Promotional strategy is the act of informing, persuading, and influencing a customer decision on purchasing a product. Promotion is the main element of the marketing mix dealing with communication that takes place between the customer and the seller. An ongoing process requires much planning. The aim of these promotional strategies is to develop a primary demand and the desire for the consumer towards a general product category. Promotional strategies vary among the various organizations. Some use it to expand their markets, while others use it to hold their current market position or present a corporate viewpoint on the public issues. The sellers to reach the selected markets can also use these strategies.
Most people identify the promotional objective, differentiate their product, increases, and stabilize the sales, and accentuating the product value. To come up with a promotional strategy, some key decisions about who the customer is, how to contact them, and the message to be delivered to them matters.
The first step in the development of a promotional strategy is the segmentation of the market into distinct groups (Michigan. S. U, 1986). This will facilitate the rate of success of a communication massage. On the process of segmentation, the details of the customers need to be explored things concerning their expectations and aspirations.
The second step is identifying the target group to which to deliver the message. Positioning the product that is determining how the product is to be preserved by the targeted group is the third step. After knowing the target group and positioning the product, the sellers need to deliver the message to the targeted group.
The tools used in the promotional mix strategy also vary in many organizations. The common tool used is advertising whereby paid form of a non-presentation and promotion of ideas are used. There is also the use of direct marketing with the use of email, telephones, or any non-personal contact tools to communicate. Public relations and publicity is another tool in that programmes are designed to promote the product, which include product literature, articles, or exhibitions. Another effective tool is the use of personal selling involving a face-to-face interaction with the consumers. In most instances, one promotional strategy is used to support another promotional strategy.
Retail marketing involves a set of activities, purposed to enhance and increase sales of a company products. This type of marketing differs from other marketing strategies because of the component parts of the retail trade. Retail marketing, as a rule, uses a large number of marketing principles, including product, price, promotion, and, even, place. In addition, the research of retail marketing involves huge number of merchandising strategies, consumer behavior, etc. It should be stated that the phenomenon of retail marketing is considered to be of major significance for small retailers, aimed to resist powerful competition against profitable and well-developed chain stores. The current paper is aimed to review and evaluate the ways and methods of promoting new and existing products without reducing the price. Moreover, information concerning consumer behavior and consumer decision-making will be discussed in the essay as well. Finally, contemporary retail marketing trends, as well as the evolution in the sphere of retail marketing will be paid attention to.
The key objective of pricing and promotion in retail marketing deals with the establishment of a steady stream that involves the existing and new purchases. Each cent spent for promotion, should result in the increased realization and total sales volumes. Such media sources as television, radio, press, and advertising are usually widely applied by retailers with the unique goal to promote new products and existing products’ distribution. In general, promotion of new products, as well as promotion of existing goods is aimed to achieve the same desired effects. However, the primary and the most essential role of new products’ promotion intends to increase and expand brand awareness. At the same time, the existing goods are promoted in order to build sales and increase customers’ traffic. On the whole, promotion of various kinds of goods and services is purposed to build a loyal and permanent customer race. In addition, such marketing strategy as promotion is directed towards the increase in sales and profits (Li 2013).
Experts in the sphere of retail marketing lay the stress on the fact that the stimuli shape consumer behavior. In other words, stimuli evoke large amounts of cognitive and affective buyers’ responses. Besides, stimuli help customers understand and assess what they expect from a good or service (Hansen & Beckmann 2000). As a result, consumer behavior and consumer decision-making process are greatly influenced with help of stimuli within the sphere of retail marketing.
One of the main purposes of marketing deals with satisfying consumers’ wants and needs. Consequently, in order to estimate what clients buy, why they make purchases, when or where they buy, and how satisfied or disappointed customers become after disposing it, business managers are recommended to be aware of the bases and peculiarities of consumer behavior. The term “consumer behavior” designates a special type of behavior that the users manifest in the process of choosing, purchasing, assessing, and disposing goods and services. Furthermore, behavior of consumers is focused on how customers make choices, pass decisions, and spend such resources as time, money, and additional efforts. It is important to emphasize that the phenomenon of “customer behavior” is comparatively complicated because each consumer is characterized by a unique mind and opposite attitudes towards the processes of buying, consumption, and disposal of products and services (Johnson, Pham & Jonar 2010).
Scientists estimate that the concept of “consumer behavior” refers not only to the actions and physical activities of consumers, while purchasing goods and services for personal consumption, but is based on mental and emotional processes of those who buy and dispose these products to satisfy their needs and wants. There are numerous causes and other factors that influence and modify customers’ behavior. The major and the most distinguished of them are as follows: the degree of consumer involvement, the price of products and services, the amount of possible alternative variants, and the level of information search (Johnson, Pham & Jonar 2010).
With help of effective marketing strategies, consumer behavior can be altered in different ways without reducing the price for a good or service.
- For instance, if a businessman intends to promote a new good or service, he/she is recommended to ensure an acceptable motive of buyers. This step should be implemented by marketers with the purpose to make consumers feel they are doing something worthy, being good people, eating healthy products of high quality, and keeping up perfect appearances. In other words, if marketers can convince buyers that they really need a product or service for a particular “legitimate” reason, a purchaser will be more likely to pay money for it.
