PROMOTIONAL TOOLS

Advertising, sales promotion, personal selling, public relations and direct marketing, coupled together, make up the so-called marketing mix, that is the marketing communication system. In principle, all of these tools are used on the industrial goods market, but the main emphasis is shifted towards personal selling and sales promotion.

Marketing communication on the industrial goods market runs along two tracks. On the one hand, the customer company looks for supplier companies through individual and telephone contact, symposia, training courses and trade fairs, but also through press and internet announcements, by publishing requests for proposals and tenders. On the other hand, the supplier company informs the potential customer about its offer, its experience and its credibility. It has to be remembered that, to a greater degree than on the consumer goods market, the offer must be tailored individually and meet the customer's detailed requirements. In many cases it has to be goods produced specially for the customer (for example feed selected and produced specially for a given farmer).

ADVERTISING

Advertising is any paid form of presenting goods, services and ideas which acts directly on market phenomena, and in particular on the motives, attitudes and behaviour of consumers making decisions about the purchase of specific goods, that is on those who create market demand. The purpose of advertising is usually to convince the audience of the merits of a product. By passing on positive information, the producer tries to interest potential customers in the goods, to arouse the desire to own the product and in this way to bring about a purchase and sale transaction.

According to M. Hutt, advertising alone cannot build a preference for an industrial product, because that requires demonstration, the presentation of detailed explanations and trials, and therefore advertising in the popular sense, that is mass advertising on television and radio, should not be used (the famous example of the Zremb forklift truck commercial broadcast around the time of the television news, although there is also the example, from two years ago, of the feed producer Wipasz sp. z o.o., which likewise broadcast a corporate image commercial in the most expensive airtime slot, causing a great deal of stir on the agricultural market, though in my opinion this was a deliberate piece of viral marketing).

Printed advertising, that is leaflets, brochures and catalogues, is in most cases technical information about products (technical parameters, applications, efficiency and so on). Because it is addressed to professionals, this information is reliable and uses language that is professional for the given industry. Often the content of catalogues consists of general information about the company, intended to build a positive image of the plant as a solid and responsible partner with many years of experience; certificates, permits and references are frequently included in the content. A separate group are the so-called company bulletins, which mostly contain substantive content (concerning the problems of the industry, the latest discoveries, scientific studies, legal changes and market trends) intended to attract the reader, while to a large extent they also contain product advertisements and articles meant to build a positive image of the company (for example a donation to a children's home, or interviews with farmers - of course positive towards the feed producer). You also come across the so-called promotional flyers (similar to those used by supermarkets, for instance), which contain photographs of products together with prices (usually promotional ones) and are published in the case of seasonal campaigns and stock clearances. Above all they accompany the so-called retail sale of a standardised product (this is of course not a sale to an individual customer, but to a smaller business buyer - for example feed in 25 bags for smaller farmers).

The trade press - a fairly significant element of promotion; potential customers are happy to reach for such periodicals and are happy to return to them, so it is a long-term medium. Companies advertise their product in them and announce the launch of new items; very often the advertisements have an image-building character, raising the standing of the company as a solid partner. Sponsored articles that reflect well on the advertiser are often placed there, as are articles in which a given company is mentioned, described and so on. It has to be admitted that the general tendency to reduce the print runs of printed magazines and the shift of readers to online periodicals applies to this medium as well.

ONLINE ADVERTISING

Online advertising means above all websites intended to present the offer (specific products, or capabilities and sample completed projects that lend credibility to those capabilities), with a strong emphasis on technical parameters and methods of use. A very important element of the site is the description of the company, its many years of experience, and also references, certificates and information showing a credible, stable and trustworthy business partner. More and more often sites take on the character of a portal, aggregating a large amount of information, for example about upcoming trade fairs, seminars and training courses, then summarising those events, about stock exchange quotations (this concerns investor relations in large companies, as well as information from commodity exchanges about, for example, grain prices) and about public relations activities (patronage over a social institution, charitable activities and so on). The website more and more often replaces printed materials; brochures, catalogues and magazines can be downloaded from it as PDF files, it is simply faster to react to changes and, of course, cheaper.

