Promotions Planning – Selecting the most powerful marketing tools
A popular saying illustrating how difficult it is to reach potential customers using traditional advertising is attributed to legendary retailer, marketer and businessman, John Wanamaker:
Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” (1838 to 1922)
Naturally, our mission (if we choose to accept it) is to be so thorough, well planned and disciplined in our marketing strategy development and promotions implementation that the above is not the case.
That instead, we implement marketing and promotions activity that is one hundred percent effective.
Your Marketing Planning Journey So Far
Your Baker Marketing “Marketing Summer School” journey has asked you to give consideration to the following important components of your marketing strategy:
- Part 1 – An overview of your Marketing Strategy
- Part 2 – Your Primary and Secondary Target Markets
- Part 3 – Your Desired Brand Positioning
- Part 4 – Your Sales Partners and Sales Influencers
- Part 5 – Product and Service Priorities
- Part 6 – Key Communication Messages
- Part 7 – The Company Vision Timetable
This week’s step of the journey is:
Part 8 – Promotions Planning – Selecting the most powerful marketing tools
What comes after Promotions Planning?
Our next steps in the Marketing Summer School will give consideration to the following marketing implementation decision areas:
- Part 9 – Marketing Action Plans – Your Branding, Digital and Sales Tools
- Part 10 – Bringing it all together – Company-wide implementation, measurement and control systems
Before I was even a Boy
The quotes below date back to before I was even a twinkle in my Father’s eye or a blush on my Mother’s cheek.
They represent marketing concepts and thinking that have truly stood the test of time.
An executive is a mixer of ingredients, who sometimes follows a recipe as he goes along, sometimes adapts a recipe to the ingredients immediately available, and sometimes experiments with or invents ingredients no one else has tried.” (Culliton, J. 1948)
When building a marketing program to fit the needs of his firm, the marketing manager has to weigh the behavioral forces and then juggle marketing elements in his mix with a keen eye on the resources with which he has to work.” (Borden, N. 1964)
I think the above quotes do a good job of summarising the role of promotions planning.
While the tools we use have changed dramatically since 1948 and 1964, however, savvy marketers in 2014 still need to consider:
- Who are your customers and what is their behaviour with regard to consuming marketing messages
- Who are your competitors and what are they doing
- Your level of resources
- The potential for you to be innovative
What has not changed is the need to take a holistic approach to the promotions planning process in order to arrive at the best mix of promotions tools (The ‘Promotions Mix’).
Marketing Myth Busters
In this section I strive to debunk some common Marketing Myths for reasons of client prosperity, fun and my own sanity.
Myth No. 1 – Promotions = Marketing
(True or False?)
Answer = False:
- Marketing refers to your overall process of planning for the mix of Products, Pricing, Distribution and of course Promotions
- Promotions refers to the process of selecting the most appropriate tools and activities for reaching and communicating with your customers.
Myth No. 2 – Advertising = Promotions and/or Marketing
(True or False?)
Answer = False:
- Advertising refers to one (‘ONE’) of the many choices that a business operator has at their disposal when it comes to communicating with their target customers (other choices = Sales, PR/Publicity, Online Promotions etc.)
- Promotions and/or Marketing – refer above
Myth No. 3 – Digital Strategy = Marketing Strategy
(True or False?)
Answer = False:
- There is a lot of talk of business operators needing to have a ‘Digital Strategy’ – When it comes to the marketing side of things what business operators need is a ‘Marketing Strategy’ in which Digital Marketing Tools are likely to be considered as part of the Promotions Planning Process
- Marketing Strategy – encompasses the overall process of planning for reaching the right customers, with the right messages, to sell the right products through the right distribution channels at the right price reaching your customers through the right promotions tools and activities (i.e. Planning for the right Marketing Mix) whilst achieving your short and long-term goals and Return on Investment (ROI) objectives
(For more information on debunking this increasingly prevalent marketing myth please refer to the Baker Marketing ‘Marketing Summer School’ Parts 1 to 7)
Myth No. 4 – Patrick Baker = Superhuman, Most Handsome Man in the Whole Wide World!
