2.7 Promotion and Marketing Communications

Building a marketing campaign and how digital tools changed the way businesses reach customers.

Part 1 of 4 What a Campaign Is

A marketing campaign is a coordinated push that carries one product message to the buyers a business wants, using some or all of the promotional mix. The tools of the promotional mix carry messages that differentiate the product, build brand loyalty, and raise sales and revenue. A single listing is one piece of promotion. The running example of this unit is a teenager who rebuilds used bikes and sells them at a Saturday market with a signed inspection tag. For him, a campaign is a planned week. During that week, four pieces of promotion present the same bikes to the same parents: short repair clips, a flyer, a message to the parents who signed his order form, and the Saturday stall.

Part 2 of 4 The Five Tools

The promotional mix

Tool	Choose it when you want	At the garage
Media advertising	Many customers to receive one identical message at the same time: TV, radio, newspapers, billboards	Skipped: a quarter-page ad costs more than the margin on two bikes and reaches people who will never buy
Personal selling	To give detailed information or a demonstration; it may include a sales pitch, a short presentation of the value proposition	The test ride and the walk through the inspection
Sales promotion	Faster decisions or less unsold inventory: discounts, coupons	$10 off any kids' bike for one week, when three have sat all summer
Direct marketing	Many potential customers to get a targeted message: flyers, brochures	A flyer at the middle-school open house; a Monday message to the parents on the order form
Public relations	A favorable public image rather than a specific sale: press releases, interviews, coverage	The neighborhood weekly runs a piece on the teenager who straightens bent wheels against a written checklist

Which tools fit depends on how customers decide to buy that product. Give buyers detailed information for consequential purchases. Use media advertising or direct marketing for routine purchases. A buyer of a $150 road bike wants the full parts list, read out at the stall or written in a long listing. A $60 kids' bike sells through a flyer that sends buyers to the consignment stall.

When all five tools carry the same claim, customers hear one consistent message.

Part 3 of 4 The Digital Layer

Digital marketing uses the internet and digital tools (websites, email, social media, mobile apps) to reach and serve customers. Digital tools reach a global audience or a narrow segment with more personalization at lower cost. So early this century, businesses moved money from newspaper, magazine, radio and TV ads to digital tools. An $18 boosted clip reaches parents within a few miles of the market; a newspaper ad reaches everyone who opens the paper, at a higher price.

Part 4 of 4 Big Data and the Funnel

A funnel of four narrowing bands: twelve hundred views, forty taps, nine inquiries, four sales, with the rate from each stage to the next. — Example numbers. A funnel shows which stage is weakest.

Digital tools also collect a large volume of information about how customers respond to a message and what makes them buy: big data. Each tag carries a short code pointing at a one-page site that lists this week's bikes, so every step can be counted. A billboard cannot report who looked, who cared or who walked away.

One campaign week

Stage	Count	Rate from the stage above
Views on the clips	1,200
Taps through to the site	40	3.3%
Inquiries sent	9	22.5%
Sales closed	4	44%

Forty-four percent of inquiries ended in a sale, so the selling at the stall works. Only three percent of viewers tapped through to the site, so tapping through is the weakest stage. The next campaign should show the code earlier and hold the code on screen longer. $36 of campaign spending divided by four sales gives a customer acquisition cost of $9. Each customer's lifetime value is about $185, so the $9 acquisition cost is small next to what the customer is expected to spend.

Some traditional tools, such as personal selling, allowed this kind of measurement at small scale. Others, such as TV ads and billboards, did not.

Worked Examples

Grading a campaign funnel

Convert campaign counts into stage rates and identify the weakest stage to fix first.

Ready to Ride Week produced four numbers. The rebuild clips collected twelve hundred views. Forty viewers tapped through to the one page inventory site. Nine site visitors sent an inquiry. Four inquiries became sales. Compute the rate at each stage and decide what the next campaign should change.

