In Advertising Sales Promotion

7/31/2019 In Advertising Sales Promotion

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In advertising sales promotion - it is apparent that companies communicate with their

customers in a number of ways. It is important that we distinguish between the two main

varieties of communication.

1. Impersonal communicatione.g. point of sale, promotions,advertising, promotions and public relations;

2. Personal communication ( or direct person to person) e.g. the face to face meetingbetween a sales person and the customer.

The problem faced by the company planning a communication plan is that firstly there

usually is more than one person responsible for making the purchase decision; secondly, there

is the important fact that the buyer is influenced by more than one form of communication.

For example, the buyer might use the following four sources of information:

1. Trade and technical press2. Salesperson calls3. Exhibition4. Direct mail

A review of the facts above reveals the following:

1. More than one person in the purchasing company has an influence on what is bought2. Sales people do not see all the influencers3. Companies get the information for their decisions from a variety of sources.

It can be seen then that the buying process is quite complicated.

1. The purchasing manager in an organization realizes the need for a specific product tobe purchased as a solution to a problem identified;

2. The characteristics and quantity of what is needed are worked out. This is the outlinedesign process such as deciding performance, weight, size, operating conditions, and

so on;

3. A specification has to be drawn up based on the above;4. A search is made for suppliers. This may merely involve the browsing through of a

suppliers catalogue;

5. Potential suppliers will submit products and plans for evaluation;6. After the necessary trials the suppliers are selected;7. The supplier delivers the product after the order is duly executed;8. The goods delivered are checked against specification;

Not all of these steps are followed in every buying decision. When something is being bought

for a new project, all the phases would be followed. Where it is simply the replacement of

something that has been bought before, the search and even the tender processes may not be

necessary. The newness of the product being purchased also plays a role in the product being

purchased. The newness of the product is determined by;

1. The complexity of the product;2. The commercial uncertainty surrounding the outcome of the purchase.


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Preparing the advertising plan

For many years it was believed that advertising was very simple in the sense that the

company advertised and the customer received the message and understood it. Now however,

we know that the process is much more complicated than first suspected!

Before setting the objectives for advertising we need to check what we need to set the

objectives:

1. The budget for advertising2. Determine who the target audience is3. Advertisement content4. Media to use5. Advertising frequency6. Measure the effectiveness of advertising

The decisions can be summarized as follows:

1. objectives (why)2. Target (who)3. Copy platform (what)4. Media (where)5. Creative platform (how)6. Timing (when)7. Budget (how much)8. Schedule9.

Response10.Evaluation

The whole process rests primarily on the first item of the list - which is the advertising

objectives.

Advertising Objectives

Research has shown that many companies set objectives for advertising which advertising

cannot achieve on its own.

A machine toll company could not understand why after an expensive advertising campaign

in Germany in which they emphasized the extremely high quality and reliability of their

products they made little headway in the market. Subsequent market research showed that

their target customers already concerned about and why they were not buying was their

dissatisfaction over delivery and customer service. This is yet another example of advertising

wasted because of ignorance of customer beliefs.

The first step is to decide on reasonable objectives for advertising. The question that needs to

be asked is can the objective be achieved by advertising alone? If the answer is 'yes' then it isan advertising objective otherwise it cannot be made an advertising objective.


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Media advertising can achieve the following:

Alter perception/ attitudes Convey information Create desires Establish connections Direct actions Provide reassurance Remind Give reasons for buying Demonstrate Generate enquiries

Setting reasonable achievable objectives, then, is the first and most important step in the

advertising plan. All the other steps are a putting together a plan to achieve the advertising

objectives.

Who

target audience, - what do they already

know about the product or service?

What do they know about the competitors?

What kind of people re they?

How do we describe identify them?

What

Response do we wish to achieve through

advertising?

Are these specific communicationsobjectives?

How

How can we embody our communications

objectives in an appealing form?

What is the evidence that we have is that is

acceptable and appropriate and acceptable to

our audience?

