Chapter 57 – promotion Flashcards
What is promotion?
- It is the method to inform and persuade potential customers to buy a product/service to meet their needs
- a key part of the marketing mix
- A promotional mix involves a range of methods
What is the purpose of promotion?
- Inform customers or raise awareness
- Increase sales
- Encourage brand loyalty
- Enhance the reputation/image of the business
What are the two main promotional strategies?
- Above the line promotion.
- Below the line promotion.
Above the line promotion
- Uses media where there is no direct contact with the potential consumer
- The business has no control over the media involved
- the media used is often referred to as mass media
Example- radio newspapers, television cinema sponsorship
Below the line Promotion
- Uses media where there is direct contact with potential consumer
- It can have some influence and control of the media used
Example-emails direct marketing sales promotion telesales packaging
Television
- Remains a powerful media for promoting a product
- Visual aspect of an advert is easier to remember than the spoken or written word
- Very expensive form of promotion
Commercial radio
- radio advertising is common, especially for local radio stations
- There are also adverts for national chains but these are less frequent
Magazines
- There are many specialist magazines that can target consumers, but it is still an above the line media because there is no direct contact with the selected consumer
Customer publications (magazines)
- Classed as below the line media
- There is a growing trend for businesses to strengthen the recognition of their brand by publishing their own magazine
Digital magazines
- taking advantage of consumers greater usage of the computer as a source of information businesses have grasped the opportunity to promote their products via the digital media
Cinema
They have experienced an increase in audiences over recent years
- they have become more popular as a media for adverts
Newspapers
- Both national and local
- Appeal to a wide range of advertisers
- Because there is such a wide range of newspapers, it is possible to target a particular segment of the market
Billboards posters and video plasma screen
- Static adverts and therefore only able to target a limited audience
- Cheap and effective form of advertising
- Needs to be eye-catching and visual
- Location of their placement is crucial if a sufficient number of people is to see them
- They can be used on a national basis or a local basis
Sponsorship
- Effective media to increase product awareness
- companies are using sponsorship to enhance their brand awareness by association with a particular sport or sports stars
Publicity
- Any form of free promotion for the business
Direct mail
- direct mail is now most effective when targeted at existing customers rather than potential or cold target customers
Electronic adverts
- As the usage of the Internet continues to grow so does the number of pop-up adverts and sidebar links
Social media and Internet promotion
-More effective and much cheaper method of getting their message across
- Low cost form of promotion
- Use of social media also makes it possible for companies to target particular groups
- This allows customers to feel involved and valued and allows the retailer to see how well products are being received
- The result is that the information they gather on the consumer is immediate and up-to-date for the consumer
Sales promotion
- An incentive at the point of sale (at the retail outlet)
Types of sales promotion used:
-BOGOF - When our competition
10% more - by three pay for two
- Donations to charity
- Loyalty points
- by now, pay later
Merchandising or branding
- Any action that encourages the consumer to purchase goods
Packaging
- It helps define the brand
- Not only does it protect and preserve the product it can advertise and promote the product by the careful display of the brand-name or it’s selling features
- Packaging can enhance the display of the product on the shelves and can add value to entice the customer to purchase
Public relations
- Plays a vital role in Either strengthening the image of the business by issuing a press release or defending/repairing an image if the business has to deal with a problem
Trade fairs
- Popular method of encouraging interested parties to visit a wide selection of fairs and exhibitions
Drip marketing
- strategy employed by businesses where information is sent in bit by bit overtime to the consumer
- usually email because this can be done at low-cost by the business
Viral marketing
- It’s the use of social networking sites to increase brand awareness
Advertising elasticity of demand
- It shows the extent to which spending on advertising will affect sales
What is the formula for calculating advertising elasticity of demand?
The percentage change in demand
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Percentage change in advertising spending
- using this calculation will help a business to see how effectively it is using its advertising budget
Selecting the appropriate promotional methods
- The method chosen will depend on the product/service and the budget
- Must fit in with the marketing mix to meet marketing strategy
Factors to be considered are: - Business
- Size
- Location
- Budget
- Actual product/service
- The customer
- Marketing strategy
- External factors
- Time factor
- stage in the product life-cycle
Service marketing
- usually the same as that of a product
- For small businesses, world of mouth is more suited than above line
- Small businesses restricted due to budget constraints
- Internet methods may be more suited
