PRINCIPLES OF MARKETING (UNIT 6: Promotion Decisions)

Concept of Promotion

▪ Promotion is a marketing tool, used as a strategy to communicate between the sellers and buyers.
Through this, the seller tries to influence and convince the buyers to buy their products or services. It
assists in spreading the word about the product or services or company to the people. The company
uses this process to improve its public image. This technique of marketing creates an interest in the
mindset of the customers and can also retain them as a loyal customer.

Concept of Promotional Mix

▪ Promotional mix refers to an optimum combination of different promotional tools and techniques; with
a view to maximizing sales and profits.
▪ The need for a promotion mix arises because all promotional tools and techniques are not equally
effective and appealing. Promotion mix imparts a variety to the promotional efforts of the marketing
manager).

Factors determining Promotional Mix

Some of the factors influencing the selection of the marketing communications mix are noted as follows:
Durable products (such as consumer durables, automobiles etc.) make use of
advertising and sales promotion. Industrial products (such as aircrafts, construction
Product equipment etc.) are largely sold using personal selling techniques. The PLC also guides
Features selection of the mix. For example, advertising and publicity have proved to be most
effective during the introduction phase, heavy emphasis is placed on advertising and
sales promotions during growth and maturity phases.
Allocation of promotional funds for consumer markets in order of priority goes to sales
Market
promotion, advertising, personal selling and public relations. Generally personal selling
Features
is more apt for high-involvement, risky or luxury products.
With push strategy, the manufacturer promotes the product only to the next institution
down the marketing channel. It generally uses personal selling and trade sales
Push and
promotions to motivate resellers to stock the product and sell them to consumers. In
Pull
case of a pull strategy, marketers direct their communications to consumers to develop
Strategies
strong consumer demand for the products or services. This is primarily achieved
through advertising and sales promotion.

Tools/ Elements of Promotional Mix

The major elements of the promotional mix comprise of advertising, sales promotion, personal selling,
public relations and publicity as well as direct marketing. They are outlined as follows:
Advertising is any paid form of non-personal mass communication through various
media to present and promote products, services and ideas by an identified sponsor. It
is highly cost-effective because it can reach a large population at a low cost per person
and the message can be repeated several times.
Characteristics of Advertising:
Advertising
▪ It is non-personal or mass communication, as personal contact is not possible
▪ It is a paid form of communication
▪ It is a one-way communication
▪ Identifiable entity/ sponsor-company or person gives advertising
▪ It is costly option to promote the sales
 ▪ It can be reproduced frequently as per need
According to the Council of Sales Promotion Agencies, sales promotion has been
defined as a marketing discipline that utilizes a variety of incentive techniques to
structure sales-related programmes targeted to customers, trade and/or sales levels that
generates a specific, measurable action or response for a product or service. Examples
include discounts, rebates, free samples, coupons, contests etc.
Characteristics of Sales Promotion:
▪ The primary purpose of sales promotion is to induce customers for immediate
Sales
buying or dealer effectiveness or both
Promotion
▪ Excessive use of sale promotion may affect sales and reputation of a company
adversely
▪ It is taken as supplementary to advertising and personal selling efforts.
▪ It involves all the promotional efforts other than advertising, personal selling, and
publicity
▪ It consists of short-term incentives, schemes, or plans offered to buyers, salesmen,
and/ or dealers
It is a face-to-face paid personal communication and aims to inform and persuade
prospects and consumers to purchase products, services or accept ideas of issues. It
involves more specific communication aimed at one or several persons. It is most
effective but also the most expensive of the promotional mix elements.
Personal Characteristics of Personal Selling:
Selling ▪ It is an oral, face-to-face, and personal presentation with consumers
▪ Basic purpose is to promote products or increase sales
▪ It involves two-way communication
▪ Immediate feedback can be measured
▪ It is an ability of salesmen to persuade or influence buyers
Public Relations are a broad set of communications activities employed to create and
maintain favourable relationships with employees, shareholders, suppliers, media,
educators, potential investors, financial institutions, government agencies and officials as
well as society, by and large, in the form of annual reports, brochures, events or
sponsorship programmes.
Characteristics of Public Relations:
▪ It is a paid form of market promotion. Company has to incur expenses
▪ PR activities are designed to build and maintain a favourable image for an
organisation and a favourable relationship with the organization’s various publics
▪ It is an integral part of managerial function. Many companies operate a special
Public
department for the purpose, known as the public relations department
Relations
▪ It involves a number of interactions, such as contacting, inviting, informing,
and
clarifying, responding, interpreting, dealing, transacting, and so forth
Publicity
▪ Public relations cover a number of publics – formal and informal groups. These
publics may be customers, stockholders, employees, unions, environmentalists,
the government, people of local community, or some other groups in society.
Publicity is a tool of public relations. It is a non-personal mass-communication, but not
paid for by the benefitting organization for the media space or time. It can take the form
of news stories about an organization, its products or activities. Some tools of publicity
include press conferences, news releases and feature articles.
Characteristics of Publicity:
▪ It involves obtaining favourable presentation about company or company’s offers
upon radio, television, or stage that is not paid for by the sponsor
 ▪ It is a non-paid form of market promotion. However, several indirect costs are
involved in publicity
▪ It may include promotion of new product, pollution control efforts, special
achievements of employees, publicizing new policies, etc., for increasing sales. It
is primarily concerning with publishing or highlighting company’s activities and
products. It is targeted to build company’s image
▪ Mostly, publicity can be carried via newspapers, magazines, radio or television
▪ Company has no control over publicity in terms of message, time, frequency,
information, and medium
It involves vending products to customers without the involvement of channel members.
It is a system by which firms communicate directly with target customers to generate the
response or transaction, such as an inquiry, purchase or vote. Direct marketers
communicate largely through direct-response media vehicles such as direct mail,
telephones, interactive TV or Internet.
Characteristics of Direct Marketing:
▪ A database of names (prospects, customers, businesses, etc.), often with certain
other relevant information such as – contact number/address, demographic
information, purchase habits/history, company history, etc., is used to develop a
Direct
list of targeted entities with some existing common interests, traits or
Marketing
characteristics
▪ It relies on being able to address the members of a target market. Addressability
comes in a variety of forms including email addresses, phone numbers, Web
browser cookies, fax numbers and postal addresses
▪ It seeks to drive a specific “call to action
▪ It emphasizes trackable, measurable responses, results and costs from prospects
and/or customers – regardless of medium
▪ Direct marketers work with the most interested customers and rely on
segmentation tools

Select Sources:

Jaideep, S. (2015, April 15). Top 5 Elements of Promotion Mix. Your Article Library. https://www.yourarticlelibrary.com/marketing/promotional-
mix/top-5-elements-of-promotion-mix-with-diagram/48643
Kotler, P., & Keller, K. L. (2009). Marketing management. Upper Saddle River, N.J: Pearson Prentice Hall.