UNIVERSITI KUALA LUMPUR

MALAYSIAN INSTITUTE OF INDUSTRIAL TECHNOLOGY

(UNIKL-MITEC)

WBD11303 – PRINCIPLES OF MARKETING

LECTURER: SIR DONNAVAN

Assignment

Due Date

Group

14 April 2015

Prepared By

Siti Fatimah Zahra Binti Abdul Hamid 57175113085

For Lecturer Used Only

Receive Date : Percentage (%) Achievement

Format

Contents

Effort

Submission

Total

Remarks Standard format use Executive summary attached and relevant with the task

TABLE OF CONTENTS

1.0 Introduction ..........................................................................................................................1

2.0 Promotion Mix Tools ...........................................................................................................2

2.1 Advantages and Disadvantages of the Promotional Mix ..............................................3

2.2 Personal Selling .............................................................................................................4

2.3 Public Relation ...............................................................................................................7

2.4 Advertising ...................................................................................................................10

2.5 Sales Promotion ..........................................................................................................16

2.5.1 Pull and Push Strategies ...............................................................................19

3.0 CONCLUSION ..................................................................................................................21

REFERENCES ..............................................................................................................................22

1

1.0 Introduction

A business' total marketing communications programme is called the "promotional mix" and

consists of a blend of advertising, personal selling, sales promotion and public relations tools.

In this revision note, we describe the four key elements of the promotional mix in more detail.

It is helpful to define the four main elements of the promotional mix before considering their

strengths and limitations.

Promotion mix is the process of communication between the company that sells the product

and the potential customer, with the purpose of influencing the attitudes and behavior. There

are specific promotional tool that are supporting chosen promotional goal. The promotion mix

represents a combination of different promotional tools. The basic elements of promotional

mix are Advertising, Public Relationship, Personal Sales and Sales Promotion.

All activities and efforts to be made in order to increase sale quantity as whole is called

promotion mix. It is a combination of promotional tools such as personal selling, advertising,

sales promotion, publicity and public relations. In other word, the task of operating different

activities to persuade consumer as whole is called promotional mix. It provides information

about price, quality, feature etc. of the products to the target customers. According to the W.J.

Stanton, “An organizational combination of personal selling, advertising, advertisement, sales

promotion, public relation and publicity to help in achieving its objective is its promotional

Mix.

Market Goals

Marketing Mix

ProductPricePromotion

Promotion Mix

Advertising

Public Relation

Personal Sales

Sales Promotion

Place

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2.0 Promotion Mix Tools

Promotion is one out of four basic instruments of marketing that has the purpose to inform

about other instruments of marketing mix and to contribute to sales increase on the long term.

The promotion is always serving to specific goal. These goals can be public informing, demand

increasing, product differentiation, and product value increasing or sales stabilizing. Usually

the promotion is targeting more than one goal.

Promotion is the process of communication between the company that sells the product

and the potential customer, with the purpose of influencing the attitudes and behavior. There

are specific promotional tool that are supporting chosen promotional goal. The promotion mix

represents a combination of different promotional tools. The basic elements of promotional

mix are Advertising, Public Relationship, Personal Sales and Sales Promotion.

In marketing, the promotional mix describes a blend of promotional variables chosen by

marketers to help a firm reach its goals. It has been identified as a subset of the marketing mix.

It is believed that there is an optimal way of allocating budgets for the different elements within

the promotional mix to achieve best marketing results, and the challenge for marketers is to

find the right mix of them. Activities identified as elements of the promotional mix vary, but

typically include the following:

Promotion Mix Tool

Personal Selling

Public Relation

Advertising

Sales Promotion

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2.1 Advantages and Disadvantages of Each Element of the Promotional Mix

