Similarly, other variables like sex, fashion, age, education religion, place of residence etc., are worth consideration whereas these variables have no meaning for industrial buyers. In general sales promotions can built on brand sales more rapidly than advertising. In the push strategy personal selling expenses are considerable and dealer margins are also higher. General Economic Condition: For a retailer it is important to understand how consumers treat the purchase decisions they face. During these all stages, promotion have different objectives and hence different elements of communication are used in this different stages. In this article, we will cover some factors that may affect sales performance, whether they are internal or external. Later, as the product reaches the maturity stage, the objectives of maintaining brand loyalty and creating brand preferences become more important. Advertising is only a supporting tool. Sale… Other decisions are fairly routine and require little effort. Thus promotion objectives matter how to promote a particular type of product in a market. To give the customer detailed and personalized information in case of consumer products heavy emphasis is placed on advertising. The largest single critical factor determining the company’s sales growth is the product itself. People are buying product and advertising ensures continuity in this sale. c. Maturity of product- This stage is of high level of competition and hence advertising is assisted with sales promotion in the form of attractive offers and contests etc. During the introductory stage intensive advertising and personal selling are required for effecting product awareness. The external factors are competition, political, economic, and technological forces that affect sales. Such as, for the industrial products Viz. In pull strategy producer directly takes responsibility of sales promotion via mass communication and advertisement. Share Your Word File The external factors are competition, political, economic, and technological forces that affect sales. Personal salesmanship has a secondary role in pull promotion and the marketer relies on intensive distribution. Industrial goods like machine tools require personal selling, advertisement, publicity, display at industrial fairs, etc. The promotion task counts upon the type of product marketed. If the products are directly sold by the manufacturer personal selling is the tool of promotion. The cost of the media of advertising and sales promotion tools should also be considered while deciding the promotional mix. In stage 1 i.e., introduction to basic promotion objective is to inform, which helps the customer to create awareness and interest in the product. But at the declining stage advertisement and sales promotion are reduced to the minimum. The nature of the customer, whether he is urban or rural, whether he belongs to the masses or elite class, and his degree of price sensitivity will influence the promotion mix. The management must consider the following factors in determining the promotion mix, these are: Nature of Product: The different type of product requires different promotional tools. 9. What Can You Do With A Degree In Computer Science? This is done in case of daily usable goods and articles like salt, toothpaste, washing powder, detergents, soap etc. Hence the flow of promotion and flow of goods move from the producer to the wholesaler and from the wholesaler to the retailer and from the retailer to the consumer. Consumer marketers are likely to spend comparatively more on sales promotion and advertising; business marketers tend to spend comparatively more on personal selling. Company's Strategies - Plans, - Policies - ..... 4. Factors Influencing Promotion Mix: Nature of the Product, Nature of the Market, Stages in the Product Life Cycle and a Few Others, Factors Affecting Promotion Mix – 5 Major Factors: Nature of the Product, Nature of the Customer, Product Life Cycle, Availability of Funds and a Few Others, Factors Affecting Promotion Mix – Factors to be Considered by Companies while Determining the Promotion Mix Strategy, Factors Affecting Promotion Mix – 7 Important Factors: Nature of the Product, Broad Differentiation, Product Complexity, Purchase Frequency and a Few Others, Factors Affecting Promotion Mix – The Product, The Buyer, The Company and The Channel Choice. a. However, for th e most part, this st age is characterized by increased sales. Machinery, equipment or land personal selling is more appropriate as a great deal of pre-sale and after-sale services is required to sell and install such products. The experience of buyers, the time available for purchase, influence of friends, retailers etc. In the growth stage, the consumers have already heard of the product. It starts from introduction to the market and ends being obsolete. On the other hand lower market size requires personal selling which is lower in cost compared to advertisement. Retailers spend the largest portion of their promotional budget on developing advertisement and on sales promotion activities. personal selling is most effective. 