Views on the clips: 1,200
Taps through to the site: 40
Inquiries sent: 9
Sales closed: 4

1. Compute the view to tap rate
Forty taps out of twelve hundred views is about three point three percent.
$\frac{40}{1200} \approx 0.033$
2. Compute the tap to inquiry rate
Nine inquiries out of forty taps is twenty two point five percent.
$\frac{9}{40} = 0.225$
3. Compute the inquiry to sale rate
Four sales out of nine inquiries is about forty four percent.
$\frac{4}{9} \approx 0.44$
4. Find the weakest stage
Each rate uses the stage above it as its denominator, so they are comparable as conversion steps. Forty four percent of conversations closing is strong and three point three percent of viewers tapping is the bottleneck.
5. Convert the diagnosis into a change
The fix belongs where the loss is largest, so the next campaign shows the code earlier in the clip and holds it on screen longer. Spending that effort on closing technique instead would improve the stage that is already working.

Check answer

Answer
3.3%, 22.5%, and 44%. The stage rates are 3.3 percent, 22.5 percent, and 44 percent. The weakest stage is the jump from view to tap, so that is what the next campaign changes.

Why it matters
A funnel is only useful when each rate is measured against the stage directly above it. Dividing every stage by the original twelve hundred views would make all three look terrible and would hide which one to fix, which is the entire point of the artifact.

Campaign acquisition cost and profit

Compute a campaign level customer acquisition cost and judge it against margin and lifetime value.

Ready to Ride Week cost thirty six dollars: ten dollars of printed codes, eight dollars of flyers, and eighteen dollars boosting one clip. The one page site ran free. The campaign produced four commuter sales at thirty eight dollars of margin each. Compute the campaign acquisition cost, the campaign profit, and judge whether the week was worth running given a five dollar acquisition cost at the stall and an eighty eight dollar lifetime value.

Printed codes: $10
Flyers: $8
Boosted clip: $18
Sales from the campaign: 4
Margin per commuter: $38
Stall acquisition cost: $5
Lifetime value in margin: $88

1. Total the campaign spending
Ten plus eight plus eighteen is thirty six dollars. The site cost nothing, so it adds nothing.
$$ 10 + $ 8 + $ 18 = $ 36$
2. Divide by the customers the campaign acquired
Thirty six dollars across four sales is nine dollars per customer.
$\frac{$ 36}{4} = $ 9$
3. Compute the margin the campaign generated
Four bikes at thirty eight dollars of margin each is one hundred fifty two dollars.
$4 \times $ 38 = $ 152$
4. Subtract the spend to get campaign profit
One hundred fifty two minus thirty six is one hundred sixteen dollars of profit from the week.
$$ 152 - $ 36 = $ 116$
5. Judge nine dollars against the two benchmarks
Nine dollars is worse than the five dollar stall figure and far better than the eighty eight dollars of lifetime value each customer is expected to return, so the campaign is profitable even though it costs more per customer than the old method.
$\frac{$ 88}{$ 9} \approx 9.8$

Check answer

Answer
$9 per customer, $116 profit. Campaign acquisition cost is nine dollars per customer and campaign profit is one hundred sixteen dollars. Worth running.

Why it matters
A rising acquisition cost is not automatically a failure. Judge it against lifetime value rather than against the previous acquisition cost, and count what the more expensive method also buys: this one is measured, targeted, and repeatable, and the old five dollar figure was none of those.

Key Terms

Practice Questions

6 questions. Nothing here is recorded or scored.

