Sales Promotion and PR Portfolio - Report Example

Sales promotion/ PR Portfolio Contents Contents 2 Please make this sure the whole report is in UK English 3 Introduction 3 UK High Street Fashion Market 4 Media in the retail industry 5 Segmentation, Targeting & Positioning this should be about how the industry might target segment and position the adverts to consumers (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). 6 Segmentation of retail and one specific example (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). 6 Targeting as above more about the industry overall targeting (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). 7 Positioning 7 Promotion 8 Sales Promotion Strategy: H&M a strategy is not needed and examples don’t need to be specific to H&M or M&S it should briefly describe the promotion e.g. price and others and why they are good or not (Sales promotional strategies are important and have been discussed through examples only) 8 Sales Promotion Strategy: Mark and Spencer, as above no strategy needed specifically to M&S (Sales promotional strategies are important and have been discussed through examples only) 9 Public Relations Strategy: H&M again not specifically to the store by the industry in general (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) 10 Public Relations Strategy: M & S as above they could be linked rather than 2 as it is genral also some theory could be used (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) 11 Public Relations: the common Factor perhaps for the industry and not just the above 2 stores (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) 12 Conclusion and Critical Recommendations 13 References 14 Tench, R and Yeomans, L. 2006. Exploring Public Relations, Prentice Hall: England 14 Bibliography 14 Appendices 16 Please make this sure the whole report is in UK English Introduction The role marketing and communication is of utmost importance for any organisation. Sales promotion and PR are two of the most important elements of the promotional mix along with advertisement, personal selling and direct marketing. Sales promotion refers to the techniques used by companies to increase sales within a short period of time. On the other hand Public relations or PR is managing the flow of information between organisations and public. PR is all about creating and managing reputation (Kazmi, 2010, p. 79). It is used to gain trust and understanding between organisations and various public. The study has been conducted in lieu to determine the different sales promotional and PR activities conducted by some of the top notch high street fashion retail outlets in the United Kingdom. High street fashion refers to mass-market retail style. In the midst of high competition and economic unrest the UK retail market has seen a change in consumer behaviour, as consumers have tried to control the expenses. (The purchase behavior of the consumers tends to have major impact on the promotional activities) Therefore, the role of sales promotional and PR has become critical in motivating, retaining and building relationship with the consumers. Strategic and marketing tools such as STP concept, marketing mix, AIDA model has been used during the study. In order to analyse the sales promotion and public relations strategy of high street fashion retailers Mark and Spencer and Hennes & Mauritz (H & M), two of the top most high street retailers have been chosen (Dey, 2009, p. 133). Please don’t use M&S too specifically perhaps warehouse or TopShop more popular. (M&S Win Most Sustainable High-Street Retailer: http://bit.ly/Zh7t9L ) UK High Street Fashion Market UK retailers had to face some tough times as the economy continued to suffer due to the recession and global downturns. The retail growth rate for the 2012 was 1.2% - third lowest growth rate in the last 30 years (Appendix-1). Perhaps add this to the introduction (According to the Instruction: “A short description of the industry or segment that you have chosen with a brief discussion of the reasons why you chose it. You should ensure that your industry is clearly defined and you could perhaps give some brief statistics here showing main industry trends, size and so on.”) Late Easter, Bank holidays and diamond jubilee improved customer sentiment things as such are used with promotion they could be related to the adverts. Add to that Euro cup, Olympics also influenced the purchasing behaviour of the consumers. This influenced a seasonal increase in the sales. The 21st century consumer lives a much more complex life. The consumers shop in a way that reflects the complexity. Not needed. (According to the instruction: over the course of the assignment you may encounter occasions/events such as ‘New Year’s Resolutions’ (January), Valentine’s Day (February), Red Nose Day (March) and the build up to Easter (April); All these are ‘hooks’ that companies often use when it comes to promotions and PR activities) The main factor influencing the purchase behaviour is convenience. There lies various kinds of shopping opportunities online shopping, mobile shopping, TV