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Advertising is a paid for communication. It is used to develop attitudes, create awareness, and transmit information in order to gain a response from the target market. There are many advertising media such as newspapers (local, national, free, trade), magazines and journals, television (local, national, terrestrial, satellite) cinema, outdoor advertising (such as posters, bus sides). The two basic aspects of advertising are the message (what you want your communication to say) and the medium (how you get your message across).
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”. But sales people are very expensive and should only be used where there is a genuine return on investment.
Providing incentives to customers or to the distribution channel to stimulate demand for a product. They include couponing, money-off promotions, competitions, free accessories (such as free blades with a new razor), introductory offers (such as buy digital TV and get free installation), and so on. Each sales promotion should be carefully costed and compared with the next best alternative.
The communication of a product, brand or business by placing information about it in the media without paying for the time or media space directly. otherwise known as “public relations” or PR. PR can be relatively cheap, but it is certainly not free. Successful strategies tend to be long-term.
Direct marketing is any marketing undertaken without a distributor or intermediary. In terms of promotion it means that the marketing company has direct communication with the customer. With advertising techniques such as mobile messaging, email, interactive consumer websites, online display ads, flyers, catalog distribution, promotional letters, and outdoor advertising
Advantages and Disadvantages of each element of the Promotional Mix
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 customer’s questions.
Not good at getting customers to make a final purchasing decision.
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.
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.
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.
Direct marketing is both swift and flexible in achieving results.
Enables you to talk directly identify, isolate and communicate with well-defined target markets.
Risk of losing control – cannot always control what other people write or say about your product.
Limited geographic reach to direct marketing involving fliers and street advertizing.
Starbucks Corporation is a leading international coffee and coffeehouse, which was founded in 1971 with 16,120 stores in 49 countries. In the United States alone, it has about 11,000 stores (Starbucks Corporation: Starbucks Company Description). Starbucks started as a local coffee shop in Seattle, Washington by English teacher Jerry Baldwin, history teacher Zev Siegel, and writer Gordon Bowker. They initially purchased their coffee from Alfred Peet, the founder of Peet’s Coffee and Tea, and later set up their own roasting operations. Their passion for quality coffee as well as exotic tea and their good business sense helped them run a profitable business and open three more Starbucks stores by the early 1980’s .
Starbucks aims to remain the most recognized brand of coffee in the world and as of today, Starbucks Corporation still remains a fine coffee industry and a very profitable organization with its strong performance. Starbucks aims for continued supply and their objective is to increase mass-market reach.
Starbucks has focused on promotion strategy that relates to consumers at a personal level, because of this it has stayed away from mass marketing and mass media outlets, and has focused on an intimate communication strategy in order to maintain a relationship with customers on a personal level. Starbucks avoids television commercials, magazine ads and radio commercials, the only form of public relations/mass media will be press release presented online directly through its website and mostly issued three months before product is launched. Starbucks utilizes direct marketing such as podcast, advertising on Facebook, Twitter, in-store posters/chalkboards and sending out emails. Also sales promotions such as coupons are sent using online mailing list, as well as provided to in-store consumers and informational pamphlets and cards are also included. Personal selling strategy is also provided by in-store employees by offering samples.
Starbucks currently has an established email list, where it updates customers regarding new products, promotions, and events happening at retail stores. A link to Starbucks website included in the email and also a note requesting that customers on email list add Starbucks on Facebook.com and follows it on twitter.com.
An audio Podcast is created for each promotion. The podcast provides the same information in pamphlets in spoken words while providing a video of new product, its ingredients and the process by which it will be produced. Starbucks has done well with its promotional mix. As a strong global brand, Starbucks was built upon a reputation for fine products and services. It definitely met its long range goal of becoming the most recognized brand of coffee in the world. Starbucks closest competitor Second Cup is way smaller and learns from Starbucks, they try to utilize the same elements of the promotional mix in the same way as Starbucks does.
