Promotion is referred to as a mix of elements used by a business to communicate to current and potential customers, its range of products or services. Getting the promotional mix right is key to the success or failure of a business, because, without promotion, there is no knowledge of your products or services, and no customers.
The 5 main elements of the promotional mix are advertising, personal selling, sales promotion, public relations, and direct marketing.
Advertising is the most common and efficient method of promotion. It enables a business to reach a large number of consumers and can be used to disseminate messages about the products and services including features and points of difference to a competitor’s product/service. Advertising can take the form of television advertising, radio adverts, magazines, direct mail, billboards, internet and newspaper adverts. The business has control over what messages are being delivered, and how they are delivered to the consumer. A disadvantage is that the delivery is non-personal and it is difficult to gauge its effectiveness as there is no direct system for feedback. The Seriously Good Chocolate Company (SGCC) could advertise in local newspapers, drawing on the history of the company, and in particular the use of her grandfather’s recipes, as a point of difference to competitors.
Personal selling is a direct face-to-face interaction with the customer. Personal selling presents opportunities to on-sell, such as an extended warranty or upgrades. A disadvantage of personal selling is the high costs of retaining an employee and incentives/commissions which may be paid for each sale, and the inconsistency of messages/information given to customers between sales people. The SGCC has a retail shop in Spey Street where they sell directly to customers. They could use these interactions to promote the purchase of wine and beer-infused, or Kiwiana-themed chocolates, or factory tours and chocolate making classes.
The element of sales promotion is the addition of incentives to the consumer in an effort to create demand. Sales promotions take the forms of coupons, free samples or products given with each sale, contests, and loyalty incentives. The advantage of using sales promotions is that there is an immediate increased demand for the product/service during the promotion. A disadvantage is that when the promotion is completed, sales will drop. A sales promotion which SGCC could do is to give samples to customers, for example, buy 10 units, get 1 free. They could also create awareness of new product flavours by providing samples for customers to try.
Public relations is about creating a positive image for the product/service/brand/business. The audience is broad, ranging from current and potential customers, to shareholders, the media and general public. A business can create publicity through being involved in community events, or writing a media release, donating prizes or sponsoring sports teams. An advantage of public relations is that it is mostly a free form of promotion, but there is little control over the messaging, and this is a definite disadvantage.
Direct marketing is a strategy which eliminates the middleman. It focuses on a direct relationship between the business and the end consumer, with the goal to creating a sale. The advantages of direct marketing means that the business can use a focused and customised approach with their target market, generating repeat sales. A disadvantage is the reliance on up-to-date information from databases and risks of violating legislation, for example, the Privacy Act.