shopping and of course the conventional store shopping. The customers go out less frequently and prefer to order products (Appendix -2) Media in the retail industry Most of the major high street retail market companies in the UK use all the media channels. This includes Television, Radio (FM), Hoardings/print adverts such as magazines, and Bill boards. However the most of the companies are also now putting special emphasis on the digital media. The digital medium also allows the company to reach the customers directly and help the marketers to create engagement. (This is essential as media used for communication is being discussed. Use of digital media in promotional activities is an emerging trend). The use of digital media includes banner ads, mobile ads and presence in social media. The rise of smart and I phones has provided a new angle all together. Though only 6% of consumers with smart phones use the mobile purchase, the consumers are still becoming key influencers in the way the consumer research for products, check prices, discounts. Even the queen is rumoured to have an iPhone. Such complexities are forcing the retailers to think about the propositions and offerings to the consumers. (Appendix -3) Segmentation, Targeting & Positioning this should be about how the industry might target segment and position the adverts to consumers (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). Segmentation of retail and one specific example (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). H &M uses demographic segmentation on the basis of gender as the company provides apparel for men, women and kids. However, the offerings different market segments have large amount of variety. Thus the company is able to create a niche market segment. Most of the products are targeted towards the people belonging to middle high income group. Based on the nature of the products produced the average group targeted ranges from 18-35. Segmentation strategy of Marks & Spencer is pretty much similar to H & M. The company is able to achieve niche through the variety of offerings. However, the product line of M&S is a bit thicker as compared to H & M as the company has beauty related products (Chattopadhyay, 2009, p. 167). ....... Targeting as above more about the industry overall targeting (Industries do not go for segmentation, Companies within the Industry adopt STP strategy). Company uses differentiated marketing strategy by offering different products to target different segments and different groups. Just like H&M, M&S also uses differentiated marketing by providing different marketing mix for different marketing segments. Positioning Hennes & Mauritz Brand values are latest fashion trends, affordable price, good quality and innovations. The company positions itself as a high-fashion retailer targeting trendy people. H&M positioning sates that it is easy to follow fashion trends without big investments. Marks & Spencer has positioned the outfits with high respite and supreme quality. Moreover, the organisation (not UK English) has the product range for the people of higher income level as well as people of medium income level. Both H&M and Mark and Spencer are well established. Just like most of the high street fashion retailer the companies have mainly targeted the youth of UK having middle to high income group. Both the companies offer product of supreme quality. However, based on the above market analysis section it seems that it is about that the companies should to target the 35+ market segment also. This can be achieved by increasing the depth of the product line, i.e. adding some new products in the same market line. Not really relevant or about adverts of the industry. (Companies adopt promotional techniques based on the STP strategy. Besides as per the instruction “Segmentation, targeting and positioning – what do the activities you have chosen tell you about the STP strategies which are most commonly used in your industry? Are there any significant differences between the strategies of the different companies which you have chosen? How effectively do you think that the activities you have chosen target particular segments? How are the different brands positioned relative to each other? In this section you should also identify the main segments in your industry using the four segmentation criteria. You do not have to do this for every example or competitor – just identify the main segments that you think companies are trying to reach”). Promotion Sales promotion is a way to increase sales in a relatively short period of time. On the other hand a Public relations (PR) is all about developing relationship and trust between the company and the stakeholders. (Tench and Yeomans, 2006, p. 105) Sales Promotion Strategy: H&M a strategy is not needed and examples don’t need to be specific to H&M or M&S it should briefly describe the promotion e.g. price and others and why they are good or not (Sales promotional strategies are important and have been discussed through examples only) Sales promotion at H & M stores is quite a frequent activity. Mostly, at