Evaluating: personal sales & brands

PERSONAL SALES
Assess constantly against targets - SMART objectives
Other factors assessed:

• productivity - calls per day/account, number of orders v calls
• account development - no. new accounts, growth of sales from existing
• expenses - expenses v no. calls made

BRANDS
(De Chernatony '01) answer on 5 point scale to highlight S&W

1. brand vision
2. organisational structure
3. brand objectives
4. brand essence
5. implementation & brand resourcing

Evaluating: direct & interactive MC & sponsorship

DIRECT & INTERACTIVE MC

Measure:

1. response rate
2. conversion rate
3. order value
4. repeat orders

Gather through voucher/coupon responses that distinguish the source. Important to aslo establish the cost per enquiry and cost per order.

Measuring online - debate as to whether this can be done effectively as no insight to attitudes, motivation or tie with offline.
Number of hits, unique hits, repeat hits, sessions (how long?). Click-through rates (but only deal with behaviour, not attitude)

SPONSORSHIP

1. Media exposure
2. Assess communications results - pre & post-test awareness, corporate image perception & attitudes
3. Feedback from stakeholders - qualitative feedback from participants ascertaining mutual benefits

Evaluating: sales promotions & PR (MC, unit 8)

SALES PROMOTIONS

1. Consumer audits - through loyalty card schemes or consumer panel (any change in behaviour as a result)
2. Sales information - essential stats if aim is market penetration
3. Retail audits - track changes in stock levels, market share immediately after a campaign
4. Sales force feedback - qualitative based on uptake
5. Voucher/coupon redemption - coded to relate to campaign

PR
Haywood suggests 8:

1. Budget
   
2. Awareness - marketing research
   
3. Attitude - MR
   
4. Media coverage & tone - who covered, how many column inches. +/-. Qualitative.
   
5. Positioning - Marketing research into perceived positioning
   
6. Response generation - generate any code or referencing
   
7. Share price
   
8. Sales - PR not often designed for this purpose, so not objective performance measure
   

Evaluating: advertising (MC, unit 8)

ADVERTISING - Pre-testing (or copy testing) show unfinished ads to preselected representative groups of the target audience to see whether meets its objectives
Use focus groups
3 different groups of techniques: (De Pelsmacker et al 2001)

1. Internal - checklists & readability
2. Communications effects - physiological tests, recall and direct opinion measurement
3. Behavioural effects - measure actual response (not predictive) using trailer tests & split scan processes

Post-testing measure the number of inquiries, or direct responses, stimulated by advert or campaign (returned coupons, literature requests, orders)

• Recall tests - how memorable with target audience. Recognition tests check ability to reprocess information about an advertisement (most common for print adverts).
• Sales tests - increases in sales as result of comms. Not necessarily accurate performance measure. Tends to be through single-source data (controlled sets of ads). Expensive, only appropriate for testing individual ads (not campaigns) but highly dependable.

Other tests
Tracking studies - regular data from buyers e.g. TGI
Likeability tests: personally meaningful, relevance, stimulates interest

Evaluating communications effectiveness: (MC, unit 8)

Evaluation is about finding ways of measuring effectiveness

EVALUATING COORDINATED MARKETING COMMUNICATIONS

To be effective in the long-term, need to evaluate the component parts of comms activities:

• Analysis - how thorough is out context analysis?
  
• Objectives - are they clearly thought through, based on detailed analysis, how do they relate back to marketing objectives and corporate objectives?
  
• Planning - logical framework needed to set out how activities will be coordinated (select appropriate strategic options, schedule, implement and evaluate)
  
• Budgets - how much do we need to (or can afford to) spend to meet our objectives?
  
• Media - review, search for more effective platforms as seek to differentiate
  
• Marketing mix - other elements of mix should also be coordinated and consistent
  
• Customer service - when marketing communications are used to encourage customers to make contact with the organisation, the appropriate mechanisms are in place to facilitate the process (e.g. adverts directing to jammed phone lines)
  
• Creativity - through whole process e.g. strategy selection, tactics, budgets
  

- Evaluation outcomes can feed next campaign and improve efficiency
- Comms should be measured on a scale with maximises the 4Cs. Perfect situation would be highly credible communications to the whole target audience at minimum cost with maximum control (if only!)
- Occasions where a campaign is from an unexpected opportunity, cost may be higher (production & media buying) but benefits outway (e.g. the sponsor of a football team that's in the final of a major cup competition). Need to be responsive to opportunities.