Mix Element Advantages Disadvantages

Advertising Good for building awareness

Effective at reaching a wide audience

Repetition of main brand and product

positioning helps build customer trust

Impersonal - cannot answer all a

customer's questions

Not good at getting customers to

make a final purchasing decision

Personal

Selling

Highly interactive - lots of

communication between the buyer and

seller

Excellent for communicating complex

/ detailed product information and

features

Relationships can be built up -

important if closing the sale make take

a long time

Costly - employing a sales force has

many hidden costs in addition to

wages

Not suitable if there are thousands of

important buyers

Sales

Promotion

Can stimulate quick increases in sales

by targeting promotional incentives

on particular products

Good short term tactical tool

If used over the long-term,

customers may get used to the effect

Too much promotion may damage

the brand image

Public

Relations

Often seen as more "credible" - since

the message seems to be coming from

a third party (e.g. magazine,

newspaper)

Cheap way of reaching many

customers - if the publicity is achieved

through the right media

Risk of losing control - cannot

always control what other people

write or say about your product

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2.2 Personal Selling

Personal selling can be defined as follows:

Personal selling is oral communication with potential buyers of a product with the

intention of making a sale. The personal selling may focus initially on developing a

relationship with the potential buyer, but will always ultimately end with an attempt

to "close the sale" Personal selling is one of the oldest forms of promotion. It involves

the use of a sales force to support a push strategy (encouraging intermediaries to buy

the product) or a pull strategy (where the role of the sales force may be limited to

supporting retailers and providing after-sales service).

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Main roles of the sales force.

Prospecting

• trying to find new customers

Communicating

• with existing and potential customers about the product range

Selling

• contact with the customer, answering questions and trying to close the sale

Servicing

• providing support and service to the customer in the period up to delivery and also post-sale

Information gathering

• obtaining information about the market to feedback into the marketing planning process

Allocating

• in times of product shortage, the sales force may have the power to decide how available stocks are allocated

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Advantages •Personal selling is a face-to-face activity; customers therefore obtain a relatively high degree of personal attention

•The sales message can be customized to meet the needs of the customer

• The two-way nature of the sales process allows the sales team to respond directly and promptly to customer questions and concerns

• Personal selling is a good way of getting across large amounts of technical or other complex product information

• The face-to-face sales meeting gives the sales force chance to demonstrate the product

• Frequent meetings between sales force and customer provide an opportunity to build good long-term relationships

Disadvantages •The cost of employing a sales force

•A business needs to provide incentives to achieve sales

•The equipment to make sales calls (car, travel and subsistence costs, Mobile phone etc).

•A sales person can only call on one customer at a time. This is not a cost-effective way of reaching a large audience.

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2.3 Public Relation

The Institute of Public Relations defines public relations as follows:

“The planned and sustained effort to establish and maintain goodwill and mutual

understanding between an organization and its publics”

What is meant by the term “publics” in the above definition?

A business may have many “publics” with which it needs to maintain good relations

and build goodwill.

For example, consider the relevant “publics” for a publicly-quoted business engaged

in medical research:

• Employees • Shareholders • Trade unions• Members of the “general public”

• Customers (past and present)

• Pressure groups• The medical

profession• Charities funding medical research

• Professional research bodies

and policy-forming organizations

• The media• Government and

politicians

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Public relations techniques

There are many techniques available to influence public opinion, some of which are

more appropriate in certain circumstances than others:

Consumer communication

Customer press releases

Trade press releases

Promotional videos

Consumer exhibitions

Competitions and prizes

Product launch events

Celebrity endorsements

Web sites

Business communication

Corporate identity design

Company and product videos

Direct mailings

Web site

Role of public relation

Identify the relevant publicsInfluence the opinions of

those publics by:

Reinforcing favorable opinions

Transforming perhaps neutral opinions into positive ones

Changing or neutralizing hostile opinions

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Trade exhibitions

Internal / employee communication

In-house newsletters and magazines

Intranet

Notice boards

Employee conferences

Email

External corporate communication

Company literature (brochures, videos etc.)

