Meaning of Promotion

Promotion is the process of marketing communication involving information, persuasion, and

influence. The promotion has three specific purposes: communicating marketing information
to consumers, users, and resale persons. Promotional efforts act as powerful tools of
competition providing the cutting edge of its entire marketing program. The promotion has
been defined as “the coordinated self-initiated efforts to establish channels of information and
persuasion to facilitate or foster the sale of goods or services, or the acceptance of ideas or
point of view.”
Hence, promotion is persuasive communication to inform potential customers about the
existence of products, to persuade and convince them that those products have emerged with
want satisfying capabilities. Consumers really, speaking, buy a bundle of expectations to
satisfy their economic, psycho- social wants and desires. The promotion offers the message,
the communication of these benefits to consumers. Hence, promotion message has two main
purposes; persuasive communication and tool of competition.
Importance of Promotion
The importance of promotion can be briefly shown below:
 Sales of the goods in imperfect market:
Promotion helps in the sales of the goods in imperfect market. In the imperfect market
conditions, the product cannot be sold easily only on the basis of price differentiation. It is the
promotional activity that provides information about the differences, characteristics and the
multi-use of the products of various competition in the market. The customer is attracted to
purchase the goods on the basis of such information successfully.
 Filling the gap between producers and consumers:
Promotion helps in filling the gap between producers and consumers. Due to the tough
market condition, mass selling is quite impossible without promotional activities. The
distance between producers and consumers has so widened in present days to get them
touched with the product that promotional activities are necessary.
 Facing intense competition:
Promotion helps in facing intense competition in the market. When a manufacturer increases
his promotional spending and adopts an aggressive strategy in creating a brand image, others
are also forced to follow the suit. This leads to ‘promotional war. Without promoting the
goods, the competition is not possible in the market. So, it is necessary to face the
competition in the market with the help of promotional activities.
 Large scales selling:
Promotion helps in the large selling of goods and services. Sales promotion is the result of
large-scale production. It can be achieved only by appropriate methods of large scale selling.
Large scale selling is possible with the help of promotional activity. Due to the large selling
of goods, there will be more chance of promotion of goods. So, it is necessary to sell lot of
goods in the market for promotional activities.
 Higher standard of living:
Promotion helps in the rising standard of the people.The promotional activities increase the
standard of living by providing the better goods at a lower rate due to large scale production
and selling. It help to increase the standard of living in a good way. People can raise their
standard of living with the help of promotional activity. As the promotional activities
increases, the standard of living of people also increases. So, the promotional activity has a
great role in the increment of a standard of people so that they can live a good and happy life.
 More employment:
Promotion helps to create more employment opportunities. People can gain employment
opportunity with the help of promotional activities. With the help of promotional activity,
many workers get motivated towards the work. Promotional activity helps to increase more
employment opportunities to the people who are unemployed, as the promotional activities
cannot be performed without the help of an effective sales force and the specialists in various
fields.
 Increased trade pressure:
Promotion helps to increase trade pressure in the market. The growth of large scales retailer,
such as supermarkets, chain stores, etc. has brought greater pressure on manufacturers for
support and allowance. Promotional activities help to decrease the trade pressure. There is
need for promotional activities to decrease the trade pressure.
 Effective sales support:
Promotion helps in the sales support of the product. Sales promotion policies are under the
supplement to the efforts and impersonal salesmanship. Good sales promotion materials make
the salesman’s effort more productive. Promotion helps in the sales of the product. It provides
good support in selling the different types of goods. Sales of different types of goods in the
market are very necessary to increase the market economy.
 Increased speed of product acceptance:
Promotion helps to increase the speed of the products acceptance. Most of the sales
promotion devices such as contests, premium coupons, etc. can be used faster than other
promotion methods such as advertising. The increase in rapid speed of product acceptance
has occurred with the help of promotional activities. As the promotional activities are done,
there will be direct effect in the increment of a speed of the product. Increase in the speed of
product acceptance is very important in the competitive market. So, it is necessary to increase
the speed of product.