- Evaluation process happens before, during and after a campaign. Different parts if a campaign are tested beforehand e.g. advertising pre-testing.
- Evaluate the success of the overall impact of a coordinated marketing communications campaign, not purely success of individual components.

Evaluation:

1. Has it done what it set out to do?
2. Did it do everything that could have been done and was it efficient?

Media: relationship building & interactivity (MC, unit 7)

RELATIONSHIP BUILDING

• Initial stimulus - often traditional media
• Response - passive (none at this stage but may be stored for reference) / active (receiver decides to take action)
• Interactivity - online media, call centres
• Ongoing contact & involvement

INTERACTIVE COMMUNICATIONS
B2B market bigger than B2C in terms of internet applications
Website at the core:

• opportunity to interact and form a dialogue
• e-commerce potential
• can collect database info

Benefits: considerably lower transaction costs, opportunities for growth & innovation, encourage cooperative behaviour, enhances customer communications, can increase corporate image, increases information about customers, enhances measurement of interaction, low barriers of entry to those debeloping

NEW MEDIA BENEFITS

• 1-2-1 & 1-2-many (v. traditional 1-2-many)
• increased dialogue
• personalised
• communities

INTERACTIVE STRATEGIES
- Can be used as: a shop window, enquiry facility, fully interactive form of engagement, fully integrated system (embed with partners)
- Has enabled some brands to reach new audiences e.g. Abbey/Cahoot
[get current ad spend figures and more examples]

Media: budgets, efficiency, buying (MC, unit 7)

MEDIA BUDGETS
Limited media presence can be supported by PR to generate additional media exposure via editorials.
Controversial approaches may stimulate media interest beyond paid-for communications.

EFFICIENCY & EVALUATION
- Duplication is to be encouraged but 'the duplication factor' needs to be taken into account by media planners when calculating net reach & frequencies
- Communications efforts don't happen in isolation, affected by competitor's media usage, how much noise created etc.

Cost per thousand (CPT)

• medium's ability to reach every 1000 customers
• calculation: CPT = (budget/no. in target audience) x 1000
• measures relative efficiency NOT effectiveness

Television rating points (TVRs)

• measure by which TV advertising time is bought
• units that represent the audience watching a particular programme
• 1 TVR = 1% audience
• most ads shown a number of times so TVRs would accumulate over time
• BARB (Broadcaster's Audience Research Board) hold figures

Gross rating points (GRPs) = reach x frequency
measure reach in other media forms
50% audience x 4 showings (or OTS, opportunities to see) = 200 GRPs

MEDIA BUYING & BRIEFING
- Media planning still often done by agency but buying is outsourced to specialists (their size means greater purchasing power)
- They'll need briefing on: campaign objectives, target audiences, associated marketing activity, relevant sales data, previous media history, competitive activity, budgets & timing

Media: creativity (MC, unit 7)

Cost of fragmentation and saturation is that you need to be creative to get people's attention and bring something new.

Examples: BEcause (Loewybe) ran award-winning campaign for Pampers. Sleep like a baby roadshow immersed parents in recreated baby's world through a 16 meter toy train. Experienced the confusion of a baby's mind while it sleeps, tried to build tower with unstackable blocks etc. Each carriage dedicated to different sleep insights intended to educate parents and entertain babies. Trained brand advocates (mums) guided people through. Had product pod at end. Hosted in shopping centres.

London Lite went to war with the London Paper. Jack Liberties sent army of tea-ladies out to hand out afternoon treats to London's drivetime DJs (Lite as London's favourite afternoon treat). As figures showed Lite ahead of competition, they dressed as superheroes to ambush major media agencies shouting about the impressive figures.


Advertisers are also looking at new ways of using traditional media e.g. interactive billboards etc.

Examples: BBC World's New York interactive billboards showing image of soldiers. Live counts of text messages for either 'liberator' or 'occupier'.

Channel 4 was the first advertiser to sign up for a new series of bluetooth enabled poster sites on the London Underground that let users download 4Docs on their phones.

