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Module 7

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The Role of Marketing Communications Marketing Communications are the means

by which firms attempt to inform, persuade, and remind consumers-directly or indirectly- about the products and brands that they sell. In a sense, marketing communications represent the “voice” of the brand and are a means by which it can establish a dialogue and build relationships with the customer.

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Marketing Communications Mix

Advertising: Any paid form of nonpersonal presentation and promotion of ideas, goods, and services by an identified sponsor

Sales promotion: A variety of short-term incentives to encourage trial or purchase of a product or service

Events and experiences: Company-sponsored activities and programs designed to create daily or special brand-related interactions

Public relations and publicity: A variety of programs designed to promote or protect a company’s image or its individual product

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Direct marketing: Use of mail, telephone, fax, e-mail, or Internet to communicate directly with or solicit response or dialogue from specific customers and prospects.

Personal selling: Face-to-face interaction with one or more prospective purchasers for the purpose of making presentations, answering questions, and procuring orders.

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The Communication Process Models Macromodel Of The Communication Process

◦ Major parties: Sender and receiver◦ Major communication tools: Message and Media◦ Major Communication Functions: Encoding, Decoding,

Response, Feedback Micromodel Of Consumer Responses

◦ Response Hierarchy Models AIDA Model (Attention-Interest-Desire-Action) Hierarchy –Of-Effects Model (Awareness-Knowledge-Liking-

Preference-Conviction-Purchase) Innovation-Adoption Model (Awareness-Interest-Evaluation-

Trial-Adoption) Communications Model (Exposure-Reception-Cognitive

Response-Attitude-Intention-Behavior)

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Steps in Developing Effective Communications Identify the Target Audience

◦ The first step is to measure the target audience’s knowledge of the object, using the familiarity scale: Never heard of Heard Of Only Know a Little Bit

Know A Fair Amount Know Very WellRespondents who are familiar with the product can be asked

how they feel toward it, using the favorability scale:Very Unfavorable Somewhat Unfavorable Indifferent Somewhat Favorable Very Favorable

Determine the Communications Objectives◦ Brand Awareness◦ Brand Attitude◦ Brand Purchase Intention

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Design the Communications◦ Message Strategy◦ Creative Strategy: Creative Strategies are how

marketers translate their messages into specific communication Informational Appeals: It elaborates on product or service

attributes or benefits (example: Excedrin stops headache pain quickly)

Transformational Appeals: It elaborates on a non-product related benefit or image. It might depict what kind of person uses a brand (E.g: VW advertises to active, youthful people with their “Drivers Wanted” campaign)

◦ Message Source (Expertise, Trustworthiness, Likability)

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Select the Communications Channels◦ Personal Communications Channels (involves two

or more persons communicating directly face-to-face, person-to-audience, over the telephone, or through e-mail.)

◦ Nonpersonal Communications Channels are communications directed to more than one person and include media, sales promotions, events and publicity).

◦ Integration of Communication Channels

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Establish the Total Marketing Communications Budget◦ Affordable Method◦ Percentage-Of-Sales Method◦ Competitive-Parity Method◦ Objective-And Task Method

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Deciding on The Marketing Communications Mix◦ Advertising◦ Sales Promotion◦ Public Relations and Publicity◦ Events and Experiences◦ Direct Marketing◦ Personal Selling

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Factors in Setting the Marketing Communications Mix

Type of Product Market Buyer Readiness Stage Product Life-Cycle Stage

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Measuring Communication Results

Managing the Integrated Marketing Communications Process

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In the marketing context, Advertising has been defined :◦ ‘as any paid form of non-personal presentation

and promotion of ideas, goods or services by an identified sponsor.’

How does Advertising Persuade the Buyer?◦ Should be of Interest to the Audience◦ The Audience should Interpret the Message in the

Intended Manner◦ The Advertisement should Influence the Audience

Advertising

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Theories on Attitude Change◦ The Consistency Theories

The Consistency theories rest on the basic idea that man seeks consistency, balance and harmony in his belief system

◦ The Congruity Theory and the Dissonance Theory The Congruity theory lays stress on the nature of

relationship among the elements of the cognitive structure; the basic need is for balance, congruity and harmony. The dissonance theory also rests on the logic of ‘cognitive balance reasoning’.

◦ The Balance Theory: Any cognitive structure has three elements- an individual or a perceiver, another person who tries to interact and some object- and that there is a definite relationship among them

Attitude Change-A Central Theme In Advertising

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The source or the endorser◦ The credibility of the source◦ Likeability/Attractiveness of the source◦ The source’s approach to the views and disposition of the

audience The Message

◦ The Message structure Message sidedness Order of Presentation Stating conclusion in a message

◦ The Message appeal Rational appeals : It is generally woven around the specialities of

the product on offer. The intention is to use reason and logic to convince the audience.

