Chapter 11
PROMOTION

IN This Chapter
The basics of promotional strategy
Advertising
Direct marketing
Sales promotions
Public relations and publicity
Your promotional plan

Introduction
A good promotional strategy lets consumers know what your product is, what it does, why it’s better than anyone else’s and how they can buy it.
A great promotional strategy does much more than that. It communicates your brand and your values. It doesn’t just tell consumers why they need your product; it inspires their goodwill, trust and respect and turns them into loyal ambassadors for your brand.
Promotional strategies are built around such tools as advertising, public relations and networking. With a little entrepreneurial creativity, you can plan inexpensive but powerful promotions. The Promotional Strategies Worksheet will help you with this.
The Basics of Promotional Strategy
Like every other element of the marketing mix, successful promotion requires a strategy. The goal is to create a promotional mix with the right blend of advertising, sales promotion, direct marketing, personal selling and publicity. Identifying the best promotional mix for your business requires looking at your product, placement and pricing strategies.
Target the right audience. All promotional messaging must start with your target customer in mind. You’ve already segmented your customers and gathered demographic and psychographic information about them. Now, this information can tell you which media channels are most likely to reach your customer, when they are most likely to buy your product, and what type of message or promotion is most likely to sway them.
Set the right objectives. Typical promotional objectives include reaching a certain percentage of your target market, increasing awareness of your brand, achieving a certain level of sales, or coaxing customers away from a competing brand. Setting clear and realistic goals helps you gauge whether you’ve gotten your money’s worth. Industry sources, newspapers, and radio and television stations can provide good estimates of the monthly sales patterns for your industry. They know their demographics, which can help you to set realistic objectives.
Push and Pull Strategies
There are two basic promotional strategies:
Pull strategies target consumers in an attempt to generate demand. Consumers then pull the product through the distribution channel: They request it from retailers, who request it from wholesalers or distributors, who request it from the producer.
Push strategies target wholesale and retail distribution channel members instead of the end consumer. The members then push the product through the distribution channel: The producer promotes the product to wholesalers, who promote it to retailers, who promote it to consumers.
Most businesses use a combination of both, depending on their product, markets, competitors, budget and distribution channels.
Product Life Cycle
Your promotional strategy will also depend to some extent on which stage of the product life cycle your product is in.
Introduction. When launching a product, your goal is to inform your target market of its availability. You’ll almost certainly use a combination of push and pull strategies during the introduction phase. This is typically the most costly stage for promotions.
Growth. As your product becomes accepted by your target market, the goal is to build brand awareness and encourage loyalty while reaching new customers. Capitalizing on the goodwill of existing customers and distribution partners is an important part of promotion during the growth stage.
Maturity. At this stage, you’re likely to face fierce competition. Communicating brand image and differentiation messages remains very important, as consumers look for reasons to choose your product over competing brands.
Decline. In this stage, promotional efforts will be expended mainly on newer and more profitable products.
Customer Engagement
In the past, customers were often treated as a captive audience for one-way promotional messages. Today, consumers increasingly control when, how and whether they will pay attention to promotional messages. They can block ads on digital TV, digital radio and online, and they are more likely to ignore or mistrust the ads they do see. Company-sponsored advertising is the least-trusted source of product information, according to a study by Forrester Research. Online reviews from customers, and recommendations from friends and family, are much more credible to most consumers.
For many businesses, the obvious solution has been to create promotional messages that offer a reward for the customer’s attention and engagement. Where traditional advertising focused on one-way communication, customer engagement requires dialogue, interaction and sharing.
This strategy is especially important given that engaged customers offer highly credible promotional messages for little expense. They can also offer valuable suggestions for improving your design, quality and service.
As an example, Amazon allows individual customers to create lists of books, music and films, which are then displayed to consumers whose buying habits suggest they’d be interested. In effect, this allows likeminded customers to recommend titles to each other; Amazon’s technology simply enables this dialogue.
Users who create lists and reviews—and get feedback—come to feel that they belong to a community. As current and prospective users are drawn in by this user-generated content, strong customer engagement drives sales.
Word of Mouth
The best form of promotion is when your customers say wonderful things about you and your business. Products that perfectly satisfy your customers’ needs make a lasting impression that they will gladly pass on to others.
Word of mouth can be strongly amplified by blog comments, social media channels and online reviews. As we’ve seen, user-generated promotional messages like these are also more credible to consumers than traditional forms of advertising.
Of course, word of mouth isn’t always positive. If you disappoint your customers, they may not tell you—but they will tell their family, friends, coworkers and acquaintances. Quality control and outstanding customer service are the two greatest tools for maintaining positive word of mouth and minimizing the effects of negative word of mouth.
