10 Minute Guide

CIM 14280 | DS | May 2009

How to achieve
an effective
promotional mix
Membership Services
Moor Hall, Cookham
Maidenhead
Berkshire, SL6 9QH, UK
Telephone: 01628 427500
www.cim.co.uk/marketingresources
The Chartered Institute of Marketing, 2009.
All rights reserved. Permission to reproduce or extract
material from this publication must be sought from
The Chartered Institute of Marketing.
10 Minute Guide
Promotional
Mix
What it is
The promotional mix is a term used to
describe the set of tools that a business
can use to communicate effectively the
benefits of its products or services to its
customers.
The promotional mix includes the following
tools
advertising
public relations
sales promotion
direct marketing
personal selling
The promotional mix is part of the wider
marketing mix. To find out about the
marketing mix see the 10-minute Marketing
Mix.
Why it is important
If customers dont know what products and
services you provide, then your business
will not survive in todays competitive
marketplace. Effective communication with
your customers is vital to ensure that your
business generates sales and profits.
By taking the time to develop and
implement an appropriate promotional mix,
you will stimulate your target audience to
buy your products or services and
manage this within a budget you can afford.
What you should do
A successful promotional mix uses a
balance of its five tools in a planned and
structured way a single tool rarely works
well in isolation.
The challenge is to select the right mix of
promotional activities to suit your particular
business at a particular time and to then
use it correctly to achieve a result. The
combination of tools you use will depend
on the target audience, the message you
wish to communicate and the budget you
make available. There would be little point
in advertising new gas boilers in a fashion
magazine much more appropriate to
advertise in a trade magazine for builders
and gas fitters.
Here is a 10-step checklist for developing
and managing your promotional mix.
1. Decide how the products and services
you provide can be packaged
together. The image of your business is
formed by the way you promote the
elements of the marketing mix your
products, prices and the places through
which you sell. It is often helpful to think
about promoting the business as
opposed to a single product or service.
If you need to think more about the
marketing mix before going any further,
take a look at the 10-minute Marketing
Mix briefing.
2. Develop a profile of the target audience
for the message you will communicate.
Who is the target audience? This goes
beyond a simple customer list. Is it
consumers, businesses or members of
the channel (such as distributors) you
are using to get your product to the end
customer? Is it the wider stakeholder
audience?
CIM 14280 | DS | May 2009 | 2
3. Decide on the message to use. Are you
trying to differentiate, remind, inform or
persuade? Set an objective for what
should be achieved. Be clear about the
benefits that you want to promote.
4. Decide what image of the
product/service/business you want your
audience to retain.
5. Decide on a budget. This is often how
much you can afford given projected
sales for the product or service.
6. Decide how the message should be
delivered. To help you to decide what
aspects of the promotional mix to use,
think about taking your customers on a
journey that starts by creating
awareness about your business,
through obtaining information about the
products and services you provide, and
ends by generating a sale. Each
component of the mix will achieve a
different result, so your choice must be
based on real objectives for your
business. What promotional tools
should be used? When should
communications happen? How often?
Is the message consistent?
7. Decide what actions you want your
audience to take as a result of receiving
your communication. It isnt always
place an order.
8. Put in place a means of measuring and
controlling the plan once it is
developed. Who will be responsible for
dealing with the agency or media? Who
will be responsible for checking that
promotional activity happens as
planned?
9. Undertake your promotional plan. Be
consistent in what you say and how
you say it.
10. Measure what you have achieved
against the original objectives that you
set.
What you need to know
To use the promotional mix effectively, you
need to understand a little bit more about
each of the five tools and how you could
use them to achieve your objectives.
Advertising There are three main reasons
for advertising
to provide your target audience with
information (creating awareness)
to persuade them to buy from you (by
promoting product and company
benefits)
to reinforce your existence (by
consistently repeating key messages)
Research shows that people need to see
an advertisement at least seven times
before it starts to mean anything to them.
