MARKETING MANAGEMENT, SEM 4 CBCS, VNSGU

Chapter 4
PROMOTION
The new advertising ecosystem will only be successful if users are put into control of decisions
relating to what ads are pushed to the users when.
- Chetan Sharma, Joe Herzog, and Victor Melfi

CHAPTER HIGHLIGHTS
5.1 Meaning of Promotion
5.2 Elements of Promotion mix
5.3 Integrated Marketing Communication meaning, role, importance
5.4 Process of Integrated Marketing Communication

5.1 DEFINITION & MEANING OF PROMOTION

Promotion is to communicate with individuals, groups or organizations to directly or indirectly
facilitate exchanges by informing and persuading one or more audiences to accept an organizations
products.
Communication plays an important role in marketing. Communication perform the function of
informing the target customer about the nature and type of the firm's product and services, their unique
benefits, uses and features as well as the price and place at which these products can be purchased.

Marketing communication is the essential element of the promotion function of marketing. Effective
promotion comes through effective communication. Success of products like Maggie 2 minute noodles,
purely depend on the promotion function played by the respective marketing firms. There are products
which have failed due to the lack of effective promotion done by the respective companies.
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5.2 ELEMENTS OF PROMOTION MIX

Definition: Promotion Mix is the combination of one or more of the communication tools used to
inform, persuade, or remind prospective buyers.
Promotion can be done by using different approaches including advertisements, sales promotion, direct
marketing, publicity etc. Together all these elements are known as Promotion mix. All these elements
play a different role while performing promotion function.

Components of Promotion Mix:

Following are some of the important elements of promotion mix;
1. ADVERTISING Any paid form of non-personal communication through mass media about a
service or product or an idea by a sponsor is called advertising.

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It is done through non personal channels or media. Print advertisements, advertisements in television,
radio, billboard, brochures and catalogs, direct mails, In-store display, motion pictures, emails, banner
ads, web pages, posters are some of the examples of advertising.

Merits of advertising:
Flexibility allows focusing on a small, clearly defined segment, (e.g. School newspapers) or a
mass market.
Cost efficient- reach to a large number at a low cost per person. This allows the message to be
repeated, and can improve public image.
Allows for repeating the message-lets the buyer receive and compare the messages of various
competitors.
Very expressive, allows for dramatization.
Used to build a long term image of a product.
Can Trigger quick sales
Demerits of advertising:
Very costly usually.
Rarely provides quick feedback, or necessarily any feedback
Less persuasive than personal selling
Audience does not have to pay attention
Indirect feedback (without interaction)

2. PERSONAL SELLING Personal selling is a process by which a person persuades the buyer to
accept a product or a point of view or convince the buyer to take specific course of action through face
to face contact. It is an act of helping and persuading through the use of oral presentation of products or
services.
Advantages:
The major benefit of personal selling is that it is the most persuasive form of promotion since it
is done face to face.
Sales person receives immediate feedback from the customer
Disadvantages:
Every customer has to be contacted personally and hence it is time consuming method of
promotion.
Requires efficient sales person to convince the customer

3. PUBLICITY: Non-personal stimulation of demand for a product, service or business unit by

generating commercially significant news about it in published media or obtaining favourable
presentation of it on radio, television or stage.
This form of promotion is not paid for by the sponsor. Thus, publicity is news carried in the mass media
about an organization, its products, policies, actions, personnel etc. Publicity can be favourable
(positive) or unfavourable (negative). The message is in the hands of media and not controlled by the
organization/firm.

4. SALES PROMOTION:- It is any activity that offers an incentive for a limited period to obtain a
desired response from the target audience or intermediaries which includes wholesalers and retailers.
It stimulates consumer demand, market demand and improves product availability. Examples: Contests,
product samples, Coupons, sweepstakes, rebates, tie-ins, self-liquidating premiums, trade shows, trade-
ins, and exhibitions.

