What are the elements of promotion?

Creating a marketing campaign can take a long time. When a company develops a new product, marketers cannot simply say, "Let's create some billboards and hope that consumers notice our product!". Promotional objectives must be specific, and the promotion itself has to be targeted. This is where the promotion mix comes into play. Read along to find out how to create the most effective promotion mix!

Promotion Mix Meaning

Promotion mix is an essential component of marketing communications. That is why we sometimes call it marketing communications mix.

Marketing communications aim to reach the target audience and influence the customer purchase journey. Its main tasks include differentiating the product and brand from the competitors, reinforcing the brand's presence and message, informing customers about the product's benefits & features, and persuading them to buy. This process is known as the DRIP model.

The DRIP framework stands for: differentiate, reinforce, inform, and persuade.

Marketers use various promotional techniques to achieve these goals, giving rise to the promotion mix.

Promotion mix is a combination of promotional tools marketers use to communicate with their target audience.

Marketers can use more than one channel to communicate brand value. Here are six key components of a communications mix:

1. Advertising,

2. Personal selling,

3. Sales promotions,

4. Direct marketing,

5. Public relations (PR),

6. Branding.

Nike uses a combination of promotional tools. They offer a variety of seasonal sales promotions, advertise their products using traditional (print) and digital (social) media, and run various public relations campaigns.

Promotion Mix Marketing

The promotion mix plays a significant role in marketing. Before we look at the promotion mix in more detail, let's examine the steps in developing effective marketing communications.

Overall, there are three stages in marketing communications:

1. Identify the target audience,

2. Determine communications objectives,

3. Select the appropriate communications channel and media.

The main goal of marketing communications is to guide customers through the buyer-readiness stages.

Buyer-readiness stages are the stages a customer passes through before making a purchase.

The buyer readiness stages include awareness, knowledge, liking, preference, conviction, and purchase (see Figure 1 below).

It is important to note that the buyer readiness stages are not the same as the buyer decision-making process.

Promotion Mix Elements

Promotion mix is made up of three key elements: promotion mix budget, tools, and strategy. An integrated marketing campaign would require marketers to combine all these three elements.

Promotion mix budget

The first step to developing a promotion mix is to calculate promotion budget. It is a crucial task as marketers do not want to waste precious dollars.

Let's look at four methods to determine a promotion budget:

1. Percentage-of-sales method: this is a relatively simple method of calculating the promotion budget. Managers simply determine a percentage of sales or forecasted sales the company will spend on promotion. For example, 20% of forecasted sales. The disadvantage of this method is that it is entirely dependent on sales. At times, increased spending on promotion is needed to boost sales, which this method ignores.

2. Affordable method: another simple method of calculating a promotion budget, often used by small businesses. The business simply determines how much it can spend on promotion - how much can we afford to spend? After subtracting total costs from revenues or forecasted revenues, managers determine how much of the remainder to allocate to promotion.

3. Objective-task method: a more complex but effective method of determining the communications budget. To use this method, marketers have to define the objective of the promotion and figure out how the company should allocate resources to achieve set goals. The process is as follows: determine the promotional objectives, decide which tasks must be conducted to achieve the objectives, and estimate the costs of performing said tasks. This method helps management understand the relationship between advertising spending and performance.

4. Competitive parity method: other companies decide to spend the same amount on promotion as their competitors. This method involves setting the promotion budget to match industry averages. However, it fails to consider the qualitative aspects of promotion - each company has different advertising needs - and thus, only the company itself knows how much it should spend on promotion.

It is essential to keep in mind that the promotion mix budget is different from product pricing methods. To learn about pricing, check out our Price and Pricing Strategies explanations.

Types of promotion mix

We have outlined the different promotion mix elements but let's look at them in more detail. The types of promotion mix elements are as follows (see Figure 2 below):

• Advertising: one of the most popular forms of marketing communications. Brands can use a variety of traditional and digital advertisements to create awareness and engagement. Advertising may also benefit from mass-market exposure and is a relatively low cost per exposure technique. Marketers can also use advertising to capture the target audience's attention creatively and use a variety of advertising appeals.