So, to be effective, advertising needs to be
conducted regularly in a consistent and
recognisable manner.
It can therefore be quite costly. Typical
advertising media include Yellow Pages,
local newspapers, radio, trade journals,
exhibitions and websites. It is also difficult
to assess how much business is achieved
through paid-for advertising unless you
include some form of monitoring scheme
(such as a discount voucher) within the
advertisement.
Public relations Publicity is something that
happens to a company and the result may
be good or bad. Public relations (or PR)
involve a sustained attempt to develop your
reputation as a business by using the
media to help create the image you desire.
It is a way of keeping the business in your
customers eyes.
News or press releases can be distributed
to the media to announce, for example,
new product launches, a change in opening
times or company successes. Articles can
be distributed to trade journals or local
newspapers, and sponsorship or charitable
donations can help to position your
business more prominently in the market
place than your competitors. Attendance at
exhibitions and seminars can also help to
promote the image of your business to a
chosen target audience.
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | DS | May 2009 | 3
If you feel confident dealing with the media
yourself, then public relations can be a very
cost-effective method of promoting your
business.
Sales promotion This activity is best
described as a specific, usually short-term,
promotion that is over and above what
you would normally provide to the customer
(e.g. buy one, get one free).
When used effectively, sales promotions
can help to move old stock, counteract
competitor activity, merchandise new
products, encourage repeat buying and
motivate your staff. They can also be
monitored, so the success of a particular
sales promotion can be measured over
time.
Sales promotions are a good way of
attracting new customers. However, on
their own they are unlikely to build customer
loyalty or change their longer term buying
habits. The type of promotion selected also
has to be relevant to your target customers
as well as to your own marketing
objectives.
Direct marketing Direct marketing s an
increasingly popular technique as it enables
you to target specific customer groups very
accurately. It is a flexible way to deliver your
message and, because each letter can be
personalised, the chances of a
response are greatly improved. The overall
success of a campaign can also be directly
measured in terms of the number of
responses received.
You can collect information on customers
and use this to build up your own in-
house database. Although this can be
time-consuming, the information gathered
will be accurate and relevant to you, and
can be relatively easily kept up to date.
Alternatively, you can buy a mailing
list of potential customers that is tailored to
your precise specification. For example, if
you were selling up-market motorbikes
and associated products, you could buy a
mailing list that provided details of men over
40 years old, who own a bike, live in a
certain postcode area and have a salary of
above 25,000. The cost of buying this list
may be high, but if you get a good
response rate from your mailing activity to
this group, then the expense would be
considered to be worthwhile.
Be aware that some false addresses may
be included in a purchased list so that the
seller of the list can verify the mailing activity
that takes place and stop theft of a list.
Personal selling This is the most effective
form of promotion because it allows your
approach to be tailored to the needs of an
individual customer. Getting a sale is
ultimately extremely important, but the
process involves a lot more than this. It is
about having a constructive dialogue with
customers to listen to their needs, promote
product & company benefits on an
individual basis, answer any questions,
resolve any problems and get their
feedback before clinching a sale.
Face-to-face, a sales person can build a
relationship with the customer
understanding their needs and feeding back
this knowledge to the business to improve
products, customer service standards,
competitor knowledge etc. Employing a
sales person is a costly exercise in the first
instance, but it is one that will provide a pay
back, usually within 12 years.
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | DS | May 2009 | 4
For owner/managers of small businesses
who may not have sufficient resources to
employ such staff, do not forget that a
personal approach to customers is still
appreciated and is an important part of any
business development strategy. Active
networking with existing customers,
suppliers, business associations and
specialised industry groups can also play a
valuable role in promoting your business to
a wider target audience and the value of
this activity should not be underestimated.
What to do now
Once you have completed the plan for your
promotional mix, you need to plan and
undertake specific promotional activities
and make sure they meet your objectives.
Advertising programmes These can be
expensive and need to be planned ahead in
order to meet publishing deadlines.