Question 12.7.A.1, 2.7.A.2
Second Stem
Amara Diallo, a high school junior, propagates houseplant cuttings in glass jars on her bedroom windowsill and sells the rooted plants under the name Second Stem. For her first structured campaign, a two-week Jar to Jungle Sale, she coordinates three moves: scheduled social media posts showing one cutting growing roots day by day, printed flyers with the sale dates pinned to boards at the library and the two coffee shops near her school, and a 10 percent discount code that expires when the two weeks end. Every post and flyer carries the same short link to her order page, and the page's software logs each visit, which post or flyer it came from, and whether it ends in a purchase. At Saturday pickup she walks each buyer through a repotting demonstration and answers care questions one buyer at a time.
Which of the following best describes the Jar to Jungle Sale as a whole?
- A.A public relations effort, because it builds a favorable public image rather than sales.
- B.A sales pitch, because it conveys the value proposition of a rooted houseplant cutting.
- C.A single promotional tool, the discount code, repeated across the two-week sale window.
- D.A marketing campaign, because several coordinated tools promote one product together.
Check answerHide answer
Answer: D
A.
Fails on purpose. Public relations, through press releases and media interviews that earn coverage, builds goodwill with the general public rather than pushing one particular sale, and an expiring discount exists to push particular sales.
B.
One zoom level too far in. A sales pitch is a brief presentation inside personal selling, one seller delivering the value proposition to one buyer, and the campaign is the coordinated whole around it.
C.
Count the tools. The sale runs scheduled posts, printed flyers, and an expiring discount code, three different promotional tools working together, and a single tool repeated would be one tactic rather than a campaign.
D.
Correct. A marketing campaign takes tools from the promotional mix and coordinates them into one effort that promotes a product to potential customers. Amara's posts, flyers, and expiring code all point at the same order page on one schedule, and that coordination is what makes the effort a campaign.
Question 22.7.A.2, 2.7.A.4, 2.7.A.6, 2.7.A.7
The discount code, the flyers, and the social media posts are best identified, in order, as which promotional mix tools?
- A.Personal selling, public relations, and media advertising, in that order.
- B.Sales promotion, public relations, and direct marketing, in that order.
- C.Sales promotion, direct marketing, and media advertising, in that order.
- D.Direct marketing, sales promotion, and personal selling, in that order.
Check answerHide answer
Answer: C
A.
The posts genuinely are media advertising, and the first two assignments sink the set: a discount code is a sales promotion aimed at everyone who sees it rather than a one-on-one conversation, and a flyer is the business delivering its own targeted message rather than earned coverage.
B.
Calls the flyer public relations, and the difference is who speaks. Public relations earns outside media coverage, while a flyer is the business delivering its own message.
C.
Correct. The promotional mix holds five tools: media advertising, personal selling, sales promotion, direct marketing, and public relations. A sales promotion, a discount or a coupon, pushes customers to decide quickly, and Amara's code expires precisely to turn browsers into buyers now. Direct marketing puts a targeted message in front of many potential customers through materials like flyers and brochures, and her pinned flyers do exactly that. The scheduled posts are media advertising, one message sent out to many viewers at once, carried on digital channels.
D.
A paired-concept swap. The discount is the sales promotion, and the flyer is the direct-marketing vehicle that carries it.
Question 32.7.A.5
Amara's repotting demonstrations and one-buyer-at-a-time care answers at Saturday pickup are best identified as which of the following?
- A.Personal selling, because one buyer gets a demonstration and detailed answers.
- B.Direct marketing, because she delivers her message straight to each individual buyer at pickup.
- C.Public relations, because the free demonstrations create goodwill around Second Stem.
- D.A sales promotion, because the demonstration is offered at no charge to the buyer.
Check answerHide answer
Answer: A
A.
Correct. Personal selling is the tool a business picks when a potential customer needs detailed product information or a demonstration, and a face-to-face repotting walkthrough with individual care answers is exactly that interaction.
B.
A vocabulary borrow. The word direct in direct marketing describes a targeted message sent to many people at once, like a flyer, and a conversation with one buyer is personal selling.
C.
Stretches goodwill too far. Public relations aims media coverage at the general public's image of the business, and a demonstration at pickup advances that buyer's specific sale.
D.
A sales promotion is an incentive on the purchase itself, a discount, a coupon, an expiring code, built to speed the buying decision. The demonstration costs nothing but is not an incentive; it is detailed help delivered one buyer at a time, which is personal selling.
