How Did You Learn of the Product?

Promotion represents all of the communications that a marketer may use in the marketplace. Like marketing mix, promotion has its own ‘ingredients’ to customize your strategy.

Marketing Mix- Promotion

Personal selling is an effective way to manage customer relationships. Sales personnel act on behalf of the producer/manufacturer. These sales personnel tend to be well trained in the approaches and techniques of personal selling. However sales personnel can be very expensive and should only be used where there is a good return on investment.

Sales promotion on the other hand, tends to be thought of as being all promotions not including advertising, personal selling and public relations. Examples of sales promotion are BOGO (Buy One, Get One Free), couponing, dollars-off promotions, competitions, free accessories, introductory offers and other methods. Each sales promotion should be carefully compared with the next best alternative.

Public relations is the deliberate, planned and sustained effort to start and maintain goodwill between an organization and its public. It is relatively inexpensive in comparison to other promotion methods, successful strategies tend to be long term and plan for all possible outcomes.

Direct mail is another element of promotion mix. It is very highly focused upon targeting consumers based on a database. The mail is sent out to potential consumers and responses are carefully monitored to maximize ROI (Return on Investment) both short and long term. One example is using subscribers to a Cat magazine would definitely be more likely to buy cat health insurance than non-cat owners.

Participating in Trade Fairs and Exhibitions are very good approaches for making new contracts and maintaining old ones. Companies will seldom sell much at these events, but it aims to increase awareness and to encourage trial of their products. Trade fairs and exhibits offer the opportunity for companies to meet with the distributors and end users.

Advertising is a paid for communication. Newspapers, magazines, journals, television, movies, radio and the internet are used to spread the information. The images, words and feelings help to develop attitudes, create awareness, and transmit information in order to gain a positive response from the target market.

Sponsorship is where an organization pays to be associated with a particular individual, event, cause or image. For example, ROLEX sponsoring the US OPEN or PEPSI sponsoring the SUPERBOWL. The target market relates the positive aspects of the sponsored individual/event to the sponsor. WARNING: Negative aspects can also be transferred, so choose wisely.

 Just like a cake mix, the ‘ingredients’ of the promotional mix are then integrated to form a unique but coherent campaign.

Promote Away,
Samuel Carrara

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Determination and Local Leads

I just go back from a 21 mile run! Yes I decided to do a full marathon instead of the half. What can it teach you, DETERMINATION! Set your goal and work HARD toward it.

I am giving two seminars in December in Charlotte, North Carolina to help local business owners to get more leads and customers. If you are in the area, or can find a way to get there, come on by to help your business.

Come Think Outside The Box, for more information visit:

I’ll help you grow your business,
Sam Carrara

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A Calamity That United a Nation

Below is a personal news report I asked one of my team members (Ingrid) to write about her experience in Manila, Philippines:

“Raining? On the weekend?! C’mon!” That’s what I thought when Typhoon Ondoy (International name: Ketsana) reached Manila. The sky was pitch dark and poured rain as if there was no tomorrow. I was really upset that day because weekends are used for quality family time usually spent outside the home. I wasn’t aware of what was happening beyond the four walls until the heavy rain turned into a drizzle. We looked outside and saw the flood water was about ankle-deep and thought to myself that it didn’t rain that much until my in-laws called for help. The home office, located at the basement was flooded! The water was knee deep and everybody was moving as fast as they could to save things from pieces of furniture to important documents. A line of bucket was formed from the nearest drain to the basement to drain the water faster. When a little sunshine peeped through the heavy clouds, we were realized that the storm was over – or so we thought.

Heavy rains came again but this time it was scary. The rain was pouring hard as if there was a flock of birds flapping their wings. The sound was deafening. The water rose faster, flooding our garage in a couple of minutes. We decided to evacuate the house when the water reached our foyer and seek refuge from my parent’s house located at a much higher place. I emailed everybody I know if they were affected by flooding and got instant messages that some of them are trapped on their rooftops and others trapped in their cars. Never had Manila been hit by such a devastation, people were unprepared for this degree of calamity. and became the hotline for help and rescue in Manila. People sending out shout outs asking for help or telling people they are okay. These sites also became the channels for asking donations after the storm subsided. According to news reports, 80% of Manila was under (and some areas after two weeks from the storm are still flooded) flood water after the typhoon left. The President declared Manila and neighboring provinces in a state of calamity and rescue efforts were done as soon as the flood waters were still. Private corporations pitched in to help by giving out immediate relief effort such as food and clothing. The Army was deployed for rescue especially to hard hit areas such as Marikina, Cainta and Pasig. People from these areas sought shelter at public schools. Seeing them first hand was really heart breaking and grateful that we weren’t hit that hard. People lost loved ones and properties during this calamity. Babies were crying for food, old people were given immediate medicine due to some of them were soaked in water for hours. Most of them didn’t have time to save any of their property, all they have for now is the clothes on their back.

Because of the Internet, young Filipinos were the frontrunners in the relief efforts. Every Filipino I know has a cell phone and has at least the basic knowledge how the internet works. They gave time to volunteer and pooled money to buy food and other necessities for the affected families. Techie savvy people set up a Google document of a list where to donate money and drop off points for in kind donations. People where blogging about what damage they saw in their area and asking more people to help out. Filipinos leaving overseas also made donations in cash and in kind. This is what makes me proud to be Pinoy everybody helps out everybody in times of crisis. It doesn’t matter in what economic class you are, whenever you need help on something they won’t hesitate and won’t ask anything in return. They would even put a smile on their faces even if they are suffering.

