Even if a product seems very good, the infinite circumstances that affect sales are not always controllable, therefore, sometimes we need to give a boost to a product to stimulate the purchase. And that’s what promotional marketing is all about.
In this article you will see when and how you can apply this type of promotion.
What is promotional marketing?
Promotional marketing is the set of actions that create an additional stimulus, seeking to increase the immediate interest in a product and influence the purchase of it.
For a promotional marketing campaign to be successful, this stimulus must be relevant to the buyer and must be limited in time. In case of very aggressive promotions it should also be limited to a certain number of units.
Discounts, punctual offers, coupons, promotional gifts such as those available from www.fyldepm.co.uk or promotions at the point of sale are some of the strategies often used.
The use of promotional marketing strategies is usual in the following cases:
-
Launch of new products: encourages trying new products that are unknown.
-
Reactivate a product: this works very well at the end of the life cycle of a product.
-
Moving old stock: sometimes it is necessary to eliminate older products to make way for newer stock, or simply create more space.
-
Obtaining liquidity: if the objective of the company is to obtain quick cash.
-
Support sales: if sales are struggling, offering a discount can be the solution.
-
Attacking the competition: promotions/offers can be used to protect market share or gain larger market share from competitors.
How to create a promotional marketing plan?
A promotional marketing plan contains a series of separate actions that seek a common and concrete goal. These are the aspects that you must analyse:
-
Current situation: how is the product you want to promote right now? Has it just been released? Are you suffering from stiff competition?
-
Desired situation: you must be clear about the objectives of the plan. Gain visibility? Support a commercial team? Renew goods?
-
Strategy: how will you achieve those objectives. If you want to gain visibility immediately you can use a field marketing strategy, or more aggressively with an interruption marketing strategy.
-
Actions: how are you going to get down to work with concrete actions. For example, an action focused on the price is to make a 50% discount on the product, make a grouped sale, put a stand in a point of sale, etc. It is also important to define the necessary actions to communicate the promotion successfully to the consumer.
-
Measure results: you must be able to evaluate the success of the promotional marketing plan. Measure essential metrics: units sold, profit margin, new customer obtained, etc.
Before applying any strategy, you must have all the possible information about your ideal client: who they are and what problem or need your product satisfies for them.
Benefits and risks of promotional marketing
Let’s start with the good.
-
Immediate sales: especially for products with elastic demand (sales change a lot with price changes) a promotion can boost sales.
-
Word of mouth: if a promotional campaign is appetizing, it is very likely that buyers will share it with other people.
-
Maximise income: a better price can give access to consumers who previously could not purchase. This pricing strategy is known as skimming
Disadvantages
-
Old customers: for a customer who has previously paid a higher price, seeing how new customers enjoy better conditions can make them feel bad.
-
Frequency: offers and promotions, when they occur too frequently, they not only lose utility but can become counterproductive.
-
Margin: a promotional marketing campaign reduces your profit margin.