Promotion can be loosely classified as “above the line” and “below the line” promotion. The promotional activities carried out through mass media like television, radio, newspaper etc. is above the line promotion.
The terms ‘below-the-line’ promotion or communications, refers to forms of non-media communication, even non-media advertising. Below-the-line promotions are becoming increasingly important within the communications mix of many companies, not only those involved in fmcg products, but also for industrial goods.
Some of the ways by which companies do BTL (below the line) promotions are by exhibitions, sponsorship activities, public relations and sales promotions like giving freebies with goods, trade discounts given to dealers and customers, reduced price offers on products, giving coupons which can be redeemed later etc.
BELOW THE LINE SALES PROMOTION
Below the line sales promotions are short-term incentives, largely aimed at consumers. With the increasing pressure on the marketing team to achieve communication objectives more efficiently in a limited budget, there has been a need to find out more effective and cost efficient ways to communicate with the target markets. This has led to a shift from the regular media based advertising.
A definition of below-the-line sales promotion given by Hugh Davidson:
‘An immediate or delayed incentive to purchase, expressed in cash or in kind, and having only a short term or temporary duration’.
Methods of below the line sales promotion
1. Price promotions
Price promotions are also commonly known as” price discounting”. These can be done in two ways:
(1) A discount to the normal selling price of a product, or
(2) More of the product at the normal price.
Price promotions however can also have a negative effect by spoiling the brand reputation or just a temporary sales boost (during the discounts) followed by a lull when the discount would be called off.
Coupons are another, very versatile, way of offering a discount. Consider the following examples of the use of coupons:
– On a pack to encourage repeat purchase
– In coupon books sent out in newspapers allowing customers to redeem the coupon at a retailer
– A cut-out coupon as part of an advert
– On the back of till receipts
The key objective with a coupon promotion is to maximize the redemption rate – this is the proportion of customers actually using the coupon.
It must be ensured when a company uses coupons that the retailers must hold sufficient stock to avoid customer disappointment.
Use of coupon promotions is often best for new products or perhaps to encourage sales of existing products that are slowing down.
3. Gift with purchase
The “gift with purchase” is a very common promotional technique. In this scheme, the customer gets something extra along with the normal good purchased. It works best for
– Subscription-based products (e.g. magazines)
– Consumer luxuries (e.g. perfumes)
4. Competitions and prizes
This is an important tool to increase brand awareness amongst the target consumer. It can be used to boost up sales for temporary period and ensure …