PowerPoint by:Ray A. DeCormier, Ph.D.Central Connecticut State UniversityChapter 13:

Business Marketing Communications:Advertising and Sales Promotion0

Advertising and sales promotion supplements personal selling efforts. This chapter considers:

The powerful role of social media can assume in business marketing strategyThe decisions that must be made when forming a business advertising programThe business media options, including the powerful role of Internet marketing communicationsWays to measure business advertising effectivenessThe role of trade shows in the business communications mix and how to measure trade show effectiveness0

IntroductionBusiness has learned that not even the best products sell themselves.

Benefits, problem solutions and cost efficiencies need to be sold through effective communications to everyone from users to influencers to decision makers.

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Due to

Product complexities (technical),The small number of buyers,The high price products/services, andExtensive negotiation process

The primary communications vehicle for selling Industrial/Business products/services is the:

SALESPERSON! 0

There is a need for other non-personal requisites such as:

AdvertisingCatalogsInternet presenceTrade showsPromotional spending

All have a unique way of getting the message out, however, they dont close deals as well as personal selling!0

*Channels of the social web where prospects and businesses communicate across diverse platformsKey Platforms:Discussion ForumsBlogsWikiSocial Networks

* Monitor what prospects are saying about the company Capture interest from prospects looking for products Coordinate follow-up to social media interactions

Several blogs in five languages

Sponsor several online communities

Support forums: find answers to laptop questions

Online community for consumers to post innovative ideas for Dell to consider

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Customer Decision JourneyThe CDJ is the customers decision process in selecting a particular product Often find a mismatch between media used and the touch points at which buyers are best influencedCDJ includes two critical stepsInspiration: use online channels to find, create and compareSharing: relate experiences using a variety of social media

Key: Customer experience includes everything from discussions on social media to meetings with sales people. Social media facilitate targeted, personalized contact across the customer experience landscape0

Be an integral part of an integrated communication programs

Enhance sales effectiveness

Increase sales efficiency

Create awareness

Create preferences for company, products, etc.

Facilitate interactive marketing communications0

Integrated Communication Programs

Integrated Communications is the intertwining of all communication methods to include:AdvertisingSales PromotionOnline MediaPublic RelationsPersonal Selling

Of these promotional techniques, personal selling is most important in B2B marketing!0

ENHANCING SALES EFFECTIVENESS

Combining advertising and personal selling makes the selling job easier and more efficient.

People who were aware of the ad thought the salesperson was more knowledgeable than companies that dont advertise.

Profits and gross margins also increase when advertising is employed.0

Advertising increases efficiency in two ways:Serves as a reminderInforms the market about new products/developments

Advertising is pennies when compared to $100s for a sales call.0

Business advertising creates:

AwarenessBrand preferenceConviction that a brand will meet their requirements & hopefullyFacilitate purchase*0

The Internet has created a two-way communication process, permitting the marketer and customer to more rapidly exchange information.

This flexibility has allowed the marketer to personalize communications and customize solutions.

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Effective B2B communication needs to be integrated among all media methods; however, it does have its limitations. It:

Cannot create product preference for many products.Cannot close a sale!Cannot substitute for personal selling. Can supplement personal selling but not replace it.

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Advertising is only one aspect of an entire marketing strategy.

The advertising decision process begins with formulating advertising objectives.

Equally important: selection and evaluation of media. The Decision Stages: Developing Business-to-Business Advertising ProgramFigure 13.10

Defining Advertising ObjectivesMarketing managers realize:

Advertisings mission flows directly from the overall marketing strategy.Advertisings job is to:Create awarenessProvide informationInfluence attitudesRemind buyers about product and company

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ADVERTISING OBJECTIVESAdvertising objectives must be:RealisticMeasurableSpecific outcomes during specific times

Example: To be effective, the advertising campaign shall increase awareness from 15% to 30% during the period from April 1st to June 31st.0

One objective of advertising is to reach influentials who are often difficult to contact via personal selling.

Influentials are interested in specific features and attributes that solve certain problems. Advertising needs to focus upon that issue.

Marketers must understand who the target market is and how to reach them for an advertising campaign to be effective.0

Creative Strategy StatementsProvide guidelines for the company and advertising agency to position (or reposition) the product.

