Answer to Question #137343 in Economics of Enterprise for Charmaine

Question

The five most important factors to consider when deciding on a promotional mix are
location of customers, the characteristics of the target market, nature of the
product, available budget and the current stage of the product life cycle.

Explain each of these factors as the pertain to the promotional mix by using practical
examples.

Answer 1

Location of customers

If customers are located in one place, personal selling is effective since the promoter can approach the target market easily.

The characteristics of the target market

Experienced buyers of industrial product need personal selling. The experience of buyers, the time available for purchase, influence of friends, retailers etc. are the factors affecting promotion mix.

Nature of the product

Promotion mix will varies with reference to the nature of the product. Consumer goods require mass advertisement. But industrial goods require personal selling, advertising, displays etc. Complex and technical products like computer need personal selling.

Available budget

The cost of the media of advertising and sales promotion tools should also be considered while deciding the promotional mix.

The current stage of the product life cycle

The marketing objectives and strategies are different at each stage of the product in its life cycle. During the introductory stage intensive advertising and personal selling are required for effecting product awareness.

During growth stage advertising should be extended to maximize the market share. During maturity stage persuasive advertising and sales promotion techniques are beneficial. But at the declining stage advertisement and sales promotion are reduced to the minimum.