the promotion strategy glencoe entrepreneurship: building a business developing a promotion strategy...

The Promotion StrategyThe Promotion Strategy

Glencoe Entrepreneurship: Building a Business

Developing a Promotion Strategy

Budgeting and Implementing Promotional Plans

12.1Section

12.2Section

1212

http://www.glencoe.com/




SECTION 12.112.1

Chapter 12 The Promotion Strategy

• Explain the role of the promotion strategy.• Explain how to formulate promotional plans.• Identify considerations for putting together a promotional mix.• Describe the elements of a promotional mix.

Section Objectives




SECTION 12.112.1


The promotion strategy is the most visible marketing strategy, designed to get the attention of prospective customers and convince them to buy from you.

Promotional activities must be in the right mix.

The Main Idea




SECTION 12.112.1


Content Vocabulary

imagepresellingcampaignpromotional mixadvertisingspecialty item

publicitynews releasepublic relationspremiumrebatesweepstakes




SECTION 12.112.1


As a new business owner, you need two kinds of promotional plans:

a preopening plan to lay the groundwork for your opening

a second plan to support your operation once it is under way

Drawing Up Promotional Plans




SECTION 12.112.1


Promotion is communication intended to persuade, inform, or remind a target audience about a business or its products.

The promotion strategy involves planning, determining the right promotional mix, and selecting specific promotional activities.

The Role of Promotion Strategy


Preopening Plan

7

Objectives of a Preopening Plan

Establish a positive image.

Let potential customers know you are opening for business.

Bring in customers or have them contact your business.

Interest customers in your new company and your products or services.



SECTION 12.112.1


The image you establish in your preopening plan sets the tone for your promotional plan.

image

the impression people have of a company; a company’s personality

Preopening Plan


Ongoing Plan

9

Objectives of an Ongoing Promotional Plan

Explain major features and benefits of your products.

Communicate information about sales.

Clear up customers’ questions and concerns.

Introduce new goods or services.



SECTION 12.112.1


An ongoing promotional plan helps in preselling your goods or services.

preselling

the act of influencing potential customers to buy before contact is actually made

Ongoing Plan




SECTION 12.112.1


Both a preopening and an ongoing plan can be organized around a promotional campaign, independent promotional activities, or a combination of the two.

campaign

a series of related promotional activities with a similar theme

Promotional Plan Format




SECTION 12.112.1


Every business has a unique promotional mix.

promotional mix

the combination of different promotional elements that a company uses to reach and influence potential customers

Selecting a Promotional Mix


Ongoing Plan

13

When selecting elements for a promotional mix, consider:

target market

product value

promotional channels

time frame

cost

The Elements of the Promotional Mix

14

PromotionalMix

publicity

sales promotion

personal selling

advertising

InternetMarketing



SECTION 12.112.1


In the United States, most businesses spend about one-fourth of their advertising dollars on newspaper ads.

advertising

the paid nonpersonal presentation of ideas, goods, or services directed at a mass audience by an identified sponsor by means of print and broadcast

Advertising


Advertising

16

newspapers magazines

direct mail

outdoor advertising

directories

transit advertisingtelevision

radio

Internet

specialtyitems

Types ofAdvertising



SECTION 12.112.1


A specialty item serves as a reminder of a business.

specialty item

an advertising device that includes giveaways, such as pens, T-shirts, and caps, printed with a business name or logo

Advertising




SECTION 12.112.1


Taking advantage of publicity means calling attention to yourself and your business.

publicity

placement in the media of newsworthy items about a company, product, or person

Publicity




SECTION 12.112.1


A news release should answer these questions: news release

a brief newsworthy story that is sent to the media

Publicity

? ? ?

? ?

Who? What? Where?

When? Why?




SECTION 12.112.1


Public relations may generate unsolicited publicity when such activities are reported by the media.

public relations

activities designed to create goodwill toward a business or control damage done by negative publicity

Publicity


Sales Promotion

21

Examplesof Sales

Promotion

displays

premiums

rebates samples

sweepstakes and contests



SECTION 12.112.1


One type of sales promotion may be to include a premium with a purchase.

premium

any item of value that a customer receives in addition to the good or service purchased; designed to attract new customers or build loyalty among existing customers, they may include coupons and gifts

Sales Promotion




SECTION 12.112.1


Some companies give a rebate on purchases.

rebate

a return of part of the purchase price of a product used as an incentive for customers to purchase the product

Sales Promotion




SECTION 12.112.1


A sweepstakes is a sales promotion that can draw attention to a business.

sweepstakes

a simple game of chance used by a business to get customers interested in what the company has to offer

Sales Promotion




SECTION 12.112.1


After You Read

1. Explain the role of the promotion strategy.

The role of the promotion strategy is to set the course for and coordinate all aspects of promotion. It involves planning, determining the right mix, and selecting specific activities.




