PROMOTION

What is Promotion? 

Promotion is one of the market mix elements, and a term used frequently in marketing. The specification of five promotional mix or promotional plan. These elements are personal selling, advertising, sales promotion, direct marketing, and publicity. A promotional mix specifies how much attention to pay to each of the five subcategories, and how much money to budget for each. A promotional plan can have a wide range of objectives, including: sales increases, new product acceptance, creation of brand equity, positioning, competitive retaliations, or creation of a corporate image. Fundamentally, however there are three basic objectives of promotion. These are:

To present information to consumers as well as others.

To increase demand.

To differentiate a product.

Which promotional methods are used depends on several factors:

Stage in the life cycle   :  E.g. advertising is important at the launch stage

Nature of the product  : How much information is required by customers before they buy

Competition                : What are rivals doing?

Marketing budget        : How much can the firm afford?

Marketing strategy      : Other elements of the mix (price, product, place etc)

Target market              : Appropriate ways to reach the target market

There are different ways to promote a product in different areas of media. Promoters use internet advertisement, special events, endorsements, and newspapers to advertise their product. Many times with the purchase of a product there is an incentive like discounts, free items, or a contest. This is to increase the sales of a given product.

Promotional methods – “above and below the line”

The way in which promotion is targeted is traditionally split into two types:

• Above the line promotion – paid for communication in the independent media e.g. advertising on TV or in the newspapers.  Though it can be targeted, it could be seen by anyone outside the target audience.  Advertising is the main methods of above-the-line promotion.
• Below the line promotion – promotional activities where the business has direct control e.g. direct mailing and money off coupons.  It is aimed directly at the target audience.

What Is Sales Promotion ?

The American Marketing Association (AMA), in its Web-based "Dictionary of Marketing Terms," defines sales promotion as "media and nonmedia marketing pressure applied for a predetermined, limited period of time in order to stimulate trial, increase consumer demand, or improve product availability.

Sales promotion is the process of persuading a potential customer to buy the product.  Sales promotion is designed to be used as a short-term tactic to boost sales – it is not really designed to build long-term customer loyalty.

Some sales promotions are aimed at consumers.  Others are targeted at intermediaries (such as agents and wholesalers) or at the firm’s sales force.

When undertaking a sales promotion, there are several factors that a business must take into account:

• What does the promotion cost – will the resulting sales boost justify the investment?

• Is the sales promotion consistent with the brand image?  A promotion that heavily discounts a product with a premium price might do some long-term damage to a brand

• Will the sales promotion attract customers who will continue to buy the product once the promotion ends, or will it simply attract those customers who are always on the look-out for a bargain?

There are many methods of sales promotion, including:

• Money off coupons – customers receive coupons, or cut coupons out of newspapers or a products packaging that enables them to buy the product next time at a reduced price

• Competitions – buying the product will allow the customer to take part in a chance to win a prize

• Discount vouchers – a voucher (like a money off coupon)

• Free gifts – a free product when buy another product

• Point of sale materials – e.g. posters, display stands – ways of presenting the product in its best way or show the customer that the product is there.

• Loyalty cards – e.g. Nectar and Air Miles; where customers earn points for buying certain goods or shopping at certain retailers – that can later be exchanged for money, goods or other offers

Kinds Of Promotion

Marketers have at their disposal  four major methods of promotion. Taken together these comprise the promotion  mix. In this section a basic definition of each method is offered while in the  next section a comparison of each method based on the characteristics of  promotion is presented.  

 

a. Advertising

Involves non-personal; mostly paid promotions  often using mass media outlets to deliver the marketer’s message. While  historically Sales promotion is designed to be used as a short-term tactic to boost sales, the  advent of computer technology and, in particular, the Internet has increased  the options that allow customers to provide quick feedback.   

b. Public Relations and Sponsorship

Also referred to as publicity, this type  of promotion uses third-party sources, and particularly the news media, to  offer a favorable mention of the marketer’s company or product without direct  payment to the publisher of the information.

c. Personal Selling

As the name implies, this form of  promotion involves personal contact between company representatives and those  who have a role in purchase decisions (e.g., make the decision, such as  consumers, or have an influence on a decision, such as members of a company  buying center). Often this occurs face-to-face or via telephone, though newer  technologies allow this to occur online via video conferencing or text chat.

d.  Sales Promotion

Involves the use of special short-term  techniques, often in the form of incentives, to encourage customers to respond  or undertake some activity. For instance, the use of retail coupons with  expiration dates requires customers to act while the incentive is still valid.

e. Direct marketing

A channel-agnostic form of advertising that allows businesses and nonprofits organizations to communicate straight to the customer, with advertising techniques that can include Cell Phone Text messaging, email, interactive consumer websites, online display ads, fliers, catalog distribution, promotional letters, and outdoor advertising.

Direct marketing messages emphasize a focus on the customer, data, and accountability. Characteristics that distinguish direct marketing are:

- Marketing messages are addressed directly to the customer and/or customers. Direct marketing relies on being able to address the members of a target market. Addressability comes in a variety of forms including email addresses, mobile phone numbers, Web browser cookies, fax numbers and postal addresses.

- Direct marketing seeks to drive a specific "call to action." For example, an advertisement may ask the prospect to call a free phone number or click on a link to a website.

- Direct marketing emphasizes trackable, measurable responses from customers — regardless of medium.

Why Do We Need Promotion ?

Promotion is benefit for customer, activities have a variety of aims:

• To inform current and potential customers about the existence of products
• To explain the potential benefits of using the product
• To persuade customers to buy the product
• To help differentiate a product from the competition
• To develop and sustain a brand
• To reassure customers that they have made the right choice

 

Pick at least 10 sentences indicating present tense

- These elements are personal selling, advertising, sales promotion, direct marketing, and publicity.

- What does the promotion cost

- Who are always on the look-out for a bargain?

- This type of promotion uses third-party sources

- To inform current and potential customers about the existence of products

- To persuade customers to buy the product

- Promoters use internet advertisement, special events, endorsements, and newspapers to  advertise their product

- Direct marketing emphasizes trackable

- Addressability comes in a variety of forms including email addresses

- Direct marketing seeks to drive a specific "call to action."

- Products packaging that enables them to buy the product next time at a reduced price

Pick at least 10 sentences indicating past tense

- Media and nonmedia marketing pressure applied for a predetermined

- Sales promotion designed to be used as a short-term tactic to boost sales

- Marketing messages addressed directly to the customer

-  Others targeted at intermediaries

- Term used frequently in marketing

- limited period of time in order to stimulate trial

- Also referred to as publicity

- later be exchanged for money

- In this section a basic definition of each method offered while in the  next section

- Information is required by customers before they buy

 

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http://www.tutor2u.net/business/gcse/marketing_promotion.html