Nowadays, when you go shopping, the shelves are full of products and promotional activities are everywhere. Today you give away a spoon, tomorrow I give you a pot. This society is truly crazy—today you offer 20% off, tomorrow I offer 80% off. Product homogenization is severe, and competition is increasingly fierce. Imagine a product being promoted in a store; consumers are already exhausted by the daily back-and-forth tactics and are passive in receiving information. What should we do? Without promotions, there are no sales; with too many promotions, sales don't increase, and a lot of money is spent. This requires us to perform surgery on promotions and make them efficient. By clarifying the following key points for differentiated promotions, consumers won't suffer from promotion fatigue, and sales will see a significant boost.

The Essence of Promotion Promotion is essentially about providing more value than the price, ensuring customers get their money's worth. It should cater to consumer psychology and target the right consumer group. Tactically: It is a short-term action to strike at competitors, accelerate capital turnover, and increase regional market share. Strategically: It is a long-term corporate action to build the brand, increase market share, and consider the long-term expansion of the national brand (market share, resources, etc.).

The Purpose of Promotion

  1. Shorten the time for a product to enter the market. Using promotional tools aims to provide short-term incentives to consumers or distributors, mobilizing purchasing enthusiasm within a period, cultivating customer interest and usage habits, and helping customers understand the product quickly.
  2. Encourage first-time purchases to achieve usage.
  3. Encourage repeat purchases to establish consumption habits.
  4. Boost sales performance. Undoubtedly, promotion is a form of competition that can change consumers' usage habits and brand loyalty. Driven by benefits, distributors and consumers may stock up and buy in large quantities. Therefore, during the promotion period, consumption and sales often increase.
  5. Competitive needs. Whether a company launches a market offensive or a market pioneer launches a counter-offensive, promotion is an effective tool. Market aggressors can use promotion to strengthen market penetration and accelerate market share gains. Market defenders can also use promotion to counter competitors and block their advances.
  6. Associated promotion. The primary goal of promotion is to sell the promoted product. However, during the promotion of Product A, it can drive the sales of related Product B. For example, promoting tea can boost the sales of tea sets. When more coffee pots are sold, coffee sales increase. In 1930s Shanghai, an American oil company gave away kerosene lamps to consumers, resulting in a significant increase in kerosene sales.
  7. Festive rewards. Promotion can add glory to products during festivals or corporate anniversaries. When routine holidays arrive or when a company has major celebrations (such as openings or listings), promotions can express gratitude and joint celebration to consumers.
  8. Inventory clearance. Due to various reasons, short-dated products appear in the market. To reduce losses, inventory clearance is conducted to accelerate capital turnover.

The Theme of Promotion Promotions must have a clear theme and a valid reason to avoid giving consumers the impression of dumping at low prices. The theme should be concise, follow trends, and be creative. For example: National Day celebration, Mid-Autumn Festival, new product launch, Teacher's Day, Children's Day, etc.

The Target of Promotion Before promoting, it's essential to determine who the promotion is for. For consumer promotions, identify the target group: women? Men? Age? Education? Once the target group is defined, consider how to deliver the message and what value and services to provide. Here are several types of promotion targets:

  1. Single-level promotions: Manufacturer to wholesaler; manufacturer to retailer; manufacturer to consumer; wholesaler to retailer; wholesaler to consumer; retailer to consumer.
  2. Two-level promotions: Manufacturer to wholesaler to retailer; manufacturer to retailer to consumer; manufacturer to wholesaler to consumer; wholesaler to retailer to consumer.
  3. Three-level promotion: Manufacturer to wholesaler to retailer to consumer.

The Timing of Promotion The timing should be on weekends or holidays when foot traffic is high, which helps create a lively atmosphere. Also, pay attention to the weather to avoid poor turnout due to bad weather. The typical time is from 9:00 to 18:00, considering all factors.

The Location of Promotion The location should be in key stores or squares with high foot traffic, facilitating the event and brand building.

The Personnel of Promotion The key is the sales promoter, who should receive thorough training, especially in FABE theory and practice. Also, logistics personnel should be prepared to avoid stockouts during the promotion period.

