Recap of the last Class:
Channel flows & Channel levels Utilities desired by the customers Types of distribution Vertical vs. Horizontal marketing systems Marketing Logistics Types of warehouses Diff b/n retailers & wholesalers
Surprise Quiz 2
Explain concept of brand ladder (2 mks) With example explain the difference between brand & line extension (2 mks) With examples explain difference b/n the two types of order processing methods? (2 mks) Explain with e.g. the concept of target costing (2mks) Explain with e.g. the difference between perceived value pricing & value pricing (2 mks)
Marketing Communications & Promotion Decisions:
Marketing Communication Mix consists of various modes of communication:
Advertising: Paid form of non-personal presentation Sales promotion: Short term incentives to encourage trial & purchase Company Sponsored Events PR & Publicity: Companys image promotion Personal Selling: Face to face interaction Direct Marketing: Use of mail, e-mail, telephone etc Interactive marketing & W-o-m marketing
Macro Model of the Communications Process:
Sender Encoding
Media/ Message
Decoding
Receiver
Noise
Feedback
Response
Eight Steps of Developing Effective Communication:
Step 1: Identify Target Audience
Determine target audiences perception about the company and its products
Step 2: Determine Communication Objective
Make consumers identify a latent need Make consumers aware of a given brand Develop a favorable brand attitude Enforce brand purchase intention
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Eight Steps of Developing Effective Communication (Cont.):
Step 3: Design the Communications
Message & Creative Strategy: What to say & how to say it?
Rational/Informational Emotional/Transformational
Message Source: Who should say the message?
Based on expertise, trustworthiness & likeability Principle of Congruity
Global Adaptations
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Eight Steps of Developing Effective Communication (Cont.):
Step 4: Selecting Communication Channels:
Choice between personal vs. non-personal communication channels
Step 5: Establishing Total Marketing Communication Budget:
Affordable Method Percentage-of-Sales Method Competitive-Parity Method Objective and Task Method
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Eight Steps of Developing Effective Communication (Cont.):
Step 6: Decide on Marketing Communication Mix:
Which of the major modes of comm. to use? Various factors also decide this
Step 7: Measure Communication Results Step 8: Managing and Coordinating Integrated Marketing Communications
Synergistic use of various modes of marketing communications
5 Major Decisions in Developing Advertising Program:
Mission: Advertising Objectives Money: Advertising Budget Message Media Measurement
Mission: Adverting Objectives
Informative Advertising Persuasive Advertising Reminder Advertising
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Money: Determining Ad. Budget
Factors considered while setting Ad. Budget are:
Stage in PLC Market Share To gain more market share, more ads. Are required Competition and Clutter Advertising Frequency Product Substitutability
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Deciding on the Message
Message Generation
Message Evaluation & Selection
Message Execution
Social Responsibility Review
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Deciding on the Media
Step 1: Decide on reach, frequency & Impact
Reach (R): No. of persons exposed to a particular media schedule during a specified time period Frequency (F): No. of times that people are exposed to a message in a specific period Impact (I): Qualitative value of exposure Total No. of Exposure (E): R*F Weighted No. of Exposure (WE): R*F*I
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Deciding on the Media (Cont)
Step 2: Choosing among major media:
Target audiences media habits Type of product Type of message Cost
Step 3: Selecting specific vehicles:
Specific media vehicle comes within a chosen media type
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Deciding on the Media (Cont)
Step 4: Deciding on Media Timing:
When to start the ad. campaign?
Step 5: Deciding on Geographical Allocation: National vs. Regional
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Measurement: Evaluating the advertising effectiveness
Communication-Effect Research:
Determines if the ad. is communicating effectively. Also called COPY TESTING Three methods of doing copy testing are:
Direct Rating Method: To rate the ads on various parameters Portfolio Test: Show a customer portfolio of ads and then ask them to recall an ad. Laboratory Test: Measure physiological reactions e.g. heartbeat, BP etc.
These tests measure attention getting power but reveal nothing about impact of ad on beliefs, attitudes or intentions
Sales Promotion:
Short term incentives to encourage trial & purchase Major Decisions taken in Sales promotion are:
Establish objectives: e.g. induce trial, encourage switching Select Tools Develop programs Pretest Program Implement and Control it Evaluate its results
Public Relations:
It involves programs aimed at promoting and protecting companys image and that of its individual products Major Decisions taken are:
Establish Objectives Choose Messages and Vehicles Implement the plan Evaluate the results
Personal Selling Process
1.
2.
3. 4. 5. 6. 7.
Prospecting and Evaluation Pre Approach Approach Presentation Handling Objectives Closing Follow-up
