Page 469 - Foundations of Marketing

436 Part 6 | Promotion Decisions

area, a supermarket manager views these actions as strong support and is much more likely
to carry the product. To encourage wholesalers and retailers to increase their inventories of
its products, a manufacturer may provide them with special offers and buying allowances. In
certain industries, a producer’s salesperson may provide support to a wholesaler by working
with the wholesaler’s customers (retailers) in the presentation and promotion of the products.
Strong relationships with resellers are important to a firm’s ability to maintain a sustainable
competitive advantage. The use of various promotional methods can help an organization
achieve this goal.

Combat Competitive Promotional Efforts
At times, a marketer’s objective in using promotion is to offset or lessen the effect of a com-
petitor’s promotional or marketing programs. This type of promotional activity does not nec-
essarily increase the organization’s sales or market share, but it may prevent a sales or market
share loss. A combative promotional objective is used most often by firms in extremely com-
petitive consumer markets, such as the fast-food, convenience store, and cable/Internet/phone
markets. Newcastle Brown Ale engages in a combative promotion objective by mocking the
clichés used in its rivals’ advertising. In one combative approach, Newcastle targeted its rival
Stella Artois’ use of the word “chalice” in its advertising. Newcastle placed billboards along-
side Stella Artois billboards that asked “Who Uses the Word ‘Chalice’?” to poke fun at its
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competitor’s use of worn-out clichés. It is not unusual for competitors to respond with a
counter-pricing strategy or even match a competitor’s pricing.
Reduce Sales Fluctuations

Demand for many products varies from one month to another because of such factors as
climate, holidays, and seasons. A business, however, cannot operate at peak efficiency when
sales fluctuate rapidly. Changes in sales volume translate into changes in production, inven-
tory levels, personnel needs, and financial resources. When promotional techniques reduce
fluctuations by generating sales during slow periods, a firm can use its resources more
efficiently.
Promotional techniques are often designed to stimulate sales during sales slumps. For
example, Snapper may offer sales prices on lawn mowers into the fall season to extend
the selling season. During peak periods, a marketer may refrain from advertising to pre-
vent stimulating sales to the point at which the firm cannot handle all of the demand.
On occasion, a company advertises that customers can be better served by coming in on
certain days. An Italian restaurant, for example, might distribute coupons that are valid
only Monday through Wednesday because on Thursday through Sunday the restaurant is
extremely busy.
To achieve the major objectives of promotion discussed here, companies must develop
appropriate promotional programs. In the next section, we consider the basic components of
such programs: the promotion mix elements.

LO 4 . Explore the elements of THE PROMOTION MIX
the promotion mix.
Several promotional methods can be used to communicate with individuals, groups, and
organizations. When an organization combines specific methods to manage the integrated
marketing communications for a particular product, that combination constitutes the promo-
tion mix for that product. The four possible elements of a promotion mix are advertising,
personal selling, public relations, and sales promotion (see Figure 15.3 ). For some products,
promotion mix A combination firms use all four elements; for others, they use only two or three. In this section, we provide
of promotional methods used to an overview of each promotion mix element; they are covered in greater detail in the next
promote a specific product two chapters.

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