction between a seller and a prospective buyer ADVANTAGES-control whom the presentation is made, reducing the amount of wasted coverage, seller can see or hear the potential buyer's reaction to the message. DISADVANTAGE-flexibility of personal selling

Adoption

through a favorable experience on the first trial, the consumer's repeated purchase and use of the product or brand.

Growth stage

to persuade the consumer to buy the product. Advertising is used to communicate brand differences, and personal selling is used to solidify the channel of distribution.

channel of communication

-The message is conveyed by means of a -salesperson, advertising media, or public relations tools

All you can afford budgeting

-allows money to be spent on promotion only after all other budget items—such as manufacturing costs—are covered. -Common to many businesses

Direct marketing

-has many forms and utilizes a variety of media -direct mail and catalogs, television home shopping, telemarketing, and direct selling -E-mail has become the most popular form of direct marketing. -Indicator-level of use

nonpersonal

-mass media (such as TV, radio, and magazines), which are nonpersonal and do not have an immediate feedback loop as does personal selling.

Objective and task budgeting

-the company (1) determines its promotion objectives, (2) outlines the tasks to accomplish those objectives, and (3) determines the promotion cost of performing those tasks. -The best approach to budgeting

communication

-the process of conveying a message to others and it requires six elements: a source, a message, a channel of communication, a receiver, and the processes of encoding and decoding.