UNIT 14 PROMOTION MIX Promotion Mix

Structure

14.0 Objectives
14.1 Introduction
14.2 Meaning and Importance of Promotion
14.3 The Communication Process
14.3.1 Elements of Communication Process

14.3.2 Steps in Communication Process

14.4 Integrated Marketing Communication

14.5 Concept of Promotion Mix
14.5.1 Components of Promotion Mix

14.5.2 Comparison of the Components of Promotion Mix

14.6 Factors Affecting the Promotion Mix

14.7 Let Us Sum Up
14.8 Key Words
14.9 Answers to Check Your Progress
14.10 Terminal Questions

14.0 OBJECTIVES
After studying this unit, you should be able to:

• explain the importance of promotion in any successful marketing effort;

• describe the communication process and explain various elements in
communication process;
• explain the meaning and components of promotion mix; and
• explain the factors that influence the development of the promotion mix.

14.1 INTRODUCTION
Production of a good product is not enough to ensure its success in the
market. Unless target customers are aware of the existence of the product, its
features, price, etc., they will not buy the product. Thus, it is necessary for the
firm to manage a complex communication system. Therefore, some form of
promotion is necessary to make consumers, middlemen and public, with
which the organization interacts, and make them aware of the existence of the
product. Marketers refer to communication with the target audience as
promotion. Personal selling, advertising, publicity and sales promotion are
the promotional methods that may be used to communicate a message. In this
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Promotion unit, we will discuss the meaning and importance of promotion,
communication process, the concept and components of promotion mix and
various factors affecting the promotion mix.

14.2 MEANING AND IMPORTANCE OF

PROMOTION
In marketing, communication has a very important place. It is the function of
marketing which is charged with the task of informing the target customer
about the nature and type of the firm's product and services, their unique
benefits, uses and features as well as the price and place at which those would
be available in the market place. Since marketing communications aim at
influencing the consumer behaviour in favour of the firm's offerings, these
are persuasive in nature. These persuasive communications are more
commonly called ‘Promotion’ and constitute one of the four Ps of marketing
mix. Thus, in the context of marketing, promotion refers to the applied
communication used by marketers to exchange persuasive messages and
information between the firm and peoples.

A study of marketing communication, therefore, is a study of the promotion

function of marketing. Not withstanding the continuing debate whether
promotion is the first element of the marketing mix or the last,the fact
remains that sound management of the marketing function is dependant on
the effective management of its promotion function. For example, in the
success of the following products and services the promotion function played
a role of greater importance: Hot-shot camera, Maggie 2-minute noodles,
Khaitan fans, and UTI's ULIP scheme, to mention only a few. Similarly, the
examples of the product which misfired due to faulty management of the
promotion function are not far to seek. With growing competition in the
market place as well as the customers becoming better informed and more
choosy, it is imperative now that marketing communication of the right kind
only are made to the right group of target buyers. Let us now understand the
importance and purposes of promotion:

1) Communicating information: As you know, the job of marketing is to

identify consumer wants and then satisfy these wants with the right kind
of product, at the right place and at the right price. The purpose of
promotion in the marketing function is to convey to customers about the
features of the product and how will it satisfy consumer wants, or any
other relevant information needed by consumers toaffect sales.

For example, if a refrigerator manufacturer is planning to offer off-

season discount it is essential to communicate to potential customers
about the extent of discount, period during which discount is available,
names of the stores where it is available, etc. If all such information is
not communicated to potential customers, lowering of prices will not be
beneficial to either the consumer or the manufacturer. Promotion is, thus,
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 an essential part of the marketing function as it is essentially Promotion Mix

communication.

2) Promotion is persuasive communication: In any free enterprise system

where firms develop and offer a wide range of new and better products,
there are full of messages and distractions of all sorts. Consumers often
have to select the products from among a wide range of competing
products. As consumers do not have time and energy to compare the
competing products physically, they turn to advertisements for product
information.

The present business environment being highly competitive, each firm

wants the customers to buy its brand. Thus, persuasion is another goal
of promotion. In other words, promotion is persuasive communication.

3) Promotion serves as a reminder: Consider a customer who regularly

buys Colgate Toothpaste or Lux Soap. Do marketers of Colgate
Toothpaste or Lux Soap advertise to appeal to such customers? The
answer is yes, because even the most loyal customers must be reminded
that a product has served them well over the years and about the features
that make the product attractive. This is more so in an environment
where competitors consistently attempt to attract the customers of
competing brands with their own informative and persuasive messages.
Thus, in addition to informing and persuading, another important
purpose of promotion is reminding customers. This is why even the
manufacturers of well established products like Colgate, Lux, Surf,
Excel, Nescafe, Lifebuoy etc., also advertise quite extensively to sustain
customers' preference for these products.

Check Your Progress A

1) What is the meaning of promotion in the context of marketing?

2) What are the three basic purposes of promotion?

3) State whether the following statements are True or False.

i) Once a good product is brought into the market, it can sell by itself
with promotion.
ii) Promotion is an important element of the marketing mix.
iii) For loyal customers, who use a product regularly, promotion has no
role to play.
iv) Persuasion is one of the goal of promotion.
v) Well established firm do not need to advertise their products and
services.

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Promotion
14.3 THE COMMUNICATION PROCESS
Communication itself may be defined as “the process of influencing others
behavior by sharing ideas, information or feeling with them,” The basic
goal of communication is a common understanding of the meaning of the
information being transmitted. In other words, the receiver of the information
should understand as closely as possible the meaning intended by the sender
of the message. It is largely the responsibility of the sender to ensure that this
purpose is achieved.

