IMD 227

Promotion of Information Products and

Services

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 Definition - Promotion
•Communication by marketers that informs, persuades,
and reminds potential buyers of a product in order to
influence an opinion or elicit (extract) a response
(McDaniel, Lamb & Hair, Introduction to marketing)

•The act of informing or reminding consumers about a

specific product or a brand
(Madura, Jef. Introduction to business)

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 Background of Promotion
• Used to supplement the other marketing strategies.

• The purpose of promotion:

1. To make consumer aware of a new product
2. To remind consumers the product exists
3. To remind consumers the product’s qualities and the advantages it
offers
4. To induce consumer to purchase a specific products
5. To protect a product’s image and retain its market share

‘
Effective promotion should increase demand for the product
and generate a higher level of sales

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 Objectives of Promotion
• The goals and tasks of promotion can be divided into three:
» Inform the target audience

» Persuade the target audience

» Remind the target audience

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 • Increasing the awareness of a new brand,
Informative product class, or product attribute
• Explaining how the product works
Promotion • Suggesting new uses for a product
• Building a company image

• Encouraging brand switching

Persuasive • Changing customers’ perceptions of product
attributes
Promotion • Influencing customers to buy now
• Persuading customers to call

• Reminding consumers that the product may

Reminder be needed in the near future
• Reminding consumers where to buy the
Promotion product
• Maintaining consumer awareness
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 Promotion Objective
• Objectives must be made based on the stages of buying
readiness called hierarchy of effects
• The stages are:
– Awareness: to build familiarity with the product and the brand
name
– Knowledge: goes beyond awareness, therefore enterprise has
to find a way to quickly and easily inform consumers how its
service is unique
– Liking: promotion can be used to move knowledgeable
audience from being indifferent to liking a brand
– Preference: distinguishing among brands such that the market
finds your brand more attractive than alternatives
– Conviction: entails the actual decision or commitment to
purchase
– Purchase: to obtain repeat purchase or building loyalty among
customers who have purchased a product Chapter 1
 Promotional Mix
 Most promotional strategies use several ingredients to reach a target
market which is called promotional mix

 Promotional mix is the combination of promotional tools used to reach

the target market and fulfill the organization’s overall goals

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 Promotion Methods/ Promotion
Mix
There are four promotional mix:
• Advertising
• Personal Selling
• Sales Promotion
• Public Relations

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ADVERTISING

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 Advertising
• A non-personal sales presentation communicated through media
or non media forms to influence a large number of consumers.
• Impersonal, one-way mass communication about a product or
organization that is paid for by a marketer
• Reasons for / Type of advertising
Brand advertising
Comparative advertising
Reminder advertising
Institutional advertising
Industry advertising

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 Medium for Advertising
• Newspapers • Telemarketing
• Magazines • Outdoor Ads
• Radio • Transportation Ads
• Television • Specialty Ads
• Internet
• Direct Mail

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 IMD202
Advertising : Hierarchy of effect model
6 sequence of making a purchase :-

1. wareness

2. nowledge

3. iking

4. reference

5. onviction

6. urchase

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 Brand Advertising
“Non-personal sales presentations about a specific brand”

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 Brand Advertising IMD202

Comparative Advertising

To persuade customers to
purchase a specific product by
demonstrating a brand’s superiority
by comparing with another
competing brands

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Brand Advertising
Reminding Advertising

To remind consumers of a
product’s existence

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Institutional Advertising
“A form of advertising designed to
enhance a company’s image rather
than a particular product”

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Industrial Advertising
“A form of advertising that touts the
benefits
of a specific product or service”

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 Advertising: Types of Advertising Appeal (approach)

Fear
Humor
Sex
Music
Rationality
Emotions
Scarcity

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PERSONAL
SELLING

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 Personal Selling
• A personal sales presentation used • Steps a salesperson should
to influence one or more follow to make personal selling:
consumers. It requires a personal
effort to influence a consumer’s 1. Identify the target market
demand for a product 2. Contact potential customers
3. Make sales presentation
• Direct communication between a 4. Answer question
sales person and one or more 5. Close the sale
prospect buyer in attempt to 6. Follow up
influence them to buy

