MODULE 5 - PROMOTION

OVERVIEW:
After finding out what products or services the customers need, these are
produced accordingly. The next concern will be how to inform the customers that
such product or services are available. The task of informing the customers however
is coupled with the task of persuading them to buy from the company. This activity
falls under the task of promotions.

Most successful company are engaged in promotions, one way or another.

Some firms use it extensively while others only superficially. In any case, the small
business operator must know what promotion is and how it can help him achieve
his sales and profit objectives.

Promotion aims to stimulate demand for a company’s goods or services.

Promotional strategy is designed to inform, persuade, or remind target audiences
about those products. The goals of promotion are to create awareness, get people
to try products, provide information, keep loyal customers, increase use of a
product, identify potential customers, and even teach clients about potential
services.

PROMOTION DEFINE

Promotions refer to the entire set of activities, which communicate the product,
brand or service to the user. The idea is to make people aware, attract and induce to
buy the product, in preference over others.

GOAL OF PROMOTION

1. Creating awareness: All too often, firms go out of business because people
don’t know they exist or what they do. Small restaurants often have this problem.
Simply putting up a sign and opening the door is rarely enough. Promotion through
ads on social media platforms and local radio or television, coupons in local
papers, flyers, and so forth can create awareness of a new business or product.

2. Getting consumers to try products: Promotion is almost always used to get

people to try a new product or to get nonusers to try an existing product. Sometimes
free samples are given away. Lever, for instance, mailed over two million free
samples of its Lever 2000 soap to targeted households. Coupons and trial-size
containers of products are also common tactics used to tempt people to try a
product. Celebrities are also used to get people to try products.
3. Providing information: Informative promotion is more common in the early
stages of the product life cycle. An informative promotion may explain what
ingredients (for example, fibre) will do for a consumer’s health, describe why the
product is better (for example, high-definition television versus regular television),
inform the customer of a new low price, or explain where the item may be
purchase.

4. Keeping loyal customers: Promotion is also used to keep people from switching
brands. Slogans such as Campbell’s soups are “M’m! M’m! Good!” and “Intel Inside”
remind consumers about the brand. Marketers also remind users that the brand is
better than the competition. Firms can also help keep customers loyal by telling them
when a product or service is improved.

5. Increasing the amount and frequency of use: Promotion is often used to get
people to use more of a product and to use it more often. The most popular
promotion to increase the use of a product may be frequent-flyer or -user programs.

6. Teaching the customer: For service products, it is often imperative to actually

teach the potential client the reasons for certain parts of a service. In services, the
service providers work with customers to perform the service. This is called “co-
creation.”

THE PROMOTIONAL MIX

The combination of traditional advertising, personal selling, sales promotion,

public relations, social media, and e-commerce used to promote a product is called
the promotional mix. Each firm creates a unique promotional mix for each product.
 But the goal is always to deliver the firm’s message efficiently and effectively to the
target audience.

These are the elements of the promotional mix:

• Traditional advertising: Any paid form of nonpersonal promotion by

an identified sponsor that is delivered through traditional media
channels.

• Personal selling: A face-to-face presentation to a prospective buyer.

• Sales promotion: Marketing activities (other than personal selling,

traditional advertising, public relations, social media, and e-commerce) that
stimulate consumer buying, including coupons and samples, displays,
shows and exhibitions, demonstrations, and other types of selling efforts.
This includes freebies, contests, discounts, free services, passes, tickets
and so on, as distinct from advertising, publicity and public relations

• Public relations: The linking of organizational goals with key aspects of

the public interest and the development of programs designed to earn
public understanding and acceptance. Public relations can include
lobbying, publicity, special events, internal publications, and media such
as a company’s internal television channel.