Emotional appeals: They are woven around sensations

Factors in an Ad that bring about Audience Persuasion

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AIDA- the Four-Stage Model Innovation-Adoption Model

◦ Awareness◦ Interest◦ Evaluation◦ Trial◦ Adoption

Six-Stage Model (Lavidge and Steiner)◦ Awareness◦ Knowledge◦ Liking◦ Preference◦ Conviction◦ Purchase

DAGMAR (Defining Advertising Goals for Measured Advertising Results)

Some Useful Models

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Objectives and Task Approach

Percentage of Sales Approach

Competitive Matching Approach

Arbitrary Approach

Determining the Advertising Budget

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Main Steps in Copy Development ( The term ‘copy’ includes every single feature that appears in the body of advertisement. In the earlier days,’copy’ was used to refer only to the written matter. In present times, copy is an all-embracing term, covering all that appear in an advertisement- the written matter, pictures, designs etc◦ The Fact-Finding Stage (What is the central issue to

be tackled)?◦ The Idea Finding Stage (Interviewing, Synectics etc)

Deciding the Copy

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Developing the Copy: The term ‘copy’ has a very broad connotation: It refers to every single element that appears in an advertisement. However the major elements of a copy are: the message and the source. While developing the copy, it is essential to understand the various dimensions relating to these two factors.

Testing the Copy

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Media Commonly Used in Advertising◦ Outdoor Media (Hoardings, Posters, Neon Signs,

transit advertising, Fairs and exhibitions, etc)◦ The Print Media◦ Direct Mail◦ Audio/Visual/Audio-Visual/Electronic Media

TV Radio Cinema Cable TV The internet Cassetes-audio, video and CDs

Deciding the Media

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Considerations in Media Selection◦ Who are You Trying To Reach?◦ What are your Communication Objectives?

Media Characteristics◦ Exposure◦ Reach and Frequency

Reach denotes the total number of persons exposed to the given media vehicle at least once during the period under reference.

Frequency denotes the number of times the audience is exposed to the media vehicle during this period

◦ Weighing Reach and Frequency Against Costs◦ Measuring TV Viewership

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Impact of the Media◦ Media Class-Source Effect and Media Vehicle-Source

Effect Media Scheduling (Media category, media vehicles,

programme choice, timing etc) Evaluating Advertising Effectiveness

◦ Evaluating How Far the Communication Task has been Accomplished

◦ Evaluating How Far the Sales Task has been Accomplished Advertiser-Ad Agency Relation

◦ The advertising job has become so complex and large that normally no business firm chooses to handle the function directly. They employ advertising agencies.

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Communication-effect Research: it seeks to determine whether an ad is communicating effectively◦ Consumer feedback method asks consumers for their

reactions to a proposed ad.◦ Portfolio test ask consumers to view or listen to a

portfolio of advertisements.◦ Laboratory tests use equipment to measure

physiological reactions- heartbeat, blood pressure, pupil dilation etc- to an ad; or consumers may be asked to turn a knob to indicate their moment-to-moment liking or interest while viewing sequenced material.

Evaluating Advertising Effectiveness

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Sales-Effect research:◦ A company’s share of advertising expenditures

produces a share of voice (i.e., proportion of company advertising of that product to all advertising of that product) that earns a share of consumers’ minds and hearts and, ultimately, a share of market.

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Public Relations is one of a firm’s corporate affairs activities. The goal of public relations is to track public attitudes, identify issues that may elicit public concern, and develop programs to create and maintain positive relationships between a firm and its stakeholders.

It can be used to promote the firm, its people, its ideas, and its image and can even create an internal shared understanding among employees.

Public Relations

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Public relations involves a variety of programs designed to promote or protect a company’s image or its individual products

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Publications: Companies rely extensively on published materials to reach and influence their target markets. These include annual reports,brochures,articles, company newsletters and magazines etc

Events: Companies can draw attention to new products or other company activities by arranging special events like news conferences, seminars, trade shows etc that will reach the target publics

Major Tools in Marketing PR

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Sponsorships: Companies can promote their brand and corporate name by sponsoring sports and cultural events and highly regarded causes

News: One of the major tasks of PR professionals is to find or create favorable news about the company, its products, and its people, and get the media to accept press releases and attend press conferences.

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Speeches: Increasingly, company executives must field questions from the media or give talks at trade association or sales meetings, and these appearances can build the company’s image.

Public- Service Activities: Companies can build goodwill by contributing money and time to good causes

Identity Media: Companies need a visual identity that the public immediately recognizes. The visual identity is carried by company logos, stationery, brochures, signs, business cards, buildings, uniforms, dress codes, etc.