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 SALES
PROMOTION

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 Sales Promotion
 The set of activities that is intended to influence consumers

 Generally, it is a short-run tool used to stimulate immediate

increases in demand

 Can be an effective means of encouraging consumers to

purchase a specific product

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 Sales Promotion
• The set of activities that is intended to influence consumers

Strategies:
1. Rebates
2. Coupons
3. Sampling
4. Displays
5. Premium

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 Sales Promotion
Sales Promotion Strategies
Rebates Firm sends refund directly to consumers after product is
purchased
Coupons Product is sold at a discounted price to consumers with coupons
Sampling Free samples of products are distributed to consumers
Displays Products are placed in a prominent area in stores
Premiums Gifts or prizes are provided free to consumers who purchase a
specific product

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Sales Promotion

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 PUBLIC
RELATIONS

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Public Relations
Refers to actions taken with
the goal of creating or
maintaining a favorable
public image

Enhance the image of a

product or of the firm

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 Public Relations
Public Relation Departments Function:-

1. Press Relation
2. Product Publicity
3. Corporate Communication
4. Public Affairs
5. Lobbying
6. Employee and investors
7. Crisis Management

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 Public Relations
1. Press Relation – placing positive, newsworthy information
in the news media to attract attention to a product, a service
or a person associated with the firm or institution

2. Product Publicity – publicizing specific product or service

3. Corporate Comm. – creating internal & external messages to

promote a positive image of the firm or institution

4. Public Affairs – building or maintain national or local

community relation

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 Public Relations
5. Lobbying – influence legislators or government officials to
promote or defeat legislators or regulators

6. Employee and investors relations – maintaining positive

relationship with employees, shareholders and others

7. Crisis Management – responding to unfavorable publicity or

negative events

Publicity is public information about

a company, good, or service
appearing in the mass media as a
news item

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 Public Relations
• Action taken with the goal of creating or
maintaining a favorable public image
• Three types of public relations strategies:
1. Special event
2. News Releases
3. Press Conferences

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 Public Relations : Special
Events
-Also known as Event Sponsorship
-Some company used event sponsorship to attract consumer

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 Public Relations : News
Release
-A brief written announcement
-About a firm
-Provided by the firm

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 Public Relations : Press
Conference
-An oral announcement
-About a firm
-Provided by the firm

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Promotional Strategies
PRODUCT LIFE
CYCLE

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 Promotional Strategies
PRODUCT LIFE
CYCLE
 Introduction stage
 The launch of new product into the marketplace

 Growth stage
 Stage where sales increase at increasing rate

 Maturity stage
 Stage where sales increase at decreasing rate

 Decline stage
 Drop in sales Chapter 1
 Product Life Cycle
• Introduction Stage: Customers are not
aware of the product’s features, nor
do they understand how it will benefit
them.
60

• Growth Stage: Customers are aware

Maturity
50

of the product’s benefit. The product is

40 selling well and middlemen want to
handle it.
30 Growth
20
• Maturity Stage: Competition
intensifies and sales level off.
Introduction
10
Decline
• Decline Stage: Sales and profit are
declining. New and better products
0

are coming to the market.

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 Factors Affecting the
Promotional
1. Nature of the product
Mix
- Unit value, degree of customization,pre/post sale services.
2. Stage in the product life cycle
3. Target market characteristics
4. Objective of the promotion effort
5. Available funds
6. Push and pull strategies

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 Reference
Madura, Jeff. Introduction to Business. 2nd ed. United States
of America: South-Western College Publishing, 2001.
Etzel, Michael J., Walker, Bruce J., and Stanton, William
J. Marketing. 12th ed. Boston: McGraw Hill/Irwin, 2001.
Lamb, Charles W., Joseph F. Hair and Carl D. McDaniel.
Marketing. 6th ed. USA: South-Western Publishing, 2001

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