Promotion Choice: Marketing Issues

Marketing issues that affect the choice of promotional method include:

  • Target Market – As one might expect, customer characteristics dictate how promotion is determined. Characteristics, such as size, location and type of target markets, affect how the marketer communicates with customers. For instance, for a small marketer serving business markets with customers widely dispersed, it may be very expensive to utilize a sales force versus using advertising.
  • Product – Different products require different promotional approaches. For the consumer market, products falling into the convenience and shopping goods categories are likely to use mass market promotional approaches while higher-end specialty goods are likely to use personalized selling. Therefore,for products that are complex and take customers extended time to make a purchase decision, personalize promotion may be more effective than methods of mass promotion. This is often the case with products targeted to the business market. Additionally, as we briefly discussed in the Managing Products Tutorial and will later see in the Planning With the Product Life Cycle Tutorial, products pass through different stages in the Product Life Cycle. As a product moves through these stages the product itself may evolve and also promotional objectives will change. This leads to different promotional mix decisions from one stage to the next.
  • Distribution –Marketing organizations selling through channel partners can reach the final customer either directly using a pull promotion strategy or indirectly using a push promotional strategy. The pull strategy is so named since it creates demand for a product by promoting directly to the final customer in the hopes that their interest in the product will help “pull” more product through the distribution channel. This approach can be used when channel partners are hesitant about stocking a product unless they are assured of sufficient customer interest. The push strategy uses promotion to encourage channel partners to stock and promote the product to their customers. The idea is that by offering incentives to channel members the marketer is encouraging their partners (e.g., wholesalers, retailers) to “push” the product down the channel and into customer’s hands. Most large consumer products companies will use both approaches while smaller firm may find one approach works better.
  • Price – Because customers generally need more time and more information when deciding to purchase higher priced products, marketers of these product are more likely to engage in personalized promotion compared to lower priced products that can be marketed using mass promotion.
Promotion Choice: Company Issues