Promotion is one of the four elements of marketing mix (product, price, place, promotion). It is the communication link between the buyers and sellers for the purpose of informing, influencing, or persuading a potential buyer’s purchasing decision. Types of promotion
Above the line promotion: Promotion in the media. For example (television, radio, newspapers, internet)
Below the line promotion: All the other promotion, much of this is intended to be suitable enough for the consumer to be unaware that promotion is taking place. For example (direct mail, sponsorship, public relations)
The specification of these elements creates a ‘promotional mix’. These elements are advertising, personal selling, direct marketing, sales promotion, public relations. A promotional mix has wide range of objectives i.e. new product acceptance, sales to be increased, positioning, creation of brand equity and creation of corporate image.
The term mix implies that a company’s promotion strategy is focused on more than one element, so the challenge is to integrate these different communication tools in an effective way. Following are different elements:
Advertising: Any paid form of non-personal communication of ideas or products in the prim media, i.e. television, the press, posters, cinema, and radio. it possesses strengths and limitations , and should be combined with other promotional tools to form an integrated marketing communications campaign.
Television: Presence in room with set switched on at turn of clock minute to relevant channel, provided that presence in room with set on is for at least 15 consecutive seconds
Press: Read or looked at any issue (for at least two minutes) within the publication period (for example, for weeklies, within the last seven days)
Posters: traffic past site (including pedestrians)
Cinema: Actual cinema admissions
Good for awareness building because it can reach a wide audience quickly.
repetition means that a brand positioning concept can be communicated effectively
Can be used to aid the sales effort, to legitimize a company and its products
The top five advertisers in UK
Procter and Gamble
COI Communications (UK Govt)
Source: European Marketing Pocket Book2006, Henley-on-Thomas, World Advertising Research canter Ltd.
Personal Selling: Personal Selling occurs when the company representative interacts directly with a consumer or prospective consumer to communicate about the good or service. This form of promotion is a far more intimate way to talk to the market. Many organisations relay heavy on personal selling because at times the ‘personal touch’ can carry more weight than mass media material. In a business-to-business market situations such as at sash UK participating in international trade shows provides an example for sales people at sash o demonstrate their goods, provide a personal touch, and begin to develop crucial relationships with clients. Also, many industrial products and services are too complex or expensive to market effectively in impersonal ways (such as through mass advertising)
Another advantage of personal selling is that salespeople are firm’s eyes and ears in the market place. They learn which competitors are talking to customers, what is being offered, what new rival products are on the way and all sorts of competitors intelligence. Salespeople perform a vital role in the success of firm’s consumer relationship management system- providing a source of timely and accurate informational input about customers and market. Personal selling has much importance for students because many graduate jobs with marketing background will enter professional sales jobs. The old business adage ‘nothing happens until something is sold’ translates into many firm’s placing quite a bit of emphasis on personal selling.
Interactive questions can be answered and objectives overcome
Adaptable: presentations can be changed depending upon consumer needs
Complex arguments can be developed
Relationships can be built because of its personal nature
Direct Marketing: Direct Marketing refers to ‘any direct communication’ to a customer or business recipient that is designed to generate response in the form of an order, and/or a visit to a shop or other place of business for purchase of product. Direct marketing covers a wide array of methods including:
Direct mail: Direct mail is sent through the postal service to the recipient’s house or business address with the purpose of promoting the product and or maintaining ongoing relationships. Direct mail at its best allows close targeting of individuals in a way not possible using mass advertising media. For example, Heinz employs direct mail to target its customers and prospects.
Telemarketing: Telemarketing is a marketing communication system where trained specialists use telecommunications and information technologies to conduct marketing and sales activities. For example callers by using their credit cards may book theatre tickets or sports tickets or purchase products online.
Catalogue Marketing: Catalogue marketing is the sale of products through catalogues distributed to agents and customers, usually by mail or at stores if the catalogue marketer is the store owner. Catalogue marketing is popular in Europe, with such organisations as Otto Versand and Quelle Schikedanz (Germany), GUS and Next Directory (UK). Key characteristics:
Individual targeting of customers most likely to respond to an appeal
Communication can be personalized
Short term effectiveness can be easily measured
A continuous relationship through periodic contact can be built
Activities are less visible to competitors
Internet promotion: The web gives the marketers to reach customers in a new and exciting way. The promotion of product pr s to consumers and business through electronic media. Online advertising has grown in European Union to €6.8 billion in 2007, having substantially increasing in later years. Specific forms of internet advertising include banners, buttons; pop up ads, search engines and directories and e-mails.
