Promotion strategy

The essentials

Promotion means communicating with customers to inform them about a product and persuade them to buy it. The combination of tools a firm uses is called its promotion mix. A new enterprise must choose tools that suit its product, target customers and budget.

Main promotion tools:

• Advertising: paid, impersonal communication through newspapers, radio, television, hoardings or online media by an identified sponsor.
• Personal selling: face-to-face presentation by a salesperson; useful for costly or technical products.
• Sales promotion: short-term incentives such as discounts, free samples, coupons, contests and "buy one get one" offers.
• Public relations and publicity: building goodwill through news coverage, events and community activities; publicity is not directly paid for.
• Digital and social media marketing: websites, social media pages, search advertising and email; often low-cost and easy to target.
• Word of mouth: recommendations by satisfied customers.

Key points

• AIDA model: a message should win Attention, create Interest, build Desire and lead to Action.
• Push strategy: promotion is directed at dealers and retailers to push the product to customers.
• Pull strategy: promotion is directed at final consumers so that they demand the product from retailers.
• Factors affecting choice: nature of product, target market, stage of product life cycle, budget, and competitors' promotion.

Exam tips

• Discounts and free samples are sales promotion, not advertising.
• A product needing demonstration or explanation usually relies on personal selling.

Common mistakes

• Assuming publicity is always favourable; news coverage can be negative too.
• Thinking small firms cannot promote effectively; social media and word of mouth are low-cost options.