Understanding the Difference between Marketing & Promotion
Copyright © Stone Evans, The Home Biz Guy
Are you an online marketer? Or do you simply promote affiliate programs?
Marketing is truly the most misunderstood word in use today on the Internet.
Let me see if I can clarify this issue just a bit.
In Marketing 101 at your local university, marketing is actually the
process of Product, Place, Price and Promotion.
PRODUCT
No business can exist without a product or service to sell.
In a nutshell, entrepreneurs are the people who believe in a product,
service or idea, so much that they are willing to invest their lives into the
development of their dream.
Historically, every major corporation in the world was started by an
entrepreneur with a dream and the drive to make it a reality.
However, there comes a time in the life of every corporation when those
who fear the gambling nature of their founder, squash the entrepreneurial drive
that made the company a viable concern in the first place. The entrepreneur
will either submit to the careful nature of the stockholders, or he will be
forced to leave the company he created.
The only entrepreneurs who withstand the pressure to move more carefully
are those who have maintained majority control over their companies.
PLACE
In the offline world, place is defined by location. On the Internet,
place is defined by domain name and the web hosting service chosen.
Both online and offline, place can make or break a company without
respect to the quality and value of the product, service or idea.
PRICE
Selecting a price is determined first on a basis of whether the company
wants to be seen as a discount or a value company.
Take for example Wal-Mart and Staples.
Wal-Mart is the lead discounter in the marketplace. Staples, on the
other hand is the specialist in office supplies.
Both sell a significant number of office supplies despite the fact
that the lowest price can usually be found at Wal-Mart. As a value dealer,
Staples can afford to charge more for their products than Wal-Mart.
So the question for you is whether you want to position your company
as a Discount or Value Company.
Testing has shown that products and services can be sold at any number
of prices and still reach a significant number of people.
The challenge of selecting the best price for your product or service
will require a certain amount of testing.
UNDERSTANDING THE PRICING EQUATION
Let's assume we are selling a product. Let us also assume that we know
that the product can be sold for $10 or $50. Let us also assume that if the
price dips below $10 or rises above $50, then the product sales fall off
significantly.
Our challenge is to determine the best rate at which to sell our product.
Testing has shown us that we can sell 1000 items a week at $10. Testing
has also shown that we can sell 500 items per week at $50. And testing has
shown that we can sell 650 items per week at $45.
At $10, our projected weekly earnings are $10,000. When we sell the
product at $50, we know that we can earn $25,000 per week. Most importantly, we
know that we can earn $29,250 when our product is priced at $45.
With the imaginary testing we have done on our imaginary product, we
can easily see that selling our product at $45 per item will earn us more money
over the long haul.
Thus, when we make the decision for a national rollout of our product,
then we will price our product at $45.
Of course, this is a very simplistic analysis of the point I am trying
to make. Though simple, I believe this analogy will help you understand the methods
of developing a product's prices.
PROMOTION
Promotion, on the other hand, is the process of notifying the consumers
for your product or service of your availability to serve them.
Methods of promotion vary distinctly and should be arranged to meet
very specific goals.
As with product, place and price, promotion should not be left to
chance. You should test every ad, every media, and every price point to
determine the best bang for your promotional dollars.
HEADS UP!
If you are an online promoter or marketer, please factor in the most
important element concerning the cost of your promotions.
What element is that? Your time!
Value your time at a certain dollar amount, and figure in your time
into the cost of your promotional accounting.
I say this because too many online promoters lose sight of this concept
and spend 20 hours to generate one sale while using free advertising. Even if
you rate your time at the federal minimum wage, then you will have invested
$105 of your time for one sale that might only net you a gross sale of $45!
ARE YOU TRULY A MARKETER OR ARE YOU JUST A PROMOTER?
Most people who run a business on the Internet call themselves marketers.
Yet, most of these same people are really just promoters wrapped in the label
of a marketer.
True marketers do not promote without a lot of advance work. They
spend time planning, testing and measuring their actions and results to get the
most out of every dollar spent and earned.
Entrepreneurs finesse the art of marketing as they build their company
into a major enterprise.
If you are a promoter who does not keep an eye on the total marketing
equation, then you are bound to fail.
If you do call yourself a marketer, then do what a professional marketer
does. Make sure that every dollar spent is spent well. Make sure that every
dollar earned is put to good use. Market well so that when the people of the
next generation look at your life, they will see a fine example of a successful
entrepreneur that they will strive to emulate.
About the Author:
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Stone Evans helps ordinary people all over the world make money online
with affiliate programs. If you can follow 3 easy steps, you can get your own
customized website, autoresponder (email follow-up software) and pre-written email
marketing campaign professionally designed and installed and ready to pull in
profits for you in 24 hours or less! See details at and sign up today at: http://www.HomeBusinessTips.com
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Quote of the Day:
"Nothing will ever be attempted if all possible objections must
first be overcome." -- Samuel Johnson
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