What is promotion marketing: The definition

What is promotion marketing: The definition

In today’s highly competitive ecommerce landscape, promotion marketing is what sets businesses apart. It’s essential to catch the attention of your present and potential customers. And it’s an important way to get consent for and gather valuable data for further marketing.

Promotion marketing can be defined as:

“A set of marketing communication activities used to showcase and raise awareness about a particular brand to attract customers and drive sales.”

Promotions help brands create awareness about their products, and also differentiate themselves from competitors at the same time. 

Promotion marketing goals

Promotion marketing goals can differ greatly depending on your product, but they should always be aligned with your business objectives. Here are 5 common promotional marketing goals:

  1. Increase brand awareness 

Small businesses need to reinforce their brand image and maintain customer awareness in order to grow. The more a consumer recognizes a brand the more likely they are to trust in the quality of the product and spend their money.

Brand awareness is the first stage in the marketing funnel. After prospects are aware of your product, it’s much easier to convince potential customers to enter the buying stage. 

Creating real brand awareness can be a daunting task, but it can be achieved through a combination of direct marketing and word of mouth. The key is to spread your strategy across multiple channels, like advertising, SEO, PR, and partnerships to create a more holistic promotion experience for your customers. 

  1. Inform consumers

This promotion goal is relevant in the early stages of the product life cycle. It’s very important when releasing changes to an existing product or brand policy. Consumers will only buy a new product, or switch to an upgraded version if they understand how it will benefit them. 

In both cases, the aim is to educate the consumer about the product and convert their needs into interest. 

You can achieve this by publishing informative videos about the product, using live streams to tell customers about your upcoming products or features, and sending product newsletters that talk about how the customer can solve their specific problems with your offering. 

  1. Increase brand loyalty

New ecommerce brands pop up regularly all the time — some become much more successful than others. Building brand loyalty helps increase the likelihood of customers choosing your brand over your competitors which, in turn, helps ensure the continued success of your brand. 

Consumers usually stumble across multiple attractive offers online before they commit to buying a product. But a brand can increase the likelihood of a customer choosing them by offering something different than the competition. Whether it’s customer rewards, discounts, or gift cards, a loyalty program and robust loyalty strategy with a range of personalized incentives will help your brand stand out. 

  1. Increase revenue

The ultimate goal of all promotions, directly or indirectly, is driving sales and increasing revenue. Simple promotions, like discounts and coupons, drive sales by offering customers a more enticing deal on a product or service.

Other promotion marketing mechanisms, like loyalty or referral programs, increase longer-term revenue by growing your customer base, repeat spending, improved customer loyalty and more opportunities for online reviews, as well as creating a number of touchpoints with your customers that allows you to communicate your marketing messages more effectively.

  1. Expand in new markets

New digital advertising channels can be used as pathways to expand your business and reach new target markets. When attempting to reach new customers it’s important to learn about their motivations and habits. You can do this by studying initial customer engagement with your brand, then using this data to decide which promotions are the most relevant for your target audience. 

Promotional strategies like referral programs and giveaways can be effective at attracting and retaining new customers. The idea is to deliver maximum value and make the product cost-effective for your new target audience. 

The Promotional Mix: Where does promotion marketing stand? 

The promotional mix consists of four Ps: product, price, place, and promotion. These are the key elements of an effective marketing strategy, and they’re essential to product positioning.

The 4 Ps of marketing/The marketing mix

Promotion strategy is arguably one of the most important Ps in the marketing mix. In many cases, it binds all other marketing efforts together. You can have a great price and effective channels to sell your product, but without an effective promotional strategy, your brand will go unnoticed. 

Promotions are all about getting your product to stand out and convincing your customers about the value they will receive. Different promotion marketing strategies impact the promotion mix in a variety of ways. For instance, geo-targeting or geofencing allows you to market in specific locations and is a useful tool for mobility apps. Discounts and coupon campaigns help in the price positioning of your product and can attract new customers when targeted correctly. And gamified loyalty programs help you engage in a much more comprehensive way with your customers.

Why does your business need promotional marketing?

