Promotion and its Types

Promotion informs consumers about the rest of the marketing mix. Without it, consumers do not know about the product, the price, or the place. Promotion is more than just advertising, and it includes several activities. It is crucial when you are selling in a mass market or you have a brand name. Promotion includes:

• Advertisements: They can take different forms, e.g. on TV, in newspapers.

• Promotion: e.g. Money off coupons.

• Personal selling: Sending out sales representatives to talk directly to the consumers.

• Public relations: Involves making the public aware of the company, e.g. creating publicity in the media.

The aims of promotion:

• To inform people about particular issues.

• To introduce new products to the market.

• To compete with competitors products.

• To improve the company/brand image.

• To increase sales.

Different Types of Promotion

Promotion is usually used to support advertising and to encourage new or existing customers to buy the product. Its main function is to boost sales in the short-term, but not in the long term. It is used to attract new customers so that they can try out items with the hope that they will like it and continue to buy it after the promotion has ended. Here are some ways in which promotion is used:

1. Price reductions: Involves sales or price reduction coupons. 

2. Gifts: Gifts are placed in the packaging of the product to encourage consumers to buy it. (e.g. toys in McDonald's happy meal). 

3. Competitions: A card may be put in the packaging allowing the consumer to enter contests such as the lottery. 

4. Point-of sale displays and demonstrations: Can be put near the window and displayed attractively. It could also encourage people to buy it if they can see how it works (demonstrated by sales staff)

5. After sales service: e.g. warranty services. It reassures the customers that if the product has a problem then they can go and fix it for free. This make the product more attractive than others without warranty.

6. Free samples: Encourages people to try the product. It can be included in other products as well. E.g. washing machine comes with free washing powder.

The Advantages of Promotion

• Can boost sales during the year when sales are traditionally low (encourage off-season purchases)

• Encourages people to try a product.

• Encourages people to buy a product or the product in greater quantities.

• Encourages people to buy a product instead of competitors' products.

Which Type of Promotion Should Be Used?

When deciding on what type of promotion should be used, these points should be considered:

• The stage of the product life cycle: e.g. use informative advertisement in the introduction stage of the life cycle.

• The nature of the product itself: e.g. consumer goods use coupons but producer goods use discounts on bulk buying.

• The advertising budget: obviously the type of promotion depends on how much you can spend.

• The cultural issues involved in international marketing: businesses need to consider whether their type of advertising might offend the local people. They should also take into account things such as how many people own TV, literacy level, etc…

• The nature of the target market: Different markets require different media for advertising.