(True or False?)
Answer = False:
- Patrick Baker is only human and although not officially confirmed it is likely (possible) that there are other men in the world who are equally handsome if not more so.
- If you answered ‘True’ to any of the above please refer back to the Baker Marketing ‘Marketing Summer School’ Parts 1 through to 7.
- If you answered ‘True’ to all of the above please take yourself away to a place where your wrists will be severely slapped.
Completing your Promotions Planning Process
I have summarised below what I consider to be the most logical approach to completing your Promotions Planning process, namely:
- Review your Strategic Marketing Decisions
- Analyse the Behaviour of your Target Customers
- Review your Competitors and their Promotions Mix
- Define your Return on Investment (ROI) Objectives
- Develop Tailored Marketing Action Plans for Your Busines
The approach taken with each of these steps should be consistent for all business operators. However, the level of investment that you make in completing the above promotions planning process should be in keeping with the level of investment (money and time) that you are making.
Naturally, decisions made will vary dramatically depending on factors such as budgets, target markets, product/service categories and your current stage of growth and development combined with your long-term aspirations.
Key Steps in Completing your Promotions Planning Process
Step 1 – Review your Strategic Marketing Decisions
Double-checking Who you are targeting and Why?
Something really obvious but often overlooked is to stop and double-check who we are targeting and what messages we most need to communicate.
When we work with clients for the first time we find that their history is often littered with examples of rushing in and spending money on promotions activity without having a clear marketing strategy or definition regarding who they are targeting and what specific messages will be most effective in achieving outcomes.
Some issues to consider when reviewing your strategic marketing decisions and planning promotions activity include:
- Who are your Primary and Secondary Target Markets and how can they be identified and/or located?
- What are their Key Needs and which promotions tools are likely to be most effective at communicating your ability to provide solutions?
- What is your Desired Brand Positioning and how does this impact on the quality and tonality of Promotions tools?
- Are there any Sales Partners and/or Sales Influencers to consider?
- Other strategic marketing planning decisions that will influence your approach to the promotions planning process
Step 2 – Analyse the Behaviour of your Target Customers
Understanding how Your Customers Consume Information
After completing a review of your strategic marketing decisions and plans you will then benefit from completing a more in-depth analysis of your Primary Target Markets and how they consume marketing messages.
In other words, you need to ensure you understand what promotions tools will be most effective and cost-efficient in achieving the following:
- Reaching your target customers
- Gaining ‘cut-through’ and gaining the attention of your target customers
- Communicating to your customers that you provide great solutions for their needs
To achieve this it will be useful to consider the daily lives of your Target Customers and understand the following:
- Where they live, travel and work
- What they do for study, employment and recreation and how they can be reached during these times
- What mass media they consume and when i.e. do they listen to the radio in their car
- What publications or media they purchase or to which they subscribe
- Their online activities for information, entertainment and use of social media
- Their approach to searching for information online such as use of search engines, directories and online retail and auction sites
- Their approach to good ‘old fashioned’ off-line searching such as visiting stores and asking Sales Partners and Sales Influencers for advice
Your Customer’s Decision Making and Purchasing Process
Most importantly you must ensure that you have a good grasp of the journey that your customers complete when researching and purchasing your product or service.
Step 3 – Review your Competitors and their Promotions Mix
Uncovering how your Competitors Communicate
Chances are that you are like most of our clients in that you operate in a highly competitive marketplace and that you have direct competitors from whom you can learn the following:
- What promotions activities are they implementing that appear to be working well and from which we can gain ideas and/or insight
- What promotions activities are they implementing that do not appear to be working for them from which we can learn valuable lessons that will help us be more cost-effective
- What innovation can you create and implement to give your brand a completive advantage
It is useful to research your competitor’s promotions activity and understand the following:
- What tools are they using?