Community involvement programmes

Trade, local, national and international media relations

Financial communication

Financial media relations

Annual report and accounts

Meetings with stock market analysts, fund managers etc

Shareholder meetings (including the annual general meeting)

Given the wide range of techniques used in public relations, how is it possible

to measure the effectiveness of public relations?

- It is actually quite difficult to measure whether the key messages have been

communicated to the target public. In any event, this could be quite costly since it

would involve a large amount of regular research. Instead, the main measures of

effectiveness concentrate on the process of public relations, and include:

a. Monitoring the amount of media coverage obtained (press cuttings agencies play

a role in keeping businesses informed of this)

b. Measuring attendance at meetings, conferences

c. Measuring the number of enquiries or orders received in response to specific

public relations efforts.

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2.4 Advertising

Advertising is the promotion of a company’s products and services carried out

primarily to drive sales of the products and services but also to build a brand identity

and communicate changes or new product or services to the customers. Advertising has

become an essential element of the corporate world and hence the companies allot a

considerable amount of revenues as their advertising budget. There are several reasons

for advertising some of which are as follows:

Thus, several reasons for advertising and similarly there exist various media which can

be effectively used for advertising. Based on these criteria there can be several branches

of advertising. Mentioned below are the various categories or types of advertising:

Reasons for advertising

Increasing the sales of the

product/serviceCreating and

maintaining a brand identity or brand

image.

Communicating a change in the existing

product line.

Introduction of a new product or

service

Increasing the buzz-value of the

brand or the company.

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i. Printing Advertising (Newspapers, Magazines, Brochures, and Fliers)

The print media have always been a popular advertising medium. Advertising

products via newspapers or magazines is a common practice. In addition to this, the

print media also offers options like promotional brochures and fliers for advertising

purposes. Often the newspapers and the magazines sell the advertising space

according to the area occupied by the advertisement, the position of the advertisement

(front page/middle page), as well as the readership of the publications. For instance

an advertisement in a relatively new and less popular newspaper would cost far less

than placing an advertisement in a popular newspaper with a high readership. The

price of print ads also depend on the supplement in which they appear, for example

an advertisement in the glossy supplement costs way higher than that in the

newspaper supplement which uses a mediocre quality paper.

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ii. Outdoor Advertising (Billboards, Kiosks, Tradeshows and Events)

Outdoor advertising is also a very popular form of advertising, which makes use of

several tools and techniques to attract the customers outdoors. The most common

examples of outdoor advertising are billboards, kiosks, and also several events and

tradeshows organized by the company. The billboard advertising is very popular

however has to be really terse and catchy in order to grab the attention of the

passersby. The kiosks not only provide an easy outlet for the company products but

also make for an effective advertising tool to promote the company’s products.

Organizing several events or sponsoring those makes for an excellent advertising

opportunity. The company can organize trade fairs, or even exhibitions for

advertising their products. If not this, the company can organize several events that

are closely associated with their field. For instance a company that manufactures

sports utilities can sponsor a sports tournament to advertise its products.

iii. Broadcast advertising (Television, Radio and the Internet)

Broadcast advertising is a very popular advertising medium that constitutes of several

branches like television, radio or the Internet. Television advertisements have been

very popular ever since they have been introduced. The cost of television advertising

often depends on the duration of the advertisement, the time of broadcast (prime

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time/peak time), and of course the popularity of the television channel on which the

advertisement is going to be broadcasted. The radio might have lost its charm owing

to the new age media however the radio remains to be the choice of small-scale

advertisers. The radio jingles have been very popular advertising media and have a

large impact on the audience, which is evident in the fact that many people still

remember and enjoy the popular radio jingles.

iv. Covert Advertising (Advertising in Movies)

Covert advertising is a unique kind of advertising in which a product or a particular

brand is incorporated in some entertainment and media channels like movies,

television shows or even sports. There is no commercial in the entertainment but the

brand or the product is subtly (or sometimes evidently) showcased in the

entertainment show. Some of the famous examples for this sort of advertising have

to be the appearance of brand Nokia which is displayed on Tom Cruise’s phone in

the movie Minority Report, or the use of Cadillac cars in the movie Matrix Reloaded.

