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Retail communication

and promotion

Marketing communications are the


voice of the brand and are used to
establish a dialogue and build
relationships with customers
Retail promotions

 The mix of communication activities designed


to influence retailer publics
 Influence consumer perceptions, attitude and
behaviour in order to increase store visits,
product purchase and store loyalty
 Influence other stakeholders such as
suppliers, journalists and local and national
politicians
Common communication
Advertising Sales Events and PR
platforms
Print/Broadcast
Promotions Experiences Press packs
Speeches
Packaging Contests Sports Seminars
Brochures Games Festivals Annual reports
Posters Gifts Arts Charity
Leaflets Sampling Causes Publications
Billboards Fairs Factory tours Community relations
POP display Trade shows Company museums Lobbying
Symbols/logos Coupons Company magazine
Discounts
Finance options Personal selling
Trade-ins Sales presentations
Incentive programmes
Direct marketing: Mailings, telesales, faxbroadcast, Trade shows
email, catalogues Samples
For retailers MCP can build own
brand equity
Advertising Brand awareness

Sales promotion
Brand image
PR
MARKETING BRAND
COMMUNICATION EQUITY
PROGRAMME
Personal
Selling Brand
responses
Direct
Marketing
Brand relationships
Events and
experiences
How persuasive communications work – Response Hierarchy Models

AIDA (1) Hierarchy of Innovation- Communication


effects (2) adoption (3) model (4)

Attention Awareness Exposure


COGNITIVE Awareness Reception
Knowledge Cognitive
response
Interest Liking Interest Attitude
AFFECTIVE Preference
Desire Conviction Evaluation Intention

Trial Behaviour
BEHAVIOUR Action Purchase
Adoption

1. Strong, The Psychology of selling. 2. Lavidge and Steiner. 3 Everett Rogers. 4. Various sources from Kotler and Keller
Promotional objectives

 Identify target group


 Identify specific product or category
 Set specific goals
 Agree main communication points and
method
 Define the time horizon
“To ensure that the parents of children aged between 4 and 16 within each
store catchment area receive information on back to school children’s offers.
To grow sales for these products by £xx for school wear and £xx for school
related equipment by September 1.”
Advertising

 Paid for time or space media communication


 Change attitudes, build image, encourage
trial, grow sales
 Create awareness of the store and range of
offers
 Can reach large numbers simultaneously with
simple message
“Spend a little. Live a lot”
“Every little helps”
“More reasons to shop at Morrisons”
Types of advertising
 Product: new, exclusive, superior merchandise or
service
 Markdown event: create excitement about genuine
“sale” event
 Retailer brand: sell the store, core vales,
commitment to customers, experiences
 Co-operative: manufacturer funded mail
drops/leaflets promoting offers and discounts
 Windows: capture focal attention, distinctive image,
promote seasonal activity
Window displays

 ID Magasin research suggest only 7% - 9%


of passing traffic will notice store display
 Bottom third of window has greatest impact
 View through the door is more important
 Clear simple messages
 Use of technology, movement, lighting, colour
to create dramatic effect
Push and pull promotional
strategy
Push strategy – push the consumer through the channel
by advertising store benefits

RETAILER MANUFACTURER
CUSTOMER

Promotes the benefits of


the product

Pull strategy – create demand for the product


through advertising and fund retailer promotional
activity
Sales promotion

 Offers and incentive to achieve a desired


result
 Mostly short term use but can become central
to marketing effort and difficult to terminate
 Often used in combination with other tools to
supplement overall marketing effort
Types of sales promotions
POINT OF SALE Window,,floor, counter display to induce impulse buy

CONTESTS Competitions for prizes to promote retailer brand

SWEEPSTAKES Random prize draws

COUPONS Money off voucher for in-store purchase

REPEAT SHOPPER Points/stamps/rewards for frequent purchase

LINKED PURCHASE Threshold level spending leads to money off other goods

DEMONSTRATIONS In-store demonstration of benefits or product testing

REFERRAL GIFTS Gifts to introduce new users

BOGOF Money saving but can stimulate demand for other items

BRANDED GIFTS Pens, bags other branded giveaways

SAMPLES Sachets, samples instore or in print media

PREMIUM Include free gift to encourage repeat purchase

SPECIAL EVENT Fashion shows, autograph sessions, store opening events


Relationships and loyalty -
CRM
 “Identify and establish, maintain and enhance and
when necessary terminate relationships with
customers, at a profit so that the objectives of all
parties are met; and this is done by mutual
exchange and fulfilment of promises” (Gronroos)
 “Managing detailed information about individual
customers and carefully managing all customer
touch points to maximise customer loyalty…to
provide excellent realtime service through the
effective use of individual account information”
(Kotler and Keller)
Loyalty

