Although this is also a non-personal form of communication, many sales promotion themes are intended to spark personal interest in the product or service being promoted.
Sales promotions are not directed solely toward the end user. Often, there is an underlying promotion directed toward company employees and trade factors (distribution channel members), using the same promotion theme. For example, a sales promotion offering consumers a trip to London may offer the same trip to the top-performing salesperson in the company, or the retail outlet selling the most merchandise during the promotion's duration
Promotion is the key to a good response on a new product and Coca Cola Enterprises have got this key just right. Coca Cola cans are usually by the till in a supermarket the key technique is that upon queuing the product is visible and since it is a small purchase it will make the customer purchase it as they are at the checkout. When Coca Cola release a new drink they make it aware for the public by going into the high street of towns and attracting the public by having parades, loud music and free testers.
Business organisations use professional advertising agencies for the promotion of their business. I think this is a very effective way of making maximum profit in minimum time! I will analyse each aspect of marketing and I will explain how business advertising agencies can do it effectively.
Business Development
Business development never relies purely on sales ability nor does it depend on spending vast financial resources on advertising and printing of company brochures.
Improving sales ability and designing attractive literature will almost definitely help; the most important factors in developing new business involve understanding the difficult relationship between the competitors, market dynamics, customer needs, specific customer groups (market segments) and effective marketing communication strategies.
Professional advertising agencies understand these difficult processes and will guide a campaign through the process of developing more effective strategies for both short and long term success.
They are trained and have a good understanding of how to significantly improving the profitability for both small and large businesses by using tried and tested techniques. Plus they save a company time and money by sourcing the best prices for promotion, choosing the right 'mix' of promotional methods and focusing advertising and marketing resource in the right direction.
Pricing
The majority of companies have difficulty in setting the best price for their products or services. Setting good prices should be an important part of the marketing strategy - especially if a business wishes to develop a strong brand and improve profitability.
If a business provides a high quality product or service and sell it at a low price, the public will automatically think that there is something wrong or that the quality is bad, they will most probably choose a more expensive alternative that they think will be better in terms of quality and build. Many companies may choose to act aggressively towards weaker companies who threaten to affect sales of their own branded products. So companies who sell own branded products need to make a good strategy to protect their business, they may choose to make their products extremely cheap and readily available.
Professional advertising agencies analyse the company situation and make any pricing decisions on the company’s current situation and the marketing needs. They take into account trends in new technology, intelligence of the market and forecast for new products and improvements to current products that they predict to come into the market within the next 12-24 months. Professional advertising agencies have vast experience in successfully setting prices for products and services in new and established markets.
New product development
For sustainable growth businesses need to develop new products and expand services. This requires commitment of time and financial resources, without any guarantee of success.
Before entering the market and launching a product a company needs to explore the market and any traps before they perform a launch. This is extremely important and professional advertising agencies do this really easily.
Spending time and money to launches has a bad effect on existing products and services. Unless a company has some launching experience they're unlikely to get their potential profit. If they decide to do it alone, they need to think from a customer’s perspective. They need to ensure that they don't let personal views alter what the majority of the market wants. One thing they need to consider is that not everyone spends time thinking of a product or service. The market recieves 1,000’s of promotional messages every week. The business needs to be realistic in their advertisement because if the don’t promote the product properly and send out cheap black and white flyers their product will not get the launch they can.
Marketing strategy
Winning new customers
There are many ways to win new customers. It is usually cheaper to win-back ex-customers than it is to develop new ones. However, it may not be possible if the business is new or developing a new service.
Most companies fail to build a good knowledge of their potential customers and the market intelligence the best way to do this is performing some good market research.
Winning new customers and keeping existing ones are two separate challenges. Gaining custom and creating loyalty is becoming very difficult, especially when the price matters and the market is growing. The Internet is an issue for new businesses, products and services, it is readily available to compare and contrast the businesses products or services with the competition.
Employing advertising agencies real is one of the best options to get a good launch quick and to get customers easily. Many companies use advertising agencies even companies such as Coca Cola acknowledge that up to 30% of customers may stop using their service every year - retaining an extra 5% of customer every year soon adds up to a significant increase in business.
Competitors
Competitors are an important aspect of any business. Knowing what your competitors were doing six-months ago doesn't mean a thing - they are likely to be developing new strategies and tactics just like you. A business needs to be paying attention to the way a competitor reacts so then they know how to improve next time they launch a new product or service – they need to remember that the better their product or service the more their competitors will be respond.
Businesses generally underestimate the likely effect of a competitor leading in terms of prices in the market. The majority of businesses always perceive their business to be better than the competition. This is risky a business should never underestimate their competitors.
Promotion is a very important aspect in all businesses it has an effect on the price of the new product. If a product has been promoted well prior to launch then a business can sell the product easily and better for a higher price. The market will have a good idea what that new product is and it will be known to the market prior to launch so when the product is launched the market will be ready and excited to purchase the product. If the product has been launched well then the market will be willing to pay a high price for it.