Advertising
An advertisement is a promotional message aimed at your target market. Its purpose is to inform, persuade and motivate buyers. You can use advertising to:
Introduce a new product
Increase sales (e.g., through special promotions)
Differentiate the product through features and benefits
Change attitudes about your brand (e.g., explain why your more expensive product offers better long-term value)
Make an emotional connection (e.g., link your product to something or someone else about which the consumer has a good feeling)
Communicate company values (e.g., donation to charities, schools or disease research)
Planning Advertisements
Once you’ve decided to advertise, you must decide which medium to use, what message to convey, which image to project, how often to run your message and how much to spend. To get the most out of your advertising dollars, you should:
Identify your target. Which customers are you trying to reach? Is this a broad campaign for a general-interest audience, or are you narrowly targeting a single segment?
Identify your objectives. What is the goal of your advertising campaign? Do you want to build wide awareness with a radio campaign, or drive sales with a narrowly targeted mobile coupon? Are you reminding people of a product they’re familiar with, or trying to persuade them to try something new? Are you giving something away, or asking customers to do something for you? Clarity about what you want to accomplish will improve your communications, and it will also make it easier to measure your response.
Set your advertising budget. How much you will spend depends on your goals and on what you can afford. It also depends on how widely and frequently you want your message to be heard.
Design your advertising strategy. This is the most creative part of advertising, and it relates directly to your positioning strategy. How will you encourage your target customers to buy? What media do your target customers favor, based on your market research? What message will appeal to them and motivate them, based on your understanding of their demographics and psychographics? Will you use humorous short radio spots to highlight how speedy your service is? Or will you use a simple, elegant color brochure to convey premium quality?
The Advertising Tools Worksheet will help you research the cost and effectiveness of each tool you’re considering.
…
I guess every good idea looks obvious in hindsight. You say to yourself, “This isn’t my first rodeo. Why the heck didn’t I think of that idea a year back? Or five years?”
Fact is, when you’re running a business full-time, you’ve usually got your hands and your brain full. It’s easy to get into a rut, and sometimes it takes a pretty big jolt to get you out of it.
Jacob Behmen buys and sells used vehicles in Cheyenne, Wyoming. His business was always slow in the summer months, so he relied heavily on a predictable influx of used trucks in fall. This had always caused seasonal cash flow problems for his business, but lately, the problems had been getting worse. After a steep decline in wholesale values left him in a slump that threatened to put him out of business, Jacob decided to try something new.
Instead of spinning my wheels like usual, and praying I made it through to fall, I needed to come up with a sales promotion that would jack up my cash flow during the summer and clear out some room for that big new fall inventory.
In this business, your customers are also your suppliers. So I had to think about what else besides trucks they might have that I could turn around and sell. It wasn’t just about Cheyenne. There’s a lot of folks way out in the boonies who come into town for trucks, so I needed to think about them, too.
One thing that struck him was that Cheyenne is the kind of town where tractors, snow plows and other big machines are very common. But changing demographics, and the ups and downs of the farming life, often turn them into excess baggage. What if he invited customers to bring in their used farm machinery and snow plows as trade-ins toward the purchase of a truck?
…
Choosing Media
Traditionally, media are assessed in terms of the access they provide to your target market. Reach describes the percentage of target customers who see your message over the course of your campaign. Frequency describes the number of times they see your message during your campaign. Most experts agree that it takes at least three exposures to an advertising message before customers notice it. For this reason, it’s usually better to run a smaller campaign with higher frequency than a large one-time ad. Not only will this increase your frequency, but it will usually lower your advertising costs.
Although it’s not foolproof, reach and frequency information provides a relatively easy means of assessing the impact of various advertising options. Depending on whether you’re assessing print or broadcast media, you will probably use one of the following measures:
Cost per thousand (CPM) measures the cost of reaching 1,000 readers with a print message. You can calculate it by dividing your ad cost by the circulation: If your ad costs $500, and the circulation is 10,000, then the CPM is .05 cents per thousand.
Cost per point (CPP). A “point” is a broadcast media metric equivalent to 1 percent of the listening audience. To calculate CPP, divide the cost of your ad buy by the number of points it delivers.
Sales reps for print and broadcast media outlets should be able to provide you with detailed reach and frequency information.
Newspapers
Local daily and weekly newspapers can be good for running short-term promotions to an audience in a specific geographic area, or for keeping your business in the public eye. By placing different coupon ads in various local papers, you can measure which ones are most effective. Larger metropolitan and regional newspapers will reach more people, but the readership will be more diverse and the cost will likely be higher.
