Nobody on the platform knows Lena's: The Station Road shop opens in September. Most people who pass it have never bought a Lena's loaf. The marketing plan gives the shop three months and $15,000 to change that.
The numbers
- 1,850 people walk past its door every morning between 6.30 and 9.00, on the way to their trains.
- 45% of the 200 people in the bakery's survey recognised the name Lena's.
- 85% recognised Goldcrust.
Telling customers about a product, and giving them a reason to buy it, is promotion. It is the part of the marketing mix that talks. Lena's promotion for Station Road has three jobs to do.
What promotion does
Inform
Tell people something they do not know: a new bakery opens across from the station, from 6.30 every morning.
Persuade
Give them a reason to choose it over the kiosk on the platform: bread baked at 5 a.m. by Priti's team, and coffee with a pastry for $3.
Remind
Keep the name in their heads once they have tried it, so the loaf for tonight is bought on the way home, not somewhere else.
One question sorts every kind of promotion into two families. Does the message go out through the mass media, to everyone who happens to be watching, reading or passing? Or does it go straight to people the business has chosen?
The first family is above-the-line promotion (ATL): paid advertising in the mass media, such as television, radio, newspapers, magazines, cinema, posters and billboards. The business pays a media owner to carry its message to a large audience, and it cannot choose who in that audience sees it.
What it is like (features)
- Paid for: the business buys space or airtime from a media owner
- Uses mass media: television, radio, the press, cinema, posters
- Reaches a large audience at the same moment
- Generally untargeted: buyers and non-buyers see the same advert
- The business controls the message, but it is hard to tell how people react to it
What it is good for
- Making many people aware of a name quickly (brand awareness)
- Launching something new that everyone should hear about
- Looking established: a big poster says a serious business
What it costs
- A large bill, even when the cost per person reached is small
- Money spent on people who will never buy
- Hard to measure: which loaf was sold by the poster?
- One-way: the audience cannot answer back
The poster in the station: Lena's plan spends $6,000 on a poster in the station for three months, $2,000 a month. Each of the 4,200 passengers a day can see it. That is above the line: paid space in a public place, seen by everyone.
Seen by everyone, counted by no one: It is also seen by people who change trains there and will never walk down Station Road, and Lena will never know exactly how many loaves it sold.
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The rest of Lena's plan looks different. None of it goes through the mass media. Each part is aimed at people Lena has chosen, and most are run by the bakery itself.
The rest of the plan
- Marco hands leaflets to commuters on the platform.
- For the first week anyone can taste a slice and a coffee for free.
- Adverts appear on the phones of people within a kilometre of the station, and on nobody else's.
- Regulars get a card that earns them a free loaf.
Below the line: Below-the-line promotion (BTL) does not use the mass media. It is aimed at a chosen group, often directly by the business.
So it is targeted at a specific, even small, audience; it usually costs far less in total than a big mass-media campaign; and it is two-way: customers can reply, taste, ask and complain, which gives the business feedback.
Common kinds of below-the-line promotion
- Sales promotion: free samples and tastings, coupons, discounts, buy-one-get-one-free, competitions.
- Direct marketing: leaflets, direct mail, emails, texts, catalogues.
- Personal selling: a member of staff who talks a customer through a choice.
- Point-of-sale displays, merchandising and packaging: what the customer sees at the moment of buying.
- Public relations and sponsorship: a story in the news, the bakery's name on the town's 10k run.
- Loyalty and referral programmes: rewards for buying again, or for bringing a friend.
- Trade fairs and exhibitions, where a business shows its products to buyers face to face.
- Social media marketing and word of mouth: customers who share what they liked.
| Lena's Station Road plan | Cost | Family | Why |
|---|---|---|---|
| Poster in the station, three months | $6,000 | Above the line | Paid space in a public place; every passenger sees it |
| Leaflets on the platform | $1,500 | Below the line | Handed only to the commuters Lena wants |
| Free-tasting week | $2,000 | Below the line | A sales promotion, run in the shop |
| Online adverts, weeks 2 to 12 | $3,000 | Below the line | Shown only to phones near the station |
| Loyalty cards | $1,000 | Below the line | Rewards people who already buy |
| Kept back for surprises | $1,500 | Neither yet | Not spent |
| Total | $15,000 | Above $6,000 (40%); below $7,500 (50%) | The two families work together |
Notice the online adverts. Shown only to people near the station, they are below the line. The same $3,000 spent on a banner that every visitor to a national news website sees would be above it. The channel matters less than the question: everyone, or chosen people?
The pieces are also meant to work together. The station poster carries one line: 'Free tasting all week at Lena's, Station Road.' The poster reaches everyone; the tasting and the loyalty card turn the people who respond into regulars. A campaign that joins the two families on purpose is through-the-line promotion (TTL), also called integrated or 360-degree marketing. Most real campaigns, Lena's included, are through the line.
Sorting mistake: below the line is not free: The tasting week costs $2,000. The line divides mass media from chosen people, not paid from unpaid.
Sorting mistake: one family counts once: A free sample and a coupon are both sales promotion. Asked for two types of below-the-line promotion, give two different families, such as a sales promotion and direct mail. A newspaper advert is above the line.
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Week six: a rival on the platform: In the sixth week Crumbline opens a coffee kiosk inside the station. The commuters Lena won in September could drift away.
Crumbline
- Coffee and a pastry for $3.50
- On the platform
Lena's
- Morning deal for $3
- Across the road
The loyalty budget: The $1,000 for loyalty cards in her plan is about to earn its place.
