Question Tag: Public Relations

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  • 10 Marks

CSEG – Nov 2018 – L2 – Q2b – Corporate social responsibility

Discuss how CSR initiatives by a large public company could contribute to the long-term benefits of the company.

Sampa Ltd is a large local fast-moving consumer goods company with many well-known branded products. It imports raw materials for its products from several countries, and all its manufacturing operations are based in Ghana. The financial performance of the company has been declining due to an economic downturn.

The CEO thinks that the economic recession will make all companies focus on profitability and that concerns about corporate social responsibility (CSR) will lessen. He has always held the view that CSR provided some public relations benefits but that it has no effect on the financial performance of companies or their share price.

Required:

Discuss how CSR initiatives by a large public company could contribute to the long-term benefits of the company. (10 marks)

Contribution of CSR Initiatives to Long-Term Benefits:

  1. Enhanced Reputation:
    • There is almost certainly some element of “public relations exercise” in the CSR pronouncements of companies. Given sufficient publicity, CSR can enhance the reputation of a company with its potential customers and its employees. In the long run, this can have a beneficial effect on sales, which can, in turn, lead to competitive advantage.
  2. Talent Attraction and Retention:
    • Being a responsible, sustainable business may make it easier to recruit new employees or retain existing ones. Employees may be motivated to stay longer, thus reducing the costs and disruption of recruitment and retraining.
  3. Ethical Investment:
    • Concerns for matters such as suppliers, communities, and employees may help to attract investments from “ethical investors” – investment institutions that specialize in making investments in companies they regard as ethical in their behavior and business activity. If so, this may have some effect in maintaining the share price.
  4. Corporate Governance and Stakeholder Engagement:
    • It may also be argued more generally that the CEO appears to hold the “shareholder view” of corporate governance – where the primary purpose of a company should be to maximize the profits of shareholders. This view may be challenged with the “enlightened stakeholder view” – that even if the main purpose of a company should be to increase the wealth of shareholders, concern should be shown for other stakeholder groups such as employees, customers, suppliers, and society.
  5. Competitive Advantage:
    • It keeps your company competitive. When you choose a unique position as a company and do things differently from competitors, it helps your business stand out. This applies to all facets of business, including social responsibility. Your relationship with society is as important as your relationship with customers. Having a strong vision and connection to a cause that makes a positive impact gives you a competitive advantage.
  6. Regulatory Benefits:
    • Reduce regulatory burden – good relationships with local authorities can often make doing business easier.
  • 5 Marks

BMIS – Nov 2021 – L1 – Q5c – Operations strategy

Advise on two effective promotion tools to raise customer awareness for a new detergent product.

Business promotion is meant to raise the customer’s awareness of the existence of a product or service. To achieve this objective, organisations employ different media to promote their business. Kofi Kodua wants your advice on promotion strategy because he is about to launch a new product called “One Corner”, used as a detergent.

Required:

Advise Kofi Kodua on TWO (2) effective promotion tools to raise customers’ consciousness about the new product. (5 marks)

Advertising
Advertising is defined as any form of paid communication or promotion for a product, service or idea. Advertisement is not only used by companies but in many cases by the museum, government and charitable organisations. However, the treatment meted out to advertising defers from an organisation to an organisation. Advertising development involves a decision across five M’s (Mission, Money, Message, Media and Measurement).

Mission looks at setting objectives for advertising. The objectives could be to inform, persuade, remind or reinforce. The objective has to follow the marketing strategy set by the company.

Money or budget decision for advertising should look at the stage of the product life cycle, market share and consumer base, competition, advertising frequency and product substitutability.

Message development is divided into four steps; message generation, message evaluation and selection, message execution, and social responsibility review.

Once the message is decided, the next step is finalising the media for delivering the message. The choice depends on the reach of media frequency of transmission and potential impact on the customer. This choice of media types is made from newspaper, television, direct mail, radio, magazine, and the internet. After which timing of the broadcast of the message is essential to grab the target audience’s attention.

Checking on the effectiveness of communication is essential to a company’s strategy. There are two types of research communication effect research and sales effect research.

Sales Promotion
Promotion is an incentive tool used to drive up short-term sales. Promotion can be launched directed at consumers or trade. The focus of advertising is to create a reason for purchase. The focus of promotion is to create an incentive to buy. Consumer incentives could be samples, coupons, free trial and demonstration. Trade incentive could be price off, free goods and allowances. Sales force incentive could be convention, trade shows, competition among salespeople.

Sales promotion activity can have many objectives, such as grabbing the attention of new customers, rewarding the existing customer, and increasing the consumption of occasional users. However, sales promotion is usually targeted at the fence sitters and brand switchers.

Sales promotional activity for the product is selected looking at the overall marketing objective of the company. The final selection of the consumer promotional tools needs to consider the target audience, budget, competitive response and each tool’s purpose. Sales promotion activity should undergo pretest before implementation. Once the activity is launched, it should be controlled as to remain within the budget. An evaluation program is a must after the implementation of the promotional scheme.

Public Relations
Companies cannot survive in isolation. They need to interact with customers, employees and different stakeholders constantly. The public relation office does this servicing of relation. The primary function of the public relations office is to handle press releases, support product publicity, create and maintain the corporate image, handle matters with lawmakers, guide management with respect to public issues.

Companies are looking at ways to converge with functions of marketing and public relation in marketing public relation. The direct responsibility of marketing public relation (MPR) is to support corporate and product branding activities. MPR is an efficient tool in building awareness by generating stories in media. Once the story is in circulation, MPR can establish credibility and create a sense of enigma among salespeople and dealers to boost enthusiasm. MPR is a much more cost-effective tool than other promotional activities.

Direct Marketing
The communication established through a direct channel without using any intermediaries is referred to as direct marketing. Direct marketing can be used to deliver a message or service. Direct marketing has shown tremendous growth in recent years. The internet has played a major part in this growth story. Direct marketing saves time, makes an experience personal and pleasant. Direct marketing reduces costs for companies. Face-to-face selling, direct mail, catalogue marketing, telemarketing, TV and kiosks are media for direct marketing.

Advertisement, Promotional activity, Public relation and direct marketing play an essential role in helping companies reach their marketing goals.

(Total: 5 marks)

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