Banners: These rectangular graphics at the top or bottom of web pages were the first form of web advertising. Although the effectiveness of banners remains in question (banners now receive less than one percent click -through rate), they still remain most popular form of web-advertising.
Buttons: These are small banner type advertisements that a company can place anywhere on a page. Early in the life of the internet, buttons encouraging suffers to ‘Download Netscape Now’ became a standard on many websites were responsible for much of Netscape early success.
Search Engine and Directory Listings: Just as the yellow pages and other directories of advertising media, so too are search engines and other online directory listings. Increasingly, firms are paying search engines for more visible or higher placement on result lists.
Pop up Ads: A pop up ad is an advertisement that appears on a screen while a web page is being loaded or after it is loaded. Because the pop up ad will take the centre of the screen while surfers are waiting ti desired page to load, they are difficult to ignore. Because surfers find pop up’s nuisance, most internet access software provides an option that blocks all the pop ups. A pop up ad opens in separate browser window. Web advertisers are typically charged only if people actually click through to the ad.
E- mail: For advertising, E-mail is becoming as persuasive as radio and television. It is one of the easiest way of communication with customers because marketers can send unsolicited e-mail advertising messages to thousands of users y spamming- sending unsolicited e-mail to five or more people not personally known to sender.
Global reach at the relatively low cost
The number of site visits can be measured
A dialogue between companies and their consumers and suppliers can be established
Convenient form of searching and buying products.
Direct sales possible
Sales Promotion: Sales Promotion as ‘marketing activities usually specific to a time period, place, or customer group which encourage a direct response from’ consumers or marketing intermediaries, through the offer of additional benefits. Media and non media communication are employed for a predetermined to increase consumer demand and improve product availability. Types of sales promotions:
Non-Standard: Promotions are usually temporary, and may be limited to certain customer groups (such as airline frequent flyer schemes) or specific to a particular distribution channel (as in ‘tailor-made’ promotions involving a producer and a single retailer.
Response Oriented: Promotions seek a direct response from customers, or those who deal with customers on the producer’s behalf. The direct response sought is not necessarily for a sale. Promotions may encourage customers to send for a brochure, visit a dealer or consume a sample. The ultimate aim is always sales, but this is true of all marketing activity.
Benefit Oriented: Promotions offer their targets, additional benefits, beyond the ‘standard’ marketing mix. The enhanced nix could include extra product, a reduced price or an added item, service or opportunity.
incentives provide quick boost to sales
Effects may be only short term
Product trial often twinned with a competition
Gift Coupons helps to encourage repeat purchases
Suitable if push strategy is used
Suitable if the product is Expensive
Public Relations: Public Relations are the communication function that seeks to build good relationships with an organisation’s public. These include consumers, stockholders, legislators and other shareholders in the organization. Today marketers use public relations activities to influence the attitudes and perceptions of various groups not only towards companies and brands but also towards politicians, celebrities, and -not-for profit organisations. Public Relation is crucial to an organisation’s ability to establish and maintain a favourable image. The communication of a product or business by placing information about it in the media without paying for the time or space directly. For example, marketers create and manage publicity; unpaid communication about an organisation that gets media exposure. This strategy helps to create awareness about a product or event, as when a local newspaper reporting on an forthcoming concert feature, an interview with the band’s lead guitarist around the time that the tickets go on sale. Some of the Public Relations channels are Newspapers and magazines articles/reports, charitable contributions, press releases, seminars etc.
High credible as message comes from a third party
Higher readerships than advertisements in trade and technical publications
PROMOTIONAL STRATEGY DECISIONS
Practising managers faced by a mix of five tactical choices
Target: Prudent marketing managers will make sure that their choices are indeed based on carefully considered target audience analysis, drawing as appropriative on the advice of the professional consultancies that have proliferated in all the subdisciples over the last decade.
Message: A less obvious tactical consideration is the nature of the promotional message. A simple, brash statement might lend itself to poster advertising, perhaps, while a complex persuasive argument could be accomplished by highly personalised and carefully targeted direct mail shot.
Cost: The cost of available promotional option is clearly a key criterion of choice. The facts are easily accessible in practice but no complex and susceptible to change overtime that it would be rash to attempt even a summary here.
Measurement: equally clearly prudent managers will be concerned with the scope for the measurement of effectiveness.
Ex: Advertising through there is ample scope for debate as to their real worth among experts.
Control: The final key factor in deployment describes is the degree of control, the user can exert over the outcome of the initiative.