  Take a look at our explanation of Advertising Media to find out more about advertising appeal.

• Sales promotions: an effective tool for encouraging purchases and increasing sales in the short term. Marketers can use a variety of discounts, offers, coupons, contests, etc., to attract consumer attention. Although sales promotions are effective in the short term, they are ineffective for building long-term customer relationships.

• Public relations (PR): can reach segments that do not respond to advertisements. Public relations include press releases, features, events, press conferences, addressing any controversies about the brand, etc. This is known as media relationship management. Rather than directly addressing consumers through ads or sales promotions, this form of communication creates a more subtle 'buzz' around a product or brand.

• Personal selling: is especially important in the B2B context. Personal selling often involves numerous parties communicating with one another and plays a significant role in the buying process. It is an effective communication method as it can quickly address the buyer's wants and needs - the sales team can quickly respond to problems and questions - thus influencing the buying process. Personal selling is also effective at building long-term relationships with customers.

  To learn more about the business-to-business environment, check out our explanation of B2B Marketing.

• Direct marketing: involves communicating with customers directly, in other words, without using any intermediaries. Direct marketing includes e-mail, catalogues, mail, SMS, telemarketing, etc. Direct marketing is effective at reaching a specific target group or demographic. Marketers have a lot of freedom in customising messages to suit the target segment's needs, and direct marketing may also encourage two-way communication. However, customers may feel uncomfortable when bombarded with frequent direct communications.

• Branding: may also be considered a promotional tool. It includes the different packaging, logos, designs, catchphrases, etc., marketers use to attract customer attention.

  Check out our Branding Strategy and Product explanations to become a branding expert.

For example, Red Bull hosted a New Moon Party to increase publicity for its brand, during which skydivers jumped out of helicopters in wingsuits above the city of Los Angeles. The skydivers' suits were equipped with LED lights and pyrotechnics, making it look like something supernatural was flying down the city.1 Now, you may wonder whether this is an appropriate promotion for an energy drink brand. Well, Red Bull is known for its involvement in racing, diving, motorsports, and numerous other extreme sports. As a result, promotional events like the New Moon Party fit well into Red Bull's integrated marketing communications mix.

Promotion mix strategies

Another important step in promotion mix creation is developing a promotion strategy.

There are two main strategies to consider here: pull and push strategies.

A push strategy involves 'pushing' the product to the customer. Push strategies start with the product's producer, who pushes their marketing communications through various channels to intermediaries who eventually promote the product to the final consumer. The producer's goal is to encourage these intermediaries to take on the product. They may use various promotional techniques like personal selling or sales promotions to convince channel members to carry the product and promote it to the end user.

On the other hand, a pull strategy involves directing communications efforts to the final customer. The producer may use traditional (e.g. print or outdoor) or digital (e.g. social or search) media to directly address end users and trigger action. Thus, creating demand for the product. As a result, consumer demand ends up 'pulling' the product through various channels. This process is known as a demand vacuum.

It is important to note that the two strategies are not mutually exclusive. Many companies use a mixture of both push and pull strategies.

Importance of Promotion Mix

Let's now examine the importance of the promotion mix.

Why do marketers spend so much time and resources constructing the promotion mix? Well, the ultimate goal is to integrate marketing communications.

After setting a promotional budget, marketers have to choose effective tools and strategies to promote their products. Both of these must work together to deliver a cohesive message across all channels. This is essential to maintaining a consistent brand image and position.

However, promotion must match customers' needs. Customers' wants and needs should always be the starting point for all communications efforts. Marketers must address these needs thoroughly in marketing messages while conveying unique selling points. To avoid confusing customers, marketers must ensure cohesive marketing messages across channels.

Finally, an integrated marketing communications strategy will allow the company to evaluate its marketing performance and generate actionable insights for future campaigns.

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