Media: characteristics & selection (MC, unit 7)

Media - a channel of communication that can be used to deliver messages to selected target audiences. Represents any interface which allows communications messages to flow between senders & receivers.

NB. wide definition includes packaging, delivery vehicles, vending machines

MEDIA CHARACTERISTICS
Convergence and audience fragmentation means selecting the media is strategically important.
Conglomeration means media owners now offer range of media vehicles, providing linkages between platforms.

MEDIA SELECTION

1. Communication - does it get the message across?
2. Price - cost-effective coverage of target audience?
3. Place - is in the appropriate environment for the message? (e.g. live demo = TV)

Selection requires a balance between reach/coverage & frequency:

• Reach/coverage - % people within the defined audience who'll be exposed to the message
• Frequency - no. times people within the defined audience will be exposed to the message in a particular period of time

Types of media schedule:

1. Burst - compacts activity into series of short time frames with long periods of no activity in between
2. Drip - provides continuity of the message, at the cost of impact
3. Pulsing - low-level activity maintained over long period with periodic increases in expenditure (e.g. seasonal)

Media environment (timing and place) - sometimes nature of the campaign dictates media to use, timing often has greatest influence

International - note key difPublish Postferences in TV ownership, multichannel penetration, broadband/net uptake

Communication strategies & planning: Communications planning frameworks (MR, unit 6)

Note strategy (purpose & direction) and planning (articulation of strategic intent) are different.

A cohesive & coordinated plan demands a systematic process ensuring all aspects covered:

1. Context analysis
2. Promotional goals & positioning (corporate, marketing, comms goals)
3. 3p's of promotional strategy (pull, push, profile)
4. Coordinated promotional mix
5. Implementation, control & evaluation

Context analysis in more detail:

• Business context - know the operating conditions (growing. declining), understand comms tactics of competitors
  
• Customer context - purchasing behaviour (existing, lapsed & potential)
  
• Internal context - how responds and reacts with external
  
• External context - PESTEL
  
• Stakeholder context - understand stakeholders
  

Communication strategies & planning: Push & Profile (MR, unit 6)

PUSH - influence members of the marketing channel
- stimulate demand by encouraging members to take and hold stock, allocate resources (shelf space) and become advocates

Communications within networks also enables: coordination, encourages loyalty, reduces conflict. Tends to stay pretty standardised (see MC5, resolving channel conflict)

PROFILE (or corporate communications)
Projects an appropriate corporate identity in order to build and maintain a solid reputation
PR is the dominant tool

3 central elements:

1. Corporate personality - internal culture and strategic purpose
2. Corporate identity - outward projection and way organisation presents itself to stakeholders
3. Corporate image - audience's response and the images they form

Close gap between actual and desired perceptions:
[image]

Resolving channel conflict (MC, unit 5)

Manage through proactive strategies that focus on STRENGTH OF RELATIONSHIPS & MARKETING COMMUNICATIONS

1) Strength of relationships
Building

• Trust - confidence in member's reliability, integrity and predictability
• Commitment - the desire to continue and maintain a valued relationship

(Morgan & Hunt '94) developing a set of shared values reduces costs and increases profitability due to customer retention

2) Marketing communications

Communications in a marketing channel is part of a PUSH strategy.

Advantages:

• Stimulates demand by encouraging partners to take & sell stock
• Opps to reward, train and motivate channel members to develop relationships and become product advocates
• Create stock availability
• Reduces overall promotion costs, not just a heavy consumer push

Disadvantages:

• Danger of deviance and conflicting messages
• Could be expensive if there are a large range of distributors
• Too much channel availability may damage perceptions of quality or exclusiveness

Timing Simultaneous is cheaper, little deviation, little time elapse.
Intermediaries may not be targeted strictly sequentially. More likely to prioritise (grade A wholesalers, then B, then C). Potential problems: message deviance & cost of repetition.

Propensity to share information
Fostered by web (fast, accurate, low-cost information exchanges). May differ between orgs.

Also think about: power (is it distributed evenly in the channel?), direction (one/two-way), frequency, style & content, common attitudes

How the internet and digital technologies can support marketing channels (MC, unit 5)

Changing channel structures
Disintermediation: depopulation of marketing channels. Web enables orgs to revert to direct approach.

