Question

Explain methods of determining the appropriate level of promotional expenditures.

Identify advertising options for a small business.

Discuss the use of sales promotional tools.

Answer 1

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Explain methods of determining the appropriate level of promotional expenditures.

1. Affordable method

For the budget determination of the promotion many businesses employ the inexpensive approach. The advertising budget can be made available by the client. This approach is a subjective assessment as the long-term promotional criteria of a service are not being given much attention. The role of promotion in the volume of sales is not taken into account. The use of an inexpensive approach also leads to an unpredictable budget, which makes long-term planning hard.

2. Percentage of sales method

Promotional expenditures are calculated by this process as a percentage of revenue. The advantages of the selling rate are.

1. Firstly, promotional costs are directly connected to revenue. The organization can also comfortably afford a certain amount of sales to be marketed.
2. Second, it allows for an overview of the relationship between the cost of advertising and the price per unit of sale. Thirdly, this strategy ensures consistency as rivals often invest on marketing the same proportion of revenue.

3. Competitive-parity method

According to this strategy, the company's promotional expenses are equal to those of the competitors. This approach is consistent with the competitors 'advertising budget strategy. The theory is that the investments of rivals are the prudence of the industry.

Since one company's advertising budget is parallel to the rival, promotional war is avoided. However, there are some drawbacks to this approach. No assurance exists that the marketing budget of rivals represents industry's collective wisdom. The prestige, capital, goals and opportunities of companies differ. The advertising budget for one organization may therefore not be sufficient for the other.

4. Objective and task method

By identifying realistic goals, specifying the tasks to be performed to meet the goals and calculating the costs of executing such tasks, the marketer can assess marketing budgets. This is a fair practice as it sets the advertising budget at the expense necessary to achieve the company's objective.

Identify advertising options for a small business.

Social Media Marketing

Social networking sites are an ideal marketing tool for new companies, as it takes little to no money to advertise yourself. The catch is that you have to spend significant time in creating your own identity and making the material as appealing as possible. Many promotions for your fans, such as bonuses, gifts or flash sales, can be of great benefit. You can create a strong word of mouth if you have a tangible product, even by supplying measuring units for prominent bloggers with several followers.

Traditional Newspaper Ads

You may reach different geographical communities through a conventional form of advertising, daily and weekly advertisements. The ad may be used to assess its effectiveness with a reward, such as a coupon. You will also enable you to meet the target customers by purchasing an ad for your company – for example, a home improvement company ad in your home and garden segment.

Targeted Radio Advertising

An attractive jingle and a quick tag line will increase the output of a radio ad. It is necessary to match the station you choose to your target population. An adult contemporary station is a good bet if you want to meet adults aged 35 to 64.Alternative or urban stations are ideal for young people between 18 and 24 years of age. Neilsen states on publication that radio reaches approximately 59 percent of the daily population, with a confidence rating of 45 percent.

Local or National Television Advertising

Television announcements on local stations that take time and effort to make, but can be especially successful if you offer a high-preis product or service. The cost of a national TV commercial can be less than $63 000, but it can differ considerably depending on the programming and demand. If a TV ad hits clients who do not respond to a radio, you can definitely explain the price difference.

Public Speaking Events

When you have your own experience on the product you are selling, advertising is a great publicity. Tell organizations that might benefit from one of your seminars or lectures about your services. Please carry business cards and promotional materials to the event to invite people to share their services.

Door Hangers and Flyers

The neighborhood is a good place to concentrate on a particular area, to put flies in mailboxes or to hung ads on doorknobs, and ensure your potential clients have seen your stuff. Even if the majority of homeowners reject the details, a handful of customers may be sufficient for a positive return on investment in the marketing campaign.

Event Sponsorship and Appearances

The advertising of your product or service can take several forms through event sponsorship. The event program can provide a certificate, a place at which sample items may be shown or a company logo on the event posters. One choice for events requiring a hand mark for entry is to put the company logo in the place; the participants then remove their logo for a day or two.

Discuss the use of sales promotional tools.

Advertising instruments are strategies or practices that you organize and conduct in order to convince customers to buy your goods or services. You are possibly a buyer without knowledge of this; as a business on the marketing side, it is difficult to find successful resources. Take note of what works and seek a mix. If what is being sold is very general, the products, such as discounts, are typically priced. Find instruments other than cost to convince buyers to purchase if you are a specialist seller.

Sampling

The delivery of a product or service preview would be a tool for the customers to seek to pay for it next time. This is generally successful if you place yourself as different from other firms, where consumers may not be able to pay for anything new if what they purchase are already familiar and satisfactory for them.

Discounts and Sales

Implement pricing strategies as marketing opportunities for consumers such as discounts and promotions. Discounts, including direct-mail deals, can be given in advance. For immediate discounts on customers 'phones which do not require paper-based coupons or advertising, you may also submit quick answer code, called QR or bar codes. Sales for retail firms may be marketed in advance as well as on site. This tactics can promote sales during the offering period; decide customer follow-up methods to make them repeat customers, particularly if your sales are close to those of your competitors

Sweepstakes and Contests

Designing a contest or sweepstakes may help in promoting your product or service, but it may be difficult. Legal aspects are such as not having a buy to participate and could be totally prohibited in some jurisdictions. Subjects can lead to unhappy participants by judging contest entries. By multiple winners, such as first- to fifth-rank winners in age groups, you can minimize potential issues. To have children draw a image of your product or company and then show the entries is a prize example.

Displays

The focus is drawn to goods or services in leading displays in department stores and other business establishments. Place the show in a traffic area, for example near a bathroom or near the check-out booklet or in convenience stores, or in another common product. Another customer marketing device such as a sale may be advertised on the show. Service providers may combine or provide guidance or advice with a continuous-loop video of their services.

Premiums

Sales and labels may be supported through premiums. Examples of premiums are loyalty programmes, giving a certain amount of visits or sales with discounts or something extra, and a bonus on an order. For example, an extra product volume or additional product may be a bonus. An example of a bonus premium is a toy contained inside a cereal box. Consider offering you a discount like a t-shirt or a hat with your company name in order to boost your brand.

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