14.3.1 Elements of Communication Process

Communication has been described as “who says what to whom through
which channels with what effect”. We notice that the two major parties
involved in the process are thesender (who) and the receiver (whom). The
tools that senders use to reach their extended receivers are called messages
and channels (media).Thus, communication occurs when :1) a sender
transmits a message, 2) a receivers received that message, and 3) the sender
and the receiver have a shared meaning. The communication process itself
involves the functions of encoding, decoding, response and feedback. Let
us understand each of these elements in communication process:

Sender: It is also called the source. Sender is the party who sends the
message to another party called the receiver or destination. The sender is
engaged in the mental process of putting thought into a form in which it can
be communicated.

Receiver : Person for whom the message is intended and is an active part of
the communication process. How meaning is assigned to a message by the
receiver depends upon on the receiver's attitudes, values, previous
experience, needs and the timing of the message.

Encoding: It is the process of translating the idea to be communicated into a

symbolic message consisting of words, pictures, numbers, gestures, etc. This
step is necessary because there is no way of sending an idea from one person
to another in its raw or pure form.

Message: It is a combination of symbols representing objects or experiences

that a sender transmits in order to induce a change in the receiver's behaviour.
Since most symbols (words, pictures, numbers, etc.) have more than one
meaning, the symbols selected for the message should be simple and familiar
to receivers.

Medium: It is a means by which the sender conveys the message to the

receiver. Broadly there are two types of media: 1) inter personal media, and
2) mass media. In inter personal medium there is a direct contact between
the sender and receiver. For example, in personal selling salesperson contacts
the customers and directly communicates about the product. Here,
266 communication flows in both directions and the salesperson receives
immediate and direct feedback. This enables the salesperson to have greater Promotion Mix

control over the communication process. Mass media are non-personal

communication media which provide contact between the sender and a large
number of receivers simultaneously. Newspapers, magazines, television,
radio, hoardings, billboards, etc., are examples of mass media.

Decoding: Just as the sender encodes the message, the receiver must decode
it. Decoding is the process by which the receiver attempts to convert symbols
conveyed by the sender into a message. Receivers may decode or interpret
the message in different ways because of their individual characteristics,
experiences and backgrounds. For example, a famous airline had once
advertised “if you fly with us you will never walkagain”. Although the airline
intended to convey to the receiver (i.e., potential passengers) that the airline
provides such an excellent services that passengers would always want to fly
with this airline, it could be misunderstood by many as a threat or a warning
of physical damage to their limbs.

Response: Receiver responds to sender's message by reacting in different

ways such as asking questions, buying or not buying the product or seeking
more information, etc. Thus, response is a set of reactions a receiver has after
being exposed to the message.

Feedback: It is the communication from a receiver to the sender about how

he/she understood the message and reacted to it. In this reverse flow of
communication, receivers encode their messages and send them to the sender.
The sender must then decode the feedback message. The longer it takes the
sender to receive and decode the feedback, the less valuable it becomes.
Feedback is more direct, more frequent and more immediate when
interpersonal communication (sales personnel) channels are used e.g.
salesperson to prospect. Good salespeople receive feedback directly and
immediately from their prospects and can modify their sales presentations to
suite the prospect's requirements. It is usually indirect, slow and hard to
obtain when the communication is through mass media. In fact, it can be
obtained only if the sender has made some arrangement to receive. Sender
may have to carry out marketing research to determine whether the receivers
have received the message, how many times, whether they can recall the
message, or not, etc.

Noise: Anything that interferes with the communication process so that the
receiver gets a message which is different from the one the sender sent or
gets no message at all is noise. Noise can affect any or all elements of the
communication process. For example, if there are too many advertisements of
the same product (different brands) in a single newspaper or magazine, it can
create distraction. Our earlier example of the airline slogan is a case of noise.

Look at Figure 14.1 carefully for a diagrammatic presentation of the

communication process.

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Promotion

MEDIUM
SENDER ENCODING DECODING RECEIVER

NOISE

FEEDBACK RESPONSE

Figure 14.1 : Communication Process

14.3.2 Steps in Communication Process

For communication to be effective, some factors become very important.
These are: 1) identifying the target audience, 2) determining the response
sought, 3) choosing the message, 4) selecting communication channels and 5)
collecting feedback.

Identifying the Target Audience

The term target audience refers to people for whom the promotional message
is meant, and includes both present and potential customers. Therefore, to
reach such people with a meaningful message, the sender must identify the
target receivers and their characteristics (like age, sex, income, education,
occupation, life style, etc.), attitudes, values, past experience, buying habits
and buying decision process. By understanding the profile of target
customers, it becomes easier for the sender to match the message to his target
audience.

The greater the extent of overlap between a sender's 'field of experience'

(background, values, attitudes, experience, education, social status, etc.) and
a receiver's 'field of experience', the more effective will be the
communication. This concept was explained by Wilbur Schramm. An
advertising agency is asked to develop a sales message about 'beedis' to the
target market of low income groups. It may develop a message which istoo
sophisticated for the target audience to understand. This results in noise
because the fields of experience of the sender and receiver are very different.
However, if the sender has the proper understanding of his target audience,
this problem can be avoided or reduced.

