Mkt - 423_ Test 1
Mkt - 423_ Test 1 MKT 4230
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This 27 page Study Guide was uploaded by Allie S on Monday February 8, 2016. The Study Guide belongs to MKT 4230 at Clemson University taught by Dr. Knowles in Spring 2016. Since its upload, it has received 118 views. For similar materials see Promotional Strategy in Marketing at Clemson University.
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Date Created: 02/08/16
▯ MKT 423 Promotional Strategy ▯ ▯ Ch. 1 ▯ Marketing ▯ What IS Marketing (pg 7) Activity, set of instruction and Processes FOR: o Creating (product), communicating (promotion), delivering (placement), and exchanging (price) offers that have VALUE for customers, clients, partners, and society at large ▯ Exchange: o Involves parties with: Each person has something of value to one another Desire and ability to give up something to the other party – have to want and be able to give up something Need a way to Communicate between the two parties Value: o Customer’s perception of benefits of a product/service against the costs The balance between costs and benefits o Benefits functional, experiential, and/or psychological Functional Benefits what capabilities/features does the product have Ex: water – thirst-quenching effect on someone thirsty Experiential benefits New ways to extend/enrich a campaign Psychological benefits How something makes you feel o Ex: safe, cool, luxurious o Costs Ex: Money, making a purchase, learning to use it, maintaining it, disposing of product Time, effort, psychic, sensory, opportunity loss cost ▯ Marketing Mix Four P’s o Product – physical goods, benefits, or service o Price – the costs o Placement – distribution, logistics o Promotion – how you are marketing product To develop an effective marketing mix, marketers must: o Be knowledgeable – know issues surrounding product/market; know customers/target market o Combine the elements – know how o Analyze market and use data – to ^^^ ▯ ▯ Integrated Marketing Communications (IMC) Bundling marketing mix in a way to give a “face” to a branded product o Contemporary perspective, changing environment o Ongoing strategic business process ▯ Goal: generate Short-term financial returns, but want to BUILD long-term brand equity and shareholder value ▯ Criticism - Inside-out marketing approach ▯ Tools: o Social Media, Email Marketing, Multi-media Marketing, Print Media and direct mail, video, PR ▯ Promotional Mix Coordination of all seller-initiated efforts to: o Set up channels of information and persuasion o Sell goods and services or promote an idea The TOOLS that accomplish an prganization’s communication objectives ▯ *** A DM DI S PR PS ▯ ▯ Advertising Any paid form of non-personal communication about an organization, product, or service From an identified sponsor Benefits of Advertising Cost-effective Builds brand equity ▯ ▯ Advertising Classification 1. National 2. Primary 3. Selective 4. Retail/local ▯ Primary Advertising o Primary-demand = general product class/industry Appeals to the masses Selective Advertising o Selective-demand = specific company’s brand Meant for a select target market Retail/Local Advertising o Specific, local store National Advertising o Specific company, but advertised nationally, indiscriminatively o Done by big companies, just need people to remember them ▯ ▯ Advertising to Business and Professional Markets Business to business o B2B o Targets individuals who buy/influence purchase of industrial goods/services for their COMPANIES Company X using GE’s electric or AT&T phone services Professional Advertising o Targets professionals/encourages them to use a company’s products in their Business operations Ex: medical magazines in a Dr. Office Trade Advertising o Target Marketing channel members, encouraging them to stock/produce/resell the manufacturer’s branded products Similar to whole sale/resellers Target selling McCormick brand spices ▯ ▯ Direct Marketing Communicating directly with target customers to generate a response and/or a transaction Important terms: o Database management o Direct selling o Telemarketing o Direct-response advertising ▯ ▯ Digital/Internet Marketing Interactive media o Users can participate in and modify the information they receive in real time Social Media o Online means of communication and interactions Mobile Marketing o Messages delivered to a consumer’s location or consumption situation Advantages: + Interactive + Measurement ▯ ▯ Sales Promotion Marketing activities that provide extra value or incentives to the: o Sales Force o Retailers o Ultimate consumer 2 Categories: Consumer-oriented Couponing, sampling, premiums, rebates, contests, sweepstakes, POP materials Encourages an IMMEDIATE Purchase Trade-oriented Promotional/merchandising allowances, price deals, sales contests, trade shows Wholesalers, distributor, retailers Publicity Nonpersonal communications regarding an organization or its offering not directly paid for or run under identified sponsorship o Advantage + High credibility and low cost o Disadvantages - Not always under the control of an organization - Negative stories are highly damaging o News stories, articles, etc. o NOT PAID FOR by own company ▯ Public Relations Tools used to evaluate public attitudes o Identifies policies and procedures o Systematically plans and distributes info Attempts to manage the public’s image of their company ▯ ▯ Personal Selling Person-to-person communication with intent to: o Sell/Purchase o Act on an idea o Tailoring messages o Immediate and precise feedback ▯ Contact/Touch points – Every opportunity a customer has to see or hear about a company and/or its brands or have an encounter or experience