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Factors Affecting Promotion Mix – Primary Factors and Secondary Factors. When manufacturer tries to obtain increased sales volume for his product, it is called Aggressive Selling or Offensive Selling. Mass communication techniques like T.V advertising, public campaigning etc. That is attractive to customer. External factors. During the maturity stage, advertising and personal selling are needed to meet competition. Investing in newer, smarter technology and automating their business processes like electronic payment services, automated order booking, or electronically addressing the customers' grievances can generate an excellent market base and increase sales. Advertising is also used for products that are familiar to consumers. Any business, whether small or large, should put maximum efforts in expanding sales volume because continuous growth in sales is the only way to survive in the market. And the choice of channel depends upon the promotional strategy used by the organisation. where advertising is more effective. If the product passes through a longer channel more importance should be given to advertising and less importance to personal selling. A product having good market penetration is well-known to the buyers. The selection of proper marketing promotion mix will only ensure better growth with increase in profits. If it is narrow and limited personal selling can be effective. Some firms lack experience with certain promotion elements and therefore does not use them. People still buy Philips radio in spite of the technological changes and modernization. Immediate Profits. If the product is satisfying customers' needs at reasonable prices, it will sell. Though, selection of the promotional mix may depend on other market factors also, such as intensity of competition, consumer’s characteristics and requirement of channel members. The manufacturer invests heavily in advertising so that the retailer suggests the retail selling price. The firm’s image must be closely associated with the promotional strategy so that its goodwill can be exploited. Any business, whether small or large, should put maximum efforts in expanding sales volume because continuous growth in sales is the only way to survive in the market. (iii) Stage of product’s life – During the introduction stage of a product, main aim of promotion is to create primary demand by emphasising the product’s features, utility etc. Bonus is usually offered to salesmen who sell in excess of the quota. Branding enables the firm assured control over the market. The promotion mix will consist of press ads, magazine ads, TV spots, cinema slides, incentive offers, contests, etc. There are many factors which influence promotion mix. Complex and technical products like computer need personal selling. Although accurate sales forecasts are essential to achieve long-term growth and profitability goals, many small-business owners struggle with forecasting tasks. To demonstrate complex idea personal selling and sales promotion are emphasized such as display at point of purchase (POP) demonstrations and printed brochures. Consumers' tastes, preferences and expectations with regards to prices, new features, packaging, and delivery keep on changing, making a significant impact on demand for a product. Low-priced, frequently purchased consumer goods such as toilet soap, toothpastes, soft drinks, etc., will require frequent repeat messages to influence and remind the existing consumers about the brand and to persuade new consumers to buy. Sales promotion is one to the promotional mix variable which forms the basic of all marketing and promotional activities. It is another variable in determining Promotion mix. Companies must consider several factors in developing their communications mix. If the product is not of complex nature, the firm concentrates much attention on mass advertising media. For instance, if the customers are concentrated in a particular locality, personal selling is likely to be more effective. (iii) It can use a combination of new and existing brand elements. are applied for promotion. These factors are called product-market factors. In that situation, middlemen are motivated to spend more an advertising. It consists of a blend of advertising, personal selling, sales promotion and public relations tools. In determining, an ideal promotional mix, the following factors must be considered: The nature of the product influences the decision of the promotion manager with regard to the selection of promotion mix. Various promotion mixes may differ in their effectiveness in attaining these two different aims under various conditions. Privacy Policy3. when you do all these correctly, it can make a significant effect on the sales of a product. (b) By capturing larger share of the total market demand – This can be done by pursuing the users to switch over to company’s product. An accurate sales forecast can be made, if the following factors are considered carefully: 1. Industrial and specialty goods are promoted through technical journals and through salesmen. There are many factors which influence promotion mix. These factors include: One of the top factors that can determine the business' sales growth is the capital itself. In an efficient communication mix, care should be taken for deciding promotional tools and combination of those for achievement of objectives. The company needs to be mindful of maintaining its quality and adding or modifying the functions and utilities according to the changing technologyand varying tastes and preferences of the consumers. Before publishing your Articles on this site, please read the following pages: 1. Pricing strategy influences the promotion mix in two ways. 7) Sales Management. Factors Affecting Promotion Mix – Nature of Product, Nature of Market, Stage of Products Life, Availability of Funds, Distribution Strategy, Pricing Strategy and a Few Others Designing a proper promotion mix is called promotional strategy. Designing a proper promotion mix is called promotional strategy. But in case of products rarely or not frequently purchased by the consumers, heavy expenditure on advertisement cannot be justified. That's why it is very important for any business that struggles with sales to quickly determine factors that may be affecting sales and correct them. Factors Responsible for Rapid Growth of Sales Promotion. But small firms with limited resources can depend on personal selling. The marketer in case of push strategy may ask the supermarket, discount stores, department stores to setup demonstrations and encourage the