• Social media: The use of social media platforms such as Facebook,

Twitter, Pinterest, Instagram, and various blogs to generate “buzz” about a
product or company. The skills and knowledge needed to generate
information as well as to defend the company against problems (such as
incriminating videos “going viral”) are separate skills from those related to
traditional advertising. Even promotional strategies such as paying
celebrities to wear a specific line of clothing and posting these images on
Twitter or
Instagram (a form of advertising) requires different types of planning and
expertise than traditional advertising.

• E-commerce: The use of a company’s website to generate sales through

online ordering, information, interactive components such as games, and
other elements of the website. Website development is mandatory is today’s
business world. Understanding how to develop and utilize a website to
generate sales is imperative for any marketer.

BENEFITS OF PROMOTION

•Increase brand awareness - With the help of various media like the
television, billboards, radio or local newspaper news, you can spread
across information about your brand and company, which helps people to
find out more about you and look into your products and make purchases.

•Segment Identification - If you’re promotional and marketing strategy is

loosely structured, it might not be successful in targeting the “right”
audiences. Having a full- proof and well-thought-out promotional
strategy and marketing plan can help you identify different segments of
consumers in the market and offer suitable.

•Increasing customer traffic –Promotion also helps in increasing customer

traffic. The more you promote your brand, the more will the customers
know about you and your company and the more will they be interested
in your products. Promotion can be done even by giving out free
samples which work wonders for customers! They try your product and
ultimately, come to you and make purchases.

REASONS WHY PROMOTIONAL ACTIVITIES ARE NECESSARY FOR BUSINESS

PROMOTION

1. To Provide Information to Customers about New Products/services

When a company comes in the market with its new products/services, it has
 to deal with several challenges. People love to buy from trusted brands that have
already captured the market.
2. Creating a Positive Image of the Company
Therefore, it is very important for all companies to have a positive image in
the eyes of existing and potential buyers. A company with a good image is praised
by customers on different forums, helping it to get more business opportunities.
3. Easy Dissemination of information About the Advantages of Goods
So, as a hard core business entrepreneur, you should initiate promotional
activities and make people aware of the importance and advantage of using your
products and services. Only then, you will be able to generate the desired sales and
leads.
4. Sales Promotion - Participate in product exhibitions, contests, lotteries, coupons,
loyalty programs, prizes, free samples, demonstrations, etc, to send business
messages to customers easily and quickly and grow the business volume.
5. Create an Easily Recognizable Logo for Your Business- As a matter of fact, a
beautifully created logo attracts the attention of people, let them know about the
main business activities of a particular company and identify it easily in the crowd of
several companies.
6. Frequent Communication with Clients & Customers
We all know the huge importance of frequent communication with clients and
customers.
Always keep in mind all customers are not fully aware of the importance of your
products/services. So, through promotional activities, you can communicate with your
clients/customers frequently, solve their problems instantly and sell more products and
services every day.
7. Further Expansion of Your Business
Different promotional activities lay the foundation for the further expansion
of your business. For example- you can give free times to customers to make them
feel special and they love to buy from your frequently. It also helps you to gain
more customers and business opportunities easily and effortlessly.

IMPORTANCE OF PROMOTION

Promoting your brand will help you in many different ways:

• Increase brand awareness - Promotions help in creating brand
awareness. With the help of various media like the television, billboards,
radio or local newspaper news, you can spread across information about
your brand and company, which helps people to find out more about you
and look into your products and make purchases.
• Segment Identification - If you’re promotional and marketing strategy is
loosely structured, it might not be successful in targeting the “right”
audiences. Having a full- proof and well-thought-out promotional strategy
and marketing plan can help you identify different segments of consumers in
the market and offer suitable solutions for your clients.
• Increase Customer Traffic - Also, promotion helps in helps in increasing
customer traffic. The more you promote your brand, the more will the
customers know about you and your company and the more will they be
interested in your products. Promotion can be done even by giving out free
samples which works wonders for customers! They try your product and
ultimately, come to you and make purchases.
• Build sales and profits - Promotional material gives customers more of an
incentive to purchase, if they can purchase your product or service from
many different sources, why should they chose you? You need to answer
this within your promotions i.e. with our product you will receive a free fitting
or extra warranty etc… This will build your profits and give you a worthy
edge over your competitors.
• Quick decision making - Limited availability offers can create a sense of
urgency in your customers that get them to act. When combined with new
content that helps customers clearly see the benefits of what you are
promoting, you can create compelling reasons to buy now.