with i ▯ Ch. 2 ▯ Marketing and Promotions Process Model ▯ ▯ ▯ Marketing and Promotions Process Model ▯ 1. Marketing Strategy and Analysis Strategic Marketing Plan Why have this plan? o To make better decisions, formulating specific marketing programs and policies, allocating resources Where does it come from? o From an Organization’s OVERALL Corporate strategy plan 1) Opportunity Analysis – Where are we needed, where can we expand to, The 3 components for opportunity analysis: i. Favorable demand ii. Needs and opportunities are not being satisfied iii. Firm can compete effectively – no monopolies already in place 2) Competitive Analysis – how the competition is doing - Analyze the competition and look for a potential Competitive advantage Competitive advantage – attributes that give a firm an edge over competitors Added incentive to your brand/product Better advertising, prices, services added, CSR 3) Target Market Selection - ▯ Identify Markets o has direct implications on a firm’s advertising efforts o Based on the OPPORTUNITY ANALYSIS Favorable demand Needs and opportunities are not being satisfied Firm can compete effectively Determining Market Segmentation o Dividing a market into distinct groups, easily grouped o 2 Necessary components: common needs who respond similarly to a marketing situation o Customer characteristics vs. Buying situations Buying situations Outlet type – discount store, whole foods type Usage – do you use a lot of product, heavy users Benefits sought – what are they looking for Awareness and intentions – Behavioral involvement – minimal effort person? Criteria o Geographic segmentation: Markets are divided into different geographic units o Demographic segmentation: Dividing the market on the basis age, sex, family size, education, income, and social class o Psychographic segmentation: Dividing the market on the basis of personality, lifecycles, and/or lifestyles o Socioeconomic segmentation: Monetary background, class level Selecting Target Market o Determine WHICH segments offer Most potential o Determine how MANY segments you which to enter Marketing Coverage Strategies Undifferentiated Marketing Ignoring segment differences and offering just one product or service to the entire market Differentiated Marketing Involves marketing in a number of segments, developing separate marketing strategies for each Concentrated Marketing Selecting a segment and attempting to capture a large share of this market Positioning o Fitting a product/service to one or more segments of the broad market to make it unique within the marketplace o Approaches: Attributes and benefits Set apart by extra features and attributes Salient attributes = aspect of a product by which the consumer tends to judge a product by o Very noticeable and obvious Price/Quality Expensive and well made products Inexpensive and OK products Use/Application Enter based on a particular use or application Product Class Positions AGAINST a product in another category 7-up as the alternative to cola Busses vs. airplanes Substitutes Competitor AT&T vs. Verizon, Mac vs. PC, Prego vs. Ragu Cultural Symbols Makes the brand easily identifiable and differentiated from others Repositioning Altering a product/brands position due to: Declining or stagnant sales Anticipated opportunities in other market positions Difficult to accomplish People tend to remember the old brand and it conflicts o Promotional PUSH Strategy Programs designed to persuade the trade to stock, merchandise and promote a MANUFACTURER’S Product Push the product through the supply chain to the consumer o Pull Spending money on advertising and sale promotion efforts direct toward the ultimate consumer Advertising to the consumer and then letting the consumer demand the product of the wholesalers/retailers Price Decisions Price variable - Refers to what the consumer has to give in exchange for a purchase o Factors that determine price o Costs o Demand factors o Competition o Perceived value o Product quality o Advertising ▯ ▯ Ch. 4 ▯ Perspectives on Consumer Behavior ▯ ▯ Consumer Behavior Process and activities people engage in with relation to products and services to satisfy their needs and desires o Searching and selecting o Purchasing and using o Evaluating o Disposing – environmental consciousness ▯ ▯ ▯ ▯ Each stage in the Consumer Decision-making Process is paired with a psychological component ▯ ▯ 1. Problem Recognition – Motivation Consumer perceives a need and gets motivated to solve the problem Caused by a difference between consumer’s ideal state and actual state Sources o Out of stock o Dissatisfaction, new needs or wants o New products, related products or purchases o Marketer-induced problem recognition Motives: Factors that lead a consumer to take action o Need to understand reasons underlying purchases Maslow’s Hierarchy of Needs ▯ Psychoanalytic Theory o Influenced modern psychology and explanations of motivation and personality o Applied to the study of consumer behavior o Deep motives can only be determined by probing the subconscious ID = Pleasure, immediate response Super Ego = morality, higher thinking Ego = reality construct, mediator between ID and Super Ego ▯ ▯ Methods used to probe the mind of the consumer ▯ ▯ ▯ 2. Information Search – Perception Personal searches/word-of-mouth – friends, family Internet sources Personal experience Public sources – articles/magazines/reports – News Marketer-controlled – Commercial sources Receiving, selecting, organizing, and interpreting info to create a meaningful picture of the world Depends on: o Internal factors o Characteristics of a stimulus ▯ Selective Perception o Filtering o Selective COMPREHENSION Interpreting info on the basis