One of the most effective ways to get people talking about your product and trying it out is through promotions. Promotional marketing helps brands to stick in your customers’ minds and incentivizes them to engage with your brand. A well-thought-out promotional strategy will ensure the long-term success of any business. 

Promotion marketing among other things, helps you understand the needs of your customers, how they interact with your product gives you insights into your target customer’s behavior, which in turn leads to a stronger digital marketing strategy and allows you to direct your resources where and when they are needed.

One great example of how promotion marketing can help differentiate a brand is Duolingo. This language learning app teaches about 39 different languages and has 40 million monthly active users. How did they reach such high numbers? A valuable product, sure, but also a solid gamification strategy. 

Statistics about promotional marketing

Credits: Pexels

According to Valassis, 37% of consumers said that messages offering coupons or discounts make them more likely to purchase from a brand. Added to this, 74% of consumers said that they generate interest in a product through advertised promotions and sales. 

54% of customers no longer consider shopping with retailers who don’t provide them with engaging content and relevant coupons. – Fundera

79% of consumers say they are only likely to engage with an offer if it has been personalized to reflect previous interactions the consumer has had with the brand. – Marketo

Referral leads have a 30% higher conversion rate than leads from any other channel. – Review 42

Loyal customers spend 67% more with a business than new ones. – Thanx

Promotion strategies for each step in the buying phase

Discounts to attract consumer attention: 

It’s always a good idea to nudge new customers or visitors with an interesting offer. You can also use this moment to collect email addresses in exchange for your discount codes. This can then help you retarget these customers later. Invesp says 64% of online consumers wait to buy things until they go on sale. So by using this initial interest, you can often lead your first-time shoppers to a cleverly timed bundle deal or inform them about the value you offer.

Loyalty programs to retain your customers:

Loyal customers spend the most on your product offerings. Retaining your customers will always spur purchases in the future. You should have a loyalty program that rewards customers with a range of personalized offers, coupons, or gift cards whenever they complete what you consider a ‘high value’ action. This may be sharing posts about your company on social media, referring a friend, writing a review on Google, or using your app regularly. 

According to Bond, 87% of consumers are open to brands monitoring details of their activity if it leads to more personalized rewards.

Referrals to gain new customers:

The easiest way to gain new customers is through referrals. Referred customers have a 37% higher retention rate and are 4 times more likely to refer more customers to your brand. – Invesp

You can incentivize your existing customers to make referrals and write reviews about your business by offering them coupons, exclusive content or free credit.

When you’re planning your referral program, you really need to consider all the relevant ways you can reward your customers for making referrals and incentivize the onboarding of their friends.   

Coupons to drive engagement:

Effective engagement happens when your customers have a memorable experience with your platform, app, or product. 

For instance, sending a time-sensitive coupon to a customer immediately after a purchase can feel a little pushy. A better idea would be offering a coupon that increases in value the more purchases you make. 

But, rewarding customers who have signed up for your newsletter with a time-sensitive discount coupon on their next purchase, for example, can be an effective way of getting these customers in the door.

87.6% of shoppers say that coupons or deals could convince them to download a retailer’s app. – eMarketer

5 effective promotion marketing examples 

Designing a promotion marketing campaign is not just about aligning with your business goals but also about creativity. Creativity can’t always be rushed through, so sometimes you also need to look to the big players for inspiration.

Here are some of our favorite promotion examples from top brands to inspire you. 

American Eagle mystery offer

Gamified email promotions are a quick way to grab the attention of customers. This is exactly what American Eagle did with their mystery offer campaign. They used suspense and exclusivity with a little ‘mystery’ to intrigue their prospects. 

The subject line of the promotion email reads, “Claim your mystery offer before it disappears.” 

The customers already know there’s an offer of some sort inside the email. Then American Eagle use the email body to build anticipation and curiosity by saying, “click below to reveal an offer you can ONLY get here.” American Eagle unleashed their creativity with this element of surprise and a well-thought-out CTA that says “Reveal Your Offer.” 

Credits: American Eagle

Chipotle rewards program

Credits: Chipotle

Chipotle recently announced an enhancement in their rewards program. They introduced a new feature called “extras” for Chipotle rewards program members. It means the members can earn more points by going to the “extras” section on the Chipotle website or app and participating in their personalized challenges. 

