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Intelligent promotions are the future for FMCG

9th November 20165

Intelligent promotions are the future for FMCG

FMCG discounting has had its day as an effective promotion tool. Even before we started to feel the impact of a weakening pound on prices, consumer spending on discount promotions was falling, as reported by Nielsen back in April. In a bid to fight the strengthening discount chains, retailers and brands wielded the blunt instrument of price promotion too often. The impact on the bottom line, the reduced takeup by consumers, and the legacy of poor price perception may have sounded the deathknell of promotional discounting.

Savvy marketers deliver profitable promotions

Good sales promotions are rarely based on price. It's all very well doubling your unit sales during a 2-for-1 promotion, but if you can't sustain that trend when the price reverts to normal then there's no success to speak of. Worse still, your subsequent sales may fall as consumers' price perception becomes skewed, waiting for the next discount to drop.

What your brand needs is a promotion that holds the value of the product, and attracts new customers who switch because of the brand attributes and will therefore stay and deliver sustainable sales growth. A savvy sales campaign focuses more on education and association, highlighting the value of a product. For example, a prize draw gives an incentive without discounting, and the chosen prize can build the brand reputation through association. A points collector mechanic builds brand loyalty over multiple products. A calculator campaign can educate the market and show the value of changing a purchasing or lifestyle habit. Even a cashback promotion is preferable to raw discounting, as it maintains price perception.

Using promotions data to develop targeted marketing

A promotion should never stand alone. When you run a promotion with a digital aspect, you have an unparalleled opportunity to dig deeper into your customer base and further refine future campaigns to target the perfect audience. You can't do this after the event: it has to be built into your campaign at the planning stage, so that the promotion mechanic can be customised to generate the best possible data.

Good promotion tools will have an element of data capture built in for fraud prevention; this strategy forms part of the standard FraudShield™ technology in your Promotion Toolbox. However, planning the data you want to capture enables us to build in more features. Want an insight into demographics? Offering social sign-in at registration gives access to a wealth of anonymised data. Need to know where you customers are? Postcodes will show you a more accurate geographical heatmap than IP data in an increasingly mobile world. Compiling data from several promotions? Tracking device identity and emails will avoid inflated, misleading metrics.

When you plan your promotions, you should always be thinking one campaign ahead. A sales promotion is not a fast grab for customers, rather it is part of a steady drive towards ever more targeted messages building value for the long term. Let us help you to realise your long term goals.

Promotion Toolbox: the savvy marketer's technical partner.

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