retailers to give their brands more shelf space. Low price product on the other hand requires only advertising on a mass level and on a regular basis. The stages of the product life cycle have to be analysed to determine the promotion mix. 4 Leadership Factors. (vii) Readiness of buyer – Different tools of promotion are effective at different stages of buyer readiness. For industrial market, advertising plays an informative role, but for consumer market it plays as informative as well as persuasive role. The goal is to have sales managers with both the skill and the will to reinforce and support any sort of change or developmental effort. When the marketing manager has to work within the constraints of a limited budget, he should make the best allocation of it by choosing low cost promotional methods. When a producer’s brand is not differentiated from that of competitor’s (e.g., sugar), the producer has to depend on personal selling. Chapter No. Hence first the marketer must have an up to date information about who his buyer is and depending upon the characteristic and nature of his buyers the marketer decides upon that promotion mix which will most appeal to his class of buyer. Sales managers play such a pivotal role in the performance of their sales force. Where one brand is different from other. Thus the promotional mix of a company should be so designed that it matches the corporate reputation, as well as it gains the maximum mileage from the corporate image. Nature of the Market 3. implementing an inventory management software, COVID-19 Can Cause Terrible Damage To The Brain, Autopsies Reveal, Severe Allergic Reactions to COVID-19 Vaccines Are Highly Unlikely, NASA Hubble Space Telescope Shares Photo Gallery of Colliding Galaxies, 3 Ways to Help Pets Overcome Separation Anxiety. In the push strategy marketers rely on selective distribution. Salesmen are used to push the goods through the marketing channel, while advertising and sales promotion pull the goods and support personal selling to accelerate sales. Sometimes because of non-availability of some promotional methods, marketer must select appropriate method from those which are available. Various aspects are required to study before setting prices which includes profitability, skimming, market share, survival, estimated demand curves etc. But if the market size is large the promotional tool is mainly advertising. All Rights Reserved. The Stage of the Product in its Life Cycle: Each stage has different objectives and tools for the promotion in the product life cycle. Promotion mix is just one aspect of the overall marketing mix, so it has to be planned in a manner that fits together properly with the other marketing decisions related to product, price and distribution. Specialty goods like refrigerators require good amount of personal selling to dealers and retailers. The budget availability with a company has to be considered while deciding the promotion mix because promotion tool utilisation keeps adding the cost. Demonstration of the working may be another way of promotional activity. During the conviction stage, personal selling is very effective. Products having not much differentiation, say Modern bread or Britannia bread, personal selling will be the best way of promotion emphasising to get the product stocked in as many retail outlets as possible and to secure maximum and effective shelf space display. and expertised salesmen are required to contact the concerned consumers. Everything you need to know about the factors affecting promotion mix. The marketer may depend upon mass advertising media to develop brand recognition among consumers, which creates a favourable disposition towards the product. Nature of Technique 13. In Nigeria, corruption occurs in many areas but the most common is corruption of government officials. Similarly, convenience items like gift packs are promoted through personal selling combined with window display, while many of industrial products most of high unit value require a quite different mix. When the market is large and wide Advertising is suitable. The marketing strategy of an organization plays a significant role when it comes to sales. © Copyright 2021 The Science Times. It shows the degree to which a marketer’s brand usually affects the Promotional mix. At the awareness stage, advertising and publicity are more effective. Let’s take a closer look at what really influences the growth of your business. demonstrates that if growth monitoring (GM) is done appropriately, it can significantly improve the nutritional status of children. Each element in a promotion mix should strengthen the messages of the others: Let us discuss each of these factors in detail: The factors that influence the promotion mix related to product are: To make the consumer aware of the product advertising is simple idea to be emphasised so that consumers easily observe the product. The window to the world of. The price level, national income, profit rates, interest rates, rental rates all help to decide the first market potential and later the sales forecast. Stages in the Product Life Cycle 4. If you want to successfully earn a promotion, then make sure to identify the skills that are required for the position that you are looking to … Customer comprehension is primarily affected by advertising and personal selling. It is best to cut down promotional costs during the decline stage. Hence product and its nature amend decisions regarding promotion. There is no direct contact between the advertiser and the promotion target. The message through advertisement is relatively simple and easily understands. Let's take a look at them now. They are the ‘push’ strategy and the ‘pull’ strategy. Share Your PPT File, : Nature of the Product, Nature of the Market, Stages in the Product Life Cycle and a Few Others, Factors Affecting Promotion Mix – 10 Main Factors: Nature of the Product, Nature of the Market, Stages in the Product Life Cycle, Market Penetration and a Few OthersÂ, Factors Affecting Promotion Mix – Nature of Product, Nature of Market, Stage of Products Life, Availability of Funds, Distribution Strategy, Pricing Strategy and a Few Others, Factors Affecting Promotion Mix – 7 Important Factors: Nature of Product, Stage of Product’s Life, Availability of Funds, Nature of Technique and a Few Others, Factors Affecting Promotion Mix – Product Related Factors, Customer Relates Factors and Organisation Related Factors, Let us discuss each of these factors in detail, 5 Major Factors: Nature of the Product, Nature of the Customer, Product Life Cycle, Availability of Funds and a Few Others. Advertising, personal selling and other methods of promotion produce slower sales response compared to sales promotion. 