INTEGRATED MARKETING COMMUNICATIONS
Integrated marketing communication (IMC) is the process that marketers used to plan, develop, execute and evaluate coordinated, measurable, persuasive brand communication programmes over time about the organisation and its products to targeted audiences. The objective is to position products and organizations clearly and distinctively in the market place. Integrated marketing communications facilitates the process by which this is achieved by sending out consistent messages through all the components of the promotional mix, so that they reinforce one another. As the array of communication media expands there is greater need to coordinate the messages and their execution. This has led to the adoption of ‘integrated marketing communications; by an increasing number of companies. For Example, it means that we site visuals are consistent with the images portrayed in advertising and that the messages conveyed in a directing campaign are in the with those developed by the public relations department.
DEVELOPING INTEGRATED MARKETING PLAN
Step 1: Identify Target Audiences
Step 2: Establish Communication objectives
Step 3: Determine and Allocate the marketing
Step 1: To determine who the target market is. Here good customer database is most important. By maintaining the customer database marketers know who their target market as well as the buying behaviour of different segment within the total market.
Step 2: To establish communication objectives. The whole point of communicating with customers and prospective customers is to let them know that the organisation has a product to meet their needs in a timely and affordable way.
Step 3: Determine and Allocate the marketing communications budget seems to be easy in reality it’s not that simple. It includes three steps:
Determining and allocate the marketing: Most firms rely on two budgeting
Techniques top down and bottom up.
Top down budgeting techniques: requires top management to establish the overall amount that the organisation allocates for the promotional activities and this amount is then divided among advertisements, public relations and other promotional departments. Most commonly used method of techniques are:
Percentage of sales
Bottom Up: At the beginning identify promotional goals and allocate enough money to promote them. Most commonly used method:
Deciding the strategy
Push Strategy: Push Strategy means that the company wants to move its products by convincing members of the distribution channel such as wholesalers, agents or retailers to offer them and entice their customers to select these items. Ex: Personal selling, Trade advertisements and sales promotions.
Pull Strategy: Pull strategy is counting on consumers wanting its products and so convincing retailers to respond to this demand by stocking them. In this case, efforts will focus on media advertising and consumer sales promotion to stimulate interest among end consumers who will ‘pull’ the product onto shop shelves then onto their shopping baskets. Ex: Procter and Gamble reduced consumer sales promotion spending in the early 19900’s when adopting its ‘value pricing’ strategy.
Designing the Promotional mix budget
Factors affecting the IMC budget:
Step 4: It includes determining the specific communication tools that will be used, what message is to be communicated. Planners must ask how elements of promotional mix can be used most effectively to communicate with different target audiences. The message should focus on
Step 5: The final step in marketing communications is to decide whether the plan is working. The marketer needs to determine whether the communication objectives are adequately translated into marketing communications that are reaching the right target audiences.
The most immediate way for a marketer to make contact with customer is simply to tell them how wonderful the product is. This part of the personal selling element of the promotional mix we mentioned previously. It is the direct interaction between the company representative and consumer that occur in personal or by phone or even over interactive computer link. Personal appeals can be tremendously effect, especially for expensive and complicated consumer items such as computers or cars and for industrial products where ‘human touch’ is essential.
The other pieces of the promotional mix are those messages which are intended to reach many perspective consumers at the same time which are impersonal and the lack of ‘human touch’. Examples of mass appeals advertising, Sales promotion and public relations.
Many marketers are starting to figure out that they must find alternatives to traditional advertising. Especially young consumers are very cynical about the efforts of big corporations to buy their allegiance.
Types of Buzz Appeals:
Word of Mouth: ‘Giving people a reason to talk about your products and services and making it easier for that conversation to take place. Ex: Burger king and Nike
Buzz Marketing: Using high- profile entertainment or news to get people to talk about your brand. Ex; Puma, Procter and Gamble.
Viral Marketing: Creating entertaining or informative messages that are designed to be passed along in an exponential fashion, often electronically or by e-mail. Ex: Microsoft and Nestle.
Guerrilla Marketing: The concept of Guerrilla marketing was invented as an unconventional system of promotions that relies on time, energy and imagination rather than a big marketing budget. The objective of Guerrilla marketing is to create a unique, engaging and thought provoking concept to generate buzz, and consequently turn viral. It is specifically geared for small business and entrepreneurs.
One golden rule of promotions management is that over – use of any technique will blunt its effectives. Innovation and creativity are key success factors, and recent advances in packaging and information technology have provided many exciting new ways to offer customers extra benefits. The implications for marketing management of the boom in promotions are becoming increasingly clear. In today’s competitive market place the professional management of promotion has become a matter of life and death for an ever growing number of brands.