the season H&M reduces the price by 50%. Add to that each and every store of the company contains products of £20, £15, £10, £5. However, H&M does not provide rebates, coupons or online Sales promotions; this helps the company to increase sales in a short span of time. (Appendix-4) But the company provides discount cards to the consumers. Not it the UK it does not. (H & M provides discount cards and vouchers in UK: http://bit.ly/jzNR68.). Such cards contain 5£ off on purchase of any products that is made with friends and family. Advantages of having such cards are that one has an account for the whole family. If the whole family is frequent H&M visitors, then the family members can also get separate cards and other bigger deals. Mostly the company looks to induce frequent purchases and customer loyalty through sales promotions. The company also uses sales promotional strategy during events. As mentioned above in the report events play a key role in stimulating the purchase behaviour of the consumers. Therefore such promotional activities are of great significance (Appendix-5). The company also uses celebrities like David Beckham to promote the products (Appendix-6). A part from this the company is also using Beyonce to promote the products. Just like Beckham Beyonce is a style icon and have a lot of followers round the globe. This will help the company to generate demand which may lead to probable increase in sales. Sales Promotion Strategy: Mark and Spencer, as above no strategy needed specifically to M&S (Sales promotional strategies are important and have been discussed through examples only) Sales promotion is an integral part of marketing strategy of Mark and Spencer. The company main goes for price discounts and price pack deals. In case of Price discounts the company reduces the price of the products say by 20 or 50%. In case of price pack deals the company offers certain percentage more of product for the same price (Appendix-7). Mark and Spencer have a more defined sales promotion strategy as compared to H&M. M&S offer sales promotional offers on the internet. Also the company provides discount coupons (do they? And if so what country not in UK), and vouchers. (Yes. M&S very much provides vouchers: http://www.marksandspencer.com/Marks-and-Spencer-Celebrate-Gift/dp/B002KFIVOA) (De, 2011, p. 167) (Appendix-8) Just like H&M Mark and Spencer also provides sales promotional offers during the Christmas season. So does every other store perhaps mention the shops that offer on Boxing Day such as NEXT as they are known to compete with each-other M&S (H&M and M&S are top high street retailers and study includes a comparative analysis of both of them) But instead of going for price deals the company looks to provide value packs i.e. getting more products at a lesser price combined (Appendix-9). Public Relations Strategy: H&M again not specifically to the store by the industry in general (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) H&M is treated as one of the most loyal brands in the country. The company maintains updated customer data base to reach the customers directly using the digital medium. The company has special guidelines for using children in the ads. Kids taking part in the campaigns actually do it on the free will. The authorities make sure that the children are absolutely safe and sound (Appendix-10). Not really relevant (Ethical Approach helps the company in building relationships, hence it is very much relevant) (Appendix-11). H&M also follows cause-related PR campaigns. In the year 2008 Designers against AIDS (DAA) and H&M launched called Fashion against AIDS (FAA). The objective was to increase awareness of HIV/AIDS among the youth and 25 percent of sales were donated to HIV AIDS prevention projects (Appendix-12). Could please mention how this is good and what it does? (The campaign was a great initiative; the campaign itself is self exploratory) Public Relations Strategy: M & S as above they could be linked rather than 2 as it is genral also some theory could be used (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) Just like H&M; M & S is also treated as one of the most trusted brand in the country. The key to such success have the effective public relations strategy of the company goes beyond advertising. In the year 2004 the company launched a flagship program called Marks and Start to provide work for students, school children, young unemployed, and 2,500 people with disabilities. (Appendix 13). The company also provides consumer loyalty cards as a way to retain customers (Appendix14). Why are these good or bad? What other tore does them an how do they relate to theory or PR. (The campaign was a great initiative; the campaign itself is self exploratory. Such campaigns enhance the brand image and help the company to build relationship with the customer.) Public Relations: the common Factor perhaps for the industry and not just the above 2 stores (Companies belonging to an industry adopts different PR strategies, PR strategy can’t be same for all the companies) Both the companies have indulged into a common