UNIT 4
Designing a customer-driven marketing strategy: Place and promotion
4.1 Retailing and Wholesaling
Many companies venture into retailing and wholesaling business in Malaysia. These companies play important roles in the product distribution system and the value chain process. Therefore, a marketer should be able to capitalise on their strength to improve the efficiency of their delivery systems. Some manufacturers give the overall distribution responsibilities to the retailers and wholesalers. They will concentrate on their core task which is manufacturing. The retailing and wholesaling business requires good coordination in stock and warehouse management to reduce costs and increase efficiency.
In Malaysia, retailers operate in a turbulent and fast-changing environment that offers threats as well as opportunities. New types of retailing systems continue to emerge to meet new situations and consumer needs. In addition to the traditional forms of retailing, consumers now have an array of non-traditional alternatives to choose from including mail order, television, phone and online shopping. The last major trend that seems to be of interest to business strategists and marketers is the rise of huge mass merchandisers and specialty superstores. These forms will have a pronounced effect on the way retailing is conducted in the future.
Wholesaling, unlike retailing, deals with the sale of goods and services that will be resold by and/or used by the business customer. One way to study and understand wholesaling is to examine the functions that are performed by the wholesalers. These functions include selling and promoting, buying and assortment building, bulk-breaking, warehousing, transportation, financing, risk bearing, supplying market information, performing management services and providing advice for customers. Wholesalers can be divided into numerous groups. The three primary types of wholesalers are merchant wholesalers, agents, brokers and manufacturers and retailer sales branches and offices. Each of these general types of wholesalers (and their numerous subdivisions) is explained in detail. This section also explains how wholesalers use target market and positioning information and make marketing mix decisions in a rapidly changing domestic and global marketing environment.
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4.2 Integrated Marketing Communications Strategy
Companies use various ways to communicate with the customers. Modern information technology has supported the communication process significantly. Marketers must make sure that effective
communication is developed between the company and the customers and this communication process must be maintained to ensure long-term profitable customer relationships. Promotion provides the basic communication function to marketers. A promotion mix consists of advertising, sales promotion, public relations, personal selling and direct marketing to support the company’s promotion activities and achieve the company’s objectives.
Integrated marketing communications involve the effort to convey well-coordinated and consistent messages to the target audience. Contradicting messages sent via different media often confuse the customers and might not attract the target audience effectively. In this section, you have also identified the steps involved in the
communication process. The steps are:
1. Identify the target audience (who does the marketer wish to communicate with).
2. Determine the objectives of the communication.
3. Design a message.
4. Choose a media.
5. Select the message source.
6. Collect feedback.
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4.3 Advertising, Sales Promotion and Public Relations
In this section, we have covered the topics on advertisements, sales promotions and public relations. Advertisement is an important marketing tool which is used by marketers to inform, remind and persuade customers to buy the products. Kotler and Armstrong (2006) describe advertising as any paid form of non-personal presentation and the promotion of ideas, goods and services by an identified sponsor. There are four important decisions that need to be made in the process of advertisements. The four decisions include setting objectives; budget decisions; advertising strategy and evaluating advertisement campaigns.
A sales promotion is a process of providing short-term incentives to encourage target customers to purchase immediately. We have covered various sales promotion tools which can be used to effectively increase the sales in the short term. Sales promotion often provides customers the reason to purchase. They also provide a short-term competitive advantage over the competitors. Nowadays, companies use sales promotions in more creative ways. Sales promotion may cause retaliation from the competitors and the marketers need to have a well-designed contingency plan to deal with competitors’ counter actions. In this section, we have also discussed the major sales promotion tools such as samples, coupons, cash rebates, price packs, premiums, advertising specialties, patronage rewards, pointof- purchase incentives, contests, sweepstakes and games.
PR activities are essential to establish long-term positive relationships with various stakeholders. Public relations activities will boost a company’s image in general. In this section, we have covered a variety of public relations tools which can be used to support the marketing activities. PR activities help the company to develop and maintain good rapport with the local and international stakeholders. Several types of PR tools have been discussed in this section. The PR tools may consist of news, speeches, special events, buzz marketing, printed materials, audio visual, corporate identity materials, public service activities and websites. The company may also participate in many social programmes to improve the image of the company.
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4.4 Personal Selling and Direct Marketing
In this section, we have covered in detail the personal selling approach in marketing. You should by now have understood the 7 steps in personal selling and how you could successfully close sales efficiently. You have also learnt many useful tips in achieving your personal selling objectives. The process of personal selling includes:
1. Prospecting and qualifying.
2. Preapproach.
3. Approach.
4. Presentation and demonstration.
5. Handling objections.
6. Closing sales.
7. Making follow-ups.
This process guides a salesperson to become a problem-solver rather than a hard-sell salesperson.
In this section, you would have realised the importance of using the relationship-marketing approach rather than the transactionalbased marketing approach. Relationship-marketing ensures the establishment of long-term relationships with customers which eventually brings about increased customer loyalty.
Many companies incorporate direct marketing techniques in their overall marketing strategy. Direct marketing ensures customer loyalty through building stronger positive customer relationships with the brand and company. Direct marketing also enables the customers to receive personalised attention from the marketers. On the other hand, the marketer can forward the feedback received from the customers to the company’s customer care department for follow-up action.
Direct marketing uses catalogues, direct mails, telemarketing, emails, sms messages and others as communication tools. The use of these communication tools may generate customers’ databases. You must also know how to manage and use the databases created by your direct-marketing activities to close sales. Many companies use technologies extensively to create user-friendly database systems to reach out to the customers effectively.
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