The Methods of Promotion (Differentiated Promotion)

  1. Free "Free" refers to a promotional method that charges no fee to target customers. It includes two forms: A. Free gift—mainly "thank-you packaging." B. Free trial—mainly "free samples."
  2. Gifts "Gifts" refers to a promotional method that offers preferential treatment to target customers when they purchase a product. Buy-gift: Purchase and receive a gift. As long as a customer buys a certain product, they get a certain number of gifts. Common methods include buy one get one free, buy five get two free, buy one get three free, etc. Exchange-gift: Purchase with compensation to receive a gift. As long as a customer buys a certain product and makes a small additional payment, they can exchange for other products.
  3. Discounts "Discounts" refers to a promotional method that offers different forms of price reductions to target customers when they purchase a product. Discount coupons, commonly known as coupons, are an ancient and popular promotional method. Coupons typically print the original price, discount ratio, purchase quantity, and validity period. Customers can use the coupon to purchase and get benefits. Current price discount: Selling at a discount based on the current price. This is the most common and effective promotional method. It allows customers to see immediate benefits and feel satisfied, while sellers also achieve satisfactory target profits. Because the discount process often involves bargaining, both parties can reach a mutually satisfactory agreement. Reduced-price special sale: Lowering the price for a certain period and selling at a special price. A characteristic of this is its phased nature. Once the promotional goal is achieved, the price returns to the original level. This type of promotion is generally implemented at the retail terminal. However, if manufacturers get involved, it may become a long-term promotional strategy. Forms include "package discount labels," "shelf discount tags," and "special sale notices." Low-price operation: Selling products below the prevailing market price. This is a sales strategy where the overall price level remains lower than other operators in the long term. Moreover, low-price operators should launch with favorable prices from the start. In the long run, although low-price operation yields small profits locally, it can strongly attract consumer groups and achieve overall profitability.
  4. Contests "Contests" refers to a promotional method that leverages people's competitive and curious nature by organizing fun and intellectual contests to attract target customers' participation. This includes collection and quiz contests, where the organizer attracts consumers through collection activities or Q&A contests. It also includes guessing contests, talent selection contests, and stamp collection contests. The participants mainly include three groups; the organizer should select target customers based on needs.
  5. Events "Events" refers to a promotional method that attracts customer attention and participation by organizing activities related to product sales. This includes: press conferences, product exhibitions, lotteries and raffles, entertainment and games, and creating events—by creating newsworthy events that become social, newsworthy, and hot topics, using media hype to achieve promotional goals. "Event promotion" can attract public attention and thereby stimulate interest in the product or service involved, ultimately driving customers to purchase or consume. If the event generates widespread social controversy, the "event promotion" will achieve perfect results.
  6. Win-Win "Win-win" refers to a promotional method where two or more market entities cooperate to achieve mutual benefits. In other words, promotions jointly held by two or more enterprises for mutual profit are "win-win SP."
  7. Direct Effect "Direct effect" refers to promotional methods with direct results. The characteristics of "direct effect SP" are on-site presence and personal engagement. These two features create a strong sales atmosphere. This includes: point-of-purchase advertising, direct mail (DM) to guide customers to purchase certain products, product demonstrations—showing product features and advantages on-site to convince consumers through seeing is believing. Product demonstrations are an immediate promotional method. By appealing to customers' visual, auditory, olfactory, gustatory, and tactile senses, they satisfy their psychology and prompt immediate purchase. It also includes: product displays, promotional newspapers, sales commissions, franchise use, and celebrity endorsements.
  8. Service "Service" refers to a promotional method that maintains customer interests and provides certain preferential services to facilitate customer purchase and consumption. "Service SP" best embodies the concept of customer satisfaction and is a concrete manifestation of CS (Customer Satisfaction) philosophy. This includes: sales service, open-shelf sales, promise sales, ordering and customizing, home delivery, free training, installment payment, deferred payment, and membership operations.
  9. Combination "Combination" refers to using two or more promotional methods together to achieve greater efficiency. We know that there are eight promotional methods mentioned above, and each can be combined with the other seven, resulting in 49 forms of combination SP.

Post-Promotion Service Support Before the event: Before the promotion, review details such as product items, specifications, prices, promotional materials, methods, timing, personnel, division of labor, theme, location, and expected results to ensure proficiency. During the event: Constantly monitor consumer changes, provide on-site after-sales service, keep displays and shelves full, maintain attractive merchandising, and keep promotional records. After the event: Evaluate the promotional effect, compare with pre-promotion and expected results, check, summarize, analyze reasons, and file for reference.

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