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Section Objectives. Explain the role of the promotion strategy. Explain how to formulate promotional plans. Identify considerations for putting together a promotional mix. Describe the elements of a promotional mix. The Main Idea. - PowerPoint PPT Presentation
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The Promotion StrategyThe Promotion Strategy
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
Budgeting and Implementing Promotional Plans
12.1Section
12.2Section
1212
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
• Explain the role of the promotion strategy.• Explain how to formulate promotional plans.• Identify considerations for putting together a promotional mix.• Describe the elements of a promotional mix.
Section Objectives
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
The promotion strategy is the most visible marketing strategy, designed to get the attention of prospective customers and convince them to buy from you.
Promotional activities must be in the right mix.
The Main Idea
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Content Vocabulary
imagepresellingcampaignpromotional mixadvertisingspecialty item
publicitynews releasepublic relationspremiumrebatesweepstakes
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
As a new business owner, you need two kinds of promotional plans:
a preopening plan to lay the groundwork for your opening
a second plan to support your operation once it is under way
Drawing Up Promotional Plans
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Promotion is communication intended to persuade, inform, or remind a target audience about a business or its products.
The promotion strategy involves planning, determining the right promotional mix, and selecting specific promotional activities.
The Role of Promotion Strategy
Preopening Plan
7
Objectives of a Preopening Plan
Establish a positive image.
Let potential customers know you are opening for business.
Bring in customers or have them contact your business.
Interest customers in your new company and your products or services.
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
The image you establish in your preopening plan sets the tone for your promotional plan.
image
the impression people have of a company; a company’s personality
Preopening Plan
Ongoing Plan
9
Objectives of an Ongoing Promotional Plan
Explain major features and benefits of your products.
Communicate information about sales.
Clear up customers’ questions and concerns.
Introduce new goods or services.
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
An ongoing promotional plan helps in preselling your goods or services.
preselling
the act of influencing potential customers to buy before contact is actually made
Ongoing Plan
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Both a preopening and an ongoing plan can be organized around a promotional campaign, independent promotional activities, or a combination of the two.
campaign
a series of related promotional activities with a similar theme
Promotional Plan Format
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Every business has a unique promotional mix.
promotional mix
the combination of different promotional elements that a company uses to reach and influence potential customers
Selecting a Promotional Mix
Ongoing Plan
13
When selecting elements for a promotional mix, consider:
target market
product value
promotional channels
time frame
cost
The Elements of the Promotional Mix
14
PromotionalMix
publicity
sales promotion
personal selling
advertising
InternetMarketing
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
In the United States, most businesses spend about one-fourth of their advertising dollars on newspaper ads.
advertising
the paid nonpersonal presentation of ideas, goods, or services directed at a mass audience by an identified sponsor by means of print and broadcast
Advertising
Advertising
16
newspapers magazines
direct mail
outdoor advertising
directories
transit advertisingtelevision
radio
Internet
specialtyitems
Types ofAdvertising
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
A specialty item serves as a reminder of a business.
specialty item
an advertising device that includes giveaways, such as pens, T-shirts, and caps, printed with a business name or logo
Advertising
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Taking advantage of publicity means calling attention to yourself and your business.
publicity
placement in the media of newsworthy items about a company, product, or person
Publicity
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
A news release should answer these questions: news release
a brief newsworthy story that is sent to the media
Publicity
? ? ?
? ?
Who? What? Where?
When? Why?
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Public relations may generate unsolicited publicity when such activities are reported by the media.
public relations
activities designed to create goodwill toward a business or control damage done by negative publicity
Publicity
Sales Promotion
21
Examplesof Sales
Promotion
displays
premiums
rebates samples
sweepstakes and contests
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
One type of sales promotion may be to include a premium with a purchase.
premium
any item of value that a customer receives in addition to the good or service purchased; designed to attract new customers or build loyalty among existing customers, they may include coupons and gifts
Sales Promotion
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
Some companies give a rebate on purchases.
rebate
a return of part of the purchase price of a product used as an incentive for customers to purchase the product
Sales Promotion
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
A sweepstakes is a sales promotion that can draw attention to a business.
sweepstakes
a simple game of chance used by a business to get customers interested in what the company has to offer
Sales Promotion
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
After You Read
1. Explain the role of the promotion strategy.
The role of the promotion strategy is to set the course for and coordinate all aspects of promotion. It involves planning, determining the right mix, and selecting specific activities.
