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Classes 23 &24 Marketing Concepts Cohen UNCC

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Communication
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process of conveying a message to others
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Source
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company/person with information to convey
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Message
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information sent by a source
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Channel of communication
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who/what conveys the message, e.g. salesperson, advertising media, public relations tool Receiver = consumer who reads, sees, hears the message
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Encoding
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process of having the sender transform an idea into a set of symbols
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Decoding
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process of having the receiver interpret the message
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Field of experience
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mutually shared understanding that will facilitate appropriate understanding of messages
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Response
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reactions of receiver after receiving message
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Feedback
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part of the receiver’s response communicated back to the sender
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Noise
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interference with effective communication/interpretation
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Product life cycle
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course of a product’s sales & profits over its lifetime
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Channel strategies
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selection of the most effective channel(s) to communicate the message to the target market
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Promotional objectives
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what the communication/message aims to accomplish, e.g. use of models ranking progressive stages of consumer awareness-action, like AIDA or AIETA models
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Promotional budget setting
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how much to spend on each element of the promotion mix
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Product placement
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consumer sales promotional tool that uses a brand-name product in a movie, TV show, video game, or commercial for another product
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Owned Social Media
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conversations on social media you control
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Earned Social Media
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conversations on social media outside your control
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5 tactical elements of the Marketing Communications Mix
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1)advertising 2)public relations 3)direct marketing 4)personal selling 5)sales promotion
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advertising
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includes print, broadcast, Internet, outdoor, etc.;
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public relations
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includes press releases, sponsorship, special events
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direct marketing
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includes catalogs, telemarketing, kiosks, Internet (again), etc.;
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personal selling
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includes sales presentations, trade shows, incentive programs
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sales promotion
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includes p.o.p., premiums, discounts, coupons, etc.
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Two major factors are changing today’s marketing communications:
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1)Huge improvements in information technology are propelling movement toward segmented marketing. 2)Shift away from mass marketing to focus on micro-markets.
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ADVERTISING
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any paid form of non-personal communication about an organization, a product, service, or an idea, by an identified sponsor
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2 types of advertising:
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1. product advertisements 2. institutional advertisements
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Product advertisements
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focus on selling product/service
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Institutional advertisements
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aims to build goodwill or an image for an organization; often used to support public relations plan or counter adverse publicity
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reach
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number of different people/households exposed to an ad
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frequency
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number of times person in target audience is exposed to ad
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rating
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% of households in market tuned to particular TV show or radio station; this is ‘reach’ for radio & TV
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gross rating points
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reach (as % of total market) x frequency = commonly used reference number to judge success of campaign
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cost per thousand (CPT)
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cost of reaching 1000 individuals/households with ad message in a given medium
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Advocacy advertisements
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– state position of a company on an issue
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Pioneering
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(informational) – inform the target market
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Pioneering advertisements
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– announce what an organization is, what it can do, where it is located, etc.
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Competitive (persuasive)
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– persuade target market to choose our brand over others
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Competitive advertisements
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promote the advantages of one product over another e.g. America’s milk processors & dairy farmers promote milk over other beverages
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Reminder
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reinforce previous knowledge of product
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Developing the Advertising Program
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1)Identify the target audience 2)Specify advertising objectives 3)Set the advertising budget 4)Design the advertisement – message content – create the message 5)Select the media – reach & frequency 6)Schedule advertising 7)Pre-test 8)Execute – full-service agency / limited service agency / in house 10)Post-test 11)Make changes
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Media options
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1)TV 2)Radio 3)Magazines 4)Newspapers 5)Yellow pages 6)Internet 7)Outdoor 8)Direct mail
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TV
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communicates with sight & sound; reaches 98.9% US households very expensive; perishable; complexity hard
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Radio
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low cost; target specific local audiences; use sound, humor, & intimacy effectively no visual
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Magazines
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target specific audiences; high quality color; long life ads; can convey complex info long lead times; relatively high cost; compete with magazine feature articles
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Infomercials
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program-length (30-minute) advertisements that provide educational communication to potential customers e.g. Nutrisystem, Bowflex; highly successful infomercial run by Barack Obama in last presidential campaign – attracted 33.5 million viewers
