The promotional mix
Definition
Promotional mix: the particular combination of promotional methods a business chooses, from advertising, sales promotion, public relations, sponsorship and social media.
- No single method reaches everybody, so most businesses use two or three that cover each other's gaps, such as an advert to make customers aware and an offer to make them buy.
- Five things decide the mix: the finance available, what competitors are doing, the nature of the product or service, the nature of the market, and the target market.
The finance available
- The budget rules methods in and out before anything else is considered. A national television campaign costs hundreds of thousands of pounds, so a small independent is choosing between leaflets, a poster site, local press and social media.
- A small budget pushes a business towards methods with a low fixed cost: its own social media accounts, word of mouth, a search listing and a shirt sponsorship for the local team.
- Promotion is paid for before the extra sales arrive, so a business with weak cash flow may pick a cheap method now rather than the best method it cannot yet afford.
Example
- A new independent coffee shop with £500 to spend uses leaflets to nearby offices, an Instagram account and a loyalty card.
- Costa, with a national budget, adds television, poster sites at stations and a phone app to the same list of methods.
- Both mixes suit the money available, which is why the cheap mix is not the wrong answer.
What competitors are doing
- If rivals promote heavily, a business that goes quiet is forgotten, so it may have to match them simply to stay visible on the same shelves.
- Matching a much larger rival pound for pound is impossible, so a smaller business often chooses a channel the rival ignores, where a small budget can dominate. A local gym cannot outspend PureGym, but it can own the town's social media feeds.
- Competitors also shape the message. Aldi's adverts compare its prices directly with Tesco's, because in that market the point customers care about is what the rival charges.
- When a rival launches a discount, the quickest reply is usually a sales promotion, because an offer can be in shops within days while an advertising campaign takes weeks to prepare.
The nature of the product or service
- An expensive or technical product has to be explained and demonstrated, so JCB sells diggers through trade magazines, exhibitions and salespeople rather than posters.
- A cheap everyday product that customers buy without thinking needs reminding and prompting instead, which is why Walkers uses television adverts and in-store offers.
- The product's image limits the methods. A premium brand avoids constant money-off deals because cutting the price repeatedly tells customers the product is not worth its price.
- How new the product is matters too. A launch needs methods that inform, such as samples and press coverage, while a product that everyone already knows needs methods that keep it front of mind.
The nature of the market and the target market
- Mass or niche: a mass market justifies wide, expensive methods because almost everybody who sees the advert is a possible customer. A niche market needs narrow methods, so a specialist cycling brand advertises in cycling magazines and nowhere else.
- Local or national: a business serving one town wants local radio, local press and leaflets, because reach beyond the delivery area is money spent on people it cannot serve.
- Selling to businesses or to the public: a business selling to other businesses uses trade press, exhibitions and direct contact, because its customers are counted in hundreds rather than millions.
- The target customers: their age, income and habits decide which methods will ever be seen, so a brand aimed at teenagers works through TikTok and influencers while one aimed at retired customers uses the local paper, radio and posted leaflets.
- Income matters as well as age, because customers on tight budgets respond strongly to coupons and multi-buys, while wealthier customers respond to quality and reputation.
Example
- Gymshark reaches young gym users through influencers and social media, because that is where its customers spend their time and it costs a fraction of television.
- The National Trust reaches a much older membership through magazines, direct mail and leaflets left in the properties themselves.
Choosing the mix for a given business
- Work through the factors in order and most methods rule themselves out, which leaves a short list the business can actually afford and its customers will actually see.
- The methods chosen should say the same thing, so the prices, images and claims online match those in the shop and in print.
- The business then compares the cost of each method with the extra sales it brings in, and drops the ones that do not pay for themselves. Many businesses have moved spending out of print and into digital methods for exactly this reason.
Common Mistake
- The dearest method is not the best one, because a cheap method aimed at the right people often brings in more sales for every pound spent.
- A small independent cannot buy television airtime at all, so recommending it ignores the finance available.
Exam technique
- Analyse the factors that influence this business's choice of promotional methods wants two or three factors taken from the case, each traced through to a method it rules in or out.
- If you are asked to recommend a mix, name two methods and justify each with a different factor, then say why you left the obvious expensive method out.
- The mistake to avoid is listing promotional methods with no link to this business's money, market or customers.
Self review
- What is the promotional mix?
- Name the five factors that influence which promotional methods a business selects.
- Why does a small budget push a business towards social media and leaflets?
- Give one way a competitor's actions can change a business's promotional mix.
- Why does a technical product need different promotion from a cheap everyday one?