Determining the Response Sought

After having identified the target audience, the sender decides on what
response he is expecting from the receiver. For example, the sender might
want the receiver to search for more information about a product or service,
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or he might want the receiver to see the product physically and then buy it. Promotion Mix

The ultimate response, however is purchase. As you know, the decision-

making process of the consumer leading to purchase is itselflong and
complex. Therefore, the sender must know how to move the target audience
from its present state to a state which is closer to the actual purchase of a
product or service. For example, the advertisement in Figure 14.2 expects the
receiver to take specific action, i.e., invest Rs. 1,000 in small savings.

Figure 14.2 : Advertisement Expecting Specific Action from the Receiver

Through the message sender may want to put something in the receiver’s
mind or change the receiver’s attitude or induce the receiver to undertake
specific action. There are different models of consumer response stages in
use. One such model, the ‘hierarchy of effects’ will be discussed in detail in
Unit 16

Choosing the Message

After deciding about the type of response expected from the receiver, the next
step is to develop an effective message. The message should be able to gain
the receiver’s attention (i.e. , the pictures or words used in the message
should have impact), arouse interest in the proportion (i.e. the message
should provide information of interest to the receiver), produce a desire for
the product or service (i.e., make the receiver want the product or service),
and finally elicit action of some kind such as actual purchase.

The important decision areas relating to message design are: 1) message

content (what is to be said), 2) message format (how is it to be said), 3)
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Promotion message source (who should say it). Let us discuss these three aspects in
detail.

1) Message Content: It refers to the key or central idea of a promotional

message. For example, the central idea or appeal in the slogan for Nike
‘Just do it’ is ‘to be active’ by given them good quality athletic shoes,
apparel and sports equipment. Similarly, all Philips advertisements carry
the slogan ‘Innovation and You’. Here the central idea reflects Philips
mission to improve peoples lives through meaning five innovation.
When an appeal or central idea is used unchanged over a long period of
time to lend consistency to the series of promotional messages, it is
called a Theme. The slogan for Philips mentioned above is a good
example of theme. The appeal or theme in most promotional messages
relate to product features or claims about the product.This leads us to
another interesting concept known as U.S.P. or ‘Unique Selling
Proposition’. In USP, the features or attributes (selling points) of the
product are matched with benefits to the consumer in a unique way. For
example, in Sensodyne toothpaste the USP is “Rapid Relief Formula’.
Thus, the promotional message claims that the toothpaste has clinically
proven ingredients to relieve sensitivity pain. (this constitutes the selling
point of the product) and the benefit of this feature to the user is ‘Fast
relief to sensitive teeth’. In this world of growing competition, it is
through USP that sellers differentiate their products from those of the
competitors.

There are three basic types of appeals used by marketers:

i) Rational appeals: Such appeals show that the product will deliver the
claimed benefits. These appeals relate to a product’s quality, economy
(price), value or performance. In fact most consumer durables such as
refrigerators, automobiles, air conditioners, washing machines and other
major appliances, and industrial products, use these appeals.

ii) Emotional appeals: Such appeals use either negative emotions (such as
fear, guilt, shame) or positive emotions (such as love, joy, pride,
humour) to stimulate action or purchase. For example, fear appeal is used
by Life Insurance Corporation to encourage people to insure themselves.
Emotional appeals are used for fabrics, garments, perfumes, cosmetics,
etc. Cadbury Chocolates use love appeal in their advertisements.
Tourism advertisements use joy and pleasure as appeals. Onida TV uses
pride as an appeal. For example advertisement shown in Figure 14.3 is a
guilt appeal.

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 Promotion Mix

Figure 14.3: An Advertisement with Guilt Appeal.

Message Format: The sender must decide how to send the message to the
target audience. He must develop a good format for the message. For
example, if the message has to be printed in newspapers or magazines, the
sender has to decide on the type and length of headline, the illustration (or
photograph), the copy (the written part of the advertisement, other than the
headline) colour etc. Marketers often use suggestive visuals (illustrations),
benefits, demonstrations, emotions and music to attract attention. If the
message has to be transmitted over radio, the words should be carefully
chosen and voice quality (speech rate and pitch etc.) should be controlled. In
the case of television, in addition to factors considered for radio, you have to
pay attention to facial expressions, gestures, dress, posture, etc. If the
message is carried by the product itself or the packaging, the sender has to
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Promotion pay attention to colour, size, shape, texture and scent, e.g., toilet soaps and
perfumes.

2) Message Source: The factor how the target audience perceives the
sender (or source) can have a great impact on Communication
effectiveness. ‘Source Credibility’ refers to the target receivers’
perception of the sender’s belief ability (i.e., how believable be the
source or the sender?). Source credibility has an influence on how does
target receive evaluate and react to the message. There are three factors
which affect source credibility: These are: i) expertise iii) trustworthiness
and iii) likeability. Let us learn them.

i) Expertise: It refers to the specialised knowledge which the sender is

expected to have by virtue of his profession, occupation or experience.
For example, doctors, scientists, engineers, professors and other
technical experts are rated high or expertise in their respective areas.
Similarly, for promoting a health product a prominent sports personality
is more believable than a professional model sending the message. For
example, Famous cricketers promoting Boost has a great impact due to
the association of cricketer’s fitness with Boost. To emphasise the
efficacy of their drugs, many Ayurvedic firms use endorsements from
medical experts.

ii) Trustworthiness: It refers to how objective or honest the source

(sender) is perceived to be. Friends and relatives are trusted more than
strangers or salespeople. In fact trustworthiness is related to expertise. If
a well known expert promotes a product, his/her statements will be
trusted more. If a company with an excellent track record of producing
high quality products launches a new product, its product claims are
more likely to be trusted than those of an unknown company making the
same product.

iii) Like abillty: It reflects the source’s general attractiveness to the

audience (receivers). Qualities such as straight-forwardness, humour,
naturalness, good looks (appearance), good voice, etc., make a person
more likeable to the audience.The source with the highest credibility
would be one which has the best combination of all the three factors
mentioned above.