Advertising on trade portals (for example Pierwszy Portal Rolny, Rolnicy com and so on) is used more and more often; it takes the form of banners and articles that are sponsored, or apparently not sponsored but mentioning the company in a positive way. AdSense and AdWords advertisements are seen less often; this is a medium underrated by companies in the agricultural sector and in the sector serving agriculture.

DIRECT MARKETING

Direct marketing consists in direct messages addressed to carefully selected, individual customers, often in individual contact, in order to obtain a direct reaction (a response). Direct marketing allows consumers to buy products by making use of various advertising media, bypassing direct personal contact with a salesperson. In addition to creating a brand image, the goal of direct marketing is to obtain a direct consumer reaction, most often an immediate and measurable one.

Direct marketing is often used by companies in this industry because of the limited number of recipients, who are fairly easy to identify. So-called newsletters are commonly used; information about upcoming price increases, promotions and new products is sent out en masse over the internet or, still to a large extent, by traditional post to customers from address databases. These databases are above all built inside the company or bought indirectly (along with a new employee).

Public relations means the activities of a company aimed at building and maintaining the desired relations between the company and its environment, that is with people or groups that may have an influence on the functioning of the business (these are institutions, media, organisations, employees, customers and so on). This includes the pursuit of favourable opinions, the creation of a favourable image of the business and an appropriate response to unfavourable information and negative phenomena within the company. Public relations can be directed both inside the company and outside it.

Public relations is also important on the industrial goods market, especially in the case of large plants that are often burdensome for their surroundings (chemical plants, pharmaceutical plants, feed producers). Public relations activities are often treated as an afterthought, yet they are very important from the point of view of building a positive image of the company. Smaller companies have no public relations departments (or even people responsible for it), and yet it would have a wide field of action: writing sponsored articles, encouraging journalists to publish information about the company, sponsorship and charitable activity (companies often take part in the life of small local communities by helping a school, a children's home, a sports team and so on, but there are also larger undertakings such as the sponsorship of the Anwil Włocławek basketball team).

Especially in larger plants, the public relations department is also tasked with running so-called internal PR, informing employees about the life of the plant and motivating them to work.

Personal selling is one of the elements of the promotion mix. It is a verbal presentation of a product or service consisting in holding a conversation with one or more potential buyers in order to make a sale. This conversation is often combined with the opportunity to see, and even to try out, the goods. Personal selling is the oldest element of promotion.

This is the main medium of communication with the customer on the industrial goods market. Because of the complex nature of the offer, which is often unique and contains a whole mass of technical details, the advisory skills, competence and expertise of the salesperson are often more desirable than their commercial abilities. So-called sales representatives are to a large extent people with education specific to the product offered; for example nutrition advisers and sales representatives in feed plants are veterinarians, animal scientists and agricultural engineers, while in companies offering machinery and equipment they are graduates of mechanical engineering and machine design faculties. Apart from winning a new customer, the salesperson is also tasked with maintaining constant contact with them, solving problems and advising on matters related to the goods sold. Companies very often organise various kinds of training courses, seminars, meetings and trips in order to establish contact with the customer in an informal way and gain their gratitude and loyalty; in the case of industrial goods, supplier-buyer relationships that go beyond the contract are fairly common.

Sales promotion (otherwise known as supplementary or additional promotion) is an element of the promotion mix. It means the use of various incentives encouraging the purchase of goods by making them more attractive. It is most often used for a limited time, at the point of sale. Activities carried out as part of sales promotion should give customers the feeling that they are dealing with an exceptional opportunity. That is why they are not used all the time. Very often supplementary promotion is linked to the seasons of the year and to occasional holidays (for example Christmas or Children's Day). These activities can be addressed to consumers as well as to trade intermediaries and sales staff. Sales promotion is an excellent complement to advertising. Sales promotion may consist of discounts, favourable payment terms, trade fairs, seminars and training courses for customers.

