Higher/Intermediate 2 Business Management

1. Higher/Intermediate 2 Business Management Promotion

2. What is Promotion • Promotion is the process by which people are encouraged to buy an organisations product / service. • Promotion exists for a number of reasons • Inform • Persuade • Remind

3. Different methods of Promotion • “Above the line” - Promotion carried out through the mass-media • “Below the line” – Promotion carried out without the use of the mass-media • Mass Media = the main means of communicating to a large audience

4. Promotional Mix • Advertising (“Above the line”) • Personal Selling (“Below the line”) • Sales Promotion (“Below the line”) • Public Relations (“Below the line”) • Direct Marketing (“Below the line”)

5. Advertising • The way that most organisations will promote their good or service • Non personal • ‘Paid for’

6. Advertising • Informative Advertising - used to increase awareness of a product/service and to inform the consumer about the product/service - for example: Yellow Pages • Persuasive Advertising - aim to persuade a customer to buy a product by stressing that it’s very desirable to have - for example: Marks & Spencer (Food)

7. Advertising (Types) • TV • Radio • Cinema • Magazines / Newspapers • Posters / Billboards • Internet • Sponsorship

8. TV Advertising • Most people watch TV - hard to avoid • Advert breaks / Commercial breaks • Programme Sponsorship • Placement • Costly, People may switch channel

13. Radio Advertising • Commercial Stations funded by advertising • Advertising forthcoming events / shows • Local Advertising – Target Audience • Cannot see product – relies on descriptions

14. Cinema Advertising • Captive Audience • Advertises forthcoming movies • Products can relate to feature movie (targeted) – Kids – Toys • High Cost

16. Newspapers / Magazines • Can be targeted – Local / National / Specialist / Young / Old • Widely available • Can be cost prohibitive

18. Posters / Billboards • Many locations – Side of roads, Buses etc… • Length of exposure • Short and Punchy – Messages need to be short and easily understood

20. Internet • Becoming more and more popular • Huge audience • Banner advertising • Pop ups can be blocked

22. Sponsorship • Advertise name at Pop Concerts, Football Teams, Stadiums • Effective in building recognisable name • May put people off by association

24. “Below the Line” Promotion • Personal Selling • Sales Promotion • Public Relations • Direct Marketing

25. Personal Selling • One of the oldest forms of promotion. • It involves using a sales force • May involve a “push” or “pull” strategy • Push – Encouraging to buy the product • Pull – Supporting retailers and providing after sales service

26. Personal Selling • Direct sales forces - Insurance and Finance • Costs a lot of money to hire and train a sales force

27. Personal Selling • Where satisfying the individual needs of the customer is paramount, personal selling is essential • In some situations the customer’s needs can only be satisfied by personal contact between buyer and seller: - special advice is required e.g. insurance - where special benefits are required - where negotiation on price is required

28. Personal Selling • It involves persuasive communication between buyer and seller • It’s designed to convince the consumer to purchase the products or services on offer • The objective is therefore to ‘make the sale’

29. Sales Promotion • Sales promotions are short-term inducements used to encourage customers to react quickly and make a purchase • Sales promotions can be given to the wholesaler/retailer or to the customer • There are 2 main types of sales promotions…

30. Into the Pipeline Promotions(Manufacturer to retailer) • Dealer Loaders (eg 6 for the price of 5) • Point of Sale materials • Dealer Competitions/Bonuses • Staff Training • Sale or Return • Credit Facilities

31. Out of the Pipeline Promotions(Retailer to customer) • Free Samples • Bonus Packs • Price Reductions • BOGOF • Demonstrations • Merchandising • Competitions • Coupons/Vouchers

32. Public Relations • Building goodwill between a business and its customers • Does this by: • Putting across positive messages • Changing negative opinions

33. Public Relations (cont) • Think of the Glasgow Commonwealth Games Bid • Can be very costly

34. Public Relations • The activities of an organisation which help it improve its image locally, nationally and internationally • Includes making donations to charities, event sponsorship, product endorsement, publicity materials, merchandising, press conferences and press releases • Staff must also deal with bad publicity with the aim to create positive publicity

35. PR Manager/Officer • Arranges press conferences • Deals with any bad publicity • Issues press releases • Organises charitable events • Liaises with celebrities regarding their endorsements

36. Direct Marketing • Direct Mail – “Junk Mail” • Mail Order catalogues – “Betterware” • Telemarketing – “Cold Calling” • Magazine Inserts

37. Packaging* Manufacturers need to consider: • Shape and weight • Protection • Convenience • Design • Product Information • Environmental Factors – recycling

38. Merchandising* • An attempt to encourage the customer to buy at the point of sale in shops and petrol stations • Display material like window displays, in-store posters will attract customers’ attention • Lighting and smells can also affect consumers’ buying decisions (bright lights to suggest cleanliness and bakery smells to make the customer hungrier)