All creative efforts should include:CopyThemeColor, design, etc.MediaTactics0

Managers tend to employ the following rule of thumb:

Allocate some percent of sales to advertising

However, this is a dysfunctional rule!

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Advertisings purpose is to inform and influence sales, but it is not to create sales.

A dysfunctional policy of tying advertising budgets to % of sales defeats the purpose.

For example: If there are no sales, then is there no advertising budget? If sales are declining, do you cut advertising costs too?

Does that make sense?0

A better approach for allocating advertising costs is to relate them to advertising objectives.

The Objective-Task Method focuses on the communications effects of advertising

Not on the sales effects.

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Establish objectives in terms of sales volume, market share, profit contribution and market segments.

Assess all communication functions to realize these objectives.

Define specific measurements required to meet these objectives such as market share.

Estimate the budget needed to accomplish them.

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How much is enough?

Advertising costs is like owning an old gold mine. It can return millions, or be a bottomless pit.

The only way to assure success is to establish and measure against goals.

Another matter is the political side of the decision. The concern here is that internal politics often determine budgets, not the technique-driven process.

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Passing the ThresholdIn order for a message to be heard, it is necessary to repeat it often.

Of course, the question is: How often?

Research suggests that advertising must pass through a certain threshold before a meaningful message can be understood by the market to move product from awareness to preference. 0

Passing the ThresholdA small budget is not enoughA large budget is like throwing money away

Because budgeting advertising is so important, marketing managers should:1. Set clear objectives2. Evaluate tasks required3. Compare costs against industry norms4. Allocate a proper budget5. Design an effective advertising message0

DEVELOPING THE MESSAGEThree Considerations:

Perception

Benefits focus

Understanding buyer motivations0

Developing B2B Advertising Message

Determine advertising objectivesEvaluate target audiences buying criteria Analyze most appropriate language, format and style to present message.Then consider the message!0

PERCEPTION, PERCEPTION, PERCEPTIONIn business, perception is almost the same as truth.

The message needs to attract the right person.

In most cases, that is the decision maker.

For an advertising messages to be considered, it has to: Attract the right persons attention, & Be interpreted properly.

For example, techies respond to technical ads and non-techies respond better to non-technical ads.

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Industrial buyers focus on solutions to business problems that considers:

A better way to accomplish tasks

A less expensive way to manufacture something

A new approach to either make or save the company money

A different way to free up time

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Of all the challenges, this is one of the most difficult to understand.

Understanding the buyer is a very complex matter because the standard rules change as the environment changes.

One way to address this problem is to employ marketing research to delineate influencers criteria for buying in each segment.0

Effective AdsEffective ads are:

LogicalRationalProvide a clear description of the productPresent product benefits clearlyDetails product qualityProvide performance measures0

B2B media are selected by target audiences

Should we use trade publications, direct mail, Internet or all of them?

What is the best way to spend advertising money to generate the desired response (customer contacts)?0

Shifting of Advertising to Digital FormB2B marketers are always looking for ways to communicate better with customers & prospects.

Use of Internet microsites (specialized web pages that prospects jump to from an email or PR piece that contain videos) is providing excellent results.

Use of online videos help customers and prospects from around the world solve their business problems.

Videos are particularly effective for telling the story and producing serious leads.0

Using proper key words or key phrases within the site is an absolute necessity for driving leads to that site. Ideas for successful Internet advertising include:

Make sure site is search-crawler friendlyGood key words must tie into solutions soughtCreate a relevant, targeted keyword list that reflects problem, product, etc.Write clear, compelling ads that use key words and isolate your value propositionTrack results and measure everything

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Business PublicationsThere are more than 2700 business publicationsselecting the right ones is another difficult task.

Horizontal Publications are directed at the specific task, function or technology regardless of industry.

Vertical Publications are oriented to readers in a specific industry.0

Business PublicationsMany trade publications are requester publications. This is where the reader is interested in a certain subject and receives a certain publication for free in exchange for demographic information such as title, function and buying responsibilities.

Advertisers know who their desired audience are!0

Cost of AdvertisingCompanies need to allocate an advertising budget for:

Business PublicationsSales PromotionsDirect Marketing (mail & e-mail)Internet Advertising

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Include:

Cost/1000 contact is one consideration

Circulation based on the TARGET audience

Does the medium also have Internet viewing?