Public relations A campaign will only be a
success if it has been planned, coordinated
and measured against a desired set of
results.
Sales promotions These need to be
effectively managed by setting objectives
for each promotion and evaluating the
results after the event.
Direct marketing Weigh up the benefits of
using your own list against a bought-in list
and whatever choice you make, be
prepared to follow-up your activity to create
the sale.
Sales representatives A sales force needs
to be motivated and managed to achieve
sales targets. They require time and
resources for training, motivation and
personal development before they become
fully effective.
For more information on planning specific
promotional activities, see the 10-minute
Marketing Communication briefing.
Where to find out more
Advertising The Advertising Standards
Authority at www.asa.org.uk is a good
reference point for UK standards and codes
on advertising practice.
Public Relations - The Chartered Institute of
Public Relations - www.cipr.co.uk
Sales promotion Institute of Sales
Promotion - www.isp.org.uk.
Direct marketing The Direct Marketing
Association (DMA) at www.the-dma.org
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | DS | May 2009 | 5
An example in practice
APPENDIX 1
Greenfingers.com
Smelling of roses
David Murphy profiles gardening website
Greenfingers.com
When dreaming up ideas for transactional
web sites, one dealing in gardening
equipment, plants and everything else you
find in the average garden centre might not
seem the most obvious choice. It's not that
there isn't a market for garden equipment
and plants - a Mintel report published in
April '99 estimated that there were some 20
million gardens in the UK, with nine million
households having both a garden and
Internet access.
But if the acid test for an online transaction
site is how little it matters that potential
buyers can touch, feel and even smell the
goods on offer, then a site selling live plants
and shrubs should, in theory, never have
got off the drawing board. But when ex-
Times gardening correspondent George
Plumptre decided to get back into
gardening after a spell working for an
auction house, a gardening internet site
was the only thing on his mind, and
Greenfingers.com (www.greenfingers.com)
was born.
Says Plumptre: "I saw that the internet
could provide a fantastic offer for the
gardening public in terms of instantly-
available information and help and advice
linked to the growing desire for people to
actually buy things online." Plumptre was
helped by the fact that at the time of the
site's launch in April 1999, unlike most of
the other Internet "spaces"; there was no
major European player in the gardening
sector. So while gardening consumers
were searching for information, he says,
apart from garden.com in the States, there
was a lack of online resources to service
their needs.
"If there had been two or three big players
doing it properly, it might have ground to a
halt because the investors would have said
we were too late" he says, "but in terms of
having a mission to deliver, I would have
taken quite a lot of deterring."
Content, content, content
The idea for the site, created by new media
agency and shareholding partner,
Designercity, which incubated the project
until the first round of funding was secured,
was conceived by Plumptre in the summer
of 1999, followed by nine months' hard
work in putting together the content.
Given the breadth and depth of this
content, amounting to some 150,000
pages in all, this was no small task. An
interactive Plant Finder database, created
with the help of expert botanists from the
Natural History Museum, contains around
7,000 species, enabling users to find the
plant they want quickly. Users can search
for a list of possible and probable plant
species using criteria such as leaf and
flower type, colour and growth habit. If the
plants returned from a Plant Finder search
are not available from Greenfingers, the site
also gives details of local stockists. In
addition to the search facilities, the Plant
Finder also offers detailed plant profiles and
planting tips for different types of garden,
with information on aspect and soil type,
plus personal preferences on colour, flower
type and season of interest.
Alongside the Plant Finder database is the
Royal Horticultural Society's Nursery
Database, which holds details of more than
400 nurseries and specialist growers on the
UK dealing in rare and unusual plants. At
the other end of the spectrum, the Essential
Plants directory has details of how to
cultivate the 50 most popular families of
garden plants, from heathers and
honeysuckle to lilies and lilacs.