 Retention can be a measure of inertia and


apathy – not loyalty
 Griffin (1995): attachment to company/brand
is shaped by degree of preference and
degree of perceived differentiation
How loyalty schemes create
value
 More purchases more often – conscious choice to commit to
brand in exchange for reward. Additional valued reason for
choice
 Mass customise marketing communication – talk to individual
customers
 Asset value of the data – what’s actually happening in every
store to every customer
 Trend tracking – what customers are buying and what they’re not
 Minimise wasted marketing effort – better targeting through real
customer insight
 Promote trust – built on knowledge and understanding and
consistently delivering on promises
The Clubcard customer
contract
Identify individual
customers

Enable more personal Reward involvement,


more relevant service to spend, consolidation
customers The customer of spend.
contract

Create accurate
segmentation for Build dynamic
marketing efficiency customer knowledge
Loyalty segments (based on Dick and
Basu 1994)
Behaviour

High repeat purchase Low repeat purchase

TRUE LOYAL LATENT LOYALTY


High Gofton 1995 only 17% buy Well disposed but not
attachment same brand in 50%+ heavy user
product service sectors Using other suppliers?
they use. Understand why Create attitudinal
loyalty is divided
Attitude attachment
FALSE LOYALTY NO LOYALTY
Low Apathy, inertia, high No perceived difference
attachment switching costs Frequent price switches
Increase degree of positiveCommunicate distinct
differentiation advantages
Loyalty lessons from Tesco: the
dunnhumby loyalty cube

Championing

Location
All customers can be
determines
placed at some point in
marketing
the loyalty cube Commitment action to earn
loyalty

Customer Contribution
Contribution

 Should you reward “profitability” or “loyalty”


eg low spending loyal versus high spending
but promiscuous
 High spender may take more rewards but not
be loyal
 Encourage loyalty, not just profitability
Commitment

 Future value based on “headroom”


 Potential to be more valuable in the future
 What emerging financial needs can be
assumed/identified and targeted
 Strengthen the bond
Championing

 Loyal customers as brand ambassadors


 Benefits become an aspiration for friends and
associates
 Word of mouth/pass on your long term
opinion
 Long term value of a low value but loyal
customer may be in recruiting higher
customers
Emotional attachment
 “Marketing people use the expression emotional
attachment in too free a way. People have an
emotional bond to Tesco in that they feel we are on
their side…that we look out for their interests…and
most important we deliver on our promises. It’s the
sort of customer thinking that says ‘Tesco has
always done alright by me.’ On the one hand that
sounds rather dull, but it is actually massively
valuable. It is, infact, branding”
Tim Mason
Other ideas about loyalty
 Clubs that identify real emotional needs
 “The only club that is worth running is one that
satisfies a genuine customer need, because they’re
the ones that consumers are interested in” Tim
Mason
 Unconditional benefits are powerful. An up-front
reward gains positive perceptions and influences
shopping behaviour in a valuable direction
 Be a “chosen” not a “given”. People value most what
they actively choose
Personal selling
 Retailer gain through face to face or telephone
contact between seller’s representative and
customers/clients
 Based on trust (perceived credibility) of seller
representative and seller company
 Trust is an important driver of loyalty intention and
loyalty behaviour
 Sales staff activity in low-risk low-priced retailer
environment is transaction based
 In high – risk, high – price activity is
information/expertise based
The retail selling process
(Gilbert)
1. Preparing through skills and Feedback and learning from prior listening and
knowledge training
2. Anticipating and identifying a Feedback and learning from prior listening and
prospective sale understanding customer
3. Method of approaching Feedback and learning from prior listening and
potential customer and task asking appropriate questions
4.Presenting the features and Establish customer need and pocket, active
benefits selling and listening to check acceptability
5. Dealing with concerns Active listening to revise argument and
overcome objections
6. Building obligation and Active listening to ensure offer is acceptable and
commitment sale can be concluded
7. Establish affinity and Close the sale, reinforce the relationship through
relationship customer delight
Summary: retail promotions
 A complex series of communications concerning store and
offerings
 Traditional promotional mix tools include advertising, sales
promotion, personal selling and PR
 Retail atmospherics and visual merchandising play a vital role in
promotional strategy
 A consistently good set of promotional campaigns help establish
a store’s long term image and position
 Advertising is used to inform, persuade and remind consumers of
the store’s value proposition
 Sales promotions encourage trial, repeat purchase and generate
short term sales increase
 PR allows other media channels to act as opinion leaders for the
retailer’s personality and image