Newspaper sales reps can advise you on the best section placement, day, size and length of run for your ad. Generally, you will pay much more for a one-time-only ad than you will for multiple ads. You will also pay more for placement in high-traffic sections.
Your local newspaper’s sales rep should be able to give you detailed demographic information on their readers, in addition to an official circulation number from the Alliance of Audited Media.
Typically, daily newspapers are more likely to reach customers who are 35 or older, while weekly “alternative” papers usually attract a younger readership.
Both types of paper tend to have regular special features spotlighting local businesses or specific areas of interest (e.g., food, home and garden, or health and fitness products). Advertising in relevant sections may deliver better results.
Apart from the relatively high cost, and the necessity of meeting technical specifications for print ads, the main problem with newspaper ads is that so many big businesses place large, eye-catching ads that the smaller ones may get overlooked.
If you decide to include a coupon or other special offer in your ad, check your text carefully before submitting the ad and make certain that you clearly state an expiration date; mistakes on coupon can be very costly! Newspapers should always be willing to provide a proof of your ad; ask for a proof and have multiple people check it carefully.
Magazines
Magazines can be a very effective way to reach a narrow target audience. There are magazines for just about any interest you can name, and many of them will have detailed demographic and psychographic information on their readers. Furthermore, magazines are often read by more than one person, so your ad may continue to generate inquiries months after it initially runs.
Even if you’re a local business, national magazines often have regional editions that spotlight area businesses; depending on your type of business, advertising in these sections could be worthwhile. As with newspapers, special features or issues may be ideal for your business.
Visit your target magazine’s website, or contact them by phone, to get a media kit with advertising rates, reader demographics and audited circulation numbers.
Lead times for placing ads in magazines are generally long. Although ad production can be expensive, small businesses can sometimes negotiate to use lower-cost “remnant” space in magazines. As with newspaper ads, ask for proofs and check them very carefully.
Broadcast Advertising
Radio and TV commercials are called “spots.” A typical spot is exactly 30 or 60 seconds in length, but some stations will accept shorter or longer spots. Radio and TV spots are ideal when you want to reach target customers at a specific time of day.
Cable TV ads can reach viewers with very specific interests for a relatively low cost. Individual channels may appeal to very specific demographics, making it easier to target your ads.
Broadcast TV ads reach a broader, less differentiated audience. As such, they tend to be better for products and services with a wide appeal.
Radio provides flexible coverage of a wide range of audiences. You can choose the best time, day, station and programming to reach your target audience, and then hit them with multiple ads. Radio stations can help you produce ad spots, but be sure to write your own message; you don’t want to sound just like everyone else. Get plenty of feedback and advice before launching a radio campaign.
Radio and TV ad rates depend on the number of spots you buy, their length and the day and time on which they run. You may be able to negotiate bargain rates with some stations. Always document such deals in writing.
Online Advertising
Online advertising includes messages delivered through websites, local business directories and social media. The main benefits are low cost, the ability to target niche customers, and the potential for viral marketing and customer engagement. Creative possibilities include podcasting, offering an e-book, or producing useful tutorials through a service like Skillshare or Slideshare. Even if you don’t sell online, the growth of location-based searching makes online advertising important. We will discuss online marketing in depth in Chapter 16 Online Marketing and Social Media.
Signage
Signage is one of the most cost-effective and powerful ways to attract customers and promote your brand. Even the most elaborate sign is cheaper over its lifetime than any other advertising medium. Signage isn’t just for retail stores and restaurants. If you run a manufacturing operation, suppliers and clients need to be able to find your business. And if you have a sign on your truck or car, think of how many people will see it as you drive around town!
Here are the ABCs of effective signage:
Attracting new customers. Because a certain number of your customers will move out of the area or switch to competitors, your business must constantly restock its customers, just like it restocks its inventory.
Branding your business. A sign that’s visible every day may do more to communicate your brand identity than all other marketing efforts combined.
Creating impulse sales. Studies show that 40 percent of all U.S. sales are impulse sales. Your job is to attract your share of these impulse buyers and turn them into regular customers.
To be effective, signs must be in a place where your target customers can see them, they must stand out enough to gain the customer’s attention, and they must communicate your message at a glance. It does no good to have a visible sign that doesn’t attract attention, and there’s no benefit in attracting attention if you don’t communicate a clear message.
Billboards and Other Outdoor Advertising
Billboards are priced by their visibility; you’ll pay a premium price for larger signs in high-traffic areas. Generally, billboards are best for building brand awareness or for advertising wide-interest goods like food or health products, online and tech services, or costly items like cars or major appliances. The high cost of billboards usually makes them much less suitable for niche products. However, the ability of billboards to generate curiosity and make a memorable graphic statement is worth considering for smaller, growth-oriented companies—such as tech firms—that want to launch a creative branding campaign.