This calamity brought a nation together, helping out one another without any expectation of any pay. Now that rehabilitation of the areas have started, I hope and pray that the spirit of reaching out and helping will continue until most of the affected families have settled.

If you would like to donate money to help in the area, Samaritan’s Purse is helping there:

Thank you,
Samuel Carrara

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Where Can I Buy It?

The 3rd ingredient of the Marketing Mix is PLACE. Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store, as well as virtual stores on the Internet. It is also the mechanism through which goods and/or services are moved from the manufacturer/service provider to the user or consumer.

There many factors that a manufacturer has to decide of what strategies it will use in placing its products. Will it use direct or indirect channels? Single or multiple channels? What type of intermediary will it use? How many intermediaries at each level to use? Which companies to use as intermediaries to avoid intrachannel conflict?

Marketing Mix- Place

Marketing Mix- Place

Aside from the strategies to be used, the manufacturer will also have to consider some factors in choosing a distributor (intermediary). Such as the knowledge of the distributor of the target consumer and segment, the compatibility of the manufacturer and the distributor in terms of policies, strategies and image, the track record of the distributor and training and support the distributor will require.

There are many types of intermediaries such as wholesalers, agents, retailers, the Internet, overseas distributors, direct marketing (from manufacturer to user without an intermediary), and many others.  The wholesalers are the ones who break down ‘bulk’ into smaller packages for resale by a retailer. They buy from producers and resell to retailers. They take ownership to goods and provide storage facilities. The wholesaler will also often take on some of the marketing responsibilities.

On the other hand, the retailer has a much stronger personal relationship with the consumer. The retailer will hold several other brands and products and will often offer credit to the consumer. The retailer will also give the final selling price to the product.

Agents are another distribution channel. An agent will typically secure an order for a producer and will take a commission. They do not tend to take title to the goods. This means that capital is not tied up in goods. Agents can be very expensive to train. They are difficult to keep control of due to the physical distances involved, and can be difficult to motivate.

The Internet has a geographically diverse market. The main benefit of the Internet is that niche products reach a wider audience. Using e-Commerce technology provides easy payment and shopping. In today’s market, there is a paradigm shift in commerce and consumption which benefits distribution via the internet.

Determine the Place Where They Can Buy It,
Samuel Carrara

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How Much Is It?

Now that you have a product to sell, the next problem is what price are you going to sell it for? There are many factors to consider when deciding on a price for a product but the most important factor is the willingness of the customer to buy the product for a certain amount.

Although competing on price is as old as mankind, the consumer is often still sensitive for price discounts and special offers. Price has also an irrational side; something that is expensive must be good. Let’s discuss the four main policies or  strategies in putting a price on a product. Another important factor is that you want your customer to choose you based on value, let others race to the bottom in a price war.

Use a high price when there is something unique about your product or service. This strategy is used where you have a substantial competitive advantage. Such high prices are charged for luxuries such as traveling in a private jet or taking a vacation at the Atlantis Resort in the Bahamas.

The price charged for products and services is set artificially low in order to gain market share. Once this is achieved, the price is increased.

This is a no frills low price. The cost of the marketing and manufacturing are kept at a minimum. Supermarkets often have economy brands for soaps, canned goods, etc.

Charge a high price because you have a substantial competitive advantage. However, the advantage is not sustainable. The high price tends to attract new competitors into the market, and the price inevitably falls due to increased supply.  For example, a company introduced an environmentally sustainable plastic. The company will sell the plastic at a high price, for which other companies will eventually produce the plastic. By the time there are other companies producing the plastic, the original producer will decrease its price and others will eventually follow. This is also known as “stair step.”

Marketing Mix- Price

Marketing Mix- Price

Determining a price for a product is not limited on those strategies alone. There are still other policies/strategies that can be used to price a product:

This strategy is used when the marketer wants the consumer to respond on an emotional, rather than rational basis. For example, when a container of cleaning spray is priced at $2.99 rather than $3.00. The penny “lost” is made up quickly with volume as people see the two dollars and miss that it really is three dollars.

Where there is a range of products or services the pricing reflect the benefits of parts of the range. For example a beauty salon, a basic manicure could be $10.00, basic manicure with high-end nail polish $13.00 and basic manicure with hi-end nail polish and 15 minute hand massage $15.00.

Companies will attempt to increase the amount customers spend once they start to buy. Optional extras increase the overall price of the product or service. For example movie houses will charge for optional extras such as guaranteeing a seat of your choice. These “upsells” increase the total profit on the sale drastically as the initial sale already covered your fixed costs.

Where products have complements, companies will charge a premium price where the consumer is captured. For example Gillette will charge a low price for its MACH 3 starter packs and recoup its margin from the sale of the MACH 3 disposable blades (regular and Turbo).

Here sellers combine several products in the same package. This also serves to move old stock. For example a supermarket can bundle a shampoo, conditioner and hair serum (old stock).

Pricing to promote a product is a very common strategy. For example a three pack of chocolate pudding Jell-O for $2.87, and then you will get a cup of their Cinnamon Roll Jell-O Pudding (new product) for free.

Geographical pricing is evident where there are variations in price in different parts of the world. For example strawberries when in season can cost $12.00 in California while when you buy the same strawberries in New York it will cost you $15.00. Cost differences can be attributed to affluence level of the customer, overhead costs, shipping, and may other factors.

This strategy is used where external factors such as recession or increased competition force companies to provide “value” products and services to retain sales. A great example for this strategy is the value meals at McDonald’s. (Though the value meal now seems to eat more money out of your wallet than it used to.)

With so many ways to price your product or service, which would you choose? I suggest to differentiate yourself from your competition.

How Much Is It?
Samuel Carrara

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