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Radio
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is a segmented medium; > 14,000 radio stations in the US
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PERSONAL SELLING
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2-way communication between buyer & seller, designed to influence the purchase decision
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Sales management
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planning the selling program, and implementing and evaluating the company’s personal selling effort
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Customer sales support
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= help sales efforts of order getters
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Missionary salespeople
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promote products and introduce new products; don’t usually sell directly themselves; especially in pharmaceutical industry
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Team selling
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cross-functional team work, especially in complex technological situations; specialized knowledge is needed
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Closing
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getting the order from the customer
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Sales quota
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specific sales goals assigned to a salesperson, team, branch office, etc, for a stated time period
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Sales plan
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statement of what sales are to be achieved, and where and how salespeople will be deployed
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Key account management
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team selling focus on important customers, in order to foster long-term relationship
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Emotional intelligence
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ability to understand one’s own emotions and the emotions of people with whom one interacts daily
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Sales Force Training & Motivation
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Sales force Training Sales force Motivation Compensation
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Publicity
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non-personal, indirectly paid presentation of an organization, product or service; most frequently-used public relations tool
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Publicity tools
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methods of obtaining non-personal presentation of an organization, product or service without direct cost; e.g. news releases, news conferences, public service announcements
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Advantage
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credibility
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Disadvantage
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lack of control
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SALES PROMOTION
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short-term incentives to stimulate interest in buying a product or service
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Coupon
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discounted price encourages consumer trial; 89% US consumers use coupons; they work despite lower revenues
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Deal
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short-term price reductions to induce trial; e.g. ‘two-fer’ (2 for the price of one)
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Premium
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merchandise offered free or at significant discount; customers are encouraged to return more often or to use more product
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Contest
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consumers apply skill to win prizes
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Sweepstakes
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games of pure chance
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Samples
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free product or product at greatly reduced price; often used for new products; ‘trial size’ is smaller than regular size
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Loyalty programs
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tool to encourage repeat purchases by promising rewards as purchases accumulate; credit card reward programs are very successful in the US; rewards customizable
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Point of purchase (POP)
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free-standing display usually in high-traffic area and usually holding product; designed to maximize exposure and encourage impulse purchases
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Rebates
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return of money offered on proof of purchase; customer must take time and trouble to apply for rebate by mail; this discourages many customers, so redemption rate is low
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Product placements
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brand-name products used in movies, TV shows, video games; integration into these shows confers authenticity
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Allowances
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reimbursement for retail support on proof of performance
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Discounts
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reduction of price, usually for finite period
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Cooperative advertising
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manufacturer contributes to retailer’s advertising expenses, often 50%, up to a certain $ limit
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Sales force training
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manufacturer trains reseller’s sales force, in order to be more effective in selling its products; also participate in incentive and recognition programs
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DIRECT MARKETING
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using direct communication with carefully targeted individual consumers to generate an immediate response and cultivate long-term customer relationships
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Direct orders
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result of offers containing all info necessary for prospective buyer to make purchase decision, and complete transaction
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Lead generation
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result of offer intended to generate interest in product/service, and request additional info
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Traffic generation
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outcome of offer to motivate people to visit a business
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PUSH strategy
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directs marketing activities at resellers, to make customer aware at point of purchase, e.g. p.o.p. displays
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PULL strategy
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encourages the customer to seek out your brand, to stimulate customer demand, e.g. advertising, mass media, word of mouth
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AIDA
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Awareness,Interest,Desire,Action
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Awareness:
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Ran a PR campaign four months prior to launch, promoting award, stylists, qualifications etc. and was reinforced through a direct marketing campaign to targeted customer groups.
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. Interest
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Executed a direct mail campaign to offer a free consultation or hair cut and finish. They used research to support that this would work, as females are loyal if the offer is compelling.
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Desire:
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Close to the opening of the new salon, they ran exclusive local launch events which was advertised through local press and social media. This created a local buzz for ‘people wanting an invite’ and excited to see the new salon.
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. Action
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Clear CTAS (calls to action) were positioned on the Facebook site (call to reserve), the website (call to book) and local advertising (call in to receive discount or the offer).
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Social Media
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online media where users submit comments, photos, videos, often accompanied by a feedback process to identify popular topics