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SALES PROMOTION

 
I thought this was going to be a shorter rant than usual, but it seems to have turned out the usual length. It concerns the everyday purchase of toothpaste at my local Boots. All very ordinary. It took a while to locate, being at ground level, tucked away in a side aisle, but hey - not every product can be at eye-level in a prime location. That usually costs money.
 
As it transpired, however, when I took my purchase to the till, the brand owners clearly were paying money, in one form, because the check-out girl helpfully pointed out that this was on a 'Buy One Get One Free' deal. So back I popped for a second tube, ensuring I won't need any more for a year or more, I'm guessing.
 
And here's the thing: there was no promotional message anywhere to be seen - certainly not on the shelf fixture - to tell me this deal existed. And my sales promotion background means I actively look for and notice this sort of stuff, far more than the average Joe.
 
So what was its point? I was buying the product anyway. At full price. Giving away a second one helps neither the manufacturer nor the retailer. It just cuts their margins. Even the retailer's, in spite of the fact that their Buyer has almost certainly arm-twisted the supplier to pay for the deal.
 
Having spent decades devising promotions for blue-chip brands that increase sales, even if only by a couple of percentage points, this seemed to me to be sloppy marketing. The Buyer has demanded a concession from the Key Account Salesman (they're nearly all professional bullies), and he (or she, mustn't be sexist) has handed it over without extracting any real commercial benefit back in return.
 
An utter waste of time and money

WHAT'S IT FOR ?


Someone who ran a rival sales promotion agency back in the 1990's coined the following phrase, which I have often used since to explain the difference between advertising and sales promotion in the marketing mix: "Advertising takes the horse to the water; sales promotion persuades it to take a drink." (Thanks, Tim Arnold).

And another agency I worked for back in the day, before forming Marketing Principles, which specialises in auxiliary selling and merchandising, used as its slogan, "It can't be bought if it isn't there."

Well in this case, at least the product I sought (and I was in search of a specific brand and no other) had got the requisite distribution, even if it wasn't in a prime store location. Neither was any of the other toothpaste, to be fair, but then were they paying large sums of money for the privilege?

But the whole point of sales promotion budgets is that they're supposed to persuade horses to drink water that they otherwise wouldn't have. OK, you can argue that it could be deemed a success to have persuaded me to buy more of a product than I otherwise would have, thus building brand loyalty.

However: 1. I was already brand loyal - I was going to buy the product, no matter what the price (up to a point, up to a point).
              2. Such a promotion can only be deemed effective if it persuades a proportion of consumers to switch brands. Without any point of sale message, how could it do so?

Small businesses rarely have the luxury of being able to waste marketing spend in this way, and certainly on this scale, but there is a good lesson for any business from this particular failure. Given the limited trade funds that most SMEs have to spend on marketing, just be very sure that for every bit of budget expenditure and every promotional campaign you carry out, you have a very clear picture of:
    1. What the activity is aiming to achieve in hard numbers: the additional sales generated, and at what cost.
    2. How you structure and communicate the benefit to your prospective customers of parting with their hard-earned cash, to maximise the effect on sales.
    3. How you evaluate that effect after the activity, in simple numbers, so you know whether to do more of it (if it works, repeat endlessly, until it stops working) or whether you need to make changes.

Marketing is, after all, just a numbers game - but for once, creative accounting is generally a positive rather than a negative.

David Croydon: 01844 238692 or e-mail dave@hilltopconsultancy.co.uk




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David Croydon

Hilltop Consultancy
Business Advice Oxford, Oxfordshire