Question 42.7.A.3, 2.7.A.5
Which of the following best explains why a seller of custom hearing aids relies mainly on personal selling while a seller of bottled water relies mainly on media advertising?
- A.Personal selling costs a business less for each customer reached than media advertising.
- B.A consequential purchase needs a detailed conversation, while a routine one is met by a mass message.
- C.Media advertising cannot describe what a product does or which features it carries to a buyer at home.
- D.Hearing aid buyers are older, so they see far fewer television and billboard advertisements each week.
Check answerHide answer
Answer: B
A.
Reverses the cost. Personal selling is the expensive tool per customer because it spends a person's time on each buyer, and a business pays that price only when the decision demands it.
B.
Correct. Businesses match the promotional tool to how customers decide on that specific product. A hearing aid is a consequential purchase, expensive, personal, and long lasting, so the buyer needs a detailed, personal conversation before committing. Bottled water is a routine purchase, so a TV, radio, newspaper, or billboard ad, one identical message reaching a large audience at the same moment, does the job.
C.
Ads describe features constantly, and a thirty-second spot can list what a product does. What an ad cannot do is examine this buyer's hearing loss and answer this buyer's questions, and that is why consequential purchases lean on personal selling.
D.
An invented audience fact, and beside the point. The choice of tool follows the nature of the decision: a hearing-aid buyer who watches television nightly still needs a fitting and a conversation before committing.
Question 52.7.B.2
Emberline Granola
Tessa Marsh runs Emberline Granola, an online granola shop, and tested two campaigns for the same new flavor. The table shows the results.
Figure | Postcard mailing | Targeted email to past store visitors Cost | $500 | $100 People reached | 1,000 | 2,000 Orders | 20 | 40 Which conclusion is supported by the table?
- A.The email campaign earned a higher response rate than the postcard campaign earned.
- B.The postcard campaign cost less for each order it produced than the email campaign did.
- C.The email campaign reached twice as many people at one tenth the postcard's cost per order.
- D.Email campaigns outperform postcard mailings for any business selling a food product.
Check answerHide answer
Answer: C
A.
Sounds right and computes wrong. 20 orders from 1,000 people is 2 percent, and 40 from 2,000 is also 2 percent, so the response rates are equal and the table gives the claim no support.
B.
Backward. The postcards cost 25 dollars per order, 500 over 20, and the email cost 2 dollars and 50 cents per order, 100 over 40. The cheaper channel per order is email, by a factor of ten.
C.
Correct. Compute cost per order first. Postcards: 500 dollars divided by 20 orders is 25 dollars per order. Email: 100 dollars divided by 40 orders is 2 dollars and 50 cents per order, one tenth of 25. Reach: 2,000 people against 1,000, twice as many. This is the shift the framework tracks: digital tools reach global audiences or targeted segments with more personalization at lower cost.
D.
Turns one comparison into a law. The table supports a conclusion about these two campaigns for this shop, and a conclusion that reaches past its own data is not supported by it.
Question 62.7.B.3
Which of the following best explains a data-collection difference between digital marketing tools and a traditional tool like a billboard?
- A.Traditional tools collected more accurate customer data than digital tools collect today.
- B.Personal selling gave a business no practical route to collecting information about customers.
- C.Big data is the term for advertising that reaches an unusually large audience at once.
- D.Digital tools log customer responses as big data, while a billboard collects no such record.
Check answerHide answer
Answer: D
A.
Traditional mass tools collected almost no customer data at all, and a billboard cannot tell who read it, let alone who bought because of it. The accuracy comparison is empty because there is nothing on the traditional side to compare.
B.
Overstates the contrast. Personal selling allowed collection on a small scale from the start, because a salesperson could record what individual customers asked about and bought; the tools that collected nothing were one-way mass tools like TV ads and billboards.
C.
Swaps the definition sideways. Big data measures the volume of response information a business collects, and audience size measures reach.
D.
Correct. Digital marketing tools record how customers respond to marketing communication, which links they tap and which messages come right before a purchase, and that large volume of collected information is called big data. Businesses mine it for the factors that push a customer toward buying. A billboard sends its message one way and learns nothing about who acted on it.

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5 Common Mistakes on 2.7

The wrong moves students actually make on these questions, why each one is wrong, and what to do instead. Part of the practice tier.

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CED Codes

2.7.A.1 · 2.7.A.2 · 2.7.A.3 · 2.7.A.4 · 2.7.A.5 · 2.7.A.6 · 2.7.A.7 · 2.7.A.8 · 2.7.B.1 · 2.7.B.2 · 2.7.B.3