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5. EXHIBITION: Exhibitions provide a chance to try the product by the customers. It is a place for the
producers to get an instant response from the potential consumers of the products. Different sellers
participate and display their products at one place. This helps the buyers to know about variety of
products at a place. Buyers and sellers can negotiate at the place. It is a great opportunities for new
products and inventions as people can notice and become aware of the innovation.
6. DIRECT MARKETING: Direct marketing is reaching the customer without using the traditional
channels of advertising such as radio, newspaper, television etc. This type of marketing reach the
targeted consumers with techniques such as telemarketing, internet marketing through emails etc.
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5.3 INTEGRATED MARKETING COMMUNICATION (IMC)
Definition & Meaning: Integrated Marketing Communications, (IMC in short) has been defined by the
American Marketing Association as a planning process designed to assure that all brand contacts
received by a customer or prospect for a product, service, or organization are relevant to that person
and consistent over time.
Integrated Marketing Communications takes into account traditional and non-traditional media, both
online and offline.
Traditional media usually refers to mass media- the use of TV, radio and newspapers.
Online marketing channels: With search engine optimization (SEO), blogs, podcasts, social
media of all kinds, online TV shows and workshops and you also have online affiliate programs,
pay-per-click ad schemes, and e-mail blasts. Aside from traditional mass media, offline
marketing channels also consider direct mail campaigns, public relations, the use of billboards
and industry analyst relations.

The goal of Integrated Marketing Communications, or IMC, is to bring together all the elements of the
company (advertising, sales promotion, public relations, direct marketing, sales support, etc.) into a
single and a unified force rather than having these different departments all work independently and
separately from each other.

Role / Importance of Integrated Marketing Communication:

With the growing competition in the market place as well as the customers becoming better informed
and more choosy, it is important now that marketing communications of the right kind only are made to
the right group of target buyers. Following are some of the most important purposes of Integrated
Marketing Communication.

Communicating information: The job of marketing is to identify consumer wants and then satisfy these
wants with the right kind of products, at the right place and at the right price. The purpose of promotion
in the marketing function is to convey to customers about the features of the product and how it will
satisfy consumer wants or any other relevant information needed by consumers to affect sales. For
example, if a refrigerator manufacturer is planning to offer off-season discount, it is important to
communicate to potential customers about the extent of discount, period during which discount is
available, name of the stores where it is available etc. If all such information is not communicated to
potential customers, lowering of prices will not be beneficial to either the consumer or the manufacturer.

Promotion is persuasive Communication: Consumers often have to select the products from among a
wide range of competing products. As consumers do not have time and energy to compare the
Dr ZAKIR PATEL, ASST. PROF, NARAN LALA COLLEGE OF COMMERCE AND MANAGEMENT 2016-17 3
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competing products physically, they turn to advertisements for product information. The present
business environment being highly competitive, each firm wants the customers to buy its brand. Thus,
persuasion is another goal of promotion. In other words, promotion is persuasive communication.

Promotion serves as a reminder: Consider a customer who regularly buys Colgate Toothpaste or Lux
Soap. Do marketers of Colgate Toothpaste or Lux Soap advertise to appeal to such customers? The
answer is yes, because even the most loyal customers must be reminded that the product has served them
well over the years and about the features that make the product attractive. This is more so in an
environment where competitors consistently attempt to attract the customers of competing brands with
their own informative and persuasive message. Thus, in addition to informing and persuading, another
important purpose of promotion is reminding customers. This is why even when the manufactures of
well established products like Colgate, Lux, Surf, Nescafe, Lifebuoy etc. also advertise quite extensively
to sustain customers preference for these products.

The role played by integrated marketing communication in marketing of products is as under;

1. Creates Competitive Advantage: It can create competitive advantage, boost sales and profits, while
saving money, time and stress.

2. Creates Relationship Marketing: IMC produces communication in such a way that it helps the
customers to move through the various stages of the buying process. In this way the organisation
develops its relationship with customers.

3. Builds Loyal Customers: This 'Relationship Marketing' creates a strong bond of loyalty with
customers which can protect them from the competition. The ability to keep a customer for life is a
powerful competitive advantage.

4. Increases effectiveness: IMC also increases profits through increased effectiveness or promotion. At
its most basic level, a unified message has more impact than a different types of messages. In a busy
world, a consistent, consolidated and a clear message has a better chance of winning customers.

5. Planned sequence of messages: Carefully linked messages also help buyers by giving timely
reminders, updated information and special offers which, when presented in a planned sequence, help
them move comfortably through the stages of their buying process.

6. Saves Money: IMC saves money as it eliminates duplication in areas such as graphics and
photography since they can be shared and used in say, advertising, exhibitions and sales literature.
Agency fees are reduced by using a single agency for all communications and even if there are several
agencies, time is saved when meetings bring all the agencies together - for briefings, creative sessions,
tactical or strategic planning. This reduces workload and subsequent stress levels - one of the many
benefits of IMC.