Selecting Communication Channels

Once the promotional message has been designed, the communicator must
select efficient communication channels to carry it. There are two broad types
of communication channels through which the message may reach to the
audience. They are personal communication channels and non personal
communication channels.

1) Personal communication channels: It involve two or more persons

communicating directly with each other face to face, person to audience,
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 over the telephone, or through e-mail. These channels' effectiveness Promotion Mix

depends to a great extent on the opportunities of individualizing the

presentation and feedback. For example, Redeffusion.com invites on-line
customers to sign up for email services and recommendations from
experts in their choice of various products available on-line. These
channels are of three types: advocate, expert and social communication
channels.

i) Advocate Channels consist of company salespeople contacting buyers

in the target market.

ii) Expert Channels consist of independent experts making statements to

target buyers.

iii) Social Channels consists of neighbours, friends, family members, and

associates talking to target buyers. The last channel is also popularly
known as word-of mouth influence and may yield considerable influence
in many product categories.

Personal influence carries especially great weight in two situations. One is

with products that are expensive, risky or purchased infrequently. The other
situation is where the product suggests something about user's status or taste.
In both cases, consumers will obtain information from others before making a
purchase decision. Companies can take several steps to stimulate personal
influence channels to work on their behalf:

• Identify influential individuals and companies and devote extra efforts to

them.
• Create opinion leaders (people whose opinions are sought by others) by
supplying certain people with the product on attractive terms.
• Work through community influentials such as local well known persons
and head of the civic organizations.
• Use influential or believable people in testimonial advertising.
• Develop word-of-mouth referral channels to build business.

2) Nonpersonal Communication Channels: Nonpersonal communication

channels are media that carry messages without personal contact or
feedback. Nonpersonal communication channels include media,
atmospheres, and events.

i) Media consist of print media (newspapers, magazines, direct mail),

broadcast media (radio, television) electronic media (audiotape,
videotape, CD-ROM, DVD, Web page), and display media (billboards,
signs, posters). Most nonpersonal messages come from these media
which are normally paid by the marketers.

ii) Atmospheres are designed environments that create or reinforce the

consumer's leanings towards product purchase. For example, many
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Promotion restaurants decorate their dinning halls to attract consumers, advocates or
law offices are decorated with fine rugs, books and furniture to
communicate confidence and success, pharmaceutical companies insist
their salespeople to wear specific dress while making visits to the doctors
for creating good impressions.

iii) Events are occurrences designed to communicate particular messages to

target audiences. Companies through their public relation departments
organize press conferences, grand openings, cultural events, arts
exhibitions, and other events to communicate with specific audiences.

Although personal communication is often more effective, non personal

channels affect personal attitudes and behaviour through a two-step-flow of
communication process. Ideas often flow from radio, print, television, and
Internet sources to opinion leaders and from these to less media involved
population groups. This two-step flow has several implications. First, the
influence of non personal channels on public opinion is mediated by opinion
leaders, people whose opinions are sought or who carry their opinion to
others. Second, the two-step flow shows that people interact primarily within
their own social group and acquire ideas from opinion leaders in their group.
Third, two-step communication suggests that marketers using non personal
channels should direct messages specifically to opinion leaders and let them
carry the message to others.

Collecting Feedback

It refers to the receiver’s reaction to the message being communicated back

to the source. We have already discussed this in great detail while discussing
about ‘feedback’ in this unit.

14.4 INTEGRATED MARKETING

COMMUNICATION
As the marketers today use variety of communication channels to reach
customers, marketing communication have assumed a new meaning.
Companies invest heavily and use number of promotion tools in order to
promote their products and services. The main problem which arises here is
that these different tools are designed by different people and put forward
before customers through different sources. These can result in delivering
conflicting, blurred or inconsistent business messages to the target audience.
Marketing communication becomes effective and give the desired results
only when all the communication or promotion tools are integrated and co-
ordinated to give a clear and consistent picture of the company’s products
and services. Therefore, Integrated Marketing Communication (IMC)has
been gaining popularity in the 21st century.

In the words of Philip Kotler, “carefully integrating and co-ordinating the

company’s many communications channels to deliver a clear, consistent
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and compelling message about the organization and its products is Promotion Mix

integrated marketing communication”.

The idea behind integrated marketing communication is that the marketers

need to carefully combine the promotion elements into a co-ordinated
promotion mix.

Check Your Progress B

1) What arc the various stages in the process of communication?

2) What is ‘noise’ in a communication process ?

3) State whether the following statements are True or False:

i) The basic goal of communication is a common understanding of

meaning between the sender and the receiver.

ii) The two major tools of communication are response and feedback.

iii) The two broad types of channels used in communication are

encoding, decoding.

iv) Integrating and co-ordinating all the company’s communication

channels is called integrated Marketing Communication.

v) Emotional appeal relates to product quality.

14.5 CONCEPT OF PROMOTION MIX

In our daily life we all are exposed to various tools of promotion aiming at
communicating one thing or the other to us. To illustrate, while at home we
come across advertisements when reading a newspaper, watching TV,
listening to radio or even examining the water, electricity or telephone bills.
On our way to the office similar communications are present on bus panels,
roadside hoardings, neon signs, posters and banners, etc. While at a retail
shop these take the shape of traffic builders displays, streamers, hangers, bins
etc., all sharing information relating to a specific product of a company.