corporate social responsible activity to enhance the reputation. One of such initiatives was the Detox commitment. In the year 2011, Greenpeace started the Detox campaign. (Appnedix-15) how do these relate to theory and what others do them? Why is this good for them to do? The main objective of the campaign was to nullify the toxic chemicals released in the water. Some of the major companies belonging to the apparel industry were the target because they are purchasing the materials that are creating the toxins. (Brown, 2009, p. 154) not needed (Such extra ordinary campaigns have specific objectives and hence they need to mentioned). Fifteen global leaders belonging to the fashion industry committed to the Detox movement it included both H&M and Marks and Spencer. The other was Nike, Adidas, C&A, Mark and Spencer, Mango, Esprit, Levi’s. Victoria’s secret, G-star, Valentino, etc (Appendix-16).perhaps move up and link say why they did this? (It is a part of the Detox commitment and hence would be included in this section only) Conclusion and Critical Recommendations UK along with rest of the EU countries has gone through an economic turmoil. Due to the economic unrest the consumers seemed more intent on saving rather than spending. Hence in order to motivate the customers sales promotional offers will have a major role to play. On the other hand PR would be used to maintain long term relationship with customers. However, that is not all. Due to the complex life style and the rise of digital platform the consumers prefer to stay home and shop from home. Therefore the companies need to have strong web presence. It must also be made sure that the promotional offers are present over the internet. For instance both M&S and H&M are providing sales promotional offers. H&M and M&S sales promotional offers are present on the internet. While positioning the sales promotional offers companies should ensure that the price–quality approach is adopted. So that the consumers can understand that the reduced in price is not equivalent to drop in quality. The marketers should also look to target other age groups a part form the youth keeping the demographic and economic conditions in mind. All in all the communication strategy of the company should follow the AIDA model. In the initial phase of the product life cycle the brand awareness of the product is going to be low. Hence advertisement in different medium would help the product to gain awareness. (Frank, 1964, p. 35). Once Awareness is created, PR campaigns in the form of different user engagement techniques would help the company to generate interest among the consumers. Interest would lead to demand. Once demand is generated the company should cash in the product USP to motivate the buyers to make the final purchase decision (Appendix-17). References Brown, L. 2009. Marketing and Distribution Research. Ronald Press Company: US. Frank, N. 1964. Market analysis: a handbook of current data sources. Scarecrow Press: US. Nargundkar, R. 2010. Marketing Research,Tata McGraw Hills Private Limited : India. Kothari. C. 2007. Research Methodology. New International: India. Kazmi. S. 2010. Advertising and Sales Promotion. Excel Books: India. De, B. 2011. Strategic Management. Matrix Educare: India. Chattopadhyay, A. 2009. Marketing Management. Matrix Educare Pvt. Ltd: India. Dey, A. 2009. Marketing Research. Matrix Educare: India. Kotler, P. 2001. Marketing Management. Prentice Hall of India Pvt. Ltd: India. Etsell, C. and Hinton, M. 2012. UK RETAIL 2012 & BEYOND. [PDF]. Available at: http://www.sas.com/offices/europe/uk/downloads/press/sas-verdict-retail2012.pdf. [Accessed on: March 14, 2013]. Tench, R and Yeomans, L. 2006. Exploring Public Relations, Prentice Hall: England Bibliography Cowan, A. 2005. Risk Analysis And Evaluation. Global Professional Publishing: UK. Henry, A. 2008. Understanding Strategic Management. Oxford University Press: UK. Wenderoth, M. 2009. Particularities in the Marketing Mix for Service Operations, GRIN Verlag: DE. Burgemeister, S. 2003. Market analysis. GRIN Verlag: DE. Kolb, B. 2008. Marketing Research: A Practical Approach. Sage: UK. Zarrela, D. 2010. The Social Media Marketing Book. OReilly Media, Inc: CAN. Appendices Appendix-1 Figure 1: UK retail expenditure year-on-year growth (%) 1972-2012 Appendix – 2 Figure 2: Typical day for the 21st century consumer Appendix-3 Figure 3: Changes in population numbers by age group 2008 & 2015 Appendix-4 Figure 4: H&M Sales Promotion-1 Appendix-5 Figure 5: H&M Sales Promotion during Christmas Appendix-6 Figure 6: H&M David Beckham Advertisement Appendix-7 Figure 7: M&S Sales Promotion-1 Appendix-8 Figure 8: M&S Sales Promotion on the web Appendix-9 Figure 9: M&S Sales Promotion during Christmas Appendix-10 Figure 10: H&M safety towards children during Ads Appendix-11 Figure 11: H&M Loyalty cards Appendix-12 Figure 12: H&M Cause Related Marketing Appendix-13 Figure 13: M&S Public relations Appendix-14 Figure 14: M&S Loyalty Schemes Appendix-15 Figure 15: H&M Detox campaign Appendix-16 Figure 16: H&M Detox campaign Appendix-17 Figure 17: AIDA Model Read More