• Reduces costs - e-commerce reduces resources associated with selling though direct channels, no cost of managing intermediaries.
• Increases customer value - intermediaries don't add costs, benefits afforded through net include customer support, increase in product information
• Become more competitive - increase efficiencies

Reintermediation: new business models emerge and channels are repopulated E.g. Ocado an online supermarket distributing Waitrose food. Ebay shops such as Worldwide Auctions which take a cut from sales but manage the process and storage for individuals.

Information: fast, accurate, up-to-date, low-cost information exchanges (MKIS esp. EPOS)
Communicating data: immediate, email, extranet
Feeding back to channel: reports and analysis

Channel membership - independenc and interdependence

Conventional marketing channel
Intermediaries may include: wholesalers, merchants, agents, manufacturers, retailers

• Wholesalers: break bulk (turn large quantities of stock into smaller manageable collections) & accumulate different goods, from numerous manufacturers, in a category.
• Retailers: provide wholesalers with sales outlets, help wholesalers by purchasing small quantities on a regular basis, focus on end-user customers.

Channel relations
Information, £ and marketing communications (promotional flow) also flow through channels. MC seeks to differentiate, reinforce, inform & persuade all channel members.

• Independent org.: not restricted by finance or ownership. Free to form voluntary relationships, often on transactional & temporary basis.
• Interdependent org.: recognises need to collaborate with others to achieve goals. Seeks longer-term relationships.

Variations on conventional channels

• Vertical channel structure: 2 or more intermediaries linked non-voluntarily e.g. franchises or corporate vertical marketing systems (VMS). Corporate VMS (one member owns all channel members) used to be considered as best because able to control all policies and receive all profit but has proved inefficient due to inbuilt inflexibility.
• Value networks: loose alignment of organisations who work together on a project then disband. The value rests with the network, not one single organisation.
• Multichannel marketing: using multiple channels to reach different target audiences. e.g. Diesel sells through it's own retail stores, other retailers (Selfridges, boutiques) and online.
  

Channel structures (MC, unit 5)

the means by which customers can access the products they want, at a time they prefer & at their convenience

A marketing channel is different to a supply channel. It deals with management of customer behaviour in order to achieve marketing goals, whereas supply chains are concerned with physical aspects of distribution and logistics management.

Direct channel (or simple channel): customer buys directly from manufacturer/producer
Places limitations on producer's scope, they have to replicate exchanges with each customer

Indirect channel: intermediary introduced to increase efficiency and scope

Key account techniques to aid customer retention management (MC, unit 4)

80% profit comes from 20% customers (or Key Accounts)

Who are they? Check out: profitability, sales volumes, regularity of order, payment structures, growth potential

Usually large customers, so personal sales is key (not always face-to-face though)

Number of changes that have led to a focus on key accounts;

• Compressed time horizons
• Intensity of competition
• Shorter product life cycles
• Shorter technology-based cycles
• Transient customer preferences
• Increasingly diverse business areas

Not just understanding relationship between buyer and seller but understanding each other's strategic intent - which may provide business opportunities.

Risk of...

• being vulnerable to opportunism and not obtaining a satisfactory saving or ROI
• committing to one partner at the exclusion of others
• misunderstanding the relationship and failing to achieve reciprocal security

Limitations that can hinder profitability of a customer relationship:

• cost implications of maintaining close relationships with KA
• mismanagement of a few KA can be potentially catastrophic
• relationships should be carefully selected for sensible investment of resources

Internal marketing communications (MC, unit 4)

Organisational identity = what individuals' within org think about it (reflects culture that binds it)

- Variances between perceptions of employees and those held by external stakeholders may be a cause of confusion or conflict (quality at the point of interaction can reinforce or dissuade)
- How the internal audience interprets messages impacts on how they deal with external audiences (they communicate through workforce as well as communications mix)
- Int & ext marketing communications must be integrated. External marketing comms more likely to work if signals of staff reinforce them

• DRIP employees
• During rapid growth, decline, mergers or acquisitions, identity is critical
• Culture isn't static - the stronger it is the more likely it'll pass down through generations, also more difficult to change
• Effective cultural change is a long-term task
• Internal comms has evolved; videoconferencing, podcasts, vodcasts, newsletters, e-bulletins
• Motivators such as staff appearing in ads (Asda, Halifax, B&Q)

