Promotion : Role, Promotion Mix and Strategies- Jaiib/DBF Paper 1 (Module D) Unit 7
As we all know that is Promotion for JAIIB Exam. JAIIB exam conducted twice in a year. So, here we are providing the Promotion (Unit-7), SUPPORT SERVICES – MARKETING OF BANKING SERVICES/ PRODUCTS (Module D), Principle & Practice of Banking JAIIB Paper-1.
♦Role of Promotion in Marketing
Promotion is the exercise of communicating the properties of different elements of marketing mix to the customers with the intention of influencing them.
- Persuasion: Promotion aims at persuading the consumers so that they start acting in favour of the firm. Persuasion seeks to bring about a change in attitude.
- Inform: Promotion aims at conveying information about the properties of products to the prospects, to influence their desires and transform them into action.
- Reminding: Promotion seeks to remind the customers about the offerings of the firm with a view to retaining their business and have a higher share in it.
- Reinforcing: Promotion also aims at reinforcing the customer satisfaction. This helps in increasing the number of habitual customers.
The Promotion Mix refers to the blend of several promotional tools used by the business to create, maintain and increase the demand for goods and services.
- Advertising: The advertising is any paid form of non-personal presentation and promotion of goods and services by the identified sponsor in the exchange of a fee. Through advertising, the marketer tries to build a pull strategy; wherein the customer is instigated to try the product at least once.
- Personal Selling: This is one of the traditional forms of promotional tool wherein the salesman interacts with the customer directly by visiting them. It is a face to face interaction between the company representative and the customer with the objective to influence the customer to purchase the product or services.
- Sales Promotion: The sales promotion is the short term incentives given to the customers to have an increased sale for a given period.Generally, the sales promotion schemes are floated in the market at the time of festivals or the end of the season. Discounts, Coupons, Payback offers, Freebies, etc. are some of the sales promotion schemes.
- Public Relations: The marketers try to build a favourable image in the market by creating relations with the general public. The companies carry out several public relations campaigns with the objective to have a support of all the people associated with it either directly or indirectly.
- Direct Marketing: With the intent of technology, companies reach customers directly without any intermediaries or any paid medium.The e-mails, text messages, Fax, are some of the tools of direct marketing.
♦Promotion Mix Strategies
There are two basic promotion mix strategies-
- Push Strategy: In this, Promotion efforts are directed are directed at the channel members to induce them to purchase the products and sell them to the final consumer. This is done through personal selling and trade promotions.
- Pull Strategy: In this, the promotion efforts are directed to the final consumer to induce them to buy the product. Consumers will them demand the product from the retailer, who, in turn, will demand from the wholesaler and producers. This product experiences the “Pull” of demand.
♦Factors Influencing the Promotion Mix
Three major factors affecting the choice of promotion mix are
- Type of Product:Type of product plays an important role in deciding on promotion mix. Product can be categorized in terms of branded products, non-branded products, necessity products, luxury products, new products, etc. All these types of products need different promotional tools. For example, advertising is suitable for the branded and popular products. Personal selling may be fit for non-branded products. Advertising, personal selling, sales promotion and publicity – all four tools – are used for a newly launched product to get a rapid consumer acceptance.
- Readiness of Buyer: Different promotional tools are required at different stages of buyer readiness. Such as, at the comprehension stage, the blend of advertising and personal selling plays a vital role. Whereas at the conviction stage, personal selling is more effective. At the time of sales closure, the blend of sales promotion and personal selling is likely to be more effective.
- Hence, the advertising and publicity are more effective at the early stages of buying decision process while the sales promotion and personal selling are more effective during the later stages.
- Stage of Product Life Cycle:Product passes through four stages of its life cycle. Each stage poses different threats and opportunities. Each stage needs separate marketing strategies. Each of the promotional tools has got different degree of suitability with stages of product life cycle.
It can be concluded that, in normal situations:
- Advertising, personal selling, and, even, sales promotion are used during the introduction stage. However, advertising is given more priority,
- More intensive advertising and sales promotional techniques are used during the second stage,
- More rigorous advertising along with personal selling are followed in the third stage, and
- Company prefers to curb the expenses in forth stage, and promotional efforts are reduced.
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