Many small business owners see the big box stores doing promotions and wish they could do that. They can do them — but differently, and quite often more effectively. It only takes some careful thought and partnering.

Sales promotion spending has grown dramatically in recent years because a well-planned promotion drives people into the store and can generate purchases. In today’s very competitive environment, sometimes a promotion gives the edge to a retailer and provides an opportunity to create lifelong customers once they get into the store.

If a store’s product mix is in the mature life cycle stage, then growth can only come from stealing market share (customers) from a competitor. If the store’s mix is a commodity with few distinctive features, then all stores' marketing is relatively the same. Finally, with America coming out of its worst recession in decades, spenders are slowly opening their purses and are looking for reasons to buy — hence a promotion.

Sales promotions are not meant to generate long-term behavior changes but rather short-term increases in sales. This increase is caused by the change in the price/value relationship that a consumer sees in a product. The customer sees a lower price for the same value product and this change causes a quicker decision to purchase.

How can a small business owner effectively do promotions? When asked that question in both my classes and counseling sessions, I ask questions back. I often start with “Who is the target audience you are trying to reach?” and “Tell me more about them beyond just age, gender, marital status — tell me why they buy this product.” These and other questions get owners thinking more in-depth about why they are considering a promotion.

Once we have more knowledge of the audience, the promotion can be planned to better appeal to them. For example, I once had a client in my advertising career who wanted to generate more traffic from parents with children. After doing some research, I came up with the grand prize of two electric race cars to be given away. We sought out partners and the local Coke bottler signed on, becoming the main sponsor. They got displays at the front of the store and end aisle and the car prominently placed on top of the product. The results were overwhelming. The store sold more Coke in two weeks than they had sold in months and definitely noticed an increase in families in the store. Coke was happy because they were selling more to the store than they had in recent months, since Pepsi had agreed to higher slotting fees and gotten more shelf space.

As a local store owner, a great place to start planning is with your local media partners. They have many opportunities to help you plan promotions and can be very efficient in reaching your target audience. Also, my office is always willing to help small business owners plan their events. Contact me at 573-243-3581 or via email.