Hello everyone. In this module, I’m going to provide an overview of the promotion mix. The sole learning objective of this module is to identify and understand the five elements of the promotion mix.
The promotion mix refers to the five basic ways that a company can promote its products through: advertising, publicity, personal selling, sales promotion, and direct marketing.
Advertising is communication about an organization, product, or service. Advertising typically relies on mass media, like TV, radio, and magazines. There were two key features of advertising. One, advertising is directly paid: you pay money and you get an ad in return. Two, the message comes from the company. An example of advertising is those Dos Equis ads that feature the most interesting man in the world.
The main advantages of advertising are: one, you can reach many consumers quickly. Two, you have a lot of control. The company can control what it wants to say in the ad. It can also decide when the ad airs and how often it is. The main disadvantages are one, the cost: advertising is very expensive. It could cost $500,000 for a national 30 second ad. Two, there’s also the issue of credibility. The ad is made by the company. So how much can you believe what you’re being told?
Publicity is a presentation of an organization, product or service. A lot of people think that publicity is free. Well, it’s not actually free, it is just indirectly paid. Imagine that the six o’clock news wants to do a feature on your product. Well, the six o’clock news isn’t going to charge you for this, but that doesn’t mean that it is free. You may have to provide product samples to the six o’clock news, and that costs money. Furthermore, you will probably have a public relations staff that deals with requests from the six o’clock news and other media. It costs money to maintain this staff. You can’t assign a cost to any particular act of publicity, meaning that it is indirectly paid. With advertising, you can assign a cost to any particular ad, meaning that it is directly paid. Another key feature of publicity is that the message comes from a neutral party and not from the company, like it does with advertising.
Subway is an example of a company that has received publicity when Jared Fogle lost 245 pounds by eating Subway’s low fat sandwiches. The story was picked up by national news outlets like Reuters and the Associated Press, and they made it national news. Subway benefitted from positive publicity when Jared lost all that weight eating their sandwiches. Later on, Jared generated negative publicity for subway when he was arrested in 2015 on very serious criminal charges.
The main advantage of publicity is that it is credible, as the message comes from a neutral party and not the company. The main disadvantage of publicity is lack of company control. The message about the company could be good or bad.
Personal selling is two way communication between a buyer and a seller, designed to influence a consumer’s decision. Personal selling is usually done face to face, although telephone and electronic sales are growing.
The main advantages of personal selling are: one, you can get great feedback — you can see or hear the buyer’s reaction, so you’ll know whether they got the message or not. Two, it’s flexible — you can tailor your presentation to what each customer wants to hear. The main disadvantages are: one, it’s time consuming. Two, it’s inconsistent: different salespeople might give out slightly different messages.
Sales promotions are short term inducements of value to try to generate sales. A classic example of a sales promotion is a sale, like a 50% off sale.
Other examples could include coupons, rebates, sweepstakes, contests, or samples.
The main advantages of sales promotion are: one, they’re flexible — you can run whatever sales promotion that you choose. Two, you might experience a short term spike in sales. The main disadvantages are: one, they’re easy to copy by competitors — if I choose to have a 50% off sale, then my competitors can choose to have a 50% off sale as well. Two: the gains might be temporary. Think of your own behavior — how many times have you bought something simply because it was on sale, and then the minute that it wasn’t on sale anymore, you stopped buying it?
Direct marketing uses direct communication with consumers to generate a response in the form of an order, a request for further information, or a visit to the retail outlet. The difference between advertising and direct marketing is that direct marketing tries to generate an immediate response. Examples of direct marketing could include telemarketing, direct mail, or email, direct response ads on TV, like that infomercial that features a guy named Vince selling a product called the Slap Chop.
Advantages. One: direct marketing is interactive. Two: it tries to create relationships with customers. Three, it can generate sales right away. The disadvantages are one, low response rates — for telemarketing, and direct mail or email, one major disadvantage is low response rates. People just don’t want to do these things. Two: the products featured might have a bad reputation. So for direct response ads that you might see on TV, radio or print, one disadvantage is that these products often have a bad reputation as far as product quality is concerned.
That’s the module — thank you very much.
The University of Winnipeg
Fabrizio Di Muro is an Associate Professor at The University of Winnipeg.
Crane, F. G., Kerin, R. A., Hartley, S. W. and Rudelius, W. (2017). Marketing, 10th Canadian Edition. Toronto: McGraw-Hill Ryerson.