Listed above are just a few types of the various promotion tools available to a
marketer. Before proceeding further, let us take a look at the definitions of
the four major components of promotion. These are: advertising, personal
selling, sales promotion and publicity. There is no way that an individual
activity, say advertising, can be managed fully without considering its
relationship with the other elements. Therefore, business enterprises normally
adopt all the four elements though the relative importance placed on different
elements of the promotion mix differ from enterprise to enterprise.

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Promotion 14.5.1 Components of Promotion Mix
As stated earlier, the four elements of promotion mix are: 1) advertising,2)
personal selling, 3) publicity, and 4) sales promotion.Let us learn them in
detail.

1) Advertising: Any paid form of non-personal communication through

mass media about a product, a service or an idea by an identified sponsor
is called advertising. It consists of paid messages by identified
sponsors through non-personal channels (media).Advertising bears a
signature in the form of a company or brand name.

The media used could include: magazines, newspapers, radio, television,

bill-boards (hoardings), direct mail, etc. Sponsors may be non-profit
organisation (colleges, universities, institutes), companies or individuals.
We will discuss about advertising in detail in Unit 16.

2) Personal Selling: Personal selling is a person-to-person dialogue

between buyer and seller, where the purpose of this face-to-face contact
is to pursuade the buyer to accept a point of view or to convince the
buyer to take a specific course of action. In other words, personal selling
is a person-to-person process by which the seller learns about the
prospective buyer's wants and seeks to satisfy them by making a
sale.

A salesperson should be properly trained to develop and deliver a

message to a prospective buyer. Personal selling often involves a lot of
travelling by salespeople and stay outside the normal place of residence.
Therefore, personal selling is very expensive. But the high cost of
personal selling is offset by flexibility. The salesperson can modify and
adapt his presentation to meet the specific needs of the prospect
(customer). The salesperson can handle the customer's objections as they
arise. In personal selling direct and almost immediate feedback can be
obtained from customers. A detailed discussion on personal selling will
be taken up in Unit 15.

3) Publicity: Publicity refers to non-personal stimulation of demand for a

product, service or business unit by generating commercially significant
news about it in published media or obtaining favourable presentation of
it on radio, television or stage. Unlike advertising, this form of
promotion is not paid for by the sponsor. Thus, publicity is news
carried in the mass media about an organisation, its products,
policies, personnel or actions. It can originate with the media or the
marketer, and is published or broadcast at no charge for media
space and time, to the organisation.

Publicity is similar to advertising except that it involves an unpaid and

unsigned message, even though it may use the same mass media as
advertising. When information about a product or a company is
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 considered newsworthy, mass media tend to communicate the Promotion Mix

information at free of cost. Thus, the organisation being publicised

neither pays nor signs the message.

Publicity can either be positive (favourable) or negative (unfavourable).

Since the message is in the hands of media and not controlled by the
organisation (or firm), publicity can be unfavourable. Newspaper (press)
reports some years ago about a major fire in a five star deluxe hotel in
Delhi. This news gave the hotel a great deal of adverse publicity on
account of its faulty fire escape systems. The hotel suffered a tremendous
loss of business. On the other hand, when Air India sponsors the
Himalayan Car Rally and organises it well, it is likely to receive
favourable coverage by mass media since the event is newsworthy.

Marketers spend a lot of time and effort in getting news items and
articles placed in newspapers and broadcasts so that a favourable image
of the company is created. We will discuss more about publicity in Unit
16.

4) Sales Promotion: It is the means of communicating with the target

audience in a way that is not possible by using other elements of the
promotion mix. Sales promotion may be defined as “those promotional
activities other than personal selling, advertising and publicity that are
intended to stimulate buyer purchases or dealer effectiveness in a
specific time period”. Thus, sales promotion is any activity that offers
an incentive for a limited period to obtain a desired response from
the target audience or intermediaries (wholesalers and retailers).

Special offers of gift, coupon deals, discounts, demonstrations, trade

shows, contests, etc. are some examples of sales promotion. The purpose
of sales promotion programmes is to supplement the advertising and
personal selling messages offered by an organisation. The effects occur
generally at the point of purchase. We will discuss in more detail about
sales promotion in Unit 15.

5) Direct Marketing : The promotional strategy which relies on direct

communication to customers rather than through a third party such as use
of mass media is termed as Direct Marketing. It is an interactive mode of
marketing where the messages can be altered depending on the
consumer’s response. This form of promotion strategy is therefore more
focussed than the other promotional tools as it is directed to a specific
individual customer or group. Thus, direct marketing is interactive,
non-public, immediate and customized.

Direct marketing comprises both of traditional tools in the form of direct

mail marketing, catalogue marketing, telemarketing, time shopping
channels and modern digital tools such as online marketing, social media
marketing, mobile marketing and many more. The direct marketing
campaigns use lists of targeted prospects to send their promotional 277
Promotion messages. We will discuss in detail more about Direct marketing in
Unit 20.

14.5.2Comparison of the Components of Promotion Mix

These promotional efforts are of two general types involving: 1) direct face-
to-face communication, and 2) indirect communication through some mass
medium, such as television, newspapers, radio, etc. Sometimes a mixture of
personal (direct) and non- personal (indirect) promotion is used, as we shall
see in the case of sales promotion. The nature of the message and the context
in which it is delivered, influence the method to be used. For example, an
industrial buyer would not decide to purchase equipment merely on the basis
of advertisements or direct mail. Greater emphasis will be given to personal
selling. On the other hand, a customer buying soap or toothpaste will have
less contact with company salespersons, and will be influenced more by
advertisements.

