IB Business Management
Unit 4 Marketing
Unit 4.5 4P's Promotion
Promotion is one of the 4 Ps in the marketing mix, alongside Product, Price, and Place. Effective promotion is essential for communicating the value of a product or service, building brand awareness, and driving sales. It involves the use of various methods to inform, persuade, and remind potential customers about a business or product. Promotion plays a key role in shaping consumer perceptions and can significantly influence purchasing decisions. Businesses must carefully balance their promotional efforts with their budget and overall marketing objectives to achieve maximum impact.
The main promotional strategies discussed include:
- Above the line (ATL) promotion
- Below the line (BTL) promotion
- Through the line promotion (TTL)
- Promotional mix
- Advertising
- Public relations (PR)
- Sales promotion
- Direct marketing
QUESTION: New Business promotional challenge
Case Study: Promotional Challenges for Three New Startups
Introduction:
Three new businesses are being launched, each in a very different market. The goal is to decide how to best spend their promotional budget of $500,000 in the first year to reach the target audience and drive brand awareness. The challenge is to design a promotional mix for each business using a combination of Above the Line (ATL) and Below the Line (BTL) promotional methods.
Business 1: Eco-Centric (Sustainable Products)
- Business Type: Online store selling eco-friendly home goods (reusable products, biodegradable materials, etc.).
- Target Audience: Environmentally conscious consumers (aged 18-45), mostly urban, tech-savvy, and globally dispersed.
- Main Goal: Build brand loyalty, increase website traffic, and convert visitors into long-term customers.
Business 2: SpeedFit (Premium Fitness Studio)
- Business Type: Boutique fitness center offering high-end personal training, group classes, and wellness coaching.
- Target Audience: Health-conscious professionals in a high-income urban area, aged 25-55.
- Main Goal: Attract clients to sign up for memberships and premium services.
Business 3: LocalGrill (Farm-to-Table Restaurant)
- Business Type: A farm-to-table restaurant in a medium-sized town, offering locally sourced food in a casual dining environment.
- Target Audience: Foodies, local families, and environmentally-conscious diners in the 25-65 age range.
- Main Goal: Increase foot traffic, build local brand awareness, and generate repeat business.
PROMOTIONAL MIX DECISION:
Method | Type (ATL/BTL) | Cost (Per Month) | Description |
TV Commercials | ATL | $50,000 | Reaches a broad audience but high cost. Best for mass-market appeal. |
Radio Advertising | ATL | $10,000 | Target specific regions and demographics with audio ads. Can use specific local channels |
Magazine Ads | ATL | $8,000 | Reaches niche markets, good for lifestyle-oriented businesses. |
Social Media Advertising | ATL | $6,000 | Insta ads, targeted by age, interest, and location. |
Influencer Marketing (Small) | BTL | $4,000 | Working with micro-influencers (10k-50k followers) to promote products. |
Search Engine Ads (Google) | ATL | $5,000 | Sponsored ads for relevant searches, driving traffic to the website. |
Social Media Content Creation | BTL | $2,000 | Building a brand presence with original posts on Instagram, Facebook. |
PR Campaigns | BTL | $7,000 | Organizing public events, press releases, and building media relations. |
Pop-up Events | BTL | $15,000 | Setting up temporary events to engage directly with customers. |
Direct Mail Campaign | BTL | $3,000 | Sending promotional material or samples directly to potential customers. |
Billboard Ads | ATL | $20,000 | High-visibility outdoor ads, especially good for local promotion. |
Email Marketing Campaign | BTL | $1,000 | Sending targeted emails to build customer relationships. |
SEO (Website Optimization) | BTL | $2,500 | Improving website visibility and ranking for search engines. |
Trade Shows | BTL | $12,000 | Attending relevant industry trade shows to build connections. |
Sponsorship (Local Events) | BTL | $5,000 | Associating the business with a local event or cause. |
QUESTIONS / TASK:
1.) Analyze each business and its target audience. What promotional methods would suit each business based on the consumer profile and marketing goals?
2.) Create a promotional mix that utilizes both ATL and BTL methods. You must stay within the $500,000 first-year budget. Guerilla marketing is missing from the table, which you may wish to try. A campaign could cost between $150,000 and $250,000 per year.
3.) Justify your choices. Be prepared to explain how your selected methods will deliver the best return on investment and reach your target market.
4.) Describe whether or not you feel the idea of ‘Through the line promotion’ would be useful to consider in relation to one of the 3 businesses.
Marketing and Promotion into the real
In the vibrant realm of IB Business Management, Unit 4.5 delves into the dynamic world of promotion, a cornerstone of the 4 P’s of marketing. Promotion encompasses the myriad strategies businesses employ to communicate with their target audiences, aiming to inform, persuade, and remind consumers about their products or services. From the bustling streets adorned with billboards to the personalized emails landing in your inbox, promotion is everywhere, shaping our purchasing decisions and brand perceptions.
Above the Line (ATL) Promotion: Casting the Wide Net
ATL promotion refers to mass media channels designed to reach a broad audience. Think television commercials, radio broadcasts, and print advertisements. These methods are ideal for building brand awareness and conveying messages to a large, diverse audience.
Real-World Example:
Consider Coca-Cola’s iconic television commercials. By airing ads during major events and prime-time slots, Coca-Cola reinforces its brand image and ensures its message resonates with millions worldwide. This strategy exemplifies how ATL promotion can saturate the market, making the brand a household name.
Below the Line (BTL) Promotion: The Personal Touch
BTL promotion focuses on direct, targeted communication, fostering a more personal connection with the audience. This includes methods like direct mail, sponsorships, in-store promotions, and experiential marketing.
Real-World Example:
A notable instance is Red Bull’s sponsorship of extreme sports events. By aligning itself with adrenaline-pumping activities, Red Bull directly engages with its target demographic, creating immersive experiences that foster brand loyalty. This hands-on approach allows consumers to associate the brand with excitement and energy, beyond traditional advertising.
Through the Line (TTL) Promotion: The Best of Both Worlds
TTL promotion integrates both ATL and BTL strategies, ensuring a cohesive message across multiple platforms. This approach allows businesses to cast a wide net while still engaging with consumers on a personal level.
Real-World Example:
Nike’s “Just Do It” campaign seamlessly blends ATL and BTL elements. While the slogan features prominently in mass media advertisements, Nike also engages customers through personalized online content, social media interactions, and community events. This holistic strategy ensures consistent messaging while fostering a deeper connection with consumers.
Guerrilla Marketing: Unconventional and Memorable
Guerrilla marketing involves unexpected, creative tactics that generate buzz and leave a lasting impression. These low-cost strategies often rely on imagination and surprise to engage audiences in unconventional ways.
Real-World Example:
IKEA’s “Real Life Series” recreated iconic living rooms from popular TV shows using their furniture, displaying them in public spaces and online. This inventive approach captivated fans, encouraging them to engage with the brand both physically and digitally. Such guerrilla tactics can create viral moments, amplifying brand reach without significant expenditure.
Strategic Allocation of Marketing Budgets
Deciding how to allocate marketing budgets across ATL, BTL, and TTL strategies is crucial. Companies must assess their objectives, target audience, and desired reach. For instance, a new product launch might benefit from ATL’s broad exposure, while a niche service could thrive with BTL’s targeted approach. TTL offers a balanced strategy, ensuring wide reach with personalized engagement.
Further Exploration
For those eager to delve deeper into promotional strategies, consider exploring the following resources:
Understanding the nuances of promotion within the 4 P’s equips IB Business Management students with the tools to craft effective, real-world marketing strategies that resonate with diverse audiences.