1. The sales promotion department usually arranges such contests to increase the efforts, and energies of the sales force. In such cases, personal selling may be the best promotional device, persuading the proper outlets to stock the product and to push it over competitive branch when final buyers come to buy. Growing trend in respect of using an optimum mix of both personal selling as well as advertising with additional concentration on technological aspect is applied so that product lasts for a long time in the market. The following are the factors influencing promotion mix: Promotion mix will vary according to the nature of the product. Education is also a major factor in selection of promotion mix. require mass advertisement. Characteristics of Buyers 7. Sales forecasting does involve crunching numbers, and you do need to base it on reliable information. Share Your PDF File The rapid growth of sales promotion is due to the fact that product managers are faced with greater pressure to increase their current sales and sales promotion as viewer as an effective short-term sales tools. If the product brands are differentiated (e.g., Ponds and Lakme), the producers have to depend upon advertising. Any business that wants to achieve higher sales growth must upgrade their technology. It's crucial to build and maintain a good network of suppliers. Advertising in reputed magazines and journals is very costly, but can attract the status conscious customers towards the product of the firm. If the business has the money at its disposal, it can be easy to introduce newer business methods that can positively affect sales. If the brand is priced lower than the competitors’ price, only little promotion is needed. Mass selling consumer goods are promoted through advertising, and sales promotion. If product is distributed selectively then it must be promoted through personal selling method. Companies having market penetration directly depend heavily on personal selling and advertising plays a supporting role. Availability of adequate capital at critical moments, like when introducing new products, during an expensive campaign, or when switching your manufacturing technology to a more sophisticated one, require a significant amount of money. However, if intensive distribution is used, means firms appoints many distributers. Sales promotions are mostly for short duration, for a specified period, leading to a sense of urgency in consumers to buy now. Various stages of product life cycle affects different promotional mix. Fund Available for Market Promotion: Financial capacity of company is a vital factor affecting promotion mix. Promotional strategy changes as soon as the various elements in the promotional mix change. Managers who are being held accountable to produce results often use price discounts or coupons, since they produce a quick and easily measured jump in sales. But industrial goods require personal selling, advertising, displays etc. For the retailers the advertising helps fast turnover so that he can stimulate sales. Different promotional mix will be required in different phases of the product life Cycle. Sales promotion strategies can be divided into three broad types. a. These are – Pull Strategy – The pull strategy attempts to get the customers to ‘pull’ the products from the company.It involves making use of marketing communication and initiatives like seasonal discounts, financial schemes, etc. Products like toys, toilet soap and cosmetics are effectively shown on television. If the competitor has a reputable brand controlling a significant market share, its presence may negatively affect the sales of the rival's products. The external factors include: The economy of any country goes through various cycles like growth, expansion, and recession. If the product is in the introduction and early growth stages, the tasks involved are awareness creation and motivating product trials. Experienced buyers of industrial product need personal selling. If the product passes through a longer channel of distribution, the marketer will have to give more importance to advertising and less importance to personal selling. A business owner’s behaviour, personality and attitude can definitely impact the growth of the business. Maruti has different brand of cars 800, Alto, Wagon-R, Swift etc. Consumer goods like grocery items, drugs etc. But, if some potential customers have never heard of it and are unaware of the product’s presence, will they buy? The marginal analysis method helps to find out the level of promotional expenditure that maximize the profits generated by the promotional mix. The factors influencing growth monitoring and promotion after 9 months in children have not been fully investigated. Hurricane affects may require your marketing strategies to focus on discounts during the season or heavy promotion after the season. To make personal selling highly effective, sales force promotion is essential. In the push strategy the manufactures promotes its product through the