HOW TO DEVELOP CUSTOMER CENTRIC PROMOTION STRATEGY
Your promotion strategy is the part of your marketing strategy that explains how you’ll bridge the gap between the places where you’re selling your product or service and the places and ways your customers gather and absorb information. A complete promotion strategy contains a description of the promotion methods you’ll use in your marketing plan.
You can promote your products in a variety of ways. In fact, it’s always good to use a mixture of methods that can help you reach your target market.
- Marketing collateral
- Media relations campaigns
- Promotional activities
- Public speaking and conferences
- Developing a consumer-centric promotion strategy
Consumer behavior explains why the consumer purchases certain product or availing the services. When you understand the “why,” you can create a promotion strategy that speaks directly to that consumer. In other words, understanding your consumers enables you to recognize their needs, motivations, attitudes, and intentions to buy. Then you can create a promotion strategy that supports those behaviours and moves consumers to purchase directly from you.
Marketing organizations must facilitate the consumer to act on their purchase intentions. The organization can use a variety of techniques to achieve this. The provision of credit or payment terms may encourage purchase, or a sales promotion such as the opportunity to receive a premium or enter a competition may provide an incentive to buy now. The relevant internal psychological process that is associated with purchase decision is integration. Once the integration is achieved, the organization can influence the purchase decisions much more easily.
Increasingly, marketers are finding that consumers are influenced by the purchasing decisions of other consumers. A recent study found that 10% of consumers are influencing the buying decisions of a large chunk of other consumers, making them top influencers. Much of this influence is through online means such as social media. As a result, marketers usually find and target these ‘top influences’ and ensure that they do their bit in influencing the behavior of other consumers.
There are 5 stages of a consumer buying process. It shows the complete process that a consumer will most likely, consciously or unconsciously, go through when they go to buy a product.
These stages are:
- The problem recognition stage.
- The search for information stage.
- The possibility of alternative options stage.
- The choice to purchase the product stage.
- The actual purchase of the product stage.
CONSUMER BEHAVIOUR AND DISTRIBUTION CHANNELS
Most businesses find that by selecting multiple distribution channels they can make more sales and attract more consumers than when they select only one. Having multiple distribution channels allows you the opportunity to gauge what channels work best for your specific product.
Here’ s a rundown of the different channels you can choose from:
Retail: Using retail stores that sell to the final consumer. This is a direct channel because you’re in touch directly with the consumer.
Wholesale: Working with wholesale dealers that act as the go-between for you and retail stores. This would be considered an indirect channel, because you aren’t in direct contact with your consumer; you’re more than likely selling to the middleman.
Direct mail: Selling directly to consumers through catalogue merchants at retail prices (plus shipping). This would be considered a direct sales channel, because you’re reaching out directly to the consumer with no go-between.
Telemarketing: Selling directly to consumers via the telephone. This can be considered either direct or indirect marketing, depending on whether you did the telemarketing within your company or you outsourced it to another company.
Internet marketing: Selling directly to consumers at retail prices or wholesale prices (plus shipping) via the Internet. This channel can be considered direct, indirect or multilevel marketing, depending on what sources you use to sell your product online.
Outside sales force: Using salaried employees or independent commission contractors who sell your products to either the consumer or to wholesale dealers This can be considered a direct channel or an indirect channel, depending on whether your sales force was employed by you or outsourced to contractors.
Distribution channels can have significant implications on the following:
Product margins and profits: The channel you use to sell your products will determine the amount of profit you make. If you choose an indirect sales method, you have to pay the middleman for selling your product.
Marketing budget: Outsourcing sales often can save on your marketing budget, because the middleman does the product marketing for you in order to meet their own sales goals.
Final retail pricing: Direct and indirect sales channels will determine your final product pricing differently. If you use indirect sales channels, they’re allowed to price the product at the price they choose. Otherwise, you may need to increase the price in order to cover their commission or fee.
Management practices: The control you have over your sales management practices is solely dependent on whether you outsource or sell directly. When outsourcing, you will often use some percentage of that control.
CONSUMER BEHAVIOR AND POSITIONAL STRATEGY
To determine your positional objectives, you need to get a handle on your positional strategy. By answering the following questions, you can identify the objectives in placement/positional strategy and determine the best methods to use to fulfill your placement goals:
- What are the characteristics of your target market and how large is your market for this product? If you carry a high-priced item that typically has a small number of buyers, you may want to focus on the direct sales approach, which provides plenty of customer service. If you’re selling a lower-priced item that appeals to a large market, such as paper clips, you could apply an indirect distribution approach by using advertising and placement in retail stores so customers could easily find that item.
- Where are your customers located? Location iS important when it comes to placement. If you have a large number of customers in your local area, you could sell through local retail outlets. If your customers are located in multiple geographic locations, you may want to consider distribution through agents, wholesalers, or Internet methods.
- How large are the orders? You can use the size of your average order to segment your customers according to their order size. You could sell directly to customers purchasing large orders and use an indirect method for smaller orders. You should choose more than one distribution channel in order to evaluate the one that works best for your company and the distribution of your company’s product.
HOW TO DEVELOP A MARKETING STRATEGY
There are some specific steps that must be taken in order to develop a marketing strategy, and although they take time, they must be implemented for the future success of the business.
Steps I: Define the products or services that the company going to offer, as well as their intentions. Determine how they are beneficial the customer on base of features or uses. Once the company defines the product or services and what are trying to sell, it can better know how to market it to the outside world.
Step II: Establish a marketing plan of action for positioning the company product or service in the marketplace. It is important to determine where the product fits in, and even if there are other similar products available within the market range, make sure that yours company product has its own niche.
Step III: Develop a market study so as to determine the type of customer you are targeting with your product or service. Learn who they are, their age group, gender, and their buying habits. Determine what concerns they are facing and how your product or service will resolve those issues. A market study also provides valuable information on market growth and trends.
Step IV: Study your competition to determine the various options available for your target customers to choose from. Compare and contrast their product or service with yours and evaluate their positive and negative points. Doing so will guide you more effectively as you establish your own advertising strategy.
Step V: Find out what sets your product or service apart from the competition. Ask yourself what is unique about what you are offering and then put together a sales proposition that you can implement.
Step VI: Decide on a marketing budget and make sure that your plan fits into it. A budget can be based on the type of marketing you are planning, or you can plan the amount of your budget and ensure that your plan fits in to that parameter.
Step VII: Determine the various marketing methods that you can implement to best promote your particular product or service. There are many marketing and options available, such as direct mail advertising, Internet marketing, and promotional events. The methods and extent of your marketing plan would obviously be dependent on your budget.
Step VIII: Be prepared to modify your marketing strategy on a regular basis. Markets and customer tastes change all the time, so be ready to evaluate your approach and change it to meet those customer climate changes. If you neglect to modify according to the economy, and you choose to remain stagnant in your approach, your product will most likely be left behind the competition.
There are several units in the market that can be analysed. Our main thrust in this course is the consumer. However, we will also need to analyse our own firm’s strengths and weaknesses and those of competing firms. Suppose, for example, that we make a product aimed at older consumers, a growing segment. A competing firm that targets babies, a shrinking market, is likely to consider repositioning toward our market.
To assess a competing firm’s potential threat, we need to examine its assets (e.g., technology, patents, market knowledge, and awareness of its brands) against pressures it faces from the market. Finally, we need to assess conditions (the marketing environment). For example, although we may have developed a product that offers great appeal for consumers, a recession may cut demand dramatically.