Pricing and promotion are not originally concepts at the same level. Pricing is a tactical task that requires high stability, while promotion is a combat task that requires higher flexibility. In e-commerce practice, price adjustments and promotion activities are frequently carried out.
Promotion refers to the use of various incentive tools or means, especially short-term incentive tools, to stimulate consumers to buy specific goods or services faster and more. As Kotler said, advertising provides reasons for purchase, and promotion provides incentives to buy immediately or buy more.
Pay attention to the following points to grasp the definition of promotion;
(1) The purpose of promotion is to stimulate purchasing behavior. It can be simply divided into two purposes: one is faster, preferably buy immediately; the other is more, the more the better.
(2) There are many tools or means for promotion, and a combination strategy can be adopted.
(3) Promotion generally has a clear subject, that is, a specific product or service, otherwise it will affect the promotion effect.
For e-commerce promotion, the following points should be explained:
(1) With the development of e-commerce platforms, promotion has been very carefully decomposed. Promotion is not the promotion in the 4P theory, but the sales promotion in Kotler’s “Marketing Management”, that is, short-term incentive behavior. When we talk about e-commerce promotion, we often refer to very short-term sales incentive behavior, and classify the longer-term sales promotion into the category of “promotion”. Following the conventions of the e-commerce industry, only short-term promotion is discussed.
(2) Because the goal of cross-border e-commerce platforms (including B2B platforms) is to compress intermediary channels, transaction promotions (such as sales competitions and annual performance rebates for manufacturers to intermediary channel merchants) are not considered, and consumer promotions (manufacturers’ promotions directly to consumers without intermediary channel merchants) and retailer promotions (retailers’ promotions to consumers) are not distinguished. It is believed that e-commerce merchants and manufacturers have the same identity, and manufacturers are retailers.
(3) Classic marketing textbooks classify discounts as pricing strategies and do not belong to the category of promotion. This makes sense. However, because e-commerce promotions focus on very short-term sales promotion, discounts and other promotional tools are often used in combination.