- Secondly, sensory stimuli are inevitable in the sphere of marketing, especially for a new product, rather than an existing one. When the packing is appealing, catching, and associated with affirmative qualities, individuals usually find the products tastier and healthier.
- Thirdly, another possible alternative for altering consumer behavior concerning existing products involves offering so-called specialized goods and services. For instance, while the phenomenon of commonality was popular in the past, more and more customers are looking to relieve the monotony of tastes, lifestyles, appearances, and personal preferences. Thomas Frank has expressed the idea that in modern society consumerism has nothing in common with conformity. On the contrary, consumerism is about products and services diversity (Mason & Hausler 2006). As a result, it is possible to draw a conclusion that marketers should apply vast number of strategies, in order to subconsciously motivate customers to buy new and existing products and services without reducing the price.
Consumer Buying Decision
In order to develop the market, to evoke a response from customers, and to obtain significant profits, marketers are obliged to figure out how much time and efforts customers are ready to put into a purchase decision. Nowadays, retailers differentiate several major categories of consumer buying decisions, including limited, routine, as well as extended types. Besides, every decision-making process, there is enormous amount of nuances and shades.
Researchers support the basic idea that the type of decision-making depends on the level of search, degree of prior experience, frequency of buying, amount of possible risk, as well as the time pressure and the limit of money.
- Firstly, limited decision making of customers takes place if a consumer participates in each of the steps in the buying process, but does not waste a lot of money for the particular product or service. The level of perceived risk, in this case, is comparatively moderate. For instance, a second car, additional clothing, and gifts are considered to be bright examples of limited decision-making process, accomplished by consumers (Jones 2014).
- The second type of consumer decision-making should be referred to as routine. It usually happens in case clients make purchases because of habit, not because of a strong necessity. A consumer, as a rule, spends money on clothing or other products or commodities of the same brands. Moreover, routine decision-making involves little or no risk, but enormous experience. Bright examples of routine decisions involve the purchase of a weekly journal, a daily newspaper, or a regular haircut (Jones 2014).
- Finally, extended decision-making occurs if a consumer is ready to fulfill the full use of the decision making process. According to this category of decision-making, an inexperienced customer makes an expensive and valuable purchase. Extended decision-making involves the processes of purchasing a house or choosing a location for a wedding ceremony (Jones 2014). Taking into consideration the types of consumer buying decisions, it is possible to summarize that marketers should know what goes on in the mind of consumers, as it can increase sales rates.
Evolution in Retail Marketing
Technological advances, expansion of shopping channels, and well-informed, as well as well-developed consumer base, are altering and broadening the means, forms, and manners of customers’ shopping. It is said that the old marketing story is inefficient and, furthermore, brings no result. Because of this reason, a new and more productive marketing story is emerging. Retail industry, that involves such types of products as food, durable (hard) products, consumables (soft products), and arts, is constantly changing and developing. Such phenomena as relationship retailing, social shopping, and omni-channel retailing, that sounded vague, obscure, and unclear a century ago, are now widely used by marketers in the sphere of retail industry.
For instance, the concept of “relationship retailing” in retail marketing means attracting, retaining, and developing relationships with clients. Therefore, the practice of relationship retailing is applied in a case, when a purchaser has an alternative for services and goods. The key factor in the process of determining and evaluating the potential for relationship retailing, as a researcher assumes, deals with the degree of personal interaction, cooperation, and distribution (Torella 2014).
The term “social shopping” is a kind of e-commerce where friends of shoppers get involved in shopping experience. It is important to stress that social shopping is purposed to apply technology in order to minimize social interactions among customers in shops and malls. With the exception of such terms as “social shopping” and ‘relationship retailing”, the phenomenon, named omni-channel retailing, is widely applied by marketers in contemporary retailing. In other words, omni-channel retailing that is often referred to as multichannel, is based on the usage of a range of channels that involve retail and online stores, etc. Omni-channel retailing is usually dictated by a customer or purchaser. Pioneers of omni-channel retailing involve John Lewis, Next PLC, and others. Omni-channels start with understanding the wishes and needs of consumers. Besides, appropriate types of technologies are applied in omni-channel with the purpose to optimize and transfer the experiences in effective, enjoyable, and catching manner (Mishra 2014). Contemporary approaches to retail marketing, that involve omni-channel retailing, relationship retailing, and social shopping, may be applied equally to promotion and sale of new, as well as existing goods and services.
As a result, having analyzed the peculiarities of consumer behavior, decision-making process, and evolution of retail marketing, it is possible to summarize that retail is the process aimed to gain profit with help of various strategies. The success of retailing, to some extent, depends on behavior, as well as decision-making of its users. In other words, understanding a consumer’s mind enhances retail marketing strategies by assessing such issues as how buyers think, feel, and select among several possible alternatives.
Moreover, understanding the behavior and decision-making of consumers helps retail marketers to develop their strategies and campaigns without depreciations of goods and services. In case marketers wish to promote and distribute new and existing products and services without reducing the price, they have to be aware of the motives, which are followed by customers in the process of making purchases. Finally, if retailers do not intend to reduce the price of goods and services, they should increase customer satisfaction, improve the quality of products, extend the knowledge base in the sphere of retail marketing, and use efficient marketing strategies that influence the whole society in a positive way.