Promotional Strategy - Definition, Importance, Types & Steps
What is Promotional Strategy?
Promotional strategy is a method used by companies to advertise, promote & sell their goods. A company chooses its promotional strategy based on factors like product type, marketing budget, target audience etc. It is a critical activity to increase product awareness & thereby increase sales. An effective promotional strategy gets more revenue as compared to the marketing spend.
Importance of Promotional Strategy
Promotion for any product or service is essential for any company. It is because only through promotion people would come to know about the product. Only after knowing about the product they consider purchasing. Since there are some many companies & brands competing to sell their products to the same set of customers, advertising & promotion are important tools to ensure each brand is differentiated & identified.
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Promotional Strategy Types
All the promotional strategies can be classified under two categories – Push and Pull.
1. Push strategy
In push strategy promotional activities are done for the distributors, wholesalers and retailers to push the product to the consumers. Trade fairs, wholesaler discounts, bonus and all the activities which benefit the distributors are all examples of push strategies. Hence the demand is pushed or created in the distribution channel. These activities are not visible to consumers and hence it is mostly unknown to the customers.
So when one goes to a mobile store to buy a new phone and the shopkeeper urges and shows only Samsung phones, it is push marketing and the shopkeeper is getting more margin on selling Samsung phone than any other brand.
2. Pull Strategy
In pull strategy promotional activities are done for the consumers. Advertisements, digital campaigns, discounts in stores etc are some examples of pull strategy. Hence demand is created in the consumers which in turn go to the retail stores or e-commerce websites to buy these products. These activities are visible to all the customers.
When a customer goes with a specific brand and product in his mind to the market, it is the pull strategy that has worked for the company.
Promotional Strategy Steps
The process steps for driving promotion for any product or service are:
1. Identify the objectives of promotion- This should be a quantifiable amount in terms of revenue, unit sales, increase brand awareness etc.
2. Evaluate promotional channels- This involves evaluating the marketing channels required for promotion eg TV, social media, radio, events, trade fairs etc.
3. Formulate a marketing budget. The amount investment required for driving a promotional strategy should be allocated channel wise. This would help in keeping track of investments.
4. Execute promotional activities- This involves creation of advertising campaigns, scheduling advertisements and making sure that promotions are happening without disruptions.
5. Monitor, measure & evaluate- All promotional activities must be monitored for effectiveness & evaluated for further improvement.
All these steps have to detailed for having an effective promotional strategy.
Hence, this concludes the definition of Promotional Strategy along with its overview.
This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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