of their Own ATTITUDES, beliefs, motives, etc. Interpret in a way that supports their own agendas/beliefs What their attitudes allow them to take away from your message o Selective Retention Consumers do not remember everything Choose to remember what they want to/found meaning in What they remember o Selective exposure Consumer choose whether or not to make themselves available to the information What they are available to o Selective attention Consumer chooses to focus attention What they focus on o Subliminal Perception Ability to perceive a stimulus that is below the conscious awareness – unaware ▯ ▯ 3. Alternative Evaluation – attitude formation comparing the brands one has identified as being capable of: Solving the consumption Problem Satisfying the needs or motives o EVOKED SET – subset of ALL the brands customer is aware of o Inept Set – unfit o Inert Set - …. Size depends on: o Importance o Time and Energy Spent ▯ Evaluative criteria: Dimensions or attributes of a product that are used to compare different alternatives o Objective or subjective o Viewed as product or service attributes Functional consequences: Concrete outcomes of product or service usage o Tangible and directly experienced by consumers ▯ Attitude Formation o Learned predispositions to respond to an object o Theoretically summarize a consumer’s evaluation of an object o Represent positive or negative feelings and behavioral tendencies ▯ ▯ 4. Purchase Decision - Integration An outcome of the alternative evaluation o Brand loyalty – a preference for la particular brand Integration o Becomes a part of the consumer’s lifestyle/integrated ▯ ▯ ▯ 5. Post-Purchase Evaluation – Learning Assessing: o Satisfaction o Dissatisfaction Learning = a change in behavior resulting from the interaction between a person and stimulus o Conditioning = UNINTENTIONAL Learning Just involved in daily activities Can ENHACE consumer comprehension of your message Encourages repeat behaviors Help promote self efficiency/navigate stimuli o Two types of conditioning: Classical Instrumental o Classical conditioning- Learning by Association o Unconditional stimulus – stimulus that Naturally triggers a response o Unconditional Response – natural response o Conditioned stimulus – becomes associated with an Unconditional stimulus through conditioning/pairing This will trigger the natural response via unconditioned stimulus, but over time, the conditional stimulus will also o Conditional response – learned response to conditioned stimulus Mind/body connection Natural occurring paired/manipulated with the conditioned Instrumental conditioning- Behavior is conditioned through reinforcement or rewards – not just association o Positive reinforcement – rewarding desired behavior Ex: loyalty cards o Punishment – demonstrate negative results of behavior Fear ▯ Ch. 5 ▯ Models of Communication/ the response Process ▯ ▯ Communication – passing of info, exchanging of ideas, process of establishing a commonness or onesness of thought between a sender and receiver ▯ ▯ Basic model of communication Sender – the communicator/SOURCE Encoding – putting thoughts/ideas/info into symbolic form o the message represented by words, symbols, pictures/represent the message Message – contains info/meaning the source hopes to convey o Marketers must determine the content/structure/design Channel – travelling of the message o Non-personal – directed at mass media o Personal – word-of-mouth, Buzz marketing (consumer- generated marketing/viral) Receiver – the other party o Decoding – transforming the sender’s message back into thought Response/feedback o Viral marketing – propagating marketing-relevant messages through the help and cooperation of individual consumers Factors affecting success Message characteristics Individual sender or receiver characteristics Social network characteristics Seeding – determining the initial group that will start the diffusion of your intended message Encoding ▯ ▯ ▯ ▯ The Response Process ▯ ▯ 3 stages: ▯ Cognitive stage- awareness, understanding of the product ▯ Affective stage- feeling associated with the product ▯ Behavioral/conative stage – call to action, purchase, adoption behaviors ▯ ▯ ▯ AIDA – from Personnel selling AIDA gets customer to make a purchase decision o Attention – salesperson must capture attention o Interest – need a level of intrigue o Desire – desire to purchase product over others o Action – purchase ▯ ▯ Hierarchy of effects model – “Purchase Funnel” Methodically reduces the number of products by evaluating alternatives Measures effectiveness of advertising o Awareness – generate awareness o Knowledge – comprehend message o Liking – affective component o Preference – over other models, narrowing down o Conviction – similar to a loyalty o Purchase – decision ▯ Innovation Adoption Model – for new products New products for adoption o Awareness – of new product; demonstration of product o Interest o Evaluation – based on demonstration/actual use o Trial – noncommittal o Adoption – commitment stage ▯ ▯ Information Processing – Presentation – exposure Attention – recognition, grabbed Comprehension – understanding the message Yielding – accepting the information/message and LIKING it Retention – retain info/recall Behavior – purchase (Alternative Response Hierarchy) Three-orders Model of Info Processing ELM Elaboration Likelihood Model o Focuses on the differences in the ways consumers process and respond to persuasive messages o Attitude formation or change process o Depends on the amount and nature of elaboration that occurs in response to a persuasive message o Elaboration likelihood is a function of: o Motivation o Ability
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