Principles of Business Marketing: Packaging and Promotion

Principles of Business Marketing

Packaging

Definition: Packaging refers to the wrapping material around a consumer item that performs multiple functions: it contains, identifies, describes, protects, displays, promotes, and makes the product marketable while keeping it clean. Packaging can also allow customers to repurpose it. For example, a glass jar used for food may be reused for storage by the customer.

Functions of Packaging
  1. Instant Brand Recognition: With many products available, consumers look for familiar colors and designs on packaging for brand identification.
  2. Easy Distribution: The shape and design of packaging allow for efficient bulk shipping; for instance, 125 ml juice containers can be packaged in 24-packs for easier handling in warehouses.
  3. Information to the Customer: Legal requirements necessitate that packaging includes important details like the business name, address, contact information, ingredients, expiry date, and caloric content.
  4. Protection and Preservation of the Product: Innovative packaging solutions such as Tetra Paks, commonly used in juice and milk, preserve contents and extend shelf life while conveying necessary information on the packaging.
  5. Safety for the End User: It is important to incorporate child-proof designs and tamper-resistant features to ensure consumer safety, particularly for products like medications.

Impact of Packaging on Business: The design and functionality of packaging influence breakage rates during shipment and a retailer's willingness to stock the product.

Forms of Packaging

  • Glass Containers: Used for coffee, bottled milk, and beverages.
  • Paper Boxes: Utilized for tea, tissues, and biscuits.
  • Hessian Sacks: Suitable for flour and agricultural products.
  • Paper Sacks and Bags: Commonly used for cement, sugar, etc.
  • Metal Cans: Often for canned fruit, molasses, and vegetables.
  • Plastic Containers: Commonly used for various food items and supermarket carry goods.
  • Cardboard and Wooden Boxes: Used to transport products in bulk.
  • Combination of Materials: For instance, perfume may be in a bottle, which is packaged in a box and transported in a cardboard box.

Packaging Regulation

Companies are required by law to disclose certain information on packaging:

  • The name of the company manufacturing the product.
  • A list of ingredients contained in the product and its packaging.
  • Health and safety guidelines regarding product use.
  • Display of a barcode for tracking and sales purposes.

Methods of Promoting Sale

Advertising

Definition: Advertising is the practice of disseminating information about products and services, encompassing both positive and negative points to reach a wide audience.

Functions of Advertising
  • Aid to Trade: Stimulates demand and thus increases market share.
  • Competition: Serves as a means to differentiate products from similar offerings.
  • Contact Facilitation: Connects buyers and sellers for commercial transactions.
  • Information Dissemination: Informs potential customers about new products.
  • Image Building: Helps establish a brand’s reputation and image.
  • Highlighting Unique Features: Emphasizes product distinctiveness to persuade purchases.
Forms of Advertising
  1. Informative Advertising: Aimed at notifying the public about new products entering the market.
  2. Persuasive Advertising: Utilizes slogans, images, and jingles to encourage purchases, often employing emotional appeals such as sex appeal (e.g., cars, cosmetics).
  3. Competitive Advertising: Focuses on defending a product’s value against competitors' products, persuading customers of superiority.
  4. Co-operative/Collective Advertising: Joint advertising efforts by multiple companies, encouraging the purchase of a category rather than a specific brand (e.g., milk, cheese).
  5. Specialty Advertising: Involves giving away promotional items (e.g., t-shirts, pens) featuring a company’s branding to promote recognition.
  6. Reminder Advertising: Important for mature products; serves to remind consumers of brand presence amid competition, like in the soft drink sector.
Sales Promotions

Sales promotions offer special buying incentives for limited periods, functioning as supplements to advertising. Key types include:

  • Temporary Price Reductions: Examples include discounts (e.g., $25 off).
  • Buy-One-Get-One Free Offers: Incentives encouraging purchases through free items.
  • Coupons: Found in publications, redeemable for discounts or cash at retail outlets.
  • Trading Stamps: Incentives given for amounts spent, redeemable for goods or money.
  • Price Packs: Bundling of slower selling items with more popular ones at a reduced price.
  • Free Gifts: Often included with purchases to entice customers.
  • Samples: Provided to allow customers to taste or try a product before purchasing.
  • Self-Liquidation Devices: Consumers can return packaging (e.g., empty boxes) for discounts on future purchases.
  • Loss Leaders: Popular products sold below cost to stimulate overall store traffic.

Public Relations (PR)

Public relations involves managing the public perception of a business. Effective PR fosters a favorable image of the firm and its employees.

Methods of Public Relations
  1. Direct Methods: Includes charitable donations, giveaways, sponsorship of events, and endorsements from public figures to promote goodwill.
  2. Indirect Methods: Focuses on customer interactions, addressing complaints, and developing relationships through courteous service.
Importance of Public Relations

PR complements advertising and reinforces the social responsibilities of businesses, aiming to create a positive perception and build community relations.

Personal Selling

Definition: Personal selling is the traditional method of sales promotion involving direct interaction between a salesperson and potential customer, serving as the precursor to modern advertising methods.

Features of Personal Selling
  1. Face-to-Face Interaction: The hallmark of personal selling, enabling personal connection and direct persuasion.
  2. Relationship Development: Focus on fostering long-term relationships to ensure repeat sales.
  3. Selling Ideas: The salesperson's role includes not only selling a product but persuading the prospect of its necessity and value.
  4. Flexibility: Salespeople must adapt their approaches based on the prospect's needs and behaviors.
  5. Mutual Satisfaction: The goal is to ensure that both the salesperson and the customer have their interests met, fostering continued engagement and sales opportunity.