• Strengthens the focus on marketing - Developing a promotion calendar

will encourage you to plan for new marketing programs focused at specific
times of year. If you don’t have a dedicated marketing team doing this for
you already, you should consider creating a promotions plan this will
ensure frequency in your overall marketing schedule.
 TYPES OF ADVERTISING

a. Newspaper advertising can promote your business to a wide range of

customers. Display advertisements are placed throughout the paper, while
classified listings are under subject headings in a specific section.
b. Magazine Advertising in a specialist magazine can reach your target market
quickly and easily. Readers (your potential customers) tend to read magazines
at their leisure and keep them for longer, giving your advertisement multiple
chances to attract attention. Magazines
generally serve consumers (by interest group e.g. women) and trade (industry/business
type
e.g. hospitality).Magazines do not usually serve a small area such as a specific
town. If your target market is only a small percentage of the circulation, then
advertising may not be cost- effective.
c. Radio Advertising on the radio is a great way to reach your target audience. If
your target market listens to a particular station, then regular advertising can
attract new customers. However, sound has its limitations. Listeners can find it
difficult to remember what they have heard and sometimes the impact of radio
advertising is lost.
d. Television advertisements have the advantage of sight, sound, movement
and colour to persuade a customer to buy from you. They are particularly useful if
you need to demonstrate how your product or service works.

Producing a television advertisement and then buying an advertising slot is

generally expensive. Advertising is sold in units (e.g. 20, 30, 60 seconds) and costs
vary according to:
• the time slot
• the television program
• whether it is metro or regional
• if you want to buy spots on multiple networks

e. Directories - list businesses by name or category (e.g. Yellow Pages phone

directories). Customers who refer to directories have often already made up
their mind to buy - they just need to decide who to buy from.

f. Outdoor and transit there are many ways to advertise outside and on-the-go.
Outdoor billboards can be signs by the road or hoardings at sport stadiums. Transit
advertising can be posters on buses, taxis and bicycles. Large billboards can get
your message across with a big impact. If the same customers pass your billboard
every day as they travel to work, you are likely to be the first business they think of
when they want to buy a product. Even the largest of billboards usually contain a
limited amount of information; otherwise, they can be difficult to read. Including your
website address makes it easy for customers to follow up and find out more about
your business. Outdoor advertising can be very expensive especially for prime
locations and supersite billboards.

g. Direct mail, catalogues and leaflets - Direct mail means writing to customers
directly. The more precise your mailing list or distribution area, the more of your
target market you will reach. A direct mail approach is more personal, as you can
select your audience and plan the timing to suit your business. A cost effective form
of direct mail is to send your newsletters or flyers electronically to an email
database. Find out more about direct mail.

Catalogues, brochures and leaflets can also be distributed to your target area.
Including a brochure with your direct mail is a great way to give an interested
customer more information about your products and services. Learn more about
leaflet marketing using letterbox drops and hangouts.

Online - Being on the internet can be a cost-effective way to attract new customers. You can reach a
global audience at a low cost. Many customers research businesses online before deciding whom to buy
from. Other ways to advertise your business online include promoting your products or services on
social media sites, blogs and search engines and other websites that your target audience visits. Find out
more about social media.

SALES PROMOTION DEFINE

Sales promotion is the practice of offering sale prices and other incentives to
customers. It is often coordinated with marketing activities such as advertising,
promotion, sales targets, channel management and visual merchandising. The
following are common types of sales promotion.

TYPES OF SALES PROMOTION

Sale prices such as a percentage discount.