Starbucks wants to open coffee shops on University campuses. Starbucks has to expend its existing market segmentation throughout generation Teens by offering free internet in all Starbucks coffee shops, and new customized drinks, such as blenders with fresh fruits and variety of ingredients that teenagers would have fun and enjoy consuming. Since nowadays going green is a main concern in our lives, Starbucks is able to meet growing trends by offering environmentally friendly products, such as motivating customers to stay and drink their coffee in house in a ceramic cup vs. plastic cup. And offering free internet would help to attract customers to stay and enjoy their food or drink in the coffee shop.
Shannon and weaver communication model;
Customers will go into Anderson and Wall and purchase a product. This may also allow Anderson and Wall to interest them in another product while in store such as a cookies. A poster is put up in store advertising a buy one get one free offer on cookies. The message is received by the public and customers are now aware of the promotion and will now consider making a purchase. The message is channeled to the potential customers that would i.e. like to have something with their coffee.
The message is transmitted to the public.
This process creates noise as people are talking about the product and causing an interest.
The first Burger King, called “Insta Burger King” opened in 1954 in a Miami, Florida suburb. About 90% of Burger King restaurants are independent franchises. The company went public with an Initial Public Offering in 2006. In 2009 Burger King introduced the Whopper Bar which is a division of the restaurant that is more like a bar that serves drinks and also offers Whoppers. Burger King has won several awards including being named one of the top 100 Global Brands by Interbrand.
One of its major objectives is to increase awareness to its new market. The objectives for Burger King like any other business that wishes to remain profitable. They want to maintain brand recognition, brand loyalty, customer satisfaction, and generate new customers. Through quality of service, product development and expansion these objectives are partially obtainable. Additional distribution channel (franchise) marketing and owner satisfaction will help progress the company toward these objectives. Burger King aims to open more stores to expand there presence in Indonesia.
Burger King uses multiple forms of advertisement for their promotional strategy. They use the television to advertise their new products, this is probably the most efficient way of advertising a product as the television reaches massive target audience. However this form of advertising can be very costly meaning smaller businesses are unable to use this particular promotion.
You often hear Burger King Promotions on the radio advertising their new products. This is again a good way of advertising a product as it reaches out to a large target audience. However this isn’t as successful as you cannot see the product meaning customers make their own interpretations. Radio is also expensive an expensive way of advertizing.
Burger king will also use billboards and posters to promote their products. This is generally a good form of advertising as you can show images of your product. Billboards are also relatively cheap compared to television or radio.
Burger King will often promote their company in the newspaper by either offering vouchers or special offers to the reader. This is again a good form of promotion as it reaches out to a large target audience. This process could also be a below the line promotion depending on how they are advertising the company or product.
They also do in-store advertizing, always advertise their above line deals in store in a below the line approach such as reminding the customers of deals with posters. This process is very successful as it can potentially make the customers spend more money and can remind customers of available products.
Burger King have recently sponsored Getafe football club in an attempt to help promote their name further in Europe. This style sponsorship is very expensive but is seen by a large target audience. Football shirts are very clever as fans wearing the shirts are also providing promotion. Burger King has been very successful with its promotional mix. As also as Starbucks, Burger King grew to be an international known brand. The biggest competitor of Burger King; McDonalds uses the same elements of the promotional mix, except sponsoring sport clubs.
Burger King has segmented their products according to bases of demographic, psychographic and behavioral factors. They’ve segmented their products and positioned their products according to kids, students and families. But they haven’t segmented their products to the Adult target group (yet) and they haven’t segmented to breakfasts in every outlet, so they have started.
Shannon and Weaver communication model;
Customers will go into Burger King and purchase the Whopper making the organization profit. This cycle will repeat itself once a month to promote a new product. The message is received by the public and customers are now aware of the product and will now consider making a purchase. The message is channeled and the message of promotion is picked up by interested customers. The message is transmitted to the public.
An advert is aired on the television promoting the Whopper Burger.
This process creates noise as people are talking about the product and causing product anticipation.
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