Friday, 23 August 2013

De-escalating price promotions

Reckitt Benckiser--the corporate name behind so many familiar household brands--wants to get off the price promotion treadmill. 'When consumers’ only criteria is to do BOGOF [buy one, get one free] or half price, then you can do the most engaging campaign but they don’t care. They will buy the competitor if they are half price', says RB's J√©rome Lemaire in a Marketing Week interview. So RB is in talks with its retail partners about other kinds of promotions.

Of course, after years of store promotions by retail chains trying to retain market share and increase shopper visits during the recession, de-escalating price promotions will not be easy for any brand. Supermarkets have been locked in a battle for price, position and image, as well, which affects how brands on their shelves are perceived by shoppers.

RB invests heavily in adverts to remind shoppers of its brands and benefits. It's on Facebook (88,000 likes), Twitter (9,500 followers), YouTube, Weibo (China) and other social networks. Even when RB markets digitally, it must rely on retail partners to actually sell the products, at least until its e-commerce strategy is tested and implemented. Meanwhile, the company has considerable sales momentum worldwide this year, thanks in part to its brand-by-brand and overall corporate marketing plans.

This post updates the opening example in Chapter 1 of Essential Guide to Marketing Planning.