Customer retention management (MC, unit 4)

keeping customers satisfied (basic definition)

More comprehensive research by (Peck et al '99)
80% retention = 5yrs loyalty
90% retention = 10yrs loyalty

6 reasons long-term established customers are more profitable:

1. Regular customers place frequent, consistent orders, therefore usually cost less to serve
2. Satisfied customers may sometimes pay premium price
3. Long-established customers tend to buy more
4. Retaining customers makes it difficult for competitors to enter a market or increase their share
5. Satisfied customers often refer new customers to the supplier at no extra cost (advocates)
6. The cost of acquiring and serving new customers can be substantial. A higher retention rate implies fewer new customers need to be acquired, and they can be acquired more cheaply

In B2C markets

• Focus mainly around loyalty schemes (although having a loyalty card is not always an indication of loyalty as research shows many consumers carry multiple cards)
• Became increasingly popular in late 90s when intensity of competition rose in supermarket wars
• Based on accessing information from customer databases and using direct response media
• Those without schemes use product-based sales promotions
• Examples: Nectar, Clubcard, Barclays & Oyster
  

In B2B markets
5 basic principles to consider:

1. Resource support - ensure range of versatile resources available to support the relationship. Should be cost-effective & efficient - may ultimately lead to alliance if business opportunities are presented.
   
2. Reduction of risk - giving as much insight into the product proposition as possible through exhibitions, trial use and product delivery guarantees.
   
3. Service levels - increasingly important. Consider time, delivery and product quality.
   
4. Technical support - providing added value to clients in industrial markets.
   
5. Technical expertise - providing expertise in design & engineering can be unique USP

Not-for-profit
Focus on 3 client groups; donors, volunteers, clients
Segment target markets exactly (retention characteristics will be very diverse due to diverse reasons for their charitable involvement)
Key issues:

• Analyse acquisition and retention costs
• Manage customer retention and customer acquisition activities concurrently
• Recognise how emphasis needs to be placed on all markets in order to meet objectives
• Get adequate information about each of the customer groups

Planning for relationship marketing (MC, unit 4)

Requires structured approach to maximise business potential, provide basis of profitability, create sustainable competitive advantage through robust, long-term customer, supplier and stakeholder relationships

Don't forget relationships begin with a first meeting, what about those customers that have left. Might be able to encourage them to return. E.g. BT "thousands are coming back campaign"

CUSTOMER LOYALTY
- Relationship stages outlined in the relationship marketing ladder: prospect, customer, client, supporter, advocate, partner
- Advocate: customer as a marketing tool, helping to grow market share, e.g. "The Dark Knight"
- Partner has been added in an organisational marketing context.

Driven by:

• high switching costs
• proprietary technology
• attraction of loyalty scheme e.g. drm on itunes music downloads prevents playback on non-ipod devices

KEY ELEMENTS OF RELATIONSHIP MARKETING (ARRET!)

• Assurance - knowledge & courtesy of employees, their ability to inspire trust
• Reliability - ability to perform promised service dependably & accurately
• Responsiveness - willingness to help customers and provide prompt service
• Empathy - caring, individualism and attention given to customers
• Tangibles - physical facilities, equipment & appearance of personnel

These elements can provide basis for positioning messages to fill the quality gap

trust, cooperation and relationship commitment should be the basis of relationship marketing aims & objective (Morgan and Hunt '94)

consumers increasingly measure brand value on how they're treated in interactions with the brand rather than price or functional attributes (Mitchell '03)

The scope of marketing relationships (MC, unit 4)

B2B has 3 different types of market to consider:

1. Organisational markets
2. Service markets
3. Not-for-profit markets

1) Organisational markets
high level relationship management due to intensity and length of purchase process
market more rational, able to build closer links
work towards gaining preferred supplier status - meaning long-term buyer/supplier relations
2) Service markets
the relationship is at the core of successful service delivery (see factors under relationship previously, aslo 'Quality as concern to all staff')
3) Not-for-profit markets
Relationship critical to sustain donors (give money & equipment), volunteers (give time, reduce overheads), clients (gain trust)

Nb. 4 groups to consider re relationship marketing: customers, suppliers, internal markets, stakeholders