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“ A sales person is an individual acting for a company by performing one or more of the following activities: prospecting, communicating, servicing, and information gathering.” (Philip Kotler)

Personal selling is the direct personal presentation by company sales force for sales and building customer relationship.

Personal Selling And Sales force Management

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Personal selling is paid personal communication that attempts to inform customers about products and persuade them to purchase those products.

The goal of Personal Selling typically involves finding prospects, informing prospects, persuading prospects to buy, and keeping customers satisfied through follow-up service after the sale. To effectively deliver on these goals, salespeople have to be not only competent in selling skills but also thoroughly trained in technical product characteristics.

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It enhances the customer’s confidence in the seller

It promotes long-term business relations through personal intimacy

It provides a human touch to business transactions

It helps facilitate the seller to understand each customer’s needs and preferences more clearly

It helps satisfy a customer by modifying the product as per the customer’s choice and preference

Important Aspects of Personal Selling

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Personal selling followed by personal service helps build long-term relations between the business and the customer

It helps keep up the competition in the market, based on product customization as per customer’s preferences

It is a powerful and effective tool in convincing the customer about the product

Through personal selling the time lag between introducing a product through the media and actual selling is reduced

It provides prospective customers with a better understanding of the product and an interactive opportunity to liaise with the sales personnel

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Salesmanship is one of the skills used in personal selling. It is the art of successfully persuading prospects or customers to buy products or services from which they can derive suitable benefits, thereby increasing their total satisfaction. Salesmanship is a seller-initiated effort that provides prospective buyers with information and other benefits, motivating or persuading them to decide in favour of the seller’s product or service.

Salesmanship

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Know the Product Know the Company Know the Competition Know the Customers Know the Process Of Selling Know Own Self

Knowledge Needs of Successful Sales Persons

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Enthusiasm Patience Initiative Self-confidence Job commitment Customer orientation Independence Self-motivation Excellent listening skill Friendliness Persistence Attentiveness

Traits or Qualities of a Successful Sales Person

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Honesty Relationship orientation Discipline Hardworking nature Team spirit

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According to the AIDAS theory, during the personal selling interview, the prospective buyer’s mind passes through the five successive mental stages shown below. The buyer goes through these stages consciously, so the sales person should lead the buyer through them in the right sequence if a sale is to result◦ A-Attention◦ I-Interest◦ D-Desire◦ A-Action◦ S-Satisfcation

AIDAS Theory of Selling

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Prospecting and Qualifying: Prospecting is the process of identifying prospects or potential buyers and eliminating non-prospects. Success in selling depends on approaching the right potential buyers. The sales person may have to approach many prospects to get just a few sales. The sales person should also know how to qualify the leads, i.e., identifying the good ones and screening out the unwanted ones. Qualifying the prospects can be done by studying their financial background, volume of business, special needs, location and scope for growth.

Pre-approach: The sales person has to do his homework before meeting the prospect. He should learn as much as possible about the organization and its buyers, as a pre-approach. The salesperson should set call objective. Another task is to decide on the best contact approach, which might be a personal visit, a phone call, or a letter. Finally, the sales person should plan an overall sales strategy for the account.

Major Steps in Effective Selling

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Approach: The sales person should know hoe to meet and greet the buyer appropriately and get the relationship off to a good start. His appearance, opening lines of conversation and the follow up remarks are important in this step

Presentation and Demonstration: The sales person presents the product to the buyer through the ‘product story’, explaining its attributes, customer benefits and how the product could solve the customer’s problems.

Overcoming Objections: Customers typically pose objections during the

presentation or when asked for the order. Psychological resistance includes resistance to interference, preference for established sources or brands, reluctance to giving up something, predetermined ideas, dislike of making decisions etc

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Logical resistance might consist of objections to the price, delivery schedule, or certain product or company characteristics.

The sales person should handle objections with a positive approach, seek out hidden objections, ask for clarifications, convert the objections into opportunities to explain more about the product and its benefits, and turn objections into reason for buying.

Closing: Once the objections are handled properly, the sales person tries to persuade the prospect to take the buying decision, i.e., closing the sale. Sales persons should know how to recognize closing signals from the buyer, which includes body language, comments and questions. The sales person can ask for the order, summarise points of agreement, offer to help to write the purchase order, ask whether the buyer wants this model or that one, etc

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Follow –Up and Maintenance: This is necessary if the salesperson wants to ensure customer satisfaction and repeat business. The sales person should follow up the sales and ensure that there is proper installation, instruction on usage and servicing arrangements. Such follow up actions would reveal any problems, assure the customer of the sales person’s interest, and reduce any dissonance that might have arisen in the buyer’s mind, after the purchase.