- Sony VAIO

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v. Surrogate Advertising (Advertising Indirectly)

Surrogate advertising is prominently seen in cases where advertising a particular

product is banned by law. Advertisement for products like cigarettes or alcohol which

are injurious to heath are prohibited by law in several countries and hence these

companies have to come up with several other products that might have the same

brand name and indirectly remind people of the cigarettes or beer bottles of the same

brand. Common examples include Fosters and Kingfisher beer brands, which are

often seen to promote their brand with the help of surrogate advertising.

- Kingfisher

vi. Public Service Advertising (Advertising for Social Causes)

Public service advertising is a technique that makes use of advertising as an effective

communication medium to convey socially relevant messaged about important

matters and social welfare causes like AIDS, energy conservation, political integrity,

deforestation, illiteracy, poverty and so on. David Oglivy who is considered to be one

of the pioneers of advertising and marketing concepts had reportedly encouraged the

use of advertising field for a social cause. Oglivy once said, "Advertising justifies its

existence when used in the public interest - it is much too powerful a tool to use solely

for commercial purposes”. Today public service advertising has been increasingly

used in a non-commercial fashion in several countries across the world in order to

promote various social causes. In USA, the radio and television stations are granted

on the basis of a fixed amount of Public service advertisements aired by the channel.

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- Campaign for Smoking can make bad impact to children.

vii. Celebrity Advertising

Although the audience is getting smarter and smarter and the modern day consumer

getting immune to the exaggerated claims made in a majority of advertisements, there

exist a section of advertisers that still bank upon celebrities and their popularity for

advertising their products. Using celebrities for advertising involves signing up

celebrities for advertising campaigns, which consist of all sorts of advertising

including, television ads or even print advertisements.

-David Beckham (player football as liaison for perfume)

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2.5 Sales Promotion

A good definition of sales promotion would be as follows:

“An activity designed to boost the sales of a product or service. It may include an

advertising campaign, increased PR activity, a free-sample campaign, offering free

gifts or trading stamps, arranging demonstrations or exhibitions, setting up

competitions with attractive prizes, temporary price reductions, door-to-door calling,

telemarketing, and personal letters on other methods”.

More than any other element of the promotional mix, sales promotion is about

“action”. It is about stimulating customers to buy a product. It is not designed to be

informative – a role which advertising is much better suited to. Sales promotion is

commonly referred to as “Below the Line” promotion. Sales promotion can be directed

at:

• The ultimate consumer (a “pull strategy” encouraging purchase)

• The distribution channel (a “push strategy” encouraging the channels to stock the

product). This is usually known as “selling into the trade”

Price Promotion Coupons

Competition

and Prizes

Gift with purchase

Frequent user / loyalty

incentives

Money Refunds

Point-of-sales display

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i. Price Promotion

Price promotions are also commonly known as” price discounting”

These offer either (1) a discount to the normal selling price of a product, or

(2) more of the product at the normal price.

Increased sales gained from price promotions are at the expense of a loss in

profit – so these promotions must be used with care.

A producer must also guard against the possible negative effect of

discounting on a brand’s reputation

ii. Coupons

Coupons are another, very versatile, way of offering a discount. Consider

the following examples of the use of coupons:

The key objective with a coupon promotion is to maximize the redemption

rate – this is the proportion of customers actually using the coupon.

One problem with coupons is that they may simply encourage customers to

buy what they would have bought anyway. Another problem occurs when

retailers do not hold sufficient stocks of the promoted product – causing

customer disappointment.

Use of coupon promotions is, therefore, often best for new products or

perhaps to encourage sales of existing products that are slowing down.

iii. Competition and Prizes

Another popular promotion tool with many variants. Most competition

and prize promotions are subject to legal restrictions.