A further database holds details of around
1,000 gardens which are open to the
public, with a visual review of each garden
including details on themed planting
schemes, unique features and a map of
how to get there. On top of all this, there's
a monthly online magazine, plus around
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | DS | May 2009 | 6
150 gardening workshops, with different
projects designed for beginners,
intermediate and experienced gardeners,
and a gardening history section. This holds
comprehensive details of every style of
gardening through the ages, from Italian
renaissance to the contemporary landscape
designs of the 20th century.
In addition to the information content, the
site is fully transactional, with 7,000 product
lines on offer, including 6,000 species of
plant, plus a wide selection of gardening
equipment, including furniture, barbecues,
greenhouses and garden tools. Goods
ordered from the web site are delivered to
customers between 4pm and 9pm
weekdays, the delivery operation
outsourced to Securicor.
Greenfingers marketing director Jonathan
Cowan believes it's this combination of
information and transaction that gives the
site its edge. He says: "Even now, when
there are lots of other competitors out
there, no one has had the same vision that
we have had, which is the fusion of content
and commerce. Everybody else out there is
either a shop with a little bit of information
to give them credibility, or they're an
information site with little or no commerce."
Customer orders are dispatched from a
variety of sources. A warehouse in
Birmingham handles much of the hardware,
though some lines are delivered direct from
the suppliers. Plants are dispatched direct
from Eastfields, a company with many
years' experience of supplying large
numbers of live plants around the UK.
Turnaround on the plants is not particularly
fast, at up to 10 days and hardware is
delivered much more quickly, usually within
48 hours. But Plumptre says the company
has deliberately chosen to err on the side of
caution, preferring to offer a level of service
that it knows it can deliver, rather than
promising the impossible - "even if it
doesn't sound as sexy as what one or two
of our competitors might be able to offer."
Far from expecting the goods faster, says
Plumptre, consumers who take the time to
complete the email surveys that go out to
all consumers after their order has been
fulfilled are, on average more than happy
with the company's delivery performance,
rating it somewhere between meeting and
exceeding their expectations.
Though the Greenfingers team has
obviously thought through many of the
problems in running a transactional site,
particularly those relating to fulfillment,
Plumptre says the company has not
modelled itself on any other online
operation.
"There were no examples of the sort of e-
commerce offer we wanted to do,
embracing hard garden goods and live
plants and a variety of other items, so it
needed a structure of its own" he says. "It
wouldn't have worked if we'd seen a
structure we liked and tried to apply it,
because no-one has done this before.
Selling a live shrub or a live tree is not like
selling a book or a CD-ROM."
The typical Greenfingers.com customer, the
company says, is similar to the typical web
user, predominantly ABC1, but slightly older
than usual, with an average age of around
44, and a roughly 50:50 male to female
split, rather than the usual male skew found
among web users. "Gardening is getting
younger thanks to Charlie Dimmock and
Ground Force while the net is getting older
in terms of penetration" says Cowan. "We
meet nicely in the middle." On marketing to
its customers, Cowan admits that the
company does not do enough yet in terms
of individual or "one-to-few" targeting, but
promises that this will improve as the
company hones its communications skills.
An experienced team
While clearly driven by his own passion for
gardening, Plumptre, who fulfils the role of
editorial director, has surrounded himself
with a team which has a healthy
combination of marketing, gardening and
online experience, bucking the trend set my
some b2c dotcoms. Chief executive officer
Helen Bridgett was recruited from Tesco in
spring 2000, after overseeing the launch of
the Tesco Online brand in the UK in 1998.
As head of online marketing, she presided
over rapid growth, as the brand hit 50
million turnover in 1999.
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | CBM | May 2009 | 7
Prior to the Tesco role, she had also
worked for Abbey National and BRMB.
Marketing director Cowan came to
Greenfingers from Dixons Stores Group,
where he was brand development director.
Prior to DSG, he had followed a traditional
marketing career at Procter & Gamble,
United Biscuits, Nestle and Spillers.