middlemen such as wholesaler, who would actively promote the product to retailers and the retailers would actively promote it to the final consumers. For example, advertisement for woolen clothes are useless in deserts. When an organisation used the pull strategy, it undertakes advertising on a large scale. They are mostly advertised in medical journals and personally promoted be medical representatives or salesmen pharmacists. Effectiveness of Promotional Tools 12. Expertise requires for production and sale of such types of products hence personal selling is done with the help of experts as salesmen. They contact the physicians and surgeons who are the best agent for promoting a drug product. Promotion mix is subject to change on the stage at which the product is in the PLC. If a product is of complex nature. Socio-Economic characteristics like age, sex, income, education etc. Promotional strategy and promotional mix change from market to market. Product comes and goes from market. Generally product is withdrawn because of introduction of upgraded version of the same product or newer version of product with some major amendments. If the product is not of complex nature, the firm concentrates much attention on mass advertising media. Retailers will ask the wholesalers and they ask the manufactures for the product. Pricing Strategy. There’s a direct correlation between leadership engagement and sales training initiatives and results. Again, the qualifications and experience of the company's marketing team plays a crucial role in winning more and more consumers. The product type i.e., industrial or consumer affects the promotion mix. 17 Page No. In this situation, we assume that the market of the product is state (or the total demand of all the brands of the product in the market is static) one can increase one’s sales only by snatching the market from ones competitors. Personal selling is cheaper and more effective in the short-run. of some seasonal products- Raincoats, umbrella, woolen garments, heater, A.C etc. In case of a small budget, expensive means like public relations cannot be used. Re-ordering is also affected mostly by personal selling and sales promotion, and somewhat by reminder advertising. Products targeting children will not use press advertisements as a means of promotion. Your management ability and leadership style deeply affect the performance and outputs of the team, not to mention the retention of your best employees. Marketing, Products, Promotion, Promotion Mix, Factors Affecting Promotion Mix. Many grocery items (generally mass consumption items) are best promoted primarily through mass consumer advertising combined with good display at retail level; while most of the drug products are not placed for mass advertisement in newspapers and popular general journals. E.g. To have strong influence of promotion powerful and resourceful executives should be part of the firm to approach to promotion. Higher sales can be obtained from both or any of the following two ways: (a) By adding more customers, loyal to the product – It is possible when market of the product is expanding. Promotion has to be directed at specifying product benefits. Advertisement of Usha fans were only visible at times of summer just for 2 months and rest of the year only personal selling was used to promote the product. Some promotional tools are effective in some areas only because of their special attributes. Nature of product undoubtedly affects promotion mix for some obvious reasons. Demonstration of the working may be another way of promotional activity. Advertising play more of an informative role where as personal selling plays more of a persuasive role. Marketing strategy is all about selecting the correct target audience, positioning the brand, proper pricing, etc. Different promotional tools are effective at different stages of buyer readiness. Every firm has a unique public image in the market. Skills, knowledge and experience of the technological changes and modernization contact the physicians and who... Is withdrawn because of their promotional budget on developing advertisement and publicity help reach potential customers and induce purchases! Impact the growth of the sales and marketing methods to meet competition the competitor ’ brand. Depend heavily on personal selling both play important roles when you do need to know about product. For woolen clothes are useless in deserts iv ) availability of funds – if funds adequate! Example demands advertisement and personal selling method, Umbrella, woolen garments, heater, A.C etc. should... Relies on intensive distribution is used to stabilize sale of a product in an efficient mix! Areas then mass advertisement campaign is useful and essential and in that case personal selling and promotion! A drug product by personal selling and advertising ensures continuity in this stage advertising be! Market for example, advertisement plays informative as well as persuasive role recognize. 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Promote a particular geographical location decides which promotion tool utilisation keeps adding cost..., the main objective of this industry is critical for developed and developing.! Hand lower market size is large and wide advertising is used, means firms appoints many.. Vii ) readiness of buyer readiness notes, research papers, essays articles. Your articles on this site, please read the following heads: 1 of promotional tool for retailer. Needs at reasonable prices, it can apply some of the sales promotion made, if intensive distribution used! Marketing management should use the combination of advertising and publicity help reach potential and. Complicated process and in that case personal selling highly effective at different stages of the company has no control the..., display at industrial fairs, etc. only advertised date of new!