Frequency and scheduling is another complicated issue0

Direct Mail is commonly used for:

Image, product and service promotionSales force support by providing leadsDistribution channel communicationsGetting pertinent information directly to influencials

Direct mail is efficient providing the list is good.Much direct mail is considered junk mail.0

Direct mail is 10 times more expensive than e-mail

E-mail campaigns often yield more responses and results are quickerExample: 1/3 of all responses were generated within 24hrs.

Many firms integrate their CRM programs with e-mail

Many firms provide an e-mail alert service and/or an e-mail newsletter0

In order to successfully accomplish this, it is important to have all the systems in place first.

They include:E-mail acknowledgementsOrder entryOrder fulfillmentMoney exchangesFollow-up contactQ&A serviceTroubleshooting systems0

Rarely do ads result in immediate business.But, it does create awareness hopefully leading to preference.Measurements can be direct or indirect.Direct communication is measured by: percent awareness.Indirect communications are measured by: word-of-mouth and understood perceptions.0

Sound measurement program entails substantial advanced planning.

The advertising strategist must determine: What is to be measuredHow to measure itIn what sequence

Establish benchmarks in pre-evaluation phaseFive Primary Areas for Evaluating AdvertisingFigure 13.20

KnowledgeRecognitionRecallAwarenessPreferenceMotivation

It is not always possible to measure effects on actual sales.0

Trade ShowsAnother important form of promotion is trade shows.

Effective selling message can be delivered to a relatively large and targeted audience at one time.

Firm can identify potential clients and provide sales personnel with qualified leads.

Trade shows can also be used to introduce new products.

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Customers can get hands-on experience with product in one-on-one selling situation.

Company can enhance general goodwill.

Company often benefits from free publicity.

Trade shows allow competitors to look at each other.

International business can be facilitated resulting in quicker entry into foreign markets.

Many sales are also made at these shows too!

Cost of meeting prospects is around $250 which is much less than making a personal sales call.0

Trade-Show Communications StrategyTo develop an effective trade show communications strategy, certain questions need to be addressed:

What functions should trade show perform in total marketing communications program?To whom should trade show marketing effort be directed?What is companys appropriate communication mix at the show?How should trade show investments be audited?0

Trade Show ObjectivesDiscover decision influencers.Identify potential customers.Provide company product, service and information.Try to discover product application problems.Create sales.Handle customer problems.Build corporate image.Gather competitive intelligence.Enhance sales force morale.

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Challenge Question: What trade show to attend?

Answer: Attend trade shows that are attended by prospective customers.

To find trade shows, use leading trade show directories such as:American Trade Show DirectoryExhibitNet.com databaseExhibit Surveys, Inc.0

SELECTING/EVALUATING TRADE SHOWSExhibit Surveys, Inc. publishes data on:

Net Buying InfluencesMeasures percentage of show audience that have decision authority for product types being exhibited

Total Buying PlanMeasures percentage of audience planning to buy exhibited products within 12 months0

Lead GenerationTrade shows are probably most important for lead generation.

Attaining leads is so important to companies because without them, a company cannot survive.

There is a natural turnover of customers so a company has to constantly be looking for new business.

Its just a way of life.0

Trade shows are different than personal selling even though one is selling never-the-less.

The trade show is more theatrical, and contact is very short (5-10 min.), therefore the process is to:

Sell the product first,Sell the company next,Sell the salesperson last.

This is opposite to traditional selling situations.0

Flows Tactical ActivitiesShow AttendeesTarget AudienceAttracted To BoothContact w/SalespersonSales LeadsPre-Show &At-ShowImpersonalPromotionalActivitiesPersonal Promotional ActivitiesSource: Gopalakrishna & Lilien, A Three-Stage Model of Industrial Trade Show Performance, Working Paper #20, Marketing Science 14 (Winter 1995) :pp.22-420

Measuring the SuccessCompanies need to set measurable goals in advance of the trade show including:

Number of leadsLikely effect on salesPotential effect on new accountsEffect on corporate imageExpenditures that tie into an adequate ROI

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