- What messages are they striving to communicate?
- What approach to Brand Positioning are they taking?
- How are they treating issues such as Regular Price Points, Promotions Pricing and Discounts and/or Bonus offers?
- What is the overall approach to quality or tonality of the communication?
- What level of success do they appear to be having with their chosen approach to promotions implementation?
To spend money on promotions activity without having a good understanding of your competitor’s activity would risk missing valuable opportunities that can save you marketing dollars and generate you more sales growth.
Step 4 – Define your Return on Investment (ROI) Objectives
Spending your Money Wisely
Since 1998 I have worked with clients to develop marketing strategies and implement promotions activities. During this time I have witnessed numerous mistakes including:
- Spending too much money on marketing and promotions activities
- Not spending enough money on marketing and promotions activities
- Spending money on the wrong promotions activities
- Embarking on a promotions program without allocating enough resources to make it effective
- Spending the right amount of money on the right tools but implementing poor quality communications
- Many more mistakes that cost business operators money, sales and years of their lives
- Choose your preferred combination from the choices above!
If you stop and give some consideration to your expected Return on Investment (ROI) you will give yourself the best chance of avoiding the above mistakes.
In addition, you will also increase your chances of reversing the problem illustrated by John Wanamaker (1838 to 1922) in the quote listed above.
That is, you will be doing your best to double-check that neither half of the money you spend on advertising (promotions implementation) is wasted.
Promotions Planning for Return on Investment (ROI)
Some issues to consider from a Return on Investment Perspective (ROI) include:
- Have you defined your Sales Growth Targets and are they realistic?
- Have you defined your Promotions Budget and is this realistic in the context of your Sales Growth Targets?
- Have you carefully analysed the Promotions Tools that you are considering for implementation in the context of their effectiveness in achieving your specific communications objectives?
- Will your Promotions Budget do justice to the Promotions Tools that you are planning to implement?
- Does your Promotions Budget allow you to develop high quality communications messages i.e. can you produce a quality advert?
- Does your Promotions Budget allow you to reach your Primary Target Market i.e. will your promotions tools reach the right people and gain ‘cut-through’?
- Does your Promotions Budget allow you to reach your Primary Target Market with enough frequency to change behaviour i.e. can you place your communication and/or advertising enough times to generate sales?
- Does the Promotions Program that you are planning provide for a level of Promotions activity across all important key periods during your trading year?
- Have you calculated/considered your expected Return on Investment (ROI) from your planned choice of Promotions Tools and implementation activity?
- If you answered ‘No’ to any of the above there is a good chance that there is still room to improve your approach to maximising your Return on Investment (ROI) from your promotions implementation.
Step 5 – Develop Tailored Marketing Action Plans for Your Business
Reaching your Customers with the right Marketing Mix
Now this is the fun part. So I am going to leave this ‘fun’ until next week.
That’s right, next week I have scheduled to devote next weeks article to developing tailored Marketing Action Plans for your Business.
In developing your Tailored Marketing Action Plans for your business you should give consideration to:
- Which Promotions Tools will be most useful and effective in helping you reach your Primary Target Markets
- Which Promotions Tools will enable you to deliver quality marketing messages that will help you:
- Gain ‘cut-through’
- Communicate your Desired Brand Positioning
- Communicate your Key Points of Difference
- Delivery your Key Communication Messages (i.e. Features and Benefits Messages)
- Which Promotions Tools represent the best value for money in terms of the quality of their communications messages and the frequency with which you are able to reach your Primary Target Customers
This is where you develop the following:
- Brand Marketing Action Plans
- Digital Marketing Action Plans
- Sales Action Plans
Marketing Actions Plans
I hope that you have found the above information to be of interest and of use for you in planning your Promotions Activity.
Next week we delve into more depth with regard to evaluating your promotions alternatives and developing your Marketing Action Plans in ‘Part 9 – Marketing Action Plans – Your Branding, Digital and Sales Tools’.