Promotional strategy Flashcards
Steps in creating a promotional strategy
Determine the objectives. Estimate the overall budget. Select the promotional mix. Implement the promotional mix. Review and revise the promotional plan.
Determine the objectives.
These are the objectives or goals that the strategy must achieve. A retailer can choose many goals, for example, increasing sales and building relationships with customers.
Determine the objectives. Example
Present and reinforce the retailer image. This is necessary in the current downmarket because many people are reverting to lower-priced high-quality products. Pep Stores is able to o er this and can now try to rein in a di erent group of customers, and with e ective service, the retailer may even gain some customers for life.
Inform customers of the di erent specials currently on o er. During the “back to school” season, Pep Stores specialises in school clothing and shoes. The store is well known for supplying the best school uniforms at the lowest price.
Maintain customer loyalty. Current customers need to be informed of the specials and the retailer should reinforce the image that customers have in their minds of buying the best-priced, top-quality products. In order to increase loyalty, the retailer needs to show that it cares about the customer. Loyalty can be maintained by keeping standards and quality high and informing the customer about this. The retailer should emphasise its money-back guarantee, which enables customers to return goods. This will reinforce the idea of Pep’s e ective customer service department.
Enhance customer relations. Pep Stores o ers a multitude of services besides selling clothes. It o ers cellphone contracts that cater for the lower LSM groups, and even makes loans available to customers. Pep Stores needs to communicate this to its customers so that they are aware of all the services it provides.
Estimate the overall budget.
Five main techniques are used to set a promotional budget. The techniques are explained in more detail in the prescribed book. One example would be a retailer choosing the competitive parity method.
Estimate the overall budget.
example
Secondly, it is necessary to establish an overall promotional budget. Pep Stores must determine how much it is willing to spend on promotional activities for the speci c campaign. There are di erent ways to determine how much to spend on a promotional budget. Since Pep Stores is a large retail store, it will have the capacity to formulate objectives and use the objective-and- task method to prepare a budget. This involves determining the cost of tasks to help achieve the objectives.
Select the promotional mix.
The retailer must select a suitable combination of the di erent promotional elements. For instance, the retailer may decide to work solely with advertising and sales promotion.
Select the promotional mix.
Example
Thirdly, a promotional mix must be selected, which involves deciding which types of promotional element to use. There is a choice between advertisements, personal selling, public relations and sales promotion. The best option for Pep Stores would be advertisements and sales promotion. A certain amount of publicity would also be helpful, in the form of, say, store demonstrations and displays to explain the retailer’s services.
Implement the promotional mix.
Here the retailer has to choose the speci c media or method to execute the promotional elements. The above retailer may now decide to use newspaper and television advertisements and in-store signs for its sales promotion.
Implement the promotional mix.
example
The next step is to implement the chosen promotional mix. This will all depend on the reach of each and the cost. SABC 1 and 2 have granted two-minute slots four times a day, two of which will be during prime time. The tari will be R20 000 for three days. Radio advertisements cost R2 000 per slot. Pep’s target market watches mainly SABC 1 and 2. Television advertisements will therefore be used. Since the target market also listens to Metro Fm and SAFM, some slots there will also be used. The promotional mix will include a few print advertisements in the Daily Sun, as well as billboards on buses and yers near bus stops. The reason for this is that the majority of the retailer’s current customers and target market read the Daily Sun, and use buses and taxis. For the new strategy to be implemented, a television slot on SABC 3 could also be used, and advertisements in more prominent national newspapers, such as the Star or Mail and Guardian, would also be appropriate. Advertisements could be placed on billboards near regional highways. The contents of messages on various different media need to be the same or imply the same message. This ensures uniformity and the fact that a wide variety of messages are being sent out. All responsibilities need to be clearly de ned and allocated to different staff members.
Review and revise the promotional plan.
This is where the retailer measures the effect of the promotional plan and decides whether any revisions are necessary. The effects are measured against the goals set in step 1.
Review and revise the promotional plan.
Example
In conclusion, it is necessary to ensure that the plan is running smoothly and having the desired e ect. This could be a di cult task, but a number of staff members and the retail marketer will be observing the different trends in sales and the use of the customer services o ered. In this way, one can determine whether the promotional messages have made a difference and whether it would be necessary to review the strategy.