If a good product has not been promoted and it is launched then the market will not know about it and they will not buy it this will mean that the price it is sold for will be considerably less than what it is actually worth if the promotional aspect was correct.
Promotion can affect the place where a product is sold, if a product has a lot of promotion and the market a familiar to it prior to the launch then even a small product can be launched in huge department stores across the world. The product will consequently be sold for a lot more than it is worth, the promotion is very important for any product. If a fantastic product that is really a work of a genius is not promoted at all or even not promoted very well then it could end up being sold in a town centre market place at a very low price.
The product can have an effect on the promotion of it, an item can be promoted extremely well but if the product is not good in itself then the customers will not have the urge to purchase it even though they know about the product.
Ice 2007 March/2007 June
Product launch campaign
Ram Bhojani 02/03/2007
TABLE OF CONTENTS
Overview………………………………………………………………………………………………………………….. 9
Market Overview………………………………………………………………………………………….. 9
Market and product objectives……………………………………………………………………… 10, 11, 12
Product pricing……………………………………………………………………………………………… 12, 13
Current Situation & Challenges…………………………………………………………………………………. 14
Company goals and strategy……………………………………………………………………………………… 14
March-June 2007 Sales forecast……………………………………………………………………. 4
Overview
Ice is an established local food producer that sells prepared frozen dishes to restaurants. Recently they have invested a lot of money into our business and they have bought new equipment. They now want to produce a new range of desserts. They need to achieve a return quickly, consequently their company wants to market to both existing and new customers. They have a budget of £12,000 for a three-month period.
Market overview
Ice is a local food producer that is located in a large town in the east midlands. Grangeborough is a university town that has many villages in the surroundings. Currently Ice supply to most of the restaurants in the university town, they are now looking at gaining new customers by supplying desserts to the restaurants in the surrounding villages. Our advertising agency has investigated into Ice’s current customers currently they supply frozen foods to;
- Angelos Trattoria
- Bar Europa
- Bombay mix
- Café Biarittz
- Acropolis
- Fiddlers restaurant
- Kiani restaurant
We are going to contact these restaurants and see if they will be interested in doing some deals with us on behalf of Ice we will offer them the new range of desserts and convince them to become regular customers on purchasing desserts. Ice want to get some new customers so they can get an income quickly. We have found some potential customers in Grangeborough that are currently purchasing their stock from one of Ice’s competitors. We will contact the following restaurant owners and sell our new range to them and beat the service our competitors provide.
- Le metro bistro
- Nazrana restaurant
- Rickshaw
We also want some new customers for Ice, we currently have a list of potential customers in the surrounding villages of Grangeborough. There are few restaurants that already have some suppliers for desserts and some don’t purchase frozen desserts. We will attempt to deal with all the potential customers and increase the amount of customers Ice actually have.
Market and product objectives
We have carried out many market research schemes and after a lot of investigation we have received our results, as shown below.
After looking at the results our company has come up with a proposed list of new desserts we think that we should provide a variety of desserts that come in different flavors. Our proposed list is
Chocolate cake
Strawberry cake
Lemon cake
Cheese cake
Lemon pie
Orange pie
Chocolate ice cream
Strawberry ice cream
Cherry ice cream
Lemon trifle
Chocolate trifle
Orange trifle
Product pricing
We have decided after considering the current market and its situation we recommend Ice not to manufacture pastry and gateau. We will need to price each of these items individually to provide the best value for money, we have priced each item considering the costs of the materials, fixed costs total cost to produce, price anticipated to sell to restaurant and RRP.
Current situations and challenges
Ice has many challenges the biggest and the most complex challenge is to gain new customers from the surrounding village our company on behalf of Ice need to deal with the restaurants and gain customers by beating the restaurant’s suppliers in terms of price and quality. Ice need be market leaders in terms of frozen food suppliers in the Grangeborough area. At the moment ice do not have a very good situation in the market they supply around 42% of frozen food in the Grangeborough area we aim to get Ice to supply over 60% of frozen food in the town.
Company goals and strategies
It’s simple yet very effective, we want to advertise the food that Ice produce we will advertise it to the public and let them know where they can get the popular desserts from. There are many advantages to this, Ice will get more business in many ways, one of the ways that Ice will increase profits is that more people will go to the restaurants that use Ice’s supplies more desserts will be purchased and consumed consequently the restaurants will have to order more supplies. All in all Ice will get more profit by getting more sales.
There are many other advantages for Ice if they advertise their products, if there is a high demand for the desserts that Ice produce then there will be more and more restaurants that want to purchase stock from Ice this will all mean that Ice will get a lot more customers and in return will make a lot more money.
On behalf of Ice we will advertise on Television, Newspapers, Billboards, Leaflets and on many advertising boards throughout the town. In the future we want Ice to be suppliers for restaurants nationwide.
Sales forecasts June-December 2007
Coca Cola Enterprises LTD | Ram Bhojani 12CLJ