PROMOTION – FUNCTIONS AND BENEFITS, SALES PROMOTION
WHAT IS PROMOTION?
Promotion is the element in an organization’s marketing mix that serves to inform, persuade, and remind the market of the organization and its products. It creates awareness of the organization, its goods and services.
Basically, promotion is an attempt to influence; it involves communication of information between sellers and potential buyers or others in the channel to influence attitude or behaviours. In short, the marketing manager’s main promotion job is to tell target customers that the right product is available at the right place, and at the right price.
Promotion is a key element of the marketing mix for several reasons. With new products, customers must be informed about the items and their attributes before they can develop favourable attitude towards them. For products with a level of consumer awareness, the promotional thrust is on persuasion: converting product knowledge to product liking. For well-entrenched products, emphasis is on reminder promotion: reinforcing existing consumer beliefs.
In short, promotion is an effort by a seller to persuade buyers to accept, resell, recommend, or use the product, service, or idea being promoted.
FUNCTIONS AND BENEFITS OF PROMOTION
Functions
Informing – This involves the dissemination of information to the middlemen as well as ultimate consumers.
Persuading – Products require strong persuasion to buy products since consumers have many brands to choose from.
Reminding – Consumers must also be reminded about a product availability and satisfaction potential.
Benefits
Promotion provides a “voice” for the firm in the marketplace, so that communicate product features and benefits to prospective customers.
Promotion helps a firm increase the sales of its products.
Promotion aids a firm in establishing new products.
Promotion assists a firm in securing distribution of its products among marketing-channel members.
Promotion helps a firm in establishing a preference for its branded products.
Promotion aids a company in building a favourable corporate image.
Promotion keeps a seller in contact with his markets. Customers and prospective customers (prospects) want to know of the existence of want-satisfying products, where to buy them, and their qualities expressed in terms of benefits. Without this information, buyers are severely handicapped in attempting to maximize the results of their expenditures.
Ultimately, sellers expect the use of promotion to increase the sales of their products or services. Sales are necessary to ensure the existence of any profit-making enterprise; they provide the revenue with which a firm keeps operating.
FORMS OF PROMOTION (THE PROMOTIONAL MIX)
Promotion mix is the combination of advertising, sales promotion, personal selling, publicity, public relations, and direct marketing that help an organization achieve its marketing objectives.
Advertising
Is any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor. It is a promotion via a recognizable advertisement, placed in a definable advertising media guaranteeing exposure to a target audience in return for a published rate for the space or time used.
Publicity
Publicity is news or information about a product, service, or idea that is published on behalf of a sponsor but is not paid for by the sponsor. Publicity is “free” in the sense that the sponsor does not pay for space or time used in presenting his message. Usually, publicity messages are presented as news, helpful information, or announcements, in such media as newspapers, magazines, television, and radio, and the sponsor’s name may or may not be given.
Public Relations
Public Relations (PR) has to do with creating a good image for the organization as well as its employees, to customers, shareholders, government agencies or a special interest group. P R efforts are seen in newsletters, annual reports, lobbying, and sponsorship of charity events, etc.
Sales Promotion
Sales promotions are short-term incentives to encourage purchase or sale of a product or service. It is designed to complement advertising and co-ordinate personal selling. Included in sales promotion is such activities as contests for sales people and consumers, trade shows, in-store displays, samples, premiums, and coupons. The various forms of sales promotion shall be discussed in detail in the next section.
Personal Selling
This has to do with persuading customers to patronize your products. It is the presentation of a by a representative of the selling, organization.
Direct Marketing
Is a promotion delivered in the post, or to the door, phone calls, or a fax messages as well as text messages and e- mails to consumers and prospects.
FORMS OF SALES PROMOTION
Sales promotion consists of short-term incentives to encourage purchases or sales of a product or service. It is a direct inducement that offers an extra value of incentive for the product sales force, distributors, or the ultimate consumers with the primary objective of creating an immediate sale. The various forms of sales promotion are discussed below.
Sampling
In sampling, consumers are given some quantity of a product for no charge to induce trial. Sampling is generally considered the most effective way to generate trial, although it is also the most expensive. As a sales promotion technique, sampling is often used to introduce a new product or brand to the market. Sampling is also used for established products as well.
Couponing
The oldest, most widely used, and most effective sales promotion tool is the naira-off coupon. Coupons make it possible to offer a price reduction only to those consumers who are price sensitive. Such consumers generally purchase because of coupons, while those who are not as concerned about price buy the brand at full value.
Premiums
A premium is an offer of item of merchandise or services either free or at a low price that is an extra incentive for purchasers. Free premiums are usually small gifts or merchandise included in the product package or sent to consumers.
Contests
A contest is a promotion where consumers compete for prizes or money on their skills or ability. The company determines winners by judging the entries or ascertaining which entry comes closer to some pre-determined criteria (e.g. picking the winning teams and total number of points in a tournament). Contest usually provides a purchase incentive by requiring a proof of purchase to enter or an entry form that is available from a dealer. Some contests require consumers to read an advertisement or package or visit a store display to gather information needed to enter.
Refunds and rebates
Refunds (also known as rebates) are offers by the manufacturer to return a portion of the product purchase price, usually after the consumer shows some proof of purchase. Consumers are generally very responsive to rebate offers, particularly as the size of the savings increases. Rebates are used by makers of all types of products, ranging from packaged goods to major appliances and cars.
Bonus packs
Bonus packs offer the consumer an extra amount of a product at the regular price by providing larger containers or extra units. A bonus pack is a lower cost per unit for the consumer and provides extra value as well as more products for the money.
Price-off Deals
Another consumer-oriented promotion technique is the direct price-off deal, which reduces the price of the brand. Price-off reductions are typically offered right on the package through specially marked prices. Typically, price-offs range from 10 to 25 percent off the regular price, with the reduction coming out of the manufacturer’s profit margin.
Event sponsorship
Another type of consumer-oriented promotions that has become popular in recent years is even sponsorship, in which a company develops sponsorship relations with a particular event. Many marketers are attracted to event sponsorship because it gets their company and/or product names in front of consumers. By choosing the right event for sponsorship companies can get visibility among their target market.
SUMMARY
Promotion is the element in an organization’s marketing mix that serves to inform, persuade, and remind the market of the organization and / or it products. It creates awareness of the organization, its products and services.
Functions of promotion are: informing, persuading, and reminding consumers about a company and its products.
Promotion is beneficial to a company because sellers expect the use of promotion to increase the sales of their products or services. Sales are necessary to ensure the existence of any profit-making enterprise; they provide the revenue with which a firm keeps operating.
Promotion mixes are the promotion tools available for the marketer to use, which he can combine in any desired manner to secure appropriate results. It is the combination of advertising, sales promotion, personal selling, publicity, public relation, and direct marketing that helps an organization achieve its marketing objectives.
Sales promotion consists of short-term incentives to encourage purchases or sales of a product or service. It is a direct inducement that offers an extra value of incentive for the product to sales force, distributors, or the ultimate consumer with the primary objective of creating an immediate sale.
Some important tools of sales promotion are: sampling, couponing, premiums, contests, refunds and rebates, bonus packs, price-off and event sponsorships.
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