Unit 3.1: Marketing | Promotion

Promotion gives the consumer information about the rest of the marketing mix. There are a few reasons why firms use promotion:

• To make consumers aware of new products.
• To remind consumers about existing products.
• To increase sales of existing products.
• To improve company image

There are also four methods of promotion:

Advertising

Advertising is any message about the firm or its products that the firm has paid for. Advertising has different advertising media:

1. Television - it can reach millions, yet it is very expensive.
2. Radio - it is cheaper than TV, but it reaches a smaller audience and often sound-only ads don’t have a great impact on the audience.
3. Newspapers/Magazines - they are easy to target effectively, but they are static and silent.
4. Posters - high visual impact and stay for a long time (and people see them daily), but they are vulnerable to wind, rain and graffiti. 
5. Cinemas - high visual and sound impact and audience is usually captive, yet it is very expensive considering the audience size reached.
6. Leaflets/Junk mail - cheap, but easy to ignore.
7. Internet sites - high visual impact, interactive, and link directly to buying the product, but advert is competing with lot of other stuff on the net.

Where to advertise?
Mass-market products - advertised anywhere (usually TV).
Local products - advertised on local radio, in local papers, and on posters.
Specialised products - advertised in specialist magazines or websites, and targeted junk mail.

Advantages of advertising	Disadvantages of advertising
Gives people information and helps them make a choice.	It makes people want things they used to be perfectly happy without.
Newspapers and TV cost less as they have more money, and they are of a better quality.	Advertising costs money, so firms have to charge more for their products to pay for it.
It employs many people, as it is a big industry	It is expensive, so small firms find it difficult to compete.

Sales promotion

Sales promotion promotes a product through activities such as displays, exhibitions, demonstrations and shows, and by incentives such as free samples and price reductions. There are several different types of promotion:

• Price reductions - this encourages the consumer to try the product and, with luck, to become a regular consumer.
• Competitions - the opportunity to enter in a competition where the consumer can have the chance to win an expensive item often encourages them into buying the product.
• Point-of-sale displays - POS is where the product is being sold. Here there may be a special display of the product, and with this demonstration it can encourage consumers in buying the product.
• Gifts - sometimes small gifts are placed in the packaging of a product to encourage the consumer to buy it. The aim is that the consumer may continue buying the product even after the promotion has ended.
• Use of credit - a good way to get someone to buy a product is to let them buy now but pay later.

Advantages of promotion

• It encourages new consumers to try an existing product.
• It encourages consumers to try a new product.
• It encourages consumers to buy your product instead of a competing brand.
• It can promote sales at times in the year when sales are traditionally low.

Personal selling

This involves talking directly to consumers and getting them to buy the product. It can give the company valuable information about what the public thinks about the product. However, it is very expensive because it is highly labour intensive.

If the product is expensive, personal selling is usually used. The customer will want to be reassured that they are making the right purchase if they are spending a lot of money.

Public relations 

Public relations (PR) is concerned with promoting a good image for the company and its products. Public relations can take many forms, from sponsoring events in sport matches, to the donation of some of their products to charity.

All of these types of activity raise the public’s awareness of the company and its products, and increase the likelihood of customers choosing the products over its competitors.

Unlike promotion, PR publicity is not paid for by the business.