An integration of all the elements of promotion mix is necessary to meet the

information requirements of all target customers. This simply means that the
promotion mix is not designed to satisfy only the prospective buyer or only
the regular buyer. Some elements of the mix may be aimed at the target
customer who is unaware of the product, while others may be aimed at
potential customers who are fully aware of the product and are likely to
purchase it. Suppose you are interested in buying a personal computer. As a
result of interest in the product, you started paying attention to computer
advertisements in newspapers and magazines. You may even read the media
reports on personal computers by experts (publicity). You also may
participate in training programmes or demonstrations. You may also contact
the salespersons of different computers and find out the features and relative
merits. Based on all this information you may then purchase a specific brand.

Now can you answer the question, which aspect of the promotional mix
brought you to the decision to buy the brand you finally selected? You may
say that the expertise of the salespersons was a major influence, but the fact is
that all the elements of the mix played their roles in bringing about the sale.
Therefore, to get better response from the target customers, you have to adopt
all the four components of the promotion mix. However, you should note that
the elements of the promotion mix must be coordinated and integrated so that
they reinforce and complement each other to create a blend that helps in
achieving the promotional objectives of the organisation.

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 Table 14.1 Comparison of Various Components of Promotion Mix Promotion Mix

S.No. Factor Advertising Personal Sales Publicity Direct

selling promotion materials

1 Mode of Indirect and Direct and Indirect and Indirect Direct

Communication non personal Indirect non- and non-
Face-to- personal personal
Face
2 Regularity Regular and Regular and Not Not regular Regular &
on-going recurring regularOnly Only news- recurring
short-term worth
stimulation information
3 Message Generally Personalised Generally Beyond the Customized
flexibility uniform and and adopted uniform marketer’s for target
unvarying to the and control prospects
Indirect, prospect unvarying but less
flexible
than
personal
selling
4 Feedback Indirect Direct No No Direct
Feedback feedback feedback
from from from
prospect Indirect, if Indirect, if
any any
5 Control over High control High High No Control Highest
message control control control

6 Sponsor Has identified Has Has Has no Identified

identified identified sponsor sponsor
7 Cost Per Low to High Variable None Low to
contact moderate moderate
8 Scope Mass Personal Mass Mass Mass
9 Advantages Allow Permits Gains Has high Messages
expressiveness flexible attention degree of are
& control over presentation and has credibility delivered
message and gains immediate quickly and
immediate effect can be
response tailored to
appeal to
specific
customers
10 Disadvantages Hard to Costs more Easy for Not as Low
measure than all others to easily response
results other forms imitate controlled rates as
per contact as other messages
forms tend to be
ignored by
customers

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Promotion Check Your Progress C

1) What are the components of the promotion mix?

2) Using Table 14.1, compare three characteristics of the various elements

of the promotion mix.

3) State whether the following statements are True or False:

i) Advertising is a non-paid, non-personal form of mass

communication.
ii) Publicity is a form of advertising.
iii) Sales promotion is used continuously over a long period of time.
iv) Personal selling involves a direct face-to-face contact between a
buyer and seller.
v) In direct marketing messages can be customized to appeal to target
prospects.

14.5 FACTORS AFFECTING THE PROMOTION

MIX
Many factors influence the choice of elements in a promotion mix and the
relative importance of each element. All the factors that influence the
promotion mix may be grouped into four categories as follows: l) product
related factors, 2) customer related factors, 3) organisation related factors,
and 4) situation related factors. Let us learn them in detail.

Product Related Factors

Product related factors include: 1) the amount and complexity of product

information to be communicated, 2) the stage of the product in the product
life cycle, and 3) product type and unit price.

1) Amount and Complexity of Product Information: Usually emphasis is

placed on advertising to convey simple ideas or to make consumers
aware of a product whose features are easily observed. Advertising is
also used for products that are familiar to consumers. The messages
which are simple and easily understandable (e.g., Campa Cola and
Thums Up advertisements) are generally conveyed through
advertisement.

Personal selling and sales promotion are considered more useful to

demonstrate complex ideas. For example, in the case of consumer
durables such as mixers, television sets, music systems, computers, etc.,
personal contact enables consumers to try the product and ask questions.

2) Stage of the product in the product Life Cycle (PLC): During the
introduction stage of PLC, the basic promotion objective is to create
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 awareness and interest in the product. Extensive advertising, sales Promotion Mix

promotions and publicity, help in reaching potential customers and

induce trial purchases. Personal-selling is useful in reaching
intermediaries (wholesalers and retailers).

As competition starts building up during the growth stage, focus of

promotion shifts on differentiating the product (brand) by showing its
advantages over rival brands. Promotion in this stage becomes more
persuasive in order to build up and maintain brand loyalty and ensure
repeat purchase. Since a larger number of people are trying and using the
product, advertising is more economical way of reaching target
customers.

As competition intensifies in the maturity stage of the PLC, promotion

efforts are at the highest levels at that stage. Promotion messages become
more persuasive and advertising gains relative importance over the other
elements of the promotion mix. Product modifications are made to
discourage entry of new competitor. This may require a new promotion
effort, Promotion is generally reduced to a minimum in the decline,
stage. Whatever little promotion is carried out at this stage, it is normally
done by intermediaries.