One of the most important—but often hidden—costs of billboard advertising is design; creating large graphics requires special expertise that many design firms and freelancers may not have.
The high visibility of billboards makes it especially important to put your best foot forward; having made an informed decision to produce a billboard, you should also commit to hiring an expert designer and paying for professional proofreading; typos tend to be a lot more noticeable when they’re 10 feet tall.
For most small businesses, more modest forms of outdoor advertising will deliver more bang for the buck. Branded vehicles are a relatively inexpensive alternative to billboards, and they have the extra advantage of being mobile. Ads in or on public transportation vehicles and shelters can also be highly effective, not least because they may allow you to target specific consumers more narrowly. For example, if your demographic is college-age youth, and a bus route serves the local community college, that route would be a better target for ads than one that serves outlying areas with older residents).
Newsletters
Even businesses with a small marketing budget can use templates to create an inexpensive but attractive newsletter. In order to be effective, newsletters should:
Be published regularly
Contain important information and up-to-the-minute news
Include interesting pictures and graphics
Be easy and enjoyable to read
Use appropriate language, colors and graphics for your target audience
Reinforce your brand identity
Forge a personal connection with you and your team members (e.g., by describing hobbies, interests or recent accomplishments, such as doing charity work overseas or completing a 50K ultramarathon)
Provide advice or solutions for your customers’ problems
Offer a reward for the reader’s attention, such as a coupon or subscriber-only sale
As with any other marketing channel that relies on content creation—from blogging, to Twitter, to video marketing—you need to consider whether you have the time and talent to produce regular, high-quality content. Newsletter creation requires above-average writing, editing and graphic design skills; if you don’t have them in-house, you may need to hire a contractor. Poorly done newsletters can damage your brand identity.
Newsletters can be printed and mailed, or they can distributed electronically, either through your own email account or through an email marketing service such as MailChimp (mailchimp.com). The second option is much cheaper, and it also saves paper, time and resources. Furthermore, electronic newsletters can include active links to online features, services and social media channels. (Of course, this won’t work unless your target customers are online.)
Brochures
Brochures allow you to go into considerable detail about your business and products, while also giving people a strong sense of your quality and values.
People expect detailed information in brochures, so be sure to deliver it to them in a compelling way:
Align with customer expectations for businesses of your type. Like newsletters, your brochures should use fonts, colors, language and graphics appropriately to communicate the right image to your prospects. Don’t confuse customers with visual mixed messages (e.g., by using a somber engraved font for a line of children’s toys, or using informal, slangy language in a financial consulting brochure).
Start with the end in mind. Before you start work on your brochure, decide what you want readers to take away from your brochure. A document that tries to be everything to everyone may end up appealing to no one. Choose one or two goals—like introducing your business and product line—and make sure your text and graphics serve those goals.
Include professional color photos of your products, or of jobs you’ve completed.
Explain your product’s features and sell their benefits.
State your team’s experience and skills.
Describe anything that makes your business special, such as locally sourced materials, a community connection, a charitable aim or a compelling story.
Use high-quality graphics and writing to make a professional impression. Avoid low-resolution photos, typo-ridden text, sloppy font choices and clashing colors. If you can’t afford a professional designer, look at industry leaders’ brochures and try to match their style. You should also run your brochure past your mentor and other trusted advisors before finalizing it.
Include a call to action. Even if it’s as simple as asking customers to visit your website for more information, or to follow you on Twitter, your brochure should encourage readers to take a step that will deepen their relationship with your company.
Like newsletters, brochures can either be printed or offered in a digital format. Printing a simple one-color brochure is fairly inexpensive. Costs go up as you add colors and improve paper quality.
If you plan to produce your own brochure, have a professional copy editor review it before you invest money in printing it; it’s much cheaper to spend a little on editing up front than it is to throw away hundreds or thousands of brochures with a serious error. You should also check price and other information very carefully, as an outside editor probably won’t catch things like pricing and return policy errors.
Other Options
Classified ads are less expensive than traditional ads and can contain more information. They are often offered at a discount to advertisers who buy frequent listings. If you often see classified ads for your type of business in your local paper, consider placing your own ads there.
Craigslist allows you to categorize messages by service or product type, while also allowing you to target specific cities, towns or neighborhoods. Overt advertising is frowned on; learn the rules and etiquette before attempt to sell through Craigslist and similar forums.
Yellow Pages. Advertisers often favor online Yellow Pages over print editions. However, the printed version may still be a good choice, depending on your business, your location and the technological level of your target customers. One advantage of this medium is that small businesses can appear to be as big as their larger competitors.