Components of Promotion
There are five components of promotion: Advertising, personal selling, sales promotion,
public relation and publicity.
 Advertising:
Advertising is the major components of promotion of products.It is an impersonal mass
communication that the sponsor has paid for and in which the sponsor is clearly identified.
The most familiar forms of ads are found in the broadcast (TV and radio) and print
(newspapers and magazines) media. However, there are many alternatives, from direct mail
to billboards and from the telephone directory to a yellow page.
 Personal selling:
Personal selling is the direct presentation of a product to a potential customer by a
representative of the organization for selling it. Personal selling takes place face to face or
over the phone, and it may be directed to a middleman or a final consumer. It plays the vital
role in the promotion of products.
 Sales promotion:
Sales promotion is demand stimulating activity designed to supplement advertising and
facilitate personal selling. It is paid for by the sponsor and frequently involves a temporary
incentive to encourage a purchase. Many sales promotions are directed at consumers. They
are designed to encourage the company’s sales force or other members of its distribution
channel to sell its product more aggressively. Sales promotion include activities such as
contests, trade shows, in- store displays, rebates, samples, premiums, discounts, and coupons.
 Publicity:
Publicity is a special form of public relations that involves news stories about an organization
or its products. It involves personal or impersonal message that reaches mass audiences
through the media. But there are several things to distinguish publicity from advertising: It is
not paid for, the organization that is the subject of publicity has no control over it, and it
appears as news and therefore has greater credibility than advertising.
  Public relation:
Public relation encompasses a wide variety of communication effort to contribute to generally
favorable attitudes and opinions toward an organization and its products. Unlike most
advertising and personal selling, it does not include a specific sales message. The targets of
the public relation may be customers, stockholders, a government agency, or a special-
interest group. Public relations can take many forms, including newsletters, annual reports,
lobbying, and sponsorship of the charitable or civic event.

Meaning of Advertising

Advertising can be defined as a non-personal presentation and promotion of ideas, goods or

services paid by an identified sponsor. It is non-personal mass communication which has
become a potent means of education and mass selling. It consists of all the achievements
involved in presenting product information targeting audiences through media such as
newspapers, magazines, catalogs, booklets, posters, radio, television, calendars, cards,
transport, etc.
According to W.J. Stanton, “Advertising consists of all the activities involved in presenting
to an audience a non-personal, sponsor- identified, paid for a message about a product or
organization.”
According to American Marketing Association, “Advertising is any paid form of non-
personal presentation and promotion of ideas, goods, and services of an identified sponsor.”
From the above definitions, we can conclude that advertising is the sales message directed to
mass on behalf of the paying sponsor.

Features of Advertising
Following are the key features of advertising:
 Payment of money:
One of the features of advertising is to pay the money for advertising. Advertisements appear
in newspapers, magazines, television or cinema screens because the advertiser has purchased
some time to communicate information to the potential customers. The adviser must pay
money for advertising activities. It is not free of cost.
 Non-personal:
In advertising, there is no face to face or direct contact with the customers. That is why it is
described as non-personal salesmanship. It is a non-personal form of presenting products and
promoting ideas. It simplifies the task of the sales force by creating awareness in the mind of
potential customers.
 Promote products and services:
Advertising helps in the promotion of products and services.It is directed towards increasing
the sale of the products and services of a business unit.Advertising is essential for the
promotion of goods and services.
 Identified sponsor:
The advertisement should disclose or identify the sources of opinion and ideas it presents.It
should identify the sponsor from where the advertisement can be occurred. Identifying the
specific sponsor is very important in the advertising process.
Importance of Advertising
Advertising helps in providing various information about the advertising firm, its products,
qualities and place of availability of its products and so on. It helps to create a non-personal
link between the advertiser and the receiver of the message. The significance of advertising
has increased in the modern era of large-scale production and tough competition in the
market.The importance of advertising to different parties are discussed as follows:
  Information about a product
 Creation of permanent demand
 Service to existing customers
 Conversion of prospective buyers to actual buyers
 Support to personal selling
 Increase in sales and reduction in cost
 Minimization of middlemen
 Creation of image or goodwill
 Protection of people from imitation
 Reminder to the users
 Establishment of relationship

