Like the last entry this is more in Chris's "wheel house", as he would say. So therefore this is mainly written by him and edited by me. This will be the bare bones of marketing and advertising for the sake of introduction. Just like with the last entry it gets a lot more complicated and involved - but cheers to finding the beginning!
In order to create a sales situation we use advertising and promotions as a way to attract possible customers. Marketing is a plan of structure to that advertising. It is where you choose the market and the advertising techniques to suit that market. Marketing is a term used to describe the processes used when products, services, and value are presented to a consumer with the intention of initiating a transaction. There are four basic categories for marketing; advertising, promotion, distribution, and sales. Advertising is the communication for marketing and is meant to encourage the consumer to take some new action. It is derived from the Latin term “ad vertere” and translates to “to turn the mind toward."
You have two avenues for advertising, mass media and new media. Mass media includes newspapers, T.V., Radio, Magazines, Billboards or other signage. New media includes, social networking, blogs, emails, or text messages. Often you want to have a balanced mix of both new media and mass media, when it comes to advertising. When advertising your goal is to increase consumption of your product by using branding. Branding is when you relate your company name, product or image with qualities in the mind of the consumer.
Promotions are when you present an offer to your consumer base. Often these offers are discounts or gifts for purchasing. When doing promotions you would like to achieve three things. You would like to clearly present information for existing clientele, as well as potential customers. You aim to increase the demand of your product or service to increase sales. Lastly you want to differentiate your product or service from your direct competition.
Distribution is making a product or service available to a consumer by direct means, or using intermediaries to present your product or service indirectly. When using intermediaries, there are three types of distribution. Intensive distribution is when you display product in many locations without exclusivity, and without the process of selection. Selective distribution is when you choose carefully where to distribute your product or service based on location and clientele. Many times this is used with specialty goods and services. Finally, exclusive distribution is when you will deal only with a small number of distributors of your product, in turn they will not sell competing brands. This is generally good for high end products or services that cater to one type of clientele.
A sale in it's basic form is the passing of ownership from seller to purchaser in return for compensation. When a sale is made, it is a transition in title. It is when the prospective buyer becomes the owner. This transaction takes place only when a potential buyer sees the value in your product or service that is equivalent or greater than the amount they are willing to pay. When quality, proper pricing, and promotion are combined with effective distribution channels, sales are more likely to be at their highest.
There are two things to look at when deciding on how you want to market. Your “ROMO” and your “ROMI”. Your ROMO Is your Return on Marketing Objective. Marketing can have a return that is not measured by dollars and cents. Many times you set out with an objective, and by achieving that objective, indirectly you can put a value on the overall success of the campaign (i.e. 1000 likes on your facebook page). When talking about your ”ROMI”, that is the Return on Marketing Investment. Your marketing investment is much like your investment when it comes to your ROI, as it is usually a combination of time and money that are invested to achieve your goal. If you put a value on your time, and calculate that with your actual investment of finances, this gives you your marketing investment. (It is important to keep your production and marketing separate when calculating your returns.) Your return on your investment is generally broken down into short term and long term. A short term return is something that can be directly represented from a specific promotion, and is on a case by case basis. A long term return is something that is progressive and is usually calculated on averages. It is very important to be aware of these aspects as you plan new avenues for marketing.
It is sometimes difficult to tell exactly what your return is on a marketing investment. To make an investment, by definition, is to give something with the knowledge of a predictable or measurable outcome equal or greater to the original investment. In marketing, your investment is never guaranteed a return equal or greater than you original investment, although the intangibles often outweigh the risks. Marketing investments generally will have long lasting effects to the bottom line of any company.
Understanding how customers make purchases and decisions can help you increase marketing effectiveness. There are generally 3 things that will help influence them to purchase from you. The first is that they like you. If you can find a connection that makes them feel comfortable, they will more likely purchase from you. If they have a genuine “need” for it, or they just really “want” it. Often they feel like they are going to buy a product anyway. Finally, if they feel like they are going to miss out. Meaning if you are running a promotion that gives incentive to buy now, then it will help influence the “impulse purchase”.
A good example of this is at your local grocer. Every week they run a new ad that is intended to bring you in. The front page almost always has a picture of someone that looks pretty average, a mom, a dad, kids playing in the yard. Most of the time it is geared toward what ever holiday or event is coming up. Right off the bat they want to make you feel comfortable. Then they will put one of the best looking steaks, or dish of some sort, that looks like it just came out of the finest restaurant, as the first “Deal” you see. This causes the “Want” feeling to occur in most people, and generally gets people to continue to peruse the rest of the ad. This is where you find coupons for items that you “need”. Essentially saying “You “need” them, and we have them on sale, so why not buy them from us?” So now they have achieved getting you comfortable, addressed your “need/want”, given you incentive to buy, and by putting a time limit on how long the offer lasts, made you feel that if you don't act now, you will “miss out”. The more you are able to be effective in delivering these aspects in a marketing plan, generally the more return you will have from your marketing investment.
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I am building up to a larger concept through this series of concepts. To get the whole picture make sure to read all the entries as we go. You can read the previous entry here:
please feel free to contact me directly or find our group page on facebook at:
https://www.facebook.com/PdxHandmadeBuySellAndTrade
I am building up to a larger concept through this series of concepts. To get the whole picture make sure to read all the entries as we go. You can read the previous entry here: