Promotion (AQA GCSE Business): Revision Notes
Marketing mix - promotion
What is promotion?
Promotion is a crucial element of the marketing mix that focuses on making customers aware of your product and convincing them to buy it. The main purpose of promotion is to ensure customers know about your product's existence and understand why it's better than competitors' offerings.
Promotion is not just about advertising - it's a comprehensive approach to communicating with customers that includes multiple methods working together.
Promotional activities serve several important purposes:
- Informing customers about existing and new products
- Explaining the benefits and features of using the product
- Persuading customers to make a purchase
- Competing effectively by showing how your product is different or superior
- Growing sales by reaching more customers or entering new markets
- Building brand image and developing customer loyalty
- Reminding customers about your product to maintain their interest
The promotional mix
Many people think promotion is just about advertising, but that's not quite right! Businesses actually use a combination of different promotional methods to get their message across effectively. This combination is called the promotional mix.
The promotional mix includes four main types of promotion: advertising, public relations, sales promotion, and social media. Most successful businesses will use several of these methods together rather than relying on just one approach.
Advertising
Advertising is any promotional method that businesses pay for directly. It involves presenting your product to target customers through various communication channels such as television, radio, cinema, billboards, online platforms, newspapers, and magazines.
Types of advertising
There are two main types of advertising:
- Persuasive advertising - This tries to encourage customers to buy the product by highlighting its benefits and advantages
- Informative advertising - This simply provides information about the product, often used by government for health campaigns or welfare benefits
Choosing the right advertising approach
When deciding which type of advertising to use, businesses need to consider several factors:
Key Factors for Advertising Decisions:
- Media reach - Whether they want national or local coverage and how many potential customers they can reach
- Product nature - The type of product affects media choice (e.g., recruitment adverts in trade magazines vs lipstick adverts on television)
- Product life cycle stage - New products need different advertising approaches than established ones
- Budget and cost - Local newspaper adverts are cheaper than radio, which is cheaper than television
- Online vs offline - Many businesses now shift advertising budgets online to reach internet users
Advantages and disadvantages of advertising
The advantages and disadvantages of advertising show that while advertising offers wide coverage and message control, it can be expensive and may not guarantee the message reaches the intended audience.
Advantages:
- Wide coverage and reach
- Full control over the message
- Can target specific audiences
- Builds brand awareness effectively
Disadvantages:
- Can be very expensive
- No guarantee of reaching target audience
- May be seen as impersonal
- Difficult to measure effectiveness
Public relations and sponsorship
Public relations (PR) involves managing a business's image and reputation with various groups including customers, media, local communities, suppliers, employees, and investors. Unlike advertising, PR activities are typically not paid for directly.
Main objectives of public relations
- Achieving positive publicity about the business
- Building a strong image and reputation for the business and its products
- Communicating effectively with customers and other stakeholders
Methods of public relations
PR can take many forms, from newspaper articles and magazine features to publicity events and free promotional gifts. Many businesses organise "open day" events to build relationships with their community. Company websites also play a crucial role in building and maintaining the business's image.
Common PR Methods:
- Press releases and media coverage
- Company websites and blogs
- Community events and open days
- Free promotional gifts and samples
- Celebrity endorsements
- Social responsibility initiatives
Advantages and disadvantages of PR
Advantages:
- Usually no direct cost (though large businesses may employ PR departments or external agencies)
- Often more credible than advertising because the message appears more genuine and trustworthy
Disadvantages:
- Can be expensive if using external agencies
- No guarantee of reaching the target audience (media may not feature the story)
- Less control over the final message compared to paid advertising
Sponsorship
Sponsorship is a specialised form of public relations that's becoming increasingly popular. Businesses donate money to events, teams, or individuals in exchange for displaying their name or logo. This builds brand awareness and can help emphasise social or ethical values.
Sponsorship Examples:
- Major sporting events (Olympics, World Cup)
- Local sports teams and clubs
- Community events and festivals
- Educational programmes and scholarships
- Arts and cultural events
Sales promotion
Sales promotion involves persuading potential customers to buy products through special offers and incentives. These activities usually happen close to where the purchase decision is made (called the point of sale) and are designed as short-term tactics to boost sales quickly.
Common sales promotion methods
Popular Sales Promotion Techniques:
- Money-off coupons - Customers get discounts through newspaper coupons or product packaging
- Additional products - "Buy one get one free" (BOGOF) offers that help sell stock quickly
- Competitions - Purchasing the product enters customers into prize draws, encouraging repeat purchases
- Discount vouchers - Temporary price reductions to encourage trial of new or relaunched products
- Free samples - Giving away small amounts of product to encourage future purchases
- Point-of-sale displays - Eye-catching displays near checkouts (like chocolate near tills)
- Loyalty cards - Reward systems that provide valuable customer data while encouraging repeat purchases
Advantages and disadvantages of sales promotion
Advantages:
- Quick boost to sales
- Encourages customers to try new products
- Helps clear excess stock
- Can attract new customers
- Provides valuable customer data
Disadvantages:
- Effects are usually temporary
- Can be expensive to implement
- May damage brand image if overused
- Attracts price-sensitive customers who may not return
Important considerations for sales promotion
Critical Factors for Sales Promotion Success:
- Cost vs benefit - Will the increased sales justify the promotion expenses?
- Brand consistency - Heavy discounting might damage a premium brand's image
- Customer attraction - Will the promotion attract loyal customers or just bargain hunters?
Social media
Social media has revolutionised promotion by providing both advertising opportunities and new promotional methods. Platforms like Facebook and YouTube enable viral marketing, where content spreads rapidly through sharing, creating excitement and massive brand awareness at relatively low cost.
However, viral marketing success is difficult to guarantee, and businesses have limited control over how their message spreads once it's released into the social media environment.
Smartphones have also created new opportunities through business apps, allowing easy customer communication and interaction through e-commerce platforms.
Choosing the promotional mix
Several factors influence which combination of promotional methods a business will use. Understanding these factors is essential for effective promotional planning.
Key factors affecting promotional mix decisions
- Budget - All promotion can be expensive. TV advertising costs millions, while local newspaper adverts might cost over £1,000. Many businesses spend up to 10% of their total costs on promotion.
- Product type - Products sold to other businesses (B2B) might be better promoted through trade magazines and agricultural shows rather than TV advertising.
- Target customers - Different customer groups require different approaches. Waitrose and Marks & Spencer target different customers than Lidl and Aldi, so use different promotional strategies.
- Competition - Businesses often respond to competitors' promotional activities and may need to match or counter rivals' strategies.
- Product life cycle - New products need awareness-building through advertising and PR, while established products might benefit more from sales promotion to encourage trial.
- Expertise - Larger businesses often have dedicated marketing departments, while smaller firms may need to use external marketing agencies for specialist help and advice.
Remember: The most effective promotional campaigns usually combine multiple methods from the promotional mix rather than relying on a single approach. The key is finding the right balance for your specific business situation.
Key Points to Remember:
- Promotion aims to make customers aware, inform them, persuade them to buy, and build brand loyalty
- The promotional mix combines advertising, public relations, sales promotion, and social media
- Advertising provides wide coverage but can be expensive and impersonal
- Sales promotion effectively boosts short-term sales but effects may be temporary
- Social media offers viral marketing opportunities but success is hard to guarantee
- Choosing the right promotional mix depends on budget, product type, target customers, competition, and available expertise