On a pack to encourage repeat

purchase

In coupon books sent out in newspapers allowing customers to

redeem the coupon at a retailer

A cut-out coupon as part of an

advert

On the back of till

receipts

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iv. Gift with purchase

The “gift with purchase” is a very common promotional technique. It is

also known as a “premium promotion” in that the customer gets

something in addition to the main purchase. This type of promotion is

widely used for:

Subscription-based products (e.g. magazines)

Consumer luxuries (e.g. perfumes)

v. Frequent user / loyalty incentives

Repeat purchases may be stimulated by frequent user incentives.

Perhaps the best examples of this are the many frequent flyer or user

schemes used by airlines, train companies, car hire companies etc.

vi. Money Refunds

Here, a customer receives a money refund after submitting a proof of

purchase to the manufacturer.

These schemes are often viewed with some suspicion by customers –

particularly if the method of obtaining a refund looks unusual or

onerous.

vii. Point-of-sales display

Research into customer buying behavior in retail stores suggests that a

significant proportion of purchases results from promotions that

customers see in the store. Attractive, informative and well-positioned

point-of-sale displays are, therefore, very important part of the sales

promotional activity in retail outlets.

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2.5.1 Push and Pull Strategies

Marketing theory distinguishes between two main kinds of promotional

strategy - "push" and "pull".

1. Push Strategies

i. A “push” promotional strategy makes use of a company's sales force and trade

promotion activities to create consumer demand for a product.

The producer promotes the product to → wholesalers, the wholesalers promote it

to → retailers, and the retailers promote it to → consumers.

ii. A good example of "push" selling is mobile phones, where the major handset

manufacturers such as Nokia promote their products via retailers such as Car

phone Warehouse.

iii. Personal selling and trade promotions are often the most effective promotional

tools for companies such as Nokia - for example offering subsidies on the

handsets to encourage retailers to sell higher volumes.

iv. A "push" strategy tries to sell directly to the consumer, bypassing other

distribution channels (e.g. selling insurance or holidays directly). With this type

of strategy, consumer promotions and advertising are the most likely

promotional tools.

2. Pull Strategies

i. A “pull” selling strategy is one that requires high spending on advertising and

consumer promotion to build up consumer demand for a product.

ii. If the strategy is successful, consumers will ask their → retailers for the product,

the retailers will ask the → wholesalers, and the wholesalers will ask the→

producers.

iii. A good example of a pull is the heavy advertising and promotion of children's’

toys – mainly on television. Consider the recent BBC promotional campaign

for its new pre-school programme – the Fimbles. Aimed at two to four-year-

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olds, 130 episodes of Fimbles have been made and are featured everyday on

digital children's channel CBeebies and BBC2.

iv. As part of the promotional campaign, the BBC has agreed a deal with toy maker

Fisher-Price to market products based on the show, which it hopes will emulate

the popularity of the Tweenies. Under the terms of the deal, Fisher-Price will

develop, manufacture and distribute a range of Fimbles products including soft,

plastic and electronic learning toys for the UK and Ireland.

v. In 2001, BBC Worldwide (the commercial division of the BBC) achieved sales

of £90m from its children's brands and properties last year. The demand created

from broadcasting of the Fimbles and a major advertising campaign is likely to

“pull” demand from children and encourage retailers to stock Fimbles toys in

the stores for Christmas 2002.

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3 Conclusion

Promotion Mix

Personal Selling

is oral communication with potential buyers of a product with the intention

of making a sale.

Buying car direct to the seller not through

the dealer

Public Relation

A business may have many “publics” with which it

needs to maintain good relations and build

goodwill

Make public selling to the customer

Advertising

the promotion of a company’s products and

services carried out primarily to drive sales of the products and services

Advertistment in newspaper, media,

also social networking

Sales PromotionAn activity designed to

boost the sales of a product or service

Discount selling at Jusco

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Reference

Yusniza Kamarulzaman, N. K. (2012). Marketing Management. Selangor: Oxford University

Press.