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10-07--Promotion - University of Southern California...

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University of Southern California Marshall School of Business BUAD 307 Lars Perner, Ph.D., Instructor Marketing Fundamentals Fall, 2007 SUMMARY OF CLASSROOM MATERIAL INTEGRATED MARKETING COMMUNICATION AND PROMOTION BACKGROUND Integrated Marketing Communication (IMC) involves the idea that a firm’s promotional efforts should be coordinated to achieve the best combined effects of the firm’s efforts. Resources are allocated to achieve those outcomes that the firm values the most. Promotion involves a number of tools we can use to increase demand for our The most well known component of promotion is advertising, but we can also use tools such as the following: Public relations (the firm’s staff provides information to the media in the hopes of getting coverage). This strategy has benefits (it is often less expensive and media coverage is usually more credible than advertising) but it also entails a risk in that we can’t control what the media will say. Note that this is particularly a useful tool for small and growing businesses— especially those that make a product which is inherently interesting to the audience. Trade promotion . Here, the firm offers retailers and wholesalers temporary discounts, which may or may not be passed on to the consumer, to stimulate sales. Sales promotion. Consumers are given either price discounts, coupons, or rebates. Personal selling . Sales people either make “cold” calls on potential customers and/or respond to inquiries. In-store displays. Firms often pay a great deal of money to have their goods displayed prominently in the store. More desirable display spaces include: end of an aisle, free-standing displays, and near the check-out counter. Occasionally, a representative may display the product. Samples
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Premiums A chart in the text discusses characteristics of each method. PROMOTIONAL OBJECTIVES AND EFFECTIVENESS Generally, a sequence of events is needed before a consumer will buy a product. This is known as a “hierarchy of effects.” The consumer must first be aware that the product exists. He or she must then be motivated to give some attention to the product and what it may provide. In the next stage, the need is for the consumer to evaluate the merits of the product, hopefully giving the product a try. A good experience may lead to continued use. Note that the consumer must go through the earlier phases before the later ones can be accomplished. Promotional objectives that are appropriate differ across the Product Life Cycle (PLC). Early in the PLC— during the introduction stage— the most important objective is creating awareness among consumers. For example, many consumers currently do not know the Garmin is making auto navigation devices based on the global position satellite (GPS) system and what this system can do for them. A second step is to induce trial — to get consumers to buy the product for the first time. During the growth stage, important needs are persuading the consumer to buy the product and prefer the brand over competing ones. Here, it is also important to persuade
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