A customer loyalty programme rewards customers for buying again and again. It is below-the-line promotion: aimed only at people who already buy, and run by the business itself.
Lena's version lives on the bakery's phone app. Every loaf or coffee earns a stamp, and the tenth is free.
What a loyalty programme is made of (its features)
Members collect points
Every purchase adds points or stamps to the member's account: one stamp per loaf or coffee.
Members receive rewards
Free items, discounts and members-only offers: the tenth loaf free, a birthday pastry.
Offers are personalised
Offers are sent to each member by email or in the app, chosen to fit what that person buys.
Data on every purchase
The app records who bought what, when and in which shop.
Several ways in
Members can use the app, the website or a card at the till.
What it does for the business (benefits)
- Keeps customers coming back (retention), even when a rival opens nearby
- Builds a relationship: the business knows its regulars and what they like
- The purchase data show who buys what, so offers can be targeted at repeat buying
- Encourages customers to buy more, to reach the next reward
- Can win customers from rivals that have no programme
What it costs the business (drawbacks)
- Money: the free loaves, the app, the staff time to read the data
- Everyone has one, so a programme with the usual rewards may hardly stand out
- A badly run programme, with lost stamps or a broken app, can annoy customers more than none at all
- The same money could have gone on another way to find or keep customers (opportunity cost)
Feature: what the programme is
- 'Members collect points'
Benefit: what the business gains
- 'Customers come back more often'
Feature, benefit, or just the word loyalty?: Asked for one, do not give the other. 'It increases customer loyalty' explains nothing, because it repeats the programme's name. Say what loyal customers do: come back, buy more, stay when Crumbline opens.
Whose benefit?: A free coffee is the customer's benefit; the business's benefit is the visit that comes with it.
By the end of November, 250 commuters have the card. The app shows which of them have stopped coming since Crumbline's kiosk opened, so Lena can send those people an offer and win them back. That is two benefits in one: a customer kept, found through the data.
A video from 5 a.m.: Lena's Bakery posts a short video on its social media page: Priti's team lifting the first loaves out of the oven at 5 a.m.
The one line underneath: 'On Station Road from 6.30. First coffee free with the Lena's app.'
By lunchtime
- The page has 2,400 followers.
- The video has been shared 300 times.
- 40 people have asked in the comments whether the new shop sells rye.
Promoting a business on social media platforms is social media marketing. It takes four forms: the business's own posts, which are free to publish; paid adverts shown only to chosen groups, by age, place or interests; influencers, people with large followings who are paid to recommend a product; and customers sharing with their friends, which is word of mouth online.
Because it can be aimed at chosen people and they can answer back, it is usually counted as below-the-line promotion.
Why a business uses it (advantages)
- Low cost compared with television or a big poster campaign
- Reaches many people fast, and paid posts can be aimed by age, place and interests
- Two-way: comments give instant feedback, like the 40 questions about rye
- Keeps the brand in front of followers every day, which builds loyalty
- Easy to measure: views, clicks, and app codes used in the shop
- Influencers can sway younger buyers who ignore other adverts
What can go wrong (disadvantages)
- Complaints are public and spread fast: one photo of a burnt loaf can reach thousands
- An influencer who behaves badly can damage the brand linked to them
- It can miss customers who rarely use social media, often older ones
- It needs a steady flow of new posts, and the time and skills to make them
- Feeds are crowded, and followers or likes are not the same as sales
It fits when
- The target market spends time on social media, like commuters with phones in their hands
- The budget is small and needs to be spent where it can be measured
- The product looks good on a screen: bread from the oven at 5 a.m.
- Someone has the time and skill to post and to answer comments
Think twice when
- The buyers are few and are won face to face, like the cafés and hotels buying wholesale
- Customers rarely use social media
- Nobody can reply quickly when a complaint appears
- An influencer's audience or behaviour does not fit the brand
Weigh it for this business: The judgement always comes from the business: who it wants to reach, what it can spend, and what it can manage.
Station Road opening: a strong choice
- The target market is commuters.
- The budget is small.
- A baking video is exactly what gets shared.
Cafés and hotels: it does little
- They buy $240,000 of bread a year.
- They are won by a visit and a tasting, which is personal selling.
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How this comes up: Promotion comes up in short questions and in questions on a case.
Short questions
- State two methods of promotion other than social media.
- State two types of below-the-line promotion, or two features of above-the-line promotion.
- Describe one feature of below-the-line promotion.
- Loyalty programmes appear as two features, two benefits, or one benefit explained.
On a case
- Explain one reason why the business uses social media to advertise, for two marks.
- Explain one advantage and one disadvantage of using social media influencers, or of starting a loyalty programme, for four.
The four-mark pattern
- Name the advantage. Influencers are a low-cost way to reach a large, young audience that trusts them.
- Show it in the case. Mira Lund's video costs $400, a fifteenth of the station poster, and reaches 40,000 followers aged mostly 18 to 30.
- Name the disadvantage. The business cannot control what the influencer does, and bad behaviour damages the brand linked to them.
- Show it in the case. Another bakery ended its deal with Mira after she mocked a customer; Lena's new shop would carry that risk from its first week.
Trap: social media in general, or influencers?: 'Social media is cheap' is about any post. The question is about paying a person to recommend the shop: say what that person brings and what that person risks.
Trap: no case, no second mark: 'It can damage the brand' is one mark. 'Mira mocked a customer before, and Lena's new shop would share the blame' is two. Every half needs a name or a number from the case.
Explain one advantage and one disadvantage for Lena's Bakery of using a social media influencer to promote the Station Road shop.
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See the answer broken into clear points, with guidance on how each point earns marks.