IMC & Sales Promotion e.g. choose and explain a sales promotion strategy run by the organisation e.g. premiums, coupons, POP, loyalty programme, sampling etc. Outline the objectives of the campaign as you see them and critically analyse the effectiveness of the method chosen. How does it tie in with other promotional activities?

Car manufacturers use clever consumer sales promotions during the busiest shopping times of the year in order to entice customers to their brand. The ultimate aim is to get as large a slice of the market as possible. With the busiest periods for registrations in Ireland in the first quarter (approx 60%), these sales promotion are usually seasonal towards the end of Q4.

Volkskwagen sales promotion for Q1 2019 was launched in October 2018. It ran for 3 months until December 31st 2018. Therefore, the promtion on offer was for any new car ordered within that timeframe for registraion within another timeframe. January to March 2019.

The promotion consisted of a number of components, and was delivered across various different platforms from direct mail to email, and from digital advertising to television ads.

The componenets of the promotion were primarily; purchase contributions, a consumer rebate of up to €2500, low rate finance, and technology packs. Technology packs are effectively a bundle of optional extras put together and sold at a reduced price. Point of Purchase displays were also sent out to authorised retailers with the most up to date promotional material.

This method of sales promotion has been consistent over the last number of years. There may be an arguement to suggest it needs to be changed up a bit. When a promotion is the same every year, is it actually a promotion, or does it simply become the expected norm from the consumer? Other tactics which should be considered include a loyalty programme which would reward repeat customers, and also a conquest programme trageting consumers of other car brands therefore increasing market share.

I’d like to take a look the Lidl Ireland Christmas 2018 Ad. This was released in November 2018 in time for the christmas period. At first glance, its not an ad that jumps out at you as being one of the classic christmas ads. Its not exactly the Coca-Cola christmas trucks, or the little girl who sees Santa Claus in the cornflakes ad. But it is Lidls method of delivery that makes it interesting for me.

Prior to the ad being released on television, Lidl released the Ad online. They tweeted the Ad, and then proceeded to poke fun at themselves on twitter. This had the effect of generating discussion on the ad before it even appeared on TV. It created a heightened sense of expectation with people wanting to see the ad and to see what all the fuss was about.

Back in March 2018, the country came to a standstill after some heavy snow. The ‘beast from the east’ captured the countrys imagination. The Lidl store in Fortunestown, Tallaght was ransacked and looted by a group of youths. The damage to the building was so bad that the building had to be knocked and re-built. Lidl managed to turn this negative into a positive social media campaign throughout the course of re-construction.

This type of self-deprecating advertising combined with interactions on social media result in a greater connection between the brand and the consumer. It humanizes the brand and gives it a fun personality that the Irish consumer can relate to.

“Price is what you pay. Value is what you get” – Warren Buffet

Volkswagen is a brand which is considered to be a premium brand within the motor industry and by consumers alike. But, what exactly does ‘premium’ mean, and how do they achive this? Well, its not quite a luxury brand along the lines of Mercedes, BMW, Audi. Also, its not a budget brand like Dacia, Seat, or Fiat. There are mid range brands which are main competitors of Volkswagen such as Renault, Toyota, and Ford. Volkswagen, being a premium brand, would position themselves slightly ahead of these close competitors.

A key driver of brand positioning is marketing. Specifically, the four P’s of marketing. Price, Place, Product, Promotion. Lets have a look at one of these, Price.

There are a few elements which combine to determine the price of a new car. Production costs, Government taxes such as VAT and VRT, which in turn are now determined by emmisions. You also have retailer and manufacturers margins. So its not as simple as picking a figure which is slightly more, or slighly below a competitors price. Also, the final RRP the manufacturers sets is a key influencer of the consumers perception of that brand.

Take a tdi Audi A3 which starts at €32705. A Volkswagen Golf with the same engine and gearbox combination is €28595. Also, a Seat Leon costs €25050. All three cars are made by the same manufacturing group. But is the Audi really over €4000 better than the golf, and the Golf €3500 better than the Seat? The price structure is a driver of the consumers perception of the brand. The more expensive the car is, the better it must be.

Volkswagens tend to have a sticker price which is slightly higher than its main competitors, however they use clever offers which then make the car more affordable if not as affordable as the competition. These include money off offers, purchase contributions and low rate finance from their own Bank. Buying a €30,000 Volkswagen on 0% or 1.9% APR might have the same or similar monthly cost as a €28,000 ford at 6% or 7% APR. Therefore the consumers perception of the quality of the brand is not tainted, but the brand remains competitive.

“The moment you make a mistake in pricing, you’re eating into your reputation or your profits.” – Katharine Paine

I wanted to call this blog ‘The Three Marketeers’ but apparantly that company already exists, so we will have to settle for D’Artagnan instead. Ah well, maybe they’ll give me a job some day??