The implementation of a promotional mix involves choosing which specific media to use (such as Newspaper A and Newspaper B), timing, message content, the makeup of the sales force, specific sales promotion tools, and the responsibility for coordination.
- Media decisions:
The choice of specific media is based on their overall costs, efficiency (the cost to reach the target market), lead time, and editorial content. The retailer’s promotion budget is important since heavy use of one expensive medium may preclude a balanced promotional mix, and a firm may not be able to repeat a message in a costly medium.
A medium’s efficiency relates to the cost of reaching a given number of target customers. Media rates are often expressed in terms of cost per 1 000 readers, watchers, or listeners:
Cost per thousand= (Cost per message ×1 000)/Circulation
A newspaper with a circulation of 400 000 and a one-page advertising rate of $10 000 has a per-page cost per thousand of $25.
In this computation, total circulation is used to measure efficiency. Yet, because a retailer usually appeals to a limited target market, only the relevant portion of circulation should be considered. If 70% of readers are target customers for a particular firm (and the other 30% live outside the trading area), the real cost per thousand is:
Cost per thousand (target market)= (Cost per page ×1 000)/(Circulation ×Target market (%))
= ($10 000 ×1 000)/(400 000 ×0.70)
=$35.71
Different media require different lead times. A newspaper ad can be placed shortly before publication and an online ad can sometimes go ‘live’ almost immediately, whereas a print magazine ad sometimes must be placed months in advance. In addition, the retailer must decide what kind of editorial content it wants near ads (such as a sports story or a personal-care column).
Media decisions are not simple. Despite spending billions of dollars on TV and radio commercials, banner ads on search engines, and other media, many Web retailers have found the most valuable medium for them is E-mail. It is fast, inexpensive, and targeted. Consider the following example.
To generate greater awareness of Web retailers, costly advertising may be necessary for today’s competitive and cluttered landscape. Netflix has a broad mix of marketing and public relations programs, including digital and television advertising, affiliates and device partners, and social media sites such as Facebook and Twitter to promote its service to potential new members.
After customers have visited a Web site, the retailer can use explicit opt-in marketing to help sustain relationships with the customer. Opt-in marketing involves the customer giving permission for the retailer to send marketing materials, which leads to higher receptivity to marketing messages. Astute marketers collect preference information, so that content and promotional offers in an E-mail newsletter are relevant to the customer. This leads to an ongoing, evolving relationship between the retailer and the customer.
- Timing of the promotional mix:
Reach refers to the number of distinct people exposed to a retailer’s promotion efforts in a specific period. Frequency is the average number of times each person reached is exposed to a retailer’s promotion efforts in a specific period. A retailer can advertise extensively or intensively. Extensive media coverage often means ads reach many people but with relatively low frequency. Intensive media coverage generally means ads are placed in selected media and repeated frequently. Repetition is important, particularly for a retailer seeking to develop an image or sell new goods or services.
Decisions are needed about how to address peak selling seasons and whether to mass or distribute efforts. In peak seasons, all elements of the promotional mix are usually utilised; in slow periods, promotional efforts are often reduced. A massed promotion effort is used by retailers, such as toy retailers, that promote seasonally. A distributed promotion effort is used by retailers, such as fast-food restaurants, that promote throughout the year. Although they are not affected by seasonality in the same way as other retailers, massed advertising is practised by supermarkets, and many use Wednesday or Thursday for weekly newspaper ads. This takes advantage of the fact that a high proportion of consumers make their major shopping trips on Friday, Saturday, or Sunday.
Sales force size can vary by time (morning versus evening), day (weekdays versus weekends), and month (December versus January). Sales promotions also vary in their timing. Store openings and holidays are especially good times for sales promotions (and public relations).
- Content of messages:
Whether written or spoken, personally or impersonally delivered, the message content is important. Advertising themes, wording, headlines, use of colour, size, layout, and placement must be selected. Publicity releases must be written. In personal selling, the greeting, sales presentation, demonstration, and closing need to be applied. With sales promotion, the firm’s message must be composed and placed on the promotional device.
To a large extent, the characteristics of the promotional form influence the message. A shopping bag often contains no more than a retailer’s name, and a billboard (seen at 55 miles per hour) is good for visual effect but can hold only limited information. Yet, a salesperson may be able to hold a customer’s attention for a while. A few shopping centres use a glossy magazine – in print and online – to communicate a community-oriented image, introduce new stores to consumers, and promote the goods and services carried at stores in the centre. Cluttered ads displaying many products suggest a discounter’s orientation, whereas fine pencil drawings and selective product displays suggest a speciality store focus.
Some retailers use comparative advertising to contrast their offerings with those of their competitors. These ads help position a retailer relative to competitors, increase awareness of the firm, maximise the efficiency of a limited budget, and offer credibility. Yet, they provide visibility for competitors, may confuse people and may lead to legal action. Fast-food and off-price retailers are among those using comparative ads.
- The make-up of the sales force:
Qualifications of sales personnel must be detailed, and these personnel must be recruited, selected, trained, compensated, supervised, and monitored. Personnel should also be classified as order takers or order getters and assigned to the appropriate departments.
- Sales promotion tools:
Specific sales promotion tools must be chosen from among those that were cited in the Figure about Types of sales promotion. The combination of tools depends on short-term goals and the other aspects of the promotion mix. If possible, cooperative ventures should be sought. Tools inconsistent with the firm’s image should never be used; retailers should recognise the types of promotions that customers really want.
- Responsibility for coordination:
Regardless of the retailer’s size or format, someone must be responsible for the promotion function. Larger retailers often assign this job to a vice president who oversees display personnel, works with the firm’s ad agency, supervises the firm’s advertising department (if there is one), and supplies branch outlets with POP materials. In a large retail store, personal selling is usually under the jurisdiction of the store manager. For a promotional strategy to succeed, its components must be coordinated with other retail mix elements. Sales personnel must be informed of special sales and know product attributes; featured items must be received, marked, and displayed; and accounting entries must be made. Often, a shopping centre or a shopping district runs theme promotions, such as ‘Back to School’. In those instances, someone must coordinate the activities of all participating retailers.
- Smartphone couponing:
There are many advantages to the use of mobile coupons as compared to the traditional paper format. Mobile coupons do not have to be cut, organised, and searched for while in a store. They can be redeemed by displaying the coupons on a customer’s smartphone. Retailers can use mobile couponing in conjunction with geo-fencing applications, whereby the retailers can offer select coupon offers to customers within a given distance of a store. The redemption rate for mobile coupons can be as much as 10% or more. Effective mobile coupons should be capable of being redeemed without printing. They also should be based on a customer’s purchase history. A retailer can offer special coupons to lapsed customers, brand-loyal customers, or customers with special purchase histories (such as those that favour organics, prepared foods, and local produce).