3) Product Type and Unit Price: There seems to be a relationship between

the promotion and the type of product and the unit price. There is greater
emphasis on advertising for inexpensive, frequently bought consumer
products like soaps, toothpastes, potato wafers, razor blades, etc.
Whereas more complex products (industrial products like lathes, large
generators, etc.) with a higher unit price require greater personal selling
effort.

Customer Related Factors

There are two types of customer related factors that affect the promotion mix:
1) characteristics of the target market, and 2) type of buying decision.
1) Characteristics of the target market: Generally, non-personal
promotion (advertising and publicity) are more suitable for ultimate
consumers, and personal selling is relatively more important for
organisational buyers. As the size of the target market increases, non-
personal forms of promotion become more relevant. As the size
increases, the market becomes more heterogeneous (i.e., it becomes more
mixed in terms of sex, age, income, occupation, life styles, etc.). Thus
the marketer needs to segment his markets and design different
promotional messages to appeal to different market segments. For
example, Binnies targeted their advertising to “young people with a
modern outlook”, because they identified a large percentage of the potato
wafer market was made up of such people, although people of all ages
eat potato wafers. Hence the slogan “Humko Binnies Mangta” after the
famous Hindi film song, was an instant hit.
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Promotion 2) Type of buying decision: Buying decisions are of two types: routine
decisions and complex decisions. Generally, consumers making routine
decisions do not pay much attention for marketing information. If they
make routine purchases of a given brand, promotion focuses on
reminding customers that the brand is better than the other brands.

When the decisions are complex, as in the case of major consumer durables
and appliances such as automobiles, Smart TV’s, Laptops, etc., the promotion
must contain messages which are fully of relevant information and adapted to
the customer’s primary needs and wants. The effect of competitor’s
promotion must also be considered. After the purchase, reassuring the
customer that he has bought the right product, through letters and personal
visits by salespeople becomes very important.

Organisation Related Factors

These factors may be of two types: 1) marketing channel and promotion

strategies, and 2)branding strategies.

1) Marketing Channel and Promotion Strategy: This relates to the

marketer’s choice of strategies to build sales. He has to decide between
(i) a push strategy and (ii) a pull strategy.

i) A Push Strategy is one in which the producer actively promotes his

product to intermediaries, who in turn actively promote it to final
buyers. In other words, each channel member (including the
producer) directs his promotional effort to the next channel member
in the link. Look at Figure 14.4 carefully for a push strategy in
promotion.

A push strategy requires a great deal of emphasis on personal selling

at the producer’s level and various types of sales promotion methods
directed to company salespeople and intermediaries.

Producer Wholesaler Retailer

Promotes Promotes Promotes Customer
Aggressively Aggressively Aggressively

Figure 14.4 :A Push Strategy of Promotion

ii) In pull strategy the producer focuses promotional efforts directly on the
final buyer rather than on intermediaries. For instance, in the case of a
consumer product, the objective is to induce customers to ask retailers
for the product, in’ turn retailers ask wholesalers and wholesalers ask the
producer for the product. Consumers, thus, “pull” the product through
the marketing channel.

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A pull strategy involves a high degree of advertising and various types of Promotion Mix

sales promotion directed to final buyers. Examples include coupons and

premiums (free gifts). Pull strategy is suitable when the producer wants to
create a strong company image. This requires complete knowledge about
target markets in order to design and develop the right kind of appeals for
such markets. Look at Figure 14.5 and study how pull strategy works.

Producer Wholesaler Retailer Consumer

Requests Requests Requests Requests
Product Product
From Product
From
From Product

To To To

Figure 14.5 :A Pull strategy of promotion

In most situations, marketers use various combinations of push and pull

strategies. In the cosmetic industry, for example, sales personnel call on
department stores, retailers and super markets to push the product through
intermediaries by means of product demonstrations, displays, etc. Producers
also spend heavily on advertising and sales promotions (coupons, free
samples, etc.) to pull customers through the marketing channels.

2) Branding strategy: A firm which adopts an individual branding strategy

relies heavily on promotion to introduce a new brand. An image has to
be created for acceptance by both customers and intermediaries. A
combination of personal selling, advertising and sales promotion will be
needed to create the image and establish the brand. Family branding on
the other hand requires relatively lesser effort to introduce a new brand.
Possibly with a little advertising, new brands introduced by Tata’s,
Godrej or Philips will find ready acceptance, because of the family
brand’s image. Consumers may try it because of their satisfaction with
other products under the family brand name.

3) Budget: It relates to the funds (money) available with the organisation

for promotion. Hence the choice of a promotional element or elements
would depend upon the relative costs of reaching the target customers
with each promotional tool. Personal selling, for example, is more
expensive (per contact)than advertising. Sales promotion can be
expensive or inexpensive depending upon the type used. Marketers try to
optimise the per rupee contribution of promotion. Therefore, the
promotion mix chosen will depend upon the relative cost and efficiency
of each element of the promotion mix and the amount available with the
company for promotions.

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Promotion Situation Related Factors

There are two situation related factors which affect the promotion mix: 1)
visibility of the firm and its political, legal and social environment, and 2)
impact of competition.

1) Visibility of the Firm and Environment Factors: Some companies are

better known to the public because of their products, their relative
position in the industry (i.e., large or small) and their impact on physical,
economic or social life of people. Examples could include: Hindustan
Unilever, Tatas, ITC, Reliance and many others. Such firms generally
like to project themselves as being sensitive to the environment. To
achieve this objective, these companies sponsor activities in the interest
of the general public. For example, Tata’s have sponsored Cancer
Research, ITC sponsors a music programme each year (Sangeet
Sammelan) and MRF has very actively associated itself with sporting
events (e.g. , World Boxing Championship).