Cooperative advertising entails sharing the cost of advertising with your suppliers, who may have funds available to help promote your products. Usually, you pay for the advertising up front, and the suppliers reimburse you for a portion of the cost upon proof of advertising. As an example, a paint company might pay a painting contractor to mention its brand in his brochure. There are many ways to use co-op funding, so talk to your suppliers about your options.
Specialty advertising refers to giveaway items—like pens, coffee mugs, T-shirts and hats—on which you print your business name, logo and contact info. It’s important to target the right customers and make sure the specialty item fits your brand. For instance, if you offer 100-percent American-made goods, you won’t want to give customers keychains made in China. And if you have a green brand, you won’t want to hand out plastic trinkets. Although this advice may seem obvious, many big businesses have made embarrassing mistakes like these.
Business cards are an excellent, inexpensive way to promote your business. All of your printed materials should be consistent, so use the same logo, fonts and colors that you use elsewhere. Use the back of your business cards to offer incentives, like a 10-percent discount on your product.
Fliers are a very economical way to spread the word about your business. Select a basic idea, combine it with an appropriate photo or image, and then explain more fully what you offer and how it benefits your target customer.
Personal letters are a great way to introduce yourself to carefully researched prospects. Write a customized letter for each of your prospects, and include specific information about what you can do for them. Follow up with a telephone call or visit.
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My cousin Luke was in the tractor business, so I figured I could resell the equipment pretty easy. Luke hadn’t sold used equipment before, but he was willing to give it a shot. He thought it could be a good way to expand his business, since he wasn’t doing so hot either at that point.
So we talked it over and decided to run a big sale on the weekend right after the Fourth of July. We’d take just about anything with a motor, as long as it was less than five years old and in good running condition.
Having hit on this idea, Jacob and Luke sat down to think about how to reach their target customers. They assumed their primary demographic would be men between the ages of 18 and 50, most of whom would work in agriculture, fertilizer processing or alternative energy. Their secondary target would be men and women from 25 to 64 who owned larger homes on multiple acres of land and often undertook large-scale landscaping or construction projects. Many of these homeowners had moved to the region for its burgeoning high-tech and wind power industries, and had promptly bought heavy equipment—such as backhoes and snow plows—to “fit in” with the locals. After the first couple of years, they often found that they rarely used this equipment.
Initially, Jacob felt that billboards would be the best way to go. But when they looked into the cost, and considered how saturated the city’s high-traffic locations already were, he started to have second thoughts.
Luke pointed out that just about everyone listens to the radio in Cheyenne. When they researched the demographics for the top-rated country and talk stations, that seemed like the best way to reach their target customers.
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Direct Marketing
Direct marketing is one of the least expensive (per sale generated), most flexible and fastest-growing advertising methods. It includes direct mail and email marketing, telemarketing and mobile marketing. These methods allow businesses not just to reach specific market segments, or individual customers, but also to tailor their message to each.
The primary factor driving direct marketing trends is data; as more consumer information becomes available—due to customer relationship management software, online behavior tracking, consumer reviews and mobile-generated data, among other things—and database applications become more sophisticated and affordable, the ability to target specific customers is increasing by leaps and bounds.
Telemarketing
Telemarketing is a form of direct marketing in which a salesperson uses the telephone or mobile phone to contact prospective buyers. This includes marketing conducted through SMS messages, or texts. Although it can be effective in certain situations, many consumers view it as a nuisance at best, while others associate it with identity theft and other forms of fraud.
Because of its unpopularity and its potential for abuse, telemarketers are subject to very strict regulations. For more information, see Chapter 7 Laws, Regulations and Taxes.
Email Marketing
Most people with email accounts are overwhelmed with spam. Those who aren’t have filtering systems that block email from unknown senders. Still, the low cost of email makes it a valuable tool, especially for staying in touch with existing customers.
Your best bet is to offer regular updates on your company, or a subscription to an online newsletter. Your website should have an icon that customers can click to be added to your mailing list; this enables you to reach thousands of customers at a fraction of the cost of traditional direct mailing.
The key to successful email promotions is to target prospects as narrowly as possible and give them the choice of opting in to receive updates, bulletins and special promotions.
Your opt-in rate will be much higher if you offer consumers something valuable in return for their attention. Discounts and free shipping are obvious choices, but information can be valuable, too. If you’ve done your market research properly, you should have a good idea of what your customers value. Beyond that, think about your own situation: As an entrepreneur, you’re a busy person with a limited amount of time. What kind of attraction or reward would convince you to add your email address to a promotional mailing list?