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
After You Read
2. Explain preopening and ongoing promotional plans.
Preopening promotional plans establish the company’s image, let customers know the business is opening, bring in customers, and create interest in the business so that the business will have customers when it opens. Ongoing promotional plans maintain and build sales after a business is open.
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
After You Read
3. Describe considerations for putting together a promotional mix.
When selecting elements for a promotional mix, consider the target market, product value, promotional channels, time frame, and cost.
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
SECTION 12.112.1
Chapter 12 The Promotion Strategy
After You Read
4. Describe the elements of a promotional mix.
The elements of the promotional mix are advertising, sales promotion, publicity, and personal selling.
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
• Determine promotional costs for a start-up business.• Describe ways to implement your promotion strategy.• Examine options for short-term changes in your promotion
strategy.• Identify considerations for updating the promotion strategy.
Section Objectives
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
Thorough planning and information gathering can help you arrive at a realistic promotional budget.
That budget will have a direct affect on how you implement your promotional plans.
The Main Idea
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
Content Vocabulary
industry averagecooperative advertising
advertising agencyconsumer pretest
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
To plan the promotional budget for a new venture, you must take these steps:
• Cost out promotional activities.• Compare industry averages.• Make final adjustments.
Budgeting for Promotion
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
You can find out the industry average for promotional expenses from such sources as trade associations or the SBA.
industry average
the standard used to compare costs among companies; usually expressed as a percentage
Compare Industry Averages
Radio
Television
Internet
Basic Media Formats
34
PrintInclude a headline, copy, illustrations, and a signature.
RadioInclude same elements as print, but can add music or sound effects.
TelevisionSame elements apply, but it requires casting, set design, sound, and filming.
InternetSame components as print, but may also have audio, video, and animation.
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
You can carry out your promotional plans yourself, or you can hire professionals to implement some or all of your promotional activities.
Professional help can come from the media, manufacturers and suppliers, and advertising agencies.
Getting Help
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
You may be able to save on your promotional budget by arranging for cooperative advertising.
cooperative advertising
an arrangement in which advertising costs are divided between two or more parties
Getting Help
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
An advertising agency can handle all phases of your advertising, including writing the copy, creating the artwork, choosing the media, and producing the ad.
advertising agency
a company that acts as intermediary between a business and the media to communicate a message to the target market
Getting Help
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
The three most common adjustments to the promotion strategy are:
Section 12.2 Budgeting and Implementing Promotional Plans
• adjust your advertising• generate publicity• promote sales
Making Possible Promotion Changes
Adjust Your Advertising
39
Factors for
Evaluation
market
media
budget
results
source
motives
messages
Section 12.2 Budgeting and Implementing Promotional Plans
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
One way to reduce the risk involved in an expensive advertising campaign is to conduct a consumer pretest.
consumer pretest
a procedure in which a panel of consumers evaluates an ad before its release
Adjust Your Advertising
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
Conduct a formal review of your promotion strategy on a regular basis.
Use your sales forecast to arrive at a promotional budget to support that level of sales.
Then revise your promotional mix promotion plan.
Revising the Promotion Strategy
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
After You Read
1. Describe how to determine promotional costs for a start-up business.
Promotional costs for a start-up business are determined by costing out the planned activities, comparing the costs to industry averages, and adjusting the budget if necessary.
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
After You Read
2. Describe approaches to implementing your promotional strategy.
Two approaches to implementing a promotion strategy are developing your own promotion items and hiring professionals to do the job.
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
After You Read
3. Discuss options for short-term changes in your promotion strategy.
Options for short-term changes are increasing the effectiveness of your advertising expenditures, capitalizing on publicity opportunities, and stimulating sales through sales promotions or changes in the sales force.
Budgeting and Implementing Promotional Plans
Glencoe Entrepreneurship: Building a Business
SECTION
Chapter 12 The Promotion Strategy
12.212.2
After You Read
4. Name considerations for updating the promotion strategy.
To update the promotional plan, consider the sales forecast for the upcoming period; make budget adjustments required by the forecast; and study changes in the target market, research results, and experiences to date. On the basis of those considerations, a new mix can be determined and a new plan developed.
The Promotion StrategyThe Promotion Strategy
Glencoe Entrepreneurship: Building a Business
Developing a Promotion Strategy
Budgeting and Implementing Promotional Plans
12.1Section
12.2Section
1212
End ofEnd of
Chapter 12The Promotion Strategy