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According to American Marketing Association, Sales promotion can be defined:◦ ‘ In a specific sense, sales promotion includes

those sales activities that supplement both personal selling and advertising, and coordinate them and make them effective, such as displays, shows, demonstrations and other non-recurrent selling efforts not in the ordinary routine.’

Sales Promotion

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According to Philip Kotler, “Sales promotion consists of short-term incentives to encourage purchase or sales of a product or service. Whereas advertising and personal selling offer reasons to buy a product or service, sales promotion offers reasons to buy now.”

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For facilitating introduction of new products For overcoming a unique competitive situation For unloading accumulated inventory For overcoming seasonal slumps For getting new accounts For retrieving lost accounts As a support and supplement to the

advertising effort As a support and supplement to the

salesmen’s effort

Sales Promotion serves a variety of Marketing Needs which are:

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For persuading salesmen to sell the full line of products

For persuading the dealer to buy more/ increase the size of the orders

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Sales promotion aimed at consumers is termed Consumer Promotion

Sales promotion in business markets is known as Trade Promotion. By targeting channel intermediaries with promotional activities, manufacturers hope to push their products through the channel by increasing sales and encouraging increased effort among their channel partners.

Types of Sales Promotion

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A Push Strategy involves the manufacturer using its sales force and trade promotion money to induce intermediaries to carry, promote, and sell the product to end users. A Pull Strategy involves the manufacturer using advertising and promotion to persuade consumers to ask intermediaries for the product, thus inducing the intermediaries to order it.

Push-Pull Strategies of promotion

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Demonstrations◦ Demonstration at retail store◦ School demonstration◦ Door-to-door demonstration◦ Demonstrations to key people

Trade Fairs and Exhibitions Coupons, Premiums, Free Offers, Price-Offs, etc

◦ Coupons are certificates which offer price reductions to consumers for specified items.

Free samples (Free samples are offered to persuade consumers to try the product)

Joint promotion (Two or more firms from different industries, but with shared markets and values, join together and conduct sales promotion programmes)

Commonly Used Tools and Techniques of Sales Promotion

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Contests Display Gifts ( Companies also distribute gifts to

customers, dealers and influential and key people. These gifts include pen, calendars, diaries, table decorations, etc. gifts normally carry the company’s name and logo).

Sales promotion on the Internet

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Direct marketing is the use of consumer-direct channels to reach and deliver goods and services to customers without using middlemen. These channels include direct mail, catalogs, telemarketing, interactive TV, kiosks, Web sites, and mobile devices.

Direct marketing is defined as direct communications with carefully targeted individual consumers to obtain an immediate response and cultivate lasting customer relationships.

Direct Marketing

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Direct marketing requires a sound customer database- an organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic and behavioural data. Such database is used to locate good potential customers, tailor products and devices to the special needs of target buyers, and maintain long-term customer relationships.

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Direct marketing has different forms like tele-marketing, direct mail, catalogue sales, direct-response TV marketing, kiosk marketing and online marketing. Tele-marketing uses the telephone to sell directly to customers. Direct mail consists of the company sending an offer through mail to buyers at their address. Catalogues are sent through mail to buyers in catalogue marketing. TV is used as medium in direct response TV marketing. Kiosks are information and ordering machines placed in stores, airports, etc. Online marketing is done through the Internet.

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Advantages Of Direct Marketing◦ Focused Approach◦ Cost Effective◦ Measurable and Attributable◦ Immediate and Flexible◦ Ability to Test, Retest and measure the Impact of

Variables◦ Easy International reach◦ Tailored Messages◦ Opportunity to Build a Database

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Disadvantages Of Direct Marketing◦ Competition to existing Intermediaries◦ Intrusive marketing : Many customers perceive

direct marketing as an intrusion in their life and work. Especially tele-marketing practices are often found to be intruding into the life of customers and creating irritation among customers.

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Electronic business, commonly referred to as "eBusiness" or "e-business", or an internet business, may be defined as the application of information and communication technologies in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business. Electronic commerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses.[

The term "e-business" was coined by IBM’s marketing and Internet teams in 1996.

E-Business

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M-commerce (mobile commerce) is the buying and selling of goods and services through wireless handheld devices such as cellular telephone and personal digital assistants (PDAs). Known as next-generation e-commerce, m-commerce enables users to access the Internet without needing to find a place to plug in. The emerging technology behind m-commerce, which is based on the Wireless Application Protocol (WAP), has made far greater strides in Europe, where mobile devices equipped with Web-ready micro-browsers are much more common than in the United States.

M-Commerce