Wednesday, January 23, 2008

Consumer Promotions : Are they really relevant?

Though we have been talking about increasing accountability of marketing expenditure and working on metrics to show the return on marketing investment not much progress has actually been made. We have not moved much further from the era when people use to claim that half of the ad expenditure is waste but no one knows which half. I thought of relating the issues of results to expenditure on consumer promotions as quite a substantial part of money is spent on consumer promotions.

I would like to share examples of a couple of consumer promotions schemes which I found to be either inappropriate or inadequate. I am regular Bru Coffee drinker, and I buy 50gms every month. Last moth they were giving a free air-tight container was with 50 gms pack. Same day evening I found that along with the double pack of Britannia Biscuits they were giving a plastic bowl free (which is a weakness in Indian consumers which has been exploited by marketers for a long time), free is something which is hard to resist so obviously I took the free gifts from both the companies. But then later on I thought what was the benefit of running the scheme, I buy the same brand and same quantity, so why did the company give me free gifts,

Consumer promotions should either encourage the regular buyer to buy more quantities or attract new ones. Schemes where in free buckets were given with 5 Kg packs of detergents made sense. In these schemes at least they could lock-in a customer for a longer time, hoping that he will get used to the brand and when the scheme is withdrawn he might still continue with the brand (though the advantage is lost when all other player come up with similar schemes).

Maybe best consumer schemes would one which would force the consumers to switch brands, so that you are able to increase market share based on consumer promotions. There are examples of these kind also, but far and between and gets copied very fast. One which I can remember is the "Britannia Khao World Cup Jao Campaign"...

But I guess such schemes need a lot of original thinking and effort so the easy way out is the examples which I have mentioned earlier....and by the way this time I got a free coffee mug with the 50gms Bru.....



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