In most cases, marketing emails should be optimized for mobile devices. This is particularly true for heavily formatted content such as newsletters, but even simple HTML-based marketing emails should be designed for maximum readability and usability on smartphones and tablets. In most cases, this means keeping content brief, informative and concise. The less users have to scroll to read your content, the happier they’ll be. Messages should also be designed to facilitate content sharing (e.g., by including a link to Twitter).
Last, always offer customers the option to get off your mailing list. When people ask to be removed, do it right away. As noted in Chapter 7, you must also follow the provisions of the CAN-SPAM Act.
Sales promotions
The Sales Promotions Worksheet will help you decide which promotions make sense for your business.
Consumer Promotions
Consumer promotions are short-term incentives that gather customer data, or increase consumer demand or product availability. Common consumer promotions include free samples and trial periods, coupons, rebates, price deals (e.g., two-for-one offers), sweepstakes, frequent shopper cards, contests and giveaways (which are also known as premiums, and frequently take the form of branded advertising specialties such as T-shirts).
The primary goals of consumer promotions include:
Getting prospects to try a product
Gathering useful consumer data
Encouraging existing customers to buy more of a product, or the same amount of a product more often
Introducing or promoting complementary products
Triggering impulse buys
Differentiating a product from competing brands
Coaxing customers away from competing brands
Trade Promotions
Trade promotions are incentives that businesses offer to retailers, wholesalers and other resellers for stocking and selling their products. The primary goals are:
Getting or improving a distribution deal
Motivating resellers to buy more of a product, or the same amount of a product more often
Improving relationships with resellers
Getting or improving shelf space or displays in a retail outlet
Motivating sales staff to push your product
Clearing out outdated or excess inventory
Outmaneuvering competitors
Here are some common trade promotion strategies:
Dealer loaders are premiums that encourage retailers to buy or sell a specific amount of your product. Often, it takes the form of a display item that the retailer is allowed to keep once the promotion ends.
Employee training programs. You train the retailer’s staff on the features and benefits of your product, so that they can pass this information on to consumers.
Point-of-purchase (POP) displays are eye-catching promotional displays that raise awareness and drive sales (impulse buys, in particular). Effective POP displays will instantly grab the customer’s attention and will also be easy for retailers to deploy. Often, the retailer will get a cut of sales resulting from a POP display.
Push money. This is a cash premium, prize or commission paid to retailers to get them to meet sales goals.
Trade allowances are short-term incentives for retailers to stock or sell more of a product. This could be a discount for resellers who place large orders, or an advertising allowance for resellers who agree to promote your product in a catalog or online.
Trade contests reward a reseller or an individual staff member who sells the most of your product. The reward could be the product itself, or it could be a prize, bonus or travel package.
Trade shows. One of the best ways to promote your offerings to resellers is by participating in trade shows, exhibits or industry fairs. The people who attend these events are serious prospects or buyers who have come to do some pre-purchase information gathering. This is also a good way to find out what your competitors are doing.
Managing Sales Promotions
As with any other marketing activity, you need to start by understanding your target, whether it’s a customer or another business.
Next, you need to have a clear goal and a clear idea of which strategy will help you achieve it. If your goal is to attract new customers, a free sample will probably be more appealing than a two-for-one deal. If you’re trying to build loyalty, a frequent shopper program will probably work better than a discount coupon.
Once you’ve decided what your promotion will be, you need to explain it clearly. The simpler an offer is, the more attractive it is. Lots of small print, restrictions and exceptions will make customers wary.
Last, choose the right media to advertise your deal. If you’re trying to build customer loyalty, a direct email campaign announcing a special sale for newsletter subscribers might be a good idea. If you’re holding a contest, Twitter and Facebook are logical ways to announce it.
Whatever method you use, be sure to track and measure your results so you can build on strategies that work and avoid ones that don’t.
Public Relations and publicity
Public relations are organized efforts that businesses undertake to present themselves in a positive way to customers, government officials, stockholders, lenders and other businesses.
Publicity is unpaid communication about a business or its product in the mass media. Because it’s unpaid, it’s one of the most credible promotional sources for small businesses.
You can generate publicity by preparing a press release for radio, newspapers, magazines or local TV stations. Join your local trade associations, chamber of commerce and community clubs, and find opportunities to speak in public or write articles for newsletters. Here are some other ways of generating publicity:
Donate money or time to clean up highways, parks or beaches.
Hire local students as interns.
Install a clean energy system (e.g., solar, wind power or geothermal) and offer public tours or demonstrations.
Remodel a dilapidated building or improve a piece of barren land.
Lecture at a local trade organization or chamber of commerce.
Send your business story to your local newspaper or trade association.
Contribute to a blog or some other industry-related site.
Sponsor an offbeat event, like a pie-eating contest. If the event relates to your business in some way, that’s even better.
