Advertisements and Sales Promotions are heavily used by most organizations in tandem with an objective to achieve their ultimate goal: drive sales. Often they have been used in close association, and consequently the boundaries between the two have blurred. Sales promotions seem to drive the sales at the ground level, and the importance of advertising seems to be diminished. As such, questions arise, that is advertising needed at all, or sales promotions themselves are more than enough to drive sales.
Similarly, if we consider the realm of advertising, we find that there is so much clutter. Given this clutter, it is very difficult for people to actually pay attention to all the advertisements and remember the messages in different advertisements. Because of this clutter, there is an emerging belief that when the purchase happens, customers have eventually forgotten about the advertisements and eventually it is the sales promotions that drive sales.
This is an age of hyper competition, with brands competing against each other fervently. Advertisement/Promotional campaigns of the rivals are noted earnestly and they are countered in shortest time possible. All this has further lead to an increase in clutter, and this clutter will increase even more in the coming future. Given so much clutter, is it even possible for the consumers to remember what was said in which advertisement? Is it possible for the advertisements to capture significant mind share and recall value in the minds of their consumers. Note that, this mind share should be significant enough to make a favourable decision in the shopping place.
So, in this debate of advertising vs. promotion, we should first understand what these both entities are, what their objectives are and to what extent are these replaceable.
Advertising is the set of communications done in order to communicate information about the products and to persuade the target audience to take specific actions. The objectives of advertising are manifold. If the product is new, advertising serves in increasing awareness about the product. If the awareness is already there, advertising serves to increase the interest in the product and makes people desire the product.
On the other hand, Sales Promotions are schemes and ways intended to increase the sales of products for a given period of time. These include discounts, coupons, vouchers etc. Sales promotions are, by definition, limited period activities with intent of either increasing trial or to increase consumption in a limited time frame.
If we consider the sales process, any sale made by an organization follows the following 4-step model:
If we follow this model, the difference between advertising and promotions becomes clearer. The role of advertising is to generate Awareness, Interest and Desire whereas the role of Promotions is to convert Desire into Action. Clearly, the roles of both are not interchangeable.
Advertisements have another very important role too; they help organizations in becoming ‘brands’. Promotion can never achieve that. If anything, too much sales promotion might actually dilute the brand value. A ‘Brand’ is not just a logo, symbol, or a name which identifies a company; instead a Brand is a living entity with a soul and with a purpose. The purpose of a Brand is to fulfill human desires, dreams, emotions and Advertisements help Brands fulfill this purpose.
In simpler words, all organizations wish to become brands, brands which will have a high recall value and which will be remembered. Becoming a brand makes it easier for organizations to drive sales, and also to carry out brand extensions by the virtue of its brand value. However, becoming a Brand is easier said than done. For an organization to become a brand, the organization needs to sell not just products, but also dreams and desires. It needs to serve not just the functional requirements through its products, but it also needs to serve some human purpose. And this is precisely what most successful brands do, for instance, Coca Cola serves the human purpose of celebrating happiness, while Pepsi serves the human purpose of being happening and youthful and Dominos serves the human purpose of celebrating relationships. While Nike exists to bring out the athlete in every one of us, Apple exists to bring out the innovative rebel in us.
An interesting advertisement highlighting the same is the recent Asian Paints advertisement in which newly-wed wife of an army-man finds her room in her husband’s home decorated just like her room in her home. Note that there is no mention of the functionalities or the attributes of the paint, however the advertisement connects to us at an emotional level, because it serves the desire to decorate a home for our loved ones. Besides this it also serves the human purpose of finding compassion and love post an arrange marriage.
So, to become a Brand, an organization needs to sell dreams, not just products and functionalities. A sales promotion might be able to sell products and functionalities, but it can never sell dreams. Selling dreams is a job best done through advertisements, and therein lies the fact that advertising is something which cannot be easily ignored.
In fact, advertising is something which helps sales promotions to be successful. If there is clutter in terms of promotions as well, and advertising makes these promotions visible to people. Often it is these advertisements about promotions which bring the audience into the market. The importance of advertising in making sales promotions visible becomes even more pronounced in the online domain. In a retail shop, often products and promotions of competitors are also visible, the same might not be always true in an online domain.
Therefore it is safe to say that advertising and sales promotions are complementary activities, and no matter how much the boundary between them blurs, both will still be required. As such, it is unlikely that sales promotions can replace advertising in the long run.
[The article has been written by Ashwini Kumar Mishra. He has completed his PGP (2012-2014) from IIM Ahmedabad.][/sociallocker]