The powerful role of price promotion

Your article “Vying for Promotion” (MW last week) paints a grim picture of in-store price promotions, likening them to the plague and the nuclear arms race!

Price promotion is a form of mass sales promotion, which rewards all and sundry regardless of whether or not they are going to buy the product anyway.

Smart brand managers are quick to tell you that their objectives are primarily about trade support rather than payback. Why is not everyone more honest about this in internal discussion and when negotiating with retailers?

For example, if the objection is trade support, is a price promotion the optimum way of doing this? What is required is more discussion about common objectives.

Price promotion does have a role if a brand wants to temporarily recruit own label or price competitive brand users. However, there are many other possible objectives such as promoting specifically to heavy users or increasing spend levels within store of the category.

There is a whole range of promotional techniques according to the objective and target response. Promotional Research can give a more precise understanding of promotional sub-groups, and what promotions will most cost effectively achieve the objectives.

Retailers are shrewd enough to recognise what is important is the overall level of expenditure and its effectiveness rather than how widely that spend is spread among customers.

Isn’t the directing of promotional spend to the customers that will really make the difference what sales promotion has always been about?

James Davies, Research and planning director, FFwd Precision Marketing, Thame, Oxfordshire

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