Marketing Promotion:
Marketing promotion is truly the most misunderstood word in use today on the Internet. Let me see if I can clarify this issue just a bit. In marketing promotion 101 at your local university. Marketing promotion is actually the process of Product, Place, Price and Marketing Promotion.
PRODUCT
No business can exist without a product or service to sell:
In a nutshell, entrepreneurs are the people who believe in a product, service or idea, so much that they are willing to invest their lives into the development of their dream.
Historically, every major corporation in the world was started by an entrepreneur with a dream and the drive to make it a reality.
However, there comes a time in the life of every corporation when those who fear the gambling nature of their founder. Squash the entrepreneurial drive that made the company a viable concern in the first place.
The entrepreneur will either submit to the careful nature of the stockholders.
Or he will be forced to leave the company he created. The only entrepreneurs who withstand the pressure to move more carefully are those who have maintained majority control over their companies.
PLACE
In the offline promotion world, place is defined by location. On the Internet, place is defined by domain name and the web hosting service chosen. Both online and offline, place can make or break a company without respect to the quality and value of the product, service or idea.
PRICE
Selecting a price is determined first on a basis of whether the company wants to be seen as a discount or a value company. Take for example Wal-Mart and Staples.
Wal-Mart is the lead discounter in the marketplace. Staples on the other hand is the specialist in office supplies. Both sell a significant number of office supplies despite the fact that the lowest price can usually be found at Wal-Mart.
As a value dealer, Staples can afford to charge more for their products than Wal-Mart.
So the question for you is whether you want to position your company as a discount or value company. Testing has shown that products and services can be sold at any number of prices and still reach a significant number of people.
The challenge of selecting the best price for your product or service will require a certain amount of testing.
UNDERSTANDING THE PRICING EQUATION
Let’s assume we are selling a product. Let us also assume that we know that the product can be sold for $10 or $50. Let us also assume that if the price dips below $10 or rises above $50, then the product sales fall off significantly.
Our challenge is to determine the best rate at which to sell our product.
Testing has shown us that we can sell 1000 items a week at $10. Testing has also shown that we can sell 500 items per week at $50. And testing has shown that we can sell 650 items per week at $45. At $10, our projected weekly earnings are $10,000.
When we sell the product at $50, we know that we can earn $25,000 per week. Most importantly, we know that we can earn $29,250 when our product is priced at $45.
With the imaginary testing we have done on our imaginary product, we can easily see that selling our product at $45 per item will earn us more money over the long haul. Thus, when we make the decision for a national roll out of our product, then we will price our product at $45.
Of course, this is a very simplistic analysis of the point I am trying to make. Though simple, I believe this analogy will help you understand the methods of developing a product’s prices.
MARKETING PROMOTION
Marketing promotion, on the other hand, is the process of notifying the consumers for your product or service of your availability to serve them. Methods of promotion vary distinctly and should be arranged to meet very specific goals.
As with product, place and price, marketing promotion should not be left to chance. You should test every ad, every media, and every price point to determine the best bang for your promotional dollars.
HEADS UP!
If you are an online promoter or marketer, please factor in the most important element concerning the cost of your marketing promotion. What element is that? Your time! Value your time at a certain dollar amount, and figure in your time into the cost of your promotional accounting.
I say this because too many online promoters lose sight of this concept and spend 20 hours to generate one sale while using free advertising. Even if you rate your time at the federal minimum wage, then you will have invested $105 of your time for one sale that might only net you a gross sale of $45!
ARE YOU TRULY A MARKETER OR ARE YOU JUST A PROMOTER?
Most people who run a business on the Internet call themselves marketers. Yet, most of these same people are really just promoters wrapped in the label of a marketer. True marketers do not promote without a lot of advance work.
They spend time planning, testing and measuring their actions and results to get the most out of every dollar spent and earned.
Entrepreneurs finesse the art of marketing promotion as they build their company into a major enterprise. If you are a promoter who does not keep an eye on the total marketing equation, then you are bound to fail.
If you do call yourself a marketer, then do what a professional marketer does. Make sure that every dollar spent is spent well. Make sure that every dollar earned is put to good use. Market well so that when the people of the next generation look at your life. They will see a fine example of a successful entrepreneur that they will strive to emulate.
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