7. Creates Credibility: IMC also makes messages more consistent and therefore more credible. This
reduces risk in the mind of the buyer which, in turn, shortens the search process and helps to dictate the
outcome of brand comparisons

Dr ZAKIR PATEL, ASST. PROF, NARAN LALA COLLEGE OF COMMERCE AND MANAGEMENT 2016-17 4
 MARKETING MANAGEMENT, SEM 4 CBCS, VNSGU

5.4 PROCESS OF INTEGRATED MARKETING COMMUNICATION

Integrated marketing communication process can be understood through following steps;

1. Identity target audience:

The first step is to know the target audience. Here the marketer has to know the following before
evolving communication strategy;

Demographic and Psychographic profile:- The target audience demographic characteristics are
important in deciding the message. For example, education of the target audience will influence the
content of the message. To further illustrate this, it has been observed the customers who are low on
education need to be told the full story with the conclusion drawn for them. But the same is not true
when the marketer is communicating with more literate and educated customer.

Media habits:- The next characteristics to be studied us the media habits of target audience. For
example, it is important to study whether the target audience watches TV. , listens radio, reads the daily
news paper and magazines. It is also important to study the frequency with which these are being
watched or listened to or subscribed for e.g. does the target audience see the TV. programs daily, every
alternate day, weekends or as and when the individuals get the time. When the individual does watch the
programs? An analysis of media habits can help in selecting the right medium and also placing the
message at appropriate place in it.

Level of awareness:- Another characteristic to be studied is the level of target audiences awareness of
the product and the organization. A target market, that is unaware of the product or brand or the
organization, will require an intensive communication, like the microwave cooking. Likewise, if the
target audience has a negative image of the product or brand and the organization, then the firm has to
invest more resources over a long time to change this perception. Japanese product has an inferior image
in 1960s and early 1970s. The image was so low and negative that they were the benchmarks of
inferiority. It is not so today.

2. Developing communication objective:

Based on the levels of target audiences awareness of the product or brand or organization, the marketer
can determine his communication objectives. The most commonly used model is the AIDA models as
describing in figure:-

Awareness

Interest

Desire

Action
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The above model suggests that before actually taking the purchase decision, the target customer has to
be aware of the particular brand or product.
3. Setting the Promotion Budget: After setting the promotion objectives, a company must decide on
how much to spend.
o Percentage of sales. In this approach, the amount of money spent on promotion is a percentage
of past or anticipated sales. A common budgeting method, this approach is often stated in terms
such as promotion budget for this year is 3 percent of last years gross sales.
o Competitive parity. This budgeting approach matches the competitors absolute level of
spending or the proportion per point of market share.
o All you can afford. Common to many businesses, the all-you-can-afford budgeting method
allows money to be spent on promotion only after all other budget items such as
manufacturing costs are covered.
o Objective and task. The best approach to budgeting is objective and task budgeting, whereby
the company 1) determines the promotion objectives, 2) outlines the tasks to accomplish these
objectives, and 3) determines the promotion cost of performing these tasks.

4. Selecting the Right Promotional Tools: Once a budget has been determined, the combination of the
five basic IMC tools advertising, personal selling, sales promotion, public relations, and direct
marketing can be specified. While many factors provide direction for selection of the appropriate mix,
the large number of possible combinations of the promotional tools means that many combinations can
achieve the same objective.
5. Designing the Promotion: The central element of a promotion program is the promotion itself.
Advertising consists of advertising copy and the artwork that the target audience is intended to see or
hear. Personal selling efforts depend on the characteristics and skills of the salesperson. Sales promotion
activates consist of the specific details of inducements such as coupons, samples, and sweepstakes.
Public relations efforts are readily seen in tangible elements such as news release, and direct marketing
actions depend on written, verbal, and electronic forms of delivery.
6. Scheduling the Promotion: Once the design of each promotional program elements is complete, it is
important to determine the most effective timing of their use. The promotion schedule describes the
order in which each promotional tool is introduced and the frequency of its use during the campaign.
Several factors such as seasonality and competitive promotion activity can also influence the promotion
schedule. Businesses such as ski resorts, airlines, and professional sports teams are likely to reduce their
promotional activity, during the off -season.
7. Executing and Evaluating the Promotional Program: The ideal execution of a promotional
program involves pre-testing each design before it is actually used. This is done to allow for changes and
modifications which improve its effectiveness. Similarly, post-tests are recommended to evaluate the
impact of each promotion and the contribution of the promotion towards achieving the program
objectives. The most sophisticated pretest and post test procedures for sales promotion and direct
marketing efforts currently focus on comparisons of the relative impact of the promotional tools and
their execution options in various situations.
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Dr ZAKIR PATEL, ASST. PROF, NARAN LALA COLLEGE OF COMMERCE AND MANAGEMENT 2016-17 6