Product sourcing is in the hands of Guy
Grimes, who has 20 years procurement
and fulfilment experience in the gardening
industry in the UK and the States, while
non-executive chairman Robin Klein sits on
the board of a number of new media
companies. "In terms of fulfilment, we
don't have your average MBA team trying
to work out how to do it" says Cowan, "we
have real people with real experience in
blue chip companies."
The company is cagey about releasing
figures, revealing only that in terms of new
members and unique visitors, it is meeting
its targets, and that it is on track to hit its
target of 800,000 unique visitors by the end
of the site's first year in business.
It received 5m of first-round investment in
February 2000 from a consortium of
venture capital companies including
Amadeus and 3K Digital from the UK and
Dutch fund Gilde IT. The company won't be
drawn on future funding plans, however, or
on when it aims to move into profit. It is
clear, however, about its ambition to look
beyond the web and use whatever
channels are available to reach new
customers.
"The dotcom is not the important bit any
more," says Cowan. "Our competence is in
direct home delivery. We can get things
from us to your door, and whether you want
to shop over the Internet or digital TV, or
mail order or telesales, we've now built an
infrastructure that can do all of them."
The company's first move away from the
web came with the launch of a mail-order
catalogue, which was released in October.
The catalogue, which features a 60-strong
line-up of contemporary gardening gifts, is
being distributed through inserts in a dozen
consumer magazines this autumn. The titles
include BBC Gardeners' World, Good
Housekeeping and Your Garden, and there
will also be a direct mail campaign targeted
at established direct mail subscribers
through the Book Club Association and the
Royal Mail. Almost 2 million catalogues will
be distributed in total. On the interactive TV
front, Greenfingers is going on Sky's Open
home shopping Extra platform, and the
company does not dismiss the possibility of
opening Greenfingers bricks and mortar
retail outlets one day.
Apart from providing Vodafone with a small
amount of content for its vizzavi WAP/fixed
line portal, however, Greenfingers is
currently doing little to explore the mobile
Internet as a distribution or marketing
channel. "Everybody is experimenting, but
nobody has a model yet which makes
money on WAP" explains Cowan.
According to the results of an omnibus
survey conducted by the market research
company Ipsos over the summer the
Greenfingers brand is second only to the
BBC in awareness of internet gardening
brands, and the company is working hard
to raise its profile through a number of key
affiliations. It has struck deals to provide
the gardening content for several portals,
most notably Freeserve, AOL UK and BT
Internet.
Offline, the company designed and built the
garden, and acted as the official gardening
supplier, to Channel 5's Jailbreak, the first
Big Brother clone to hit UK TV screens,
which began in September. Without
access to membership statistics or sales
figures, it's impossible to know for sure
whether everything in the Greenfingers.com
garden is as rosy as it appears to be, but
the company certainly seems to have a
good management team in place and an
appealing combination of content and
commerce on its site.
With the b2c market in the doldrums and
allegedly on most venture capitalists'
blacklists, it's refreshing to find a b2c
operation that seems to be working. And
with one eye on the recent b2c backlash,
Cowan offers an insight into why
Greenfingers intends to succeed where
other b2c online outfits have failed.
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | CBM | May 2009 | 8
"A lot of b2c dotcoms were run by people
who didn't have experience in managing
business-to-consumer operations" he says.
"They came straight from an MBA or they
just had an idea. We believe that because
we are a blue-chip management team in a
large market space, with experience of
running proper businesses, we will
succeed."
Finding out more
Visit
www.cim.co.uk/marketingresources
gives more useful advice for small
businesses wanting to build on their
marketing knowledge.
10 Minute Guide: How to achieve an effective promotional mix
CIM 14280 | CBM | May 2009 | 9
Data Panel
Greenfingers.com
at a glance
Conceived: Summer 1999
Launched: April 2000
Content: 150,000 pages
Product Lines: 7,000
Including plant species: 6,000
Unique visitors target: 800,000
by April 2001