A promotion occurs when marketers offer something of value, generally in the form of lower cost or something with additional value, for a short time period to try to convince customers to buy. For example, if Finest Supermarket (grocery retailer) runs a “Get 15% off on all food items during 3 days leading Eid” offer – that is a promotion. If a beverage company, like Coca-Cola, hands out a free sample of their new juice drink to everyone attending a soccer match, that is a promotion.
Promotion is often confused with advertising, but they are two different concepts.
The confusion exists because a promotion is often announced using a method of advertising (like a radio ad or a flyer). For example, if a local coffee shop, such as iCafe in Share Naw, announces in a radio ad that it will offer “Buy a sandwich get 1 soda free” all day on next Thursday only, then this is both advertising and promotion.
In this case, both activities are occurring – the promotion (buy a Pizza Roll and get a soda free) is being communicated by advertising (the radio ad). Promotion includes all aspects of marketing communications with your customers (and potential customers) when you try to get them to take some action in a short-term timeframe. Promotional messages can be seen/heard in media such as TV and
radio; they can be found in action-oriented incentives (e.g., temporary sale prices & discounts), and are present in direct selling (in person, or personalized via phone, email, or internet).
The objective of promotional activity is to get people to buy. Promotions can be an
effective tool for: Creating a sense of urgency (“call to action”) to encourage customers to buy
immediately.
Getting people to try – using offers such as “Free sample” or “Buy one Get one Free”. Increasing how much they buy -- For example: “Buy 100 Afs in 3G data from Etisalat and get 150 Afs worth of data usage for next month. Or a fast food restaurant, such as Mr. Cod, has supersized meals which is an example of this type of promotion.
Increase how often they buy -- The use of loyalty cards is a well-accepted promotional tool to motivate consumers to return more often. The airline and retail industries have been doing this for years.
Research has shown that three concepts can help explain how promotion works to grow your business: Awareness, Trial and Repurchase. These three concepts summarize the steps in the purchasing process - from thinking about making a purchase to buying the product on an ongoing basis.
Step 1: - Awareness - First, potential customers must become aware of a product/service and recall its particular benefits and performance levels.
Step 2: - Trial - If the customer thinks that the product/service will meet their needs and will deliver good value for the money, then the customer may try the product. Of course, trial may not happen if the brand can’t be found in stores or if the customer realizes that her perceptions are wrong (e.g. the actual price is much higher than what she thought).
Step 3: - Repurchase - When a customer purchases the product, they can test the product’s performance in use and determine whether their perceptions were correct and the product delivers the expected value. If so, the customer may buy the product again. This is the best result of a promotion - a loyal customer.
Different promotional tools are effective for addressing different marketing needs. Some well-known promotional tools are:
Trial offers – This is usually seen at the launch of new product, this type of promotion can be used to reduce the price. “20% off for a limited time only.” The goal is to reduce a potential customer’s resistance to trying something new by offering a short-term deal.
Coupons – this type of promotion is used for new and existing products. Coupon use has a similar aim to trial offers – encouraging a customer to buy because of a lower price.
Sampling – the most expensive type of promotion puts the product in the hands of customers for free. This is risk free to the customer, but can be costly to the business. Sampling has been proven to be the #1 most effective type of promotion to get people to try a product or service. For instance, perfume shops hand out sample fragrances to customers to get them to visit their shops.
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