Discuss the steps involved in Promotion Decisions.

A marketer has five promotion tools at his/ her disposal for carrying out the promotion activities – Advertising, personal selling, publicity, sales promotions, and direct selling. Each of these offer advantages and disadvantages for different conditions in the market. To help utilise an effective promotion plan, most of the organisations follow the steps shown in the figure.

1) Marketing Plan – The marketing plan of the organisation gives the direction for all the promotion decisions. Marketing planning involves analysing the organisations capabilities, economic conditions, competitors and customers to list out the strengths, weaknesses, threats and opportunities (SWOT analysis). This sets the framework and gives direction for promotion activities.

2) Defining the Target audience – It becomes important for an organisation to clearly define its target audience. Unless the firm has clear target audience, the communication message as well as tools for dispersing this message will be like shooting an arrow in the dark. The target audience consists of potential buyers, current buyers, media, individual, groups, public at large, intermediaries, etc. that can influence the sale of the product. Basis the target audience, a marketer decides on the content of the message, its dispersing frequency, tools to communicate, and at which places to disperse it, etc.

3) Promotion objective – Promotion objective is directed towards a favourable response from buyers to drive sales, increase market share, create a positive image of the brand, and retaining the customers by way of reminding the brand for future, etc. These can be long term as well as short term. The basis for this is the marketing program of the organisation. In order to drive immediate sales, organisations adopt direct mail and personal selling. For creating awareness about the product and creating demand, promotion tools like TV advertising, sales promotions are utilised. For creating and altering the image, organisations opt for Public Relation programs- organise events like blood donation, marathons, etc. for health awareness in the society. This helps an organisation create an image that it is committed to society. Similarly organisations invest in eco-friendly infrastructure that utilises solar power for operations, etc. which is often highlighted in press, etc.

The marketers have to decide to what extent the audience’s perceptions, attitudes, beliefs, and behaviour should change. Depending on this the marketer decides on the frequency of dispersing the message in the market relevant to the objective of how fast the change should occur.

The objective usually revolves around defining a desired response –
– Creating awareness,
– Educating the buyers, (what could be the reason for not buying?, negative perception to be changed),
– Influence buying, differentiate,
– remind, persuade.

For example, Motorola launched its Moto G models in India. Its promotion objective was to capture market share via creating awareness about its product highlighting a better priced product with high end features.

4) Designing the Message – The next step involves designing a message that will serve the promotion objective. There are lot of ways in which a message can be constructed. When designing a message the marketer has to consider these things – message content and message structure or format. The results of a well-designed message are substantial. The message content includes images and logos along with the text message. The message structure or format consists of graphics, colour, clarity, presentation content in case of personal selling, etc.

The local culture and beliefs need to be considered when designing a message. Certain colour selection or image selection might be fine in one region and may be considered offensive on other region. For example, semi-nude models doing the advertisements will have negative reaction in some Asian countries while they will be acceptable in European countries. When Gerber launched its baby products in Africa, they went ahead with the same packaging and image of a baby on the package. The company later learned that companies in Africa put picture of the product which is inside the package.

Organisations determine which strategy will have most advantageous result in the target market. Some organisations highlight the specific benefits that the customer may regard as beneficial to them – Unique selling proposition (USP). Subway’s stress on “Eat Fresh”, Domino’s, “Pizza delivery in 30 minutes or its free” are good examples of unique selling propositions. The organisations communicate value to the customers.

Marketers strive to understand the culture and belief system of the target market to ensure maximum impact of the message. For example, Amazon has been creating advertisements to target the family values of the Indian market. Almost all the advertisements have an elder in the family who is emotionally touched by the need of a family member, and comes across an option of a product available among 60 million products on Amazon India website.

5) Promotion budget – Deciding on the promotion budget is one of the most difficult decision a marketer takes. If the right tool is not selected because of budget constraints, the entire process of promotion or even marketing goes waste. For most of the companies, the promotion budget forms the biggest chunk of the cost components. There are many ways of assigning budget for promotion activities. The marketing plan sets the direction for promotion budget decisions. Below are the common methods for setting budget for promotion-

Affordable method – an organisation sets aside a budget as it deems affordable without much concerns of the impact it will make on the sales and revenues. When a company is doing well in the market, the promotion budget will be high and if the product is not doing good and generating less revenue, the promotion budget is less. The budget is decided after taking all expenditures into consideration. Whatever returns are left deducting the expenditures, a promotion budget is decided. This is the most ineffective way of deciding the promotion budget, as the end results of promotion are not taken into consideration.

In Percentage of sales method, the budget is set aside basis the projection of sales for the year. Instead of a promotion plan taking priority, the sales determine the promotion budget. It doesn’t considers the market opportunities. Though illogical, it has advantages like, simple to calculate and less risky as it is linked to sales.

In Competitive Parity method, the budget is assigned depending on that of the competitors. The marketers who follow this method believe that this avoids promotion wars, and the wisdom of the industry as a whole is reliable for setting promotion budgets. Though this method considers competition, this method is unreliable as the objectives, opportunities, resources, and brand image of the organisations are not always the same.

The Objective and Task method relies on proper objective setting and the tasks that need to be performed to achieve these objectives. The costs for performing these tasks are calculated which determine the promotion budget. Though this method is logical, it is not easy to implement as it involves research as well as analysis before arriving at the final number.

6) Select the promotion tool – Marketers have to select the most efficient promotion tool to ensure the message is dispersed as intended. It usually involves a three step process.

• First selecting the promotion tool. For example, advertising.
• In the second step, the marketer needs to choose from various advertising components live TV, radio, print, billboards, display signs, symbols and logos, etc.
• Thirdly, the marketer has to decide on the aspect within each component. In TV advertising, for example, which TV shows the target customer usually watches and at which time maximum coverage can be attained.

The promotion tool selection usually depends on the cost, coverage, and availability with regard to the target market. The communication strategy has to adapt to the market environment of each target market or region. Else, a communication message as well as the tool should be acceptable in all target markets.

7) Decide promotion mix – An organisation has to wisely use its promotion budget over the promotional tools. Each of these tools offer advantages and disadvantages. An average person is bombarded with many messages in a day. It is the job of the marketer to choose the appropriate channel or channels so that the message generates a favourable response in the target market. For example, a consumer product like stain remover meets the need of both the consumer as well as business markets. To reach these two markets, an organisation will need to adopt advertising as well as print ads in business journals. The scope of further penetration in the market increases if the organisation adopts enthusiastic salesmen for personal selling.

8) Evaluation and management – A marketer’s job doesn’t ends at implementing the promotion tools and sending the message across in the target market.
First the job of the marketer is to study the response of buyers, and make changes to its promotion strategy if the expected response is not achieved. He/ she has to employ different tools to influence, remind, persuade, or educate the customers about the product. For example, when a product moves through the different stages of its product life cycle, different strategies are needed at each of these stages to generate maximum sales.

Secondly, even if the promotion strategy is successfully implemented, a regular study of the target market is needed to consider various environmental factors like competitor’s promotion strategy, economic changes, policy changes by government, behavioural changes of customers, etc. These factors have to be constantly monitored, evaluated, and corrective actions should be taken accordingly.