One can also explain the importance of advertising in relations to major individual
components of the market. They are as follows:
Importance to Manufacturers and Traders
Advertising has become indispensable for the manufacturers because of the following
advantages:
 Introducing new product:
Advertising helps in introducing new products. A business organization can introduce itself
and its products to the public through advertising.It is essential for the organization to
introduce its product through advertising.
 Increase the sale:
Advertising leads to increase the sale of existing products by entering into new markets and
attracting new customers. The increase in the selling activities helps in increment of sales in
the market.
 Create steady demand:
Advertising helps to create the steady demand for the products. For example, a drink may be
advertised during summer as a product necessary to fight tiredness caused by heat and during
winter as essential things to resist cold.
 Help in meeting competition:
Advertising helps in meeting the forces of competition in the market place. If a product is not
advertised continuously, the competitors may snatch its market through increased
advertisements. Therefore, advertising is necessary to remain in the market and remind the
customer about its reputation in the market.
 Increase the goodwill:
Advertising helps to increase the goodwill of a firm by promising improved quality to the
customers. It is necessary for an organization to increase its goodwill to sustain in the market.
 Increase the morale:
Advertising helps to increase the morale of the employees of the firm. The salesmen feel
happier because their task becomes easier if the product is advertised and known to the
public.
 Facilitates mass production:
Advertising helps to facilitate mass production of goods in the market. It enables the
manufacturer to achieve lower cost per unit of product. Distribution costs are also lowered
when the manufacturer sells the product directly to the customers. Advertising encourages
mass distribution of the product through the retailers. Retailers are encouraged to purchase
and sell the advertised products.
Importance to Customers
Advertising offers the following importances to customers:
  To know about the existence of various products:
Advertising helps the customers to know about the existence of various products and their
prices. They can choose from the various brands to satisfy their wants. It is very important for
the customers to know about the existence of the products available there in the market.
 Educates customers:
Advertising educates the people about new products and its uses. It creates public awareness.
With the help of advertisements, we can be aware of the products which are available in the
market.
 Utility of existing products:
Advertising helps to increase the utility of existing products for many people. The utilization
of the products is very necessary for the market. Without it, advertising will not get effective.
 Receive the quality product:
Advertising helps to receive the quality product in the market.It induces the manufacturers to
improve the quality of their products through research and development. This ensures supply
of the products of better quality to the consumers.
Importance to the Society
Advertising is important for the society because of the following advantages:
 Provides employment:
Advertising helps to provide employment to persons engaged in writing, designing and
issuing advertisements. Increased employment brings additional income with the people. It
increases more demand in the market. Employment is further generated to meet the increased
demand.
 Promote the standard of living:
Advertising helps to promote the standard of living of the people by increasing the variety
and quality in consumption. It raises the standard of the people. As a result, it helps in
sustained research and development activities by manufacturers.
 Educate people:
Advertising helps to educate people about the various uses of different products. This
increases their knowledge about the products. Advertising also helps in finding customers in
the national as well as international market.
 Sustains the press and other media:
Advertising helps to sustain the press and other media by providing an important source of
income to the press, radio and television network. The customers are also benefited because
of increased circulation of their publications. It also encourages commercial art.

Types of Advertising

There are various types of advertising. They are mentioned below:

Consumer-oriented advertising:
Consumer-oriented advertising is one of the types of the advertising process. It helps in
creating and maintaining regular demand in the market. It also helps to attract the attention
and preference of the customers. It informs the target audience about the various schemes of
sales promotion. The objectives of consumer- oriented advertising are as follows:

 To inform consumers about new products.

 To hold consumer patronage against intensified campaign.
 To teach consumers how to use the product.
 To promote a contest or a premium offer.
 To establish a new trade character.
Informative advertising:
Informative advertising is another type of advertising process. Customers often purchase
durable products once in a lifetime. These are often expensive. So the potential buyer requires
detailed information about them e.g. TV sets, refrigerators, air- conditioners and washing
machines. The manufacturers spend a lot on informative advertising.
Institutional advertising:
Institutional advertising is also important types of the advertising process.The main
objectives of this type of advertising are to build a corporate image. This advertising helps to
highlight the objectives and achievements of a company. Large companies such as Godrej,
Jagadamba cement, telecom, etc. resort to this type of advertising. The institutional
advertising companies have the following objectives:

 To create a corporate personality of the institutional image.

 To build a company prestige.
 To emphasize company services and facilities.
 To enable company salesman to see top executive of the various organization when
making sales calls.

Financial advertising:
It refers to advertisements issued by financial institutions like Everest Bank, SBI bank and
company’s sale of shares. These advertisements provide information about investment
opportunities with its attendant risks and benefits.
Classified advertising:
This is also the type of the advertising process.Classified advertisement refers to the
messages. They are placed under specific or particular headings and columns in newspapers
and magazines e.g. situations vacant for sale and matrimonial. In it, the advertisements are
classified into various headings.
Government advertising:
It is the type of advertising process in which there is involvement of government.It is
conducted by government departments/ undertakings to promote public awareness with a
view to overcome social problems like dowry, drinking water, AIDS, environmental
pollution, and overpopulation. Such advertising has a social purpose, it is also known as
social advertising.