Promotion is one of the key elements in the marketing mix. That’s why it’s closely linked to marketing activities and is often considered the same thing. To help Labamu friends better understand what promotion is, its benefits, types, and how to do it, check out the following article!
What Is Promotion?
In marketing, promotion can be defined as a form of marketing communication used to convey information to customers about a company’s activities.
It also includes current and future offers, shaping a positive brand image, building strong customer relationships, and stimulating demand.
In short, promotion helps a company showcase the products or services it offers while building an effective differentiation strategy.
Benefits of Promotion
There are many benefits to promotion. Here are some of the most important ones.
1. Reinforce Your Unique Selling Point (USP)
A Unique Selling Point (USP) is what makes a product different and superior to competitors’ offerings. By emphasizing it, you can more effectively convince customers and give them strong reasons to choose your product over others.
To ensure this message reaches your customers, you need to communicate it through engaging and effective promotional tactics.
2. Enhance Brand Perception
Through smart promotional strategies, you can build your brand narrative and enhance Through smart promotional strategies, you can build your brand narrative and enhance brand perception. This is excellent for increasing visibility and creating brand awareness in the minds of consumers.
To be effective, you can leverage various promotional channels and tactics that reach a wide audience, helping to build a strong brand in the market.
3. Increase Sales Figures
Effective promotional strategies can drive sales and increase revenue. However, it’s important to keep in mind that promotions should stay within the allocated budget.
This is closely related to the profit margin you’ll achieve. Therefore, a smart promotional strategy is needed to align them effectively.
4. Build Customer Relationships
Promotional activities allow businesses to reach their target market in a more personal and relevant way. This can capture customers’ attention and interest, resulting in higher conversion rates.
These activities can also build and strengthen relationships with customers, enabling your business to foster long-term connections, create better experiences, and cultivate customer loyalty.
5. Maintain Retention and Reduce Customer Churn
Loyalty explains why customers choose your products over competitors’. In this context, promotion can help a company maintain retention and reduce customer churn.
The long-term impact is that customers will remain loyal to a brand—or even to the company behind it. When this happens, you also benefit from the power of word of mouth. It’s worth noting that word of mouth is a highly effective way to promote a business—and best of all, it’s completely free!
Types of Promotion
The promotional approach used can vary depending on the goals, context, and target audience. Here are some types of promotion you can take advantage of.
- Personal selling – one-on-one communication with customers. It is the most time- and resource-intensive method, but it tends to be the most profitable of all types of promotion.
- Advertising – targeted messages that can increase brand awareness, reaching both existing customers and potential new ones.
- Direct marketing – unlike advertising, direct marketing reaches customers who are already familiar with your products. This can be done by sending messages via email, SMS, or social media.
- Public relations – used to build a positive and constructive brand image.
- Lobbying – used to influence public opinion about your products or business.
- Merchandising – influences customer behavior through store and product presentation, helping to boost sales.
- Sales promotion – used to stimulate demand through various incentives, such as discounts, cashback, free shipping, gifts, and more.
How to Run Effective Promotions
If you’re still unsure how to run promotions, try imagining yourself as a store owner who wants to attract more customers. Here are the steps you can take when creating a promotional strategy.
1. Determine the Product
First, decide which product you want to promote, taking into account the costs and profit margins.
To ensure that potential revenue covers the promotion costs, choose products with the highest profit margins.
2. Understand Your Audience’s Needs
In addition to choosing which products to promote, you also need to identify your target audience. This is crucial, as it can influence how you communicate your message.
This way, you can create offers that match their preferences and tendencies, making your promotions more relevant and potentially more profitable.
3. Set Clear Promotion Goals
By setting clear goals, you can choose the most effective methods and promotional channels. Here are some marketing and sales objectives that promotions aim to achieve.
- Increase off-season sales.
- Stimulate product demand.
- Increase customer loyalty and brand awareness.
- Introduce new products or services.
- Emphasize your competitive advantages.
4. Choose the Right Marketing Channels
In communication theory, a message is delivered effectively only if the channel or medium used is also effective. Therefore, communication with consumers depends on who you want to reach, their characteristics, and the product you want to promote.
Additionally, the scope and intensity of the campaign must be considered. Some products are better promoted through digital advertising, while others are more effective when advertised using traditional methods.
5. Set Your Budget
After all that, consider how much funding should be allocated to marketing activities, especially for promotional campaigns.
Calculate and estimate the ROI, taxes, essential expenses, and product development costs. Try to find solutions that minimize costs while maximizing impact.
So, those are the benefits of promotion and how to carry them out. To ensure your promotional activities are measurable and their impact can be evaluated, make sure to document every progress and expense in the Labamu app.
Besides documenting your business administration, you can also manage transactions with ease. Don’t believe it? Download the app now on Google Play or the App Store! and feel the benefits!