WhereWhich are the most cost effective places to

make our communications?

When

When are communications going to be made

to clients?

What is the reasoning for our scheduling of

advertisements/ communications over time

Result

What results do we expect?

How are we planning to measure theresults?

Do we intend to measure results and if so do

we need to do anything beforehand?Budget How much money do the activities need?


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How much money is available?

How is expenditure going to be controlled?

Schedule

Who is to do what and when?

How much is to be spent on what, whereand when?

The usual assumption about advertising is that advertising is deployed in an aggressive

manner and that changes over time is the creative content. But the role of advertising changes

over the life cycle of the product.

For example, the process of persuasion itself cannot usually start until there is some level of

awareness about a product or service in the marketplace. Creating awareness is, therefore

usually one of the most important objectives early on in a life cycle.

Sales Promotion

The term advertising is constantly referred to as 'above the line expenditure' and can be

defined as all non-personal communication in measured media. This includes television,

cinema, radio, print and outdoor media.

Sales promotion for which the term 'below the line expenditure' is used as a synonym, is not

easily defined.

In practice sales promotion is a specific activity, which can be defined as the making of a

featured offer to certain customers within a specified time period. This means that to qualify

as sales promotion, someone must be offered something which is featured rather than just

being an aspect of trade.

Sales promotion in practice

Sales promotion is a problem-solving activity designed to get customers to behave more inline with the economic interests of the company.

Typical tasks for sales promotion are: rectifying slow stock movements; counter-acting

competitive activity; encouraging repeat purchase; securing marginal buyers; getting bills

paid on time; inducing trial purchase etc.

However, it is important to realize that, on its own, sales promotion will not replace selling,

change long term trends, or build long term customer loyalty.

Types of Sales Promotion

Money Goods Services


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Target market Direct Indirect Direct Indirect Direct Indirect

Consumer Price reductioncoupons vouchers

money equivalent

competitions

Free goods

premium offers free

gifts trade-in offers

Stamps coupons

vouchers money

equivalentcompetitions

Guarantees group

participation events

special exhibitionsand displays

co-operative

advertising stamps

coupons vouchers forservices

TradeDealer loaders

loyalty schemes

incentives

Extended credit

Delayed invoicing

sale or return

coupons vouchersmoney equivalent

Free gifts Trial

offers Trade-in

offers

Guarantees group


Free services Riskreduction schemes

Stamps, coupons

Vouchers for services

Competitions

Sales force Bonus commissionCoupon vouchers

Points system

Money equivalentFree gifts

Coupons Vouchers

Points systems

Money equivalentFree services Group


Coupons Vouchers

points systems for

services Event

admission

Competitions

Strategic role of sales promotion

Because sales promotion is essentially used as a tactical device, it often amounts to a series of

unconnected gimmicks to lacking any coherence. Contrary to this advertising has been

always considered as a strategic process of building brand value over the longer term.

Compare this against sales promotion which is commonly used to help the company retain atactical advantage.

There is no reason why there should not be a strategy for sales promotion, so that each

promotion increases the effectiveness of the next.

Sales promotion of industrial products

Industrial goods are always sold to other businesses and this has the effect of changing theemphasis placed on certain elements of the marketing mix.

It will not be surprising then to learn that suitably adapted most consumer goods sales

promotional techniques can be applied to industrial goods.

Sales promotion plan preparation

There is wide acceptance that sales promotion is one of the most mismanaged of all

marketing functions. This can be attributed to the confusion as to what sales promotion reallyis - which often results in expenditures not being properly accounted for. Some companies

record it as advertising expenditure, others as sales force expenditure and others as general

marketing expenditure - while the loss of revenue from special price reductions is not

recorded at all.

The companies can no longer afford not to set objectives or to evaluate results after the event,

or to fail to have some company guidelines. For example, a 1 Euro case allowance on a

product with a contribution rate of 3 Euro per case has to increase sales by 50% just to

maintain the same level of contribution.


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Documents

In Advertising Sales Promotion