This gamification of the Chipotle rewards program also allows members to earn achievement badges and points. These points can be redeemed via Rewards Exchange for free food at chipotle, chipotle goods (apparel), or donations to charity. 

The Chipotle rewards program has already been a massive success with 24 million members and it will continue to do so with this new feature. In the earlier rewards program, members could only redeem points for a free starter. But by diversifying their reward options Chipotle is creating a more valuable and personal experience for their program members.

Flash Coffee #iGotMyShot campaign

Flash Coffee, the tech-enabled coffee chain in Asia started a promotional campaign to reward their vaccinated customers in Singapore. The coffee chain just entered the Singapore market and they’ve already seen heavy engagement with their new promotional campaign. 

Credits: Flash Coffee Singapore

The offer is for customers who’ve already gotten their first vaccine shot or are fully vaccinated. After they show proof of vaccination, a promo code with their unique user ID is given to the customers. The code is redeemed through the Flash Coffee app, and Talon.One validates the coupon code and user ID, then the customer gets their free drink.  Apart from this, the sephora promo code would be the perfect treat for those who are fond of beauty products.

This is a great initiative where the company is not just pushing for social change, but also creating awareness around the brand and bringing people into their cafe. 

SHARE NOW #ImpfSpurt campaign

Credits: SHARE NOW Germany

SHARE NOW is another brand that set up a promotional campaign to encourage vaccinations. They recently launched their campaign called #ImpfSpurt in Germany which translates as “vaccine sprint.” The #ImpfSpurt campaign is a collaboration between many of Germany’s leading mobility operators. 

All the companies collaborating on this campaign declared September the vaccination month. In this month each company is creating special offers and incentives to encourage people to get their COVID vaccination. For instance, SHARE NOW is offering a 5 € voucher to travel and get the COVID vaccination. The campaign is already off to a great start with more than 7,000 redemptions on Day 1 alone. 

What do you need to start promotion marketing?

Even if you only have a brick-and-mortar store, you need to set up physical promotions like paper coupons, badge collection, or loyalty cards so you can understand who is returning to your store and how your promotions are affecting your sales. However, setting up promotions in a digital environment requires more specialized promotion software such as a headless Promotion Engine that’s integrated with your product and customer data points, so you can use this information to target and personalize deals.  

Promotion Engines allow retailers to increase conversions by presenting highly customized and targeted promotions. They also remove the manual effort of coding offers with unique characteristics and qualifying criteria. Simply put, a Promotion Engine is a software that manages and automates everything related to your promotional marketing and supports advanced validation criteria, customer segmentation, and real-time analytics to track and optimize your promotions. 

If you want your ecommerce store to stand out you need a Promotion Engine that integrates with your existing marketing infrastructure. This will allow you to pull valuable consumer data from CRM and deliver personalized promotions across different channels. 

Now you have a better understanding of what promotional marketing is, how it works and where it stands in the marketing mix. It’s time for you to use this knowledge and design a tailored promotional marketing campaign for your business. 

Here’s a quick summary of promotional marketing basics that we learned in the blog post:

  • What is promotion marketing? Promotion marketing is a set of marketing communication activities used to showcase and raise awareness about a particular brand to attract customers and drive sales.
  • Promotion marketing help businesses work towards objectives such as brand awareness, customer loyalty, increasing sales, and increasing customer base.
  • Promotion marketing plays a key role in the marketing mix and can help businesses with each of the 4 Ps (Product, Price, Place, Promotion).
  • Different types of promotions are better suited to different business goals. Knowing when to use each promotion is an important part of getting your promotion strategy right.
  • Look towards big brands and their promotional campaigns for inspiration. 
  • To run a successful promotional campaign, you need the right promotional marketing tools at your disposal such as a Promotion Engine.

Author Bio

Payal is a Content Creator and Online Editor at Talon.One. She is highly passionate about content writing and everything to do with the digital landscape. Along with her work, she is also pursuing her Masters in Public Relations and Digital Marketing on the side. This has essentially widened her content and digital marketing horizons.