Nature and Importance of Promotion - Principles of Marketing | Principles of Marketing - B Com PDF Download

Meaning of Promotion

• Promotion is a marketing tool, used as a strategy to communicate between the sellers and buyers. Through this, the seller tries to influence and convince the buyers to buy their products or services. It assists in spreading the word about the product or services or company to the people. The company uses this process to improve its public image. This technique of marketing creates an interest in the mindset of the customers and can also retain them as a loyal customer. 
• Promotion is a fundamental component of the marketing mix, which has 4 Ps: product, price, place, and promotion. It is also an essential element promotional plan or mix, which includes advertising, self and sales promotion, direct marketing publicity, trade shows, events, etc.,
• Some methods of this procedure contain an offer, coupon discounts, free sample distribution, trial offer, buy two items in the price of one, contest, festival discounts, etc. The promotion of a product is important to help companies improve their sales because customers reaction towards discounts and offers are impulsive. In other words, promotion is a marketing tool that involves enlightening the customers about the goods and services offered by an organization.

Types of Promotion

• Advertising: It helps to outspread a word or awareness, promote any newly launched service, goods or an organization. The company uses advertising as a promotional tool as it reaches a mass of people in a few seconds. An advertisement is communicated through many traditional media such as radio, television, outdoor advertising, newspaper or social media. Other contemporary media that supports advertisement are social media, blogs, text messages, and websites.
• Direct Promotion: It is that kind of advertising where the company directly communicates with its customers. This communication is usually done through various new approaches like email marketing, text messaging, websites, fliers, online adverts, promotional letters, catalog distributors, etc.
• Sales Promotion: This utilizes all sorts of a marketing tool to communicate with the customers and increase sales. However, it is for a limited time, used to expand customers demand, refresh market demand and enhance product availability.
• Self-promotion: It is a process where the enterprises send their agents directly to the customers to pitch for their product or service. Here, the response for the feedback of the customer is prompt and therefore, easy to build trust.
• Public Relation: Popularly know as PR is exercised to broadcast the information or message between a company (NGO, Government agency, business), an individual or a public. A powerful PR campaign can be valuable to the company.
• Online Promotion: This includes almost all the elements of the promotion mix. Starting from the online promotion with pay-per-click advertising. Direct marketing by sending newsletters or emails.
  Key Points of Promotion:
  • It is a communication tool that incorporates all the elements used to spread awareness and convince customers to buy good and services
  • It is applicable only for short term sales
  • It is one of the variables of the marketing mix
  • The effect of promotion is short term
  • The result or outcome of the promotion is immediate
  • It is an economic marketing tool as compared to advertising
  • It can be used for all sorts of businesses irrespective of the size, brand of a company

Nature and Importance of Promotion

The importance of promotion can be briefly shown below:

• Sales of the goods in imperfect market: Promotion helps in the sales of the goods in imperfect market. In the imperfect market conditions, the product cannot be sold easily only on the basis of price differentiation. It is the promotional activity that provides information about the differences, characteristics and the multi-use of the products of various competition in the market. The customer is attracted to purchase the goods on the basis of such information successfully.
• Filling the gap between producers and consumers: Promotion helps in filling the gap between producers and consumers. Due to the tough market condition, mass selling is quite impossible without promotional activities. The distance between producers and consumers has so widened in present days to get them touched with the product that promotional activities are necessary.
• Facing intense competition: Promotion helps in facing intense competition in the market. When a manufacturer increases his promotional spending and adopts an aggressive strategy in creating a brand image, others are also forced to follow the suit. This leads to ‘promotional war. Without promoting the goods, the competition is not possible in the market. So, it is necessary to face the competition in the market with the help of promotional activities. 
• Large scales selling: Promotion helps in the large selling of goods and services. Sales promotion is the result of large-scale production. It can be achieved only by appropriate methods of large scale selling. Large scale selling is possible with the help of promotional activity. Due to the large selling of goods, there will be more chance of promotion of goods. So, it is necessary to sell lot of goods in the market for promotional activities.
• Higher standard of living: Promotion helps in the rising standard of the people. The promotional activities increase the standard of living by providing the better goods at a lower rate due to large scale production and selling. It help to increase the standard of living in a good way. People can raise their standard of living with the help of promotional activity. As the promotional activities increases, the standard of living of people also increases. So, the promotional activity has a great role in the increment of a standard of people so that they can live a good and happy life.

• More employment: Promotion helps to create more employment opportunities. People can gain employment opportunity with the help of promotional activities. With the help of promotional activity, many workers get motivated towards the work. Promotional activity helps to increase more employment opportunities to the people who are unemployed, as the promotional activities cannot be performed without the help of an effective sales force and the specialists in various fields.
• Increased trade pressure: Promotion helps to increase trade pressure in the market. The growth of large scales retailer, such as supermarkets, chain stores, etc. has brought greater pressure on manufacturers for support and allowance. Promotional activities help to decrease the trade pressure. There is need for promotional activities to decrease the trade pressure.
• Effective sales support: Promotion helps in the sales support of the product. Sales promotion policies are under the supplement to the efforts and impersonal salesmanship. Good sales promotion materials make the salesman’s effort more productive. Promotion helps in the sales of the product. It provides good support in selling the different types of goods. Sales of different types of goods in the market are very necessary to increase the market economy.
• Increased speed of product acceptance: Promotion helps to increase the speed of the products acceptance. Most of the sales promotion devices such as contests, premium coupons, etc. can be used faster than other promotion methods such as advertising. The increase in rapid speed of product acceptance has occurred with the help of promotional activities. As the promotional activities are done, there will be direct effect in the increment of a speed of the product. Increase in the speed of product acceptance is very important in the competitive market. So, it is necessary to increase the speed of product.