We distinguish trade discounts for intermediary and trading companies, quantity discounts for the size of a single order or of orders within a specified time, loyalty discounts for regular customers, discounts for cash payment or early payment, and seasonal discounts for buying goods after or before the season (frequently encountered on the artificial fertiliser market in connection with passing storage costs on to the customer).

OTHER PROMOTIONAL TOOLS

Trade fairs are an excellent form of contact with customers, of presenting new products to them, explaining the technical intricacies of a product and signing contracts. In one place and in a short time you can serve a large group of customers and maintain business and personal contacts; trade fairs are often linked with seminars, training courses and informal meetings (for example business dinners). Trade fairs also make it possible to build the company image and to underline your presence on the market, including for the competition's customers.

Seminars and training courses are a very important form of supporting sales on the industrial goods market, especially in the agricultural sector. Here producers can show market novelties, familiarise customers with the latest market trends and pass on the knowledge needed to intensify production further. This is of course an excellent form of building the company image and strengthening personal ties with the customer, bearing in mind that events of this kind are mostly combined with banquets and trips.

Contract farming - this is an interesting form of sale in which the customer can become a supplier and the supplier a customer (although the company may only commit to buying back goods grown in the future, without offering its own products). It is commonly used on the agricultural market and consists in a trading or manufacturing company contracting, that is committing itself to buy specified agricultural products within a specified time and at a specified price. For example, a trading company selling mineral fertilisers to a farm undertakes to accept as payment part of the grain grown with the help of those very fertilisers; the company then treats the contracted grain as goods for further resale. Maspex Wadowice, the owner of the Kubuś brand, supplies farmers with seeds of a suitable carrot variety with a high water content and obliges them to follow an appropriate cultivation regime and an appropriate sowing period; in return it undertakes to collect the raw material and also secures the appropriate quality and delivery dates (different sowing dates set by the buyer allow it to collect and process gradually, without too large a stock in the warehouses). Indykpol SA supplies "its farmers" with turkeys of suitable breeds from its Frednowy hatchery and then collects the raw material from them, deducting its investment costs; of course the date the chicks are placed in the poultry house is synchronised with the planned production at the plant. The poultry company Cedrob, in addition to supplying chicks, also produces the feed used by the farmers who supply chickens to the plant. This is a fairly convenient arrangement, especially for farmers, as in many cases it does not require them to commit financial resources or to get involved in commercial matters, while for the contracting companies it makes it possible to sell goods to customers who are not always solvent, to obtain raw material for production or for further resale at favourable prices, and to link deliveries with the production process.

The local market leader - this is a fairly interesting form of promotion on the agricultural market, often used when selling agricultural and production machinery, but also fertilisers, feed, seeds and so on. The company offers a purchase on favourable terms, or a trial of a given product, to the local or industry market leader. The industry, or the neighbours, treat this as a kind of recommendation. It is a fairly effective form of supporting sales, especially on a new market or in a new area of operation, or when introducing a new product.

The promotional mix - on the production goods market, and especially on the agricultural market, a multi-track approach is required. The most important thing is of course personal contact, building a bond with the customer, providing them with pre-sales advice but also with advice after the purchase, staying in constant touch with them, solving problems and proposing better solutions. Personal contacts, however, have to be supported by advertising, which builds the brand and a positive image of the business, or simply informs about the product. Trade magazines and portals, leaflets, brochures, advertising on vehicles and billboards. Websites are, these days, a compendium of knowledge about the company. Trade fairs, training courses and seminars are an opportunity to deepen ties with the customer, to present a new offer and to explain the intricacies of a product, but also a tool for building the brand. Discounts make it possible to intensify sales, to speed them up or to get rid of stock. Direct mail makes it possible to reach current and potential customers in a more mass way than personal contact. Different forms of promotion should be used in the right proportions, appropriate to the specific nature of a given market - only then can you achieve a satisfying level of sales.

Rafał Sadowski

An excerpt from the diploma thesis "Methods of promoting industrial goods on the example of companies operating on the agricultural market"