Cosponsor sporting or charity events.
Offer to be a guest speaker on a local radio show to discuss elements of your business. If you’re a landscaper, you can talk about garden design ideas. If you’re a dog trainer, you can explain the best way to train a dog to fetch the paper.
Donate prizes or time to local fundraisers.
Press Releases
You might prepare a press release to announce an event in which you’re participating or a change at your business. Hiring new people, offering a new service, donating to charity or holding a contest are all good reasons to send a press release to local media.
The easier you make it for people to help you promote your business, the more likely you are to get publicity. When preparing a press release, double-space it and keep it simple and short (one page is ideal).
Mail, email or hand-deliver your press release to your local newspaper, radio and TV stations. Be sure it gets sent to the correct section editor, or to the news editor. Don’t overlook weekly community or college papers and public radio stations. If you have a good photo, include it in mailings to key newspapers.
Networking
Networking can be a very effective and inexpensive way to promote your business. As we’ve said before, you should keep widening your circle of contacts to include customers, investors, vendors, distributors and other entrepreneurs.
Thanks to social networking sites like LinkedIn, Twitter and Facebook, this is easier than ever before, and your access to prospects and partners is much wider.
Think about what you can do for the people you meet and what they can do for you. You never know if they’ll become customers or refer customers to you.
You can also develop a network of partners who refer people to each other’s businesses. For instance, a gardener could refer a customer to someone who hauls yard waste, or a drycleaner could refer a customer to someone who cleans carpets.
To be an effective networker, you need to be able to tell new contacts exactly what your business is and how it helps customers. Use the Business Commercial Worksheet to create a brief description that will impress and interest the people you meet.
Take every opportunity to speak publicly. When you do, give out lots of business cards and collect lots of business cards from others. Follow up on new contacts with a brief note or phone call. Set aside some time to work on these things every week, using the Public Relations and Networking Strategies Worksheet as your guide. Over time, this process will pay off with increased sales and opportunities.
…
Jacob called the local FM country music station, and they told him he could run three spots a day for $200 each. He also called a smaller AM talk station that broadcast livestock and agricultural news. Their price was significantly lower, and their listeners were likelier prospects.
Jacob knew that most of his primary targets would be country listeners, and that with three spots a day he could probably hit at least half his target audience during the week before the sale. He and Luke pooled their money, and they ended up buying three days’ worth of ads on the FM station, and three days’ worth on AM.
We ran the AM ads first, and then the FM ads, so we’d get more bang for the buck. I didn’t bother with any big newspaper ads, because as far as I could ever tell, most of these folks weren’t big newspaper readers. Those ads cost me and Luke $2,500. That was a whole lot of cash for us back then, but it would be worth it if our idea panned out.
It did pan out. In fact, it was better than we’d hoped for. By the end of the sale, I’d nearly cleared my lot of old trucks, and we’d gotten 20 snow plows, 13 trailers and a skid loader.
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Your Promotional PLAN
As we mentioned earlier, you should judge media by the amount of access they give you to your target customer. With this in mind, let’s look at the necessary steps in managing promotions.
Set a Promotional Budget
You should always plan carefully before spending your hard-earned cash, and that’s especially true when planning promotions.
You need to set aside funds for each part of your promotional strategy. You can either decide on your total budget, and then divide it among each of your promotional tools; or you can set spending levels for each element, and then total them to arrive at your promotional budget.
First, add up the total cost of your ideal promotional budget. Next, decide which of these promotional elements are most important, and estimate how much money you can afford to spend on each. If the amount seems too low, don’t give up. Chances are, you can make your money go farther than you think.
Determine your budget at least 12 months in advance. This will help to ensure that you have funds available for important holidays or events.
Remember to measure the results of your promotions and change them as needed. If you hand out 1,000 fliers but you don’t see an increase in business, it’s time to try another strategy.
Create a Promotional Calendar
Usually, a promotional calendar lists when promotions and events will occur, how long each will last and what its purpose is, and the total budget for each event. This enables you to use your budget more efficiently and to avoid gaps in your promotional efforts.
You can air advertising messages in a few large bursts at scheduled intervals, or spread them over a period of time to maintain awareness.
For businesses that wish to introduce a new product, frequency tends to be more important than reach. Again, it takes at least three exposures to a message before people absorb it, let alone act on it. Therefore, businesses often use a high-frequency “burst” strategy when they want to create an early, intense impact. Seasonal businesses and short-term sales promotions usually rely on this strategy.
Measure Your Results
Evaluating the impact of advertising on sales isn’t always easy, but it’s an absolute necessity. Here’s one way to proceed. Let’s say your goal is to sell 45 flower arrangements at $25 each, and you decide to advertise in the local paper.