SECTION 12.112.1


After You Read

2. Explain preopening and ongoing promotional plans.

Preopening promotional plans establish the company’s image, let customers know the business is opening, bring in customers, and create interest in the business so that the business will have customers when it opens. Ongoing promotional plans maintain and build sales after a business is open.




SECTION 12.112.1


After You Read

3. Describe considerations for putting together a promotional mix.

When selecting elements for a promotional mix, consider the target market, product value, promotional channels, time frame, and cost.




SECTION 12.112.1


After You Read

4. Describe the elements of a promotional mix.

The elements of the promotional mix are advertising, sales promotion, publicity, and personal selling.




SECTION


12.212.2

• Determine promotional costs for a start-up business.• Describe ways to implement your promotion strategy.• Examine options for short-term changes in your promotion

strategy.• Identify considerations for updating the promotion strategy.

Section Objectives




SECTION


12.212.2

Thorough planning and information gathering can help you arrive at a realistic promotional budget.

That budget will have a direct affect on how you implement your promotional plans.

The Main Idea




SECTION


12.212.2

Content Vocabulary

industry averagecooperative advertising

advertising agencyconsumer pretest




SECTION


12.212.2

To plan the promotional budget for a new venture, you must take these steps:

• Cost out promotional activities.• Compare industry averages.• Make final adjustments.

Budgeting for Promotion




SECTION


12.212.2

You can find out the industry average for promotional expenses from such sources as trade associations or the SBA.

industry average

the standard used to compare costs among companies; usually expressed as a percentage

Compare Industry Averages


Print

Radio

Television

Internet

Basic Media Formats

34

PrintInclude a headline, copy, illustrations, and a signature.

RadioInclude same elements as print, but can add music or sound effects.

TelevisionSame elements apply, but it requires casting, set design, sound, and filming.

InternetSame components as print, but may also have audio, video, and animation.



SECTION


12.212.2

You can carry out your promotional plans yourself, or you can hire professionals to implement some or all of your promotional activities.

Professional help can come from the media, manufacturers and suppliers, and advertising agencies.

Getting Help




SECTION


12.212.2

You may be able to save on your promotional budget by arranging for cooperative advertising.

cooperative advertising

an arrangement in which advertising costs are divided between two or more parties

Getting Help




SECTION


12.212.2

An advertising agency can handle all phases of your advertising, including writing the copy, creating the artwork, choosing the media, and producing the ad.

advertising agency

a company that acts as intermediary between a business and the media to communicate a message to the target market

Getting Help




SECTION


12.212.2

The three most common adjustments to the promotion strategy are:

Section 12.2 Budgeting and Implementing Promotional Plans

• adjust your advertising• generate publicity• promote sales

Making Possible Promotion Changes


Adjust Your Advertising

39

Factors for

Evaluation

market

media

budget

results

source

motives

messages

Section 12.2 Budgeting and Implementing Promotional Plans



SECTION


12.212.2

One way to reduce the risk involved in an expensive advertising campaign is to conduct a consumer pretest.

consumer pretest

a procedure in which a panel of consumers evaluates an ad before its release

Adjust Your Advertising




SECTION


12.212.2

Conduct a formal review of your promotion strategy on a regular basis.

Use your sales forecast to arrive at a promotional budget to support that level of sales.

Then revise your promotional mix promotion plan.

Revising the Promotion Strategy




SECTION


12.212.2

After You Read

1. Describe how to determine promotional costs for a start-up business.

Promotional costs for a start-up business are determined by costing out the planned activities, comparing the costs to industry averages, and adjusting the budget if necessary.




SECTION


12.212.2

After You Read

2. Describe approaches to implementing your promotional strategy.

Two approaches to implementing a promotion strategy are developing your own promotion items and hiring professionals to do the job.




SECTION


12.212.2

After You Read

3. Discuss options for short-term changes in your promotion strategy.

Options for short-term changes are increasing the effectiveness of your advertising expenditures, capitalizing on publicity opportunities, and stimulating sales through sales promotions or changes in the sales force.




SECTION


12.212.2

After You Read

4. Name considerations for updating the promotion strategy.

To update the promotional plan, consider the sales forecast for the upcoming period; make budget adjustments required by the forecast; and study changes in the target market, research results, and experiences to date. On the basis of those considerations, a new mix can be determined and a new plan developed.


The Promotion StrategyThe Promotion Strategy




12.1Section

12.2Section

1212

End ofEnd of

Chapter 12The Promotion Strategy




the promotion strategy glencoe entrepreneurship: building a business developing a promotion strategy...

Documents

promotion strategy promotion

promotion strategy section

promotion strategy budgeting

promotional mix slide

ongoing promotional

promotional campaign

right promotional mix

ongoing plan slide