Strategies and Importance of Promotion
Table of Contents:-
Strategies of Promotion
The Strategies and Importance of Promotion are given below. There are two types of Strategies of Promotion, Marketing communication or promotional strategies:
- Push Strategy
- Pull Strategy
In push strategy, the promotional programme is primarily directed at the market intermediaries in the distribution system. It aims to motivate the market intermediaries to stock, promote, and sell the products to the ultimate customers, as depicted in the figure. The market intermediaries, such as distributors, wholesalers, and retailers, are offered a variety of incentives to push the product into the market. Generally, in the push strategy, the distributors are motivated to promote the product to the wholesalers, who, in turn, promote the product to the retailers, who finally push the product to the consumers.
The tools used in push strategy include sales promotion, personal selling, contests for salespersons, and trade shows. Push strategy is usually more effective under the following situations:
i) Lack of product differentiation,
ii) Weak brand identity or brand clutter,
iii) Low brand loyalty.
iv) Difficulty in appreciating product benefits,
v) Industrial products,
vi) Institutional sales,
vii) Lack of access to advertising media,
viii) Low promotional budget,
ix) Short and direct marketing channels.
x) Low wages, i.e., the cost of employing salespersons is lower than the advertising cost.
Firms with low promotional budgets often adopt push strategies to move their products through the distribution channels. Besides, the commodification of brands has made it difficult for customers to differentiate between competing brands, making the push strategy more effective.
The process of motivating the customers to buy the product from the retailers through promotional programmes, as given in the figure, is referred to as a push strategy. A retailer asks for a product from a wholesaler and the wholesaler asks for the product from a distributor who gets the product from the firm.
Pull strategy is much more effective in the following situations:
i) Perceived product differentiation,
ii) Strong brand identity.
iii) High brand loyalty.
iv) High-involvement product category,
v) High promotional budgets,
vi) Self-service in retail system, i.e., supermarket culture.
The promotional techniques used for pull strategy include advertising and sales promotion campaigns directed at consumers, such as discounts, gift vouchers, samples, etc. In retail outlets where self-service is predominant, the pull strategy is more effective. Besides, the pull strategy also facilitates long-term brand loyalty among customers. However, given the market conditions and the factors mentioned above, a firm may use a judicial mix of pull and push strategies for market promotion.
Importance of Promotion
The role of promotion in communicating value to customers in the target market can be explained with the following points:
1. Increasing Awareness
If the product is new, or the marketer wants to introduce it to a new potential customer base, promotion is vital. Using testimonials from other people who have used the product, citing research or awards that validate the products’ effectiveness or desirability and getting the media to write or speak about the effect all alert consumers to the fact that the product is available.
2. Increasing Knowledge and Preference
Just because consumers know about the product or brand, doesn’t mean they’ll buy it. Promotion let them communicate the product’s benefits to consumers and helps convince them that the product is something they need. Combining product or brand, awareness and knowledge is key to getting consumers to seek out the product in stores.
3. Increasing Retailers
Many retailers have more products than they can sell based on limited shelf space. If one can demonstrate to current and potential retailers that one will be increasing their sales of the product by increasing consumer demand for it, one will get and keep retail accounts.
4. Increasing Sales
Ultimately, the measurement of successful promotion is whether or not the promotion increased sales. Increasing awareness of a product is of little value if one doesn’t get consumers to act. The promotion strategies should work together to inform, convince and motivate customers to buy.
5. Increase Customer Traffic
Most retailers start their frequency programs by having customers fill out an application. They then issue cards for customers to use each time they make a purchase; the cards contain magnetic strips that track purchases through registers and computers. Frequency card promotions are designed primarily to attract traffic among current customers. New customers also may get attracted to the promotion if they hear about it.
6. Build Sales and Profits
Ultimately, the measurement of successful promotion is whether or not the promotion increased sales. Increasing awareness of a product is of little value if one doesn’t get consumers to act. The promotion strategies should work together to inform, convince and motivate customers to buy. One will need to quickly follow this with promotions that convince consumers to buy.
It should always be noted that the clearer, more interesting, and more convincing the marketing communication is, the more influence it will have on the customers to take positive action, which will positively affect the revenue and deliver the expected level of customer value.