Since a large number of people are concerned with the actions of such
highly visible firms, these firms spend more money on public relations
and publicity, in addition to the money and effort spent on promoting
their products and services.

2) Impact of Competition: Firms very often have to match or counter the

promotional activities of their competitors to maintain or increase their
market shares. Hence the promotional effort of such firms is affected and
influenced-by the activities of their rivals. In recent times we have seen
the advertisement war between competing firms in the soft drink industry
(Coca Cola Vs. Pepsi) and the telecom industry (Reliance Jio Vs. Airtel).

Check Your Progress D

1) List out the various factors affecting the promotion mix.

2) Differentiate between push and pull promotion strategies.

3) State whether the following statements are True or False:

i) Promotional efforts are at the highest level in the maturity stage of

the product life cycle.
ii) Less promotional effort is required for new products introduced
under the family brand name.
iii) The choice of an element in the promotion mix does not depend
upon the amount of money available with the firm for promotion.
iv) Firms often try to match or counter the promotional activities of
their competitors.
v) A pull strategy involves high degree of advertising.

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14.6 LET US SUM UP Promotion Mix

Promotion may be defined as applied communication used by marketers to

exchange persuasive messages and information between the organisation and
its various publics. It includes all the activities designed to stimulate demand.
Thus, promotional strategy is designed to inform, persuade and remind about
the existence and benefits of a product, a service or an idea.

Communication occurs when a sender transmits a message, a receiver

receives that message and the sender and the receiver have a shared meaning.
The communication process itself consists of the following elements: sender,
receiver, encoding, decoding, message, media, response, feedback and noise.
Marketers must understand the process of communicating effectively with
their target markets and the other publics. Important steps in developing
effective communication are: 1) identifying the target audience, 2)
determining the response sought, 3) choosing the message in terms of content
and format,4) selecting communication channels and 5) collecting feedback.

The promotion mix consists of a careful blending of the four elements viz.,
advertising, personal selling, sales promotion and publicity. Advertising is
any paid form of non-personal communication through mass media about a
product by an identified sponsor. Personal selling is a face-to-face direct
interaction between the buyer and the seller, where the seller learns about the
buyer’s wants and seeks to satisfy them by making a sale. Sales promotion is
an activity that offers an incentive for a limited time period to increase sales
and enhance dealer effectiveness. Publicity is a non-personal, non-paid form
of mass communication not identified by a sponsor. It is news carried in mass
media about an organisation or its products at no charge for media
space/time.

Factors that influence the use and relative emphasis of various promotional
elements are: 1) product-related factors (complexity of the product and
information to be communicated, stage in the product-life cycle, and product
type and unit price), 2) customer-related factors (characteristics of the target
market and the buying decision type), 3) organisation related factors (type of
marketing channel, branding and budget decisions), and 4) situation-related
factors (firms and their environment, and the impact of competition on the
choice of promotional elements).

14.7 KEY WORDS

Appeal: Central idea of a promotional message.

Communication: The process of influencing others’ behaviour by sharing

ideas, information or feelings with them.

Decoding: The process by which the receiver attempts to convert symbols

conveyed by the sender into a message.
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Promotion Encoding: The process of translating ideas to be communicated into
symbolic messages such as words’pictures, numbers, gestures, etc.

Feedback: Refers to the receiver’s reaction to the message being

communicated back to the source.

Integrated Marketing Communication: Integrating and co-ordinating the

company’s many communication channels to deliver a clear and consists
message about the company’s products and services.

Medium: A communication channel which carries the sender’s message to

the receiver and vice versa.

Message: A combination of symbols representing objects or experiences that

the sender transmits to induce a change in the receiver’s behaviour.

Noise: Anything that interferes with the communication process, so that the
receiver gets a message which is different from the one the sender sent, or
gets no message at all.

Promotion: Applied communication used by marketers to exchange

persuasive messages and information between the firm and its various
publics.

Promotion Mix: A careful blending of advertising, personal selling, sales

promotion and publicity to achieve the organisation’s promotional objectives.

Pull Strategy: A promotional strategy in which the producer focuses

promotion efforts directly on the final buyer, who in turn asks for the product
from the intermediaries.

Push Strategy: A promotional strategy in which the producer actively

promotes his product to intermediaries, who in turn promote it to the final
buyer.

14.8 ANSWERS TO CHECK YOUR PROGRESS

A3 i) False ii)True iii)Falseiv)True v) False

B3 i) True ii)False iii)Falseiv) Truev) False
C3 i) False ii)False iii)False iv) Truev) True
D3 i) True ii)True iii)False iv) True v) True

14.9TERMINAL QUESTIONS
1) Using a communication model, give examples of the encoding and
decoding that might take place during the personal selling process.

2) How does a push strategy differ from a pull strategy? Give examples
from your experience.
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3) How do interpersonal communication channels differ from mass Promotion Mix

communication channels?

4) Explain the factors which affect the sender’s perceived credibility among
receivers in the communication process?

5) What do you mean by communication process in the context of

marketing? Explain the major steps in communication process.

6) What is promotion mix? Explain the elements of promotion mix.

7) What factors do you take into account while deciding about the
promotion mix for your product? Discuss with examples

Note: These questions will help you to understand the unit better.
Try to write answers for them. But do not submit your answers
to the University for assessment. These are for your practice
only.

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