Why do companies use promotions

Television content captures more audience time than any other media and is targeted at home audiences. Radio is cost effective, and the audience is usually loyal to a station's program format. The internet offers you a variety of different ways to market your product or service on a website or by email.

Cellphones and smartphones allow for marketing tactics that let you reach customers directly on their mobile devices. Social media marketing encourages online interaction between your customers and your business using various social networking sites.

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The interview is very similar to a buyer-seller situation. Both the buyer and seller have objectives they hope to achieve. Business-to-business marketers generally utilize professional selling more often than most business-to-consumer marketers.

PR is often perceived as more neutral and objective than other forms of promotion because much of the information is tailored to sound as if it has been created by an organization independent of the seller.

Public relations materials include press releases, publicity, and news conferences. While other techniques such as product placement and sponsorships, especially of events and experiences, tend to generate a lot of PR, the growth of expenditures and importance of sponsorships are so critical for so many companies that it is often considered a separate component in the communication mix.

Many companies have internal PR departments or hire PR firms to find and create public relations opportunities for them. Sponsorships typically refer to financial support for events, venues, or experiences and provide the opportunity to target specific groups.

With an increasing amount of money being spent on sponsorships, they have become an important component of the promotion mix. They create incentives for customers to buy products more quickly and make larger purchases.

Sales promotions are often temporary, but when the economy is weak, sales promotions become even more popular for consumers and are used more frequently by organizations. Samples, coupons, premiums, contests, and rebates are examples of consumer sales promotions.

Do you like free samples? Most people do. A free sample allows consumers to try a small amount of a product so that hopefully they will purchase it. The strategy encourages trial and builds awareness. You have probably purchased a product that included a small free sample with it—for example, a small amount of conditioner packaged with your shampoo. Have you ever gone to a store that provided free samples of different food items? Although sampling is an expensive strategy, it is usually very effective for food products.

People try the product, and the person providing the sample tells them about the product and mentions any special prices for it. In many retail grocery stores, coupons are given to consumers with the samples. Coupons provide an immediate price reduction off an item.

The amount of the coupon is later reimbursed to the retailer by the manufacturer. The retailer gets a handling fee for accepting coupons. When the economy is weak, more consumers cut out coupons and look for special bargains such as double coupons and buy-one-get-one-free BOGO coupons.

They may also buy more store brands. While many consumers cut coupons from the inserts in Sunday newspapers, other consumers find coupons online or on their cell phones. Point-of-purchase displays, including coupon machines placed next to products in stores, encourage consumers to buy a brand or product immediately. When a consumer sees a special display or can get a coupon instantly, manufacturers hope the sales promotion increases sales.

Stores may also provide coupons for customers with loyalty cards to encourage them to select particular brands and products. Mobile marketing and the Internet provide consumers in international markets access to coupons and other promotions. In India, the majority of coupons used are digital, while paper coupons have the largest share in the United States.

Over 80 percent of diapers are purchased with coupons; imagine how much easier and less wasteful digital coupons scanned from a mobile phone are for both organizations and consumers. Other sales promotions may be conducted online and include incentives such as free items, free shipping, coupons, and sweepstakes.

For example, many online merchants such as Shoe Station and Zappos offer free shipping and free return shipping to encourage consumers to shop online. Some firms have found that the response they get to their online sales promotions is better than response they get to traditional sales promotions. Another very popular sales promotion for consumers is a premium.

A premium is something you get either for free or for a small shipping and handling charge with your proof of purchase sales receipt or part of package. Remember wanting your favorite cereal because there was a toy in the box?

The toy is an example of a premium. Sometimes you might have to mail in a certain number of proofs of purchase to get a premium. The purpose of a premium is to motivate you to buy a product multiple times. Contests or sweepstakes also attract a lot of people. Contests are sales promotions people enter or participate in to have a chance to win a prize. The organization that conducts the sweepstakes or contest hopes you will not only enter its contest but buy some magazines or more food when you do.

Loyalty programs are sales promotions designed to get repeat business. The brand may be new and the products largely unknown, but the message will draw the attention of consumers, who may give it a try. Businesses can build an existing market segment and improve market position substantially through the use of advertising and promotion. If your business has been around for some time and has found a dependable primary market segment, you may wonder how to add to the existing base of customers without losing the ones you have.

Targeted advertising and promotional campaigns can show your current customers you have even more to offer, thus increasing their spending and your business's revenue. Promotions can increase customer loyalty by getting the word out about special pricing, rewards programs and other incentives to buy. Existing customers are your most important target market, because you have an established relationship and you typically have access to the data that makes direct marketing possible.

When you regularly remind customers about your offerings, they may begin to visit your company first for whatever they need, bypassing other options.

Making it clear that you have the best product and the best price through the use of marketing often results in increased loyalty.

Marketing is an effective defense against competition. It keeps your brand name in the public eye and prevents other companies from gaining a foothold among the market segments you have secured.