• Volume Discount such as buy two get one free.
• Freebies Free items with a purchase such as a free baseball cap with a
purchase of a meal.
• Contests such as prize giveaways.
• Coupons are one way to implement price discrimination as price
sensitive customers will be more willing to look for coupons.
• Loss Leaders selling an item at an exceptionally low price to attract
customers to a location.
• Upgrades & Premiums Free upgrades such as more memory in a mobile
device.
• Terms temporarily offering improved terms such a telecom company that
offers unlimited bandwidth on new contracts for a limited time.
• Free Trials Allowing customers to try a service risk free for a period of time.
• Free Samples such as a trial size of a new product that is given out to
create brand awareness.
• Loyalty Programs offering double or triple points on a loyalty program
for a period of time.
• Trade Allowances Discounts given to distribution partners such as
retailers to encourage them to stock up on your product. In many cases,
this is done in conjunction with advertising to support sales.
• Dealer Loader A dealer loader is a reward that is given to retailers to buy
a minimum amount or to install in-store displays.
• Push Money Extra commissions for salespeople and distribution partners
to increase sales volume

Publicity involves conveying information and generating awareness about products

and services to the general public or target audiences through various media.

SIX COMMON TYPES OF PRESS RELEASES:

1. General News -This is the most common type of press release. The idea
behind a general news release is to generate traditional coverage in online and
offline media. While ideally the topic in the release should be newsworthy,
sometimes the definition of “newsworthy” can be stretched a bit. For example, a
press release can be sent out when your company wins an award or contest.

2. Launch Release - A launch press release relates to the release of a new

company, product, website, initiative or something similar. The format of this press
release is similar to a general news release, but with more of an emphasis on
timeliness. A launch release should help create a sense of urgency about the
upcoming news.
A launch press release doesn’t even have to be about something tangible. Instead,
you can launch an idea. Recently, the Democratic Party launched a new economic
platform called a "Better Deal." While this isn’t a physical object you can hold in your
hand, many media outlets still devoted a lot of (virtual) ink to discussing the
concept.

3. Event Press Release - Most press releases are written with members of the
media as the initial audience. An event press release is a little different. This type
of press release needs to clearly explain the details of an event. The goal is to
have the event specifics printed in the media so the general public can learn
about them.

4. Product Press Release -Releasing a new product? Let the world know with a
product press release. This has a similar format to a launch press release. The
main difference is that a product press release contains product specs.

5. Executive, Staff and Employee Press Release -Large companies typically

 announce new hires, especially those in high levels of management, in a press
release. A press release of this genre often includes fairly extensive biographical
information about the new hire. At least one photo of the person should be
included, too.

6. Expert Position Press Release -This is a type of press release used to

establish an individual’s or brand’s credibility in a particular field. The idea is to
position the person or company as a go-to source of information to be contacted by
the media at some point in the future. An expert position press release provides a
general introduction as well as some type of third-party verification of expertise.

Positive result of word-of-mouth

• Competent employee
• Proper treatment of people
• Not overcharging
• Not using false claims in advertising
• Keeping promises to customers
• Having a good product or services
• Keeping customers happy

Activitiy 3.5

A. Discuss in your own words:

1. What is promotion in simple words?

2. How do I start business promotion?
3. How do you do a promotion?

B. MULTIPLE CHOICES:

1. The idea is to make people aware, attract and induce to buy

the product, in preference over others.
A. advertising b. selling c. promotion d. General
news
2. This type of press release needs to clearly explain the details of an event.
A. launch press release b. event press release c.
General new
D. Product

3. Extra commissions for salespeople and distribution partners to increase sales

volume.
A. Push Money b. Dealer Loader c. Free Trials
D. Personal Selling

4. It involves conveying information and generating awareness about

products and services to the general public or target audiences
through various media.
A. Sales Promotion c. Advertising C. Selling d. Publicity
5. The use of a company’s website to generate sales through online
ordering, information, interactive components such as games, and other
elements of the website.

A. Online Selling b. E-commerce c. Internet d. Webmail