The promotion element of the marketing mix: advertising and the media used, into-the-pipeline and out-of-the-pipeline sales promotions, public relations and personal selling, and their purposes.

What this key area is asking

Promotion is the fourth element of the marketing mix: how a firm communicates with customers to make them aware of a product and persuade them to buy. The SQA wants you to know advertising and its media, the difference between into-the-pipeline and out-of-the-pipeline sales promotions, public relations and personal selling, and the purpose of each. Higher rewards you for matching a method to its aim.

Advertising

The firm chooses the medium to suit its audience and budget: television and social media for a mass market, trade magazines for a niche, local papers for a local business. The purpose is to build awareness and a strong brand image over time.

Sales promotions

Sales promotions are short-term incentives to boost sales. The SQA splits them by who they target.

Sales promotions are good for a short-term boost (a launch, clearing stock, beating a rival), but if overused they can cheapen the brand and only shift sales temporarily.

Public relations and personal selling

• Public relations (PR) builds a favourable image through press releases, sponsorship of events or sports teams, charity work, donations and positive news stories. PR is credible (it looks independent) and relatively cheap, but the firm has less control over how the media reports it, and bad publicity can damage the image.
• Personal selling uses sales staff dealing directly with customers, in store, by phone or face to face, to inform, advise and persuade and to close the sale. It suits complex or expensive products (cars, financial services) where customers need advice, but it is labour-intensive and costly per customer.

Choosing the promotional mix

A firm combines these methods into a promotional mix suited to its product, target market, objective and budget. A mass-market snack might rely on television advertising and consumer sales promotions; a specialist machine might rely on personal selling and trade promotions.

Examples in context

Example 1. A supermarket's consumer promotions. A supermarket uses out-of-the-pipeline promotions, such as BOGOF deals, money-off coupons and loyalty-card points, to pull customers in and increase basket size. These are aimed at the consumer, in contrast to a manufacturer offering a shop a "buy ten cases get one free" deal, which is into-the-pipeline because it targets the retailer. The contrast is a common SQA discrimination point.

Example 2. A car maker combining personal selling and PR. A car manufacturer relies on personal selling in dealerships, because a car is an expensive, complex purchase where customers want advice and a test drive, supported by advertising for awareness and PR such as sponsoring a sports event. This shows how an expensive product needs personal selling that a low-value, mass-market product would not justify.

Try this

Q1. Give two examples of out-of-the-pipeline (consumer) sales promotions. [2 marks]

• Cue. Money-off coupons, free samples, BOGOF (buy one get one free), loyalty points, competitions, free gifts (any two). These target the final consumer to encourage purchase.

Q2. Explain two benefits of public relations as a method of promotion. [4 marks]

• Cue. PR is credible because it looks independent of the firm, so customers trust it more than paid advertising; it is relatively cheap compared with advertising; and good news stories, sponsorship and charity work build a positive long-term image and goodwill (any two, developed).