To measure the effect of that ad:
Establish your baseline sales. What’s the average weekly number of flower arrangements you sold during the previous two weeks?
Track your sales over the time your ad was running.
Track your sales for two to four weeks after the ad, to see if there’s any delayed effect.
Having analyzed your sales before, during and after your ad campaign, you can determine how many extra flower arrangements you sold. Compare your sales during and after your promotion to your baseline sales. Divide the cost of running the ad by the extra number of flower arrangements you sold, and you’ll know if the ad was effective. If it cost you more to create and run the ad than you received from sales, the ad was not effective.
Once you know how to calculate advertising effectiveness, you must decide what part of your business to measure. Do you want to measure the increase in overall sales? Or just the increase for the items you advertised? Or maybe you want to measure whether there was an increase in foot traffic (the number of customers coming in your door, whether they buy or not).
The best way to know what worked and what didn’t is to ask customers how they heard of you. You can also count coupons, measure the number of participants in contests or sweepstakes, and compute sales levels during short-term promotions.
Having done so, consider these questions:
Did your promotion communicate the right message?
Did the message fit your product positioning strategy?
Did the message reinforce your brand identity?
Did you reach your target customers? If so, how did they feel about your message?
How did each element of your promotional mix affect sales?
How can you do better next time? What should be in your next promotional plan?
Be Creative!
Now that you understand the basics of promotional strategy, throw out your traditional thinking about how businesses promote themselves. For entrepreneurs, textbook techniques are just the jumping-off point to more unconventional, low-cost methods. The only things that should constrain your creativity are your budget and time restrictions.
…
So here it was July, and we were sitting on a bunch of snow plows, utility tractors and farm equipment. At first, our goal was to blow them out as fast as possible, but then we got to thinking: What if we could rent some of these machines out?
Things were changing in Cheyenne, granted, but they weren’t changing that fast. People still use tractors, and snow still piles up roof-high in winter. The folks who sold us these vehicles hadn’t sworn off them for life. They’d just decided they needed a truck more at that time.
But soon enough, it’ll be January and they’ll wish they had that plow back. So why not hold onto it and rent it to anyone who needs it? We could do it by the hour, the day or the month. It’s good for me because I get steadier income than I would from selling trucks, and it’s good for customers because they get access to machinery without the cost of storing it and maintaining it and so on. It just made sense.
Jacob still advertises his annual July trade-in sale locally. But these days, word of mouth pulls in buyers from as far away as Laramie and Fort Collins, Colorado. He and Luke have a well-maintained fleet of rental equipment for farming, construction, landscaping and snow removal, which they advertise year-round on local radio and TV. But their best advertising idea was the cheapest: They had their fleet professionally painted with their business name and logo.
Just about anywhere you drive in Cheyenne, on just about any day, you’re going to see one of my machines. We always ask where folks heard about us, and I reckon that seven times out of 10, they saw one of our rigs while they were driving around on some other errand and they decided to give us a call.
At this point, the auto sales and the equipment rentals are just about neck and neck. My cash flow has evened out, which is all I set out to do. But now that I’m out of that rut, I don’t know that I want to get straight into another one. Me and Luke have been talking about opening a second location over in Laramie, and maybe even putting together a team of operators  who’ll work on demand, so you not only get the fork lift, but you also get the guy who knows how to run it safely.
To make a long story short, I see a lot of possibilities worth looking into. So I’m not all that worried about hindsight anymore. These days, I’m looking straight ahead.
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Conclusion
Look for the most creative, cost-effective, and efficient ways to promote your products. Choose methods that are consistent with your positioning and branding, and tools that communicate the same message as the rest of your marketing mix.
Remember: Even the best promotional strategies won’t help a business that offers poor quality, bad service or unwanted products. Start with a great product, a good understanding of your customer, and let your passion for your business fuel an inspired promotional campaign.

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| NxLeveL® TECH TIP BUSINESS RESOURCES AND THE WEB
Media Data & Directories Alliance for Audited Media is a nonprofit organization comprising leading publishers, advertisers and content providers. It’s dedicated to measuring, auditing and reporting on print, broadcast and digital media, as well as related consumer demographics and trends. They offer useful tools and reports for planning promotions and researching media markets. auditedmedia.com Standard Rate & Data Service (SRDS) was founded in 1919 to connect advertisers with media owners. Now run by Kantar Media, SRDS.com offers rate information, reach and frequency data, audience metrics, competitive intelligence and contact information for magazines, newspapers, radio, TV and online media. Their website offers data on more than 100,000 media properties, categorized by type, market and geographic region. They can also conduct custom research for a fee. next.srds.com