IB Business Management HLTopic 4 — MarketingPaper 1 & 2Core idea~11 min read
Promotion and Advertising Methods
Promotion is how a business tells people it exists and why they should care. The methods split into three groups, and the choice between them almost always comes down to one question the case study will answer for you: how much money is there?
📘 What you need to know
Promotion creates awareness, interest and desire, and builds brand loyalty and repeat purchases.
Above the line: paid advertising through mass media the business does not control — TV, radio, press, billboards.
Below the line: methods the business controls directly — direct marketing, sales promotions, personal selling, public relations.
Through the line: a campaign combining both, so mass awareness is followed up with targeted messages.
Above the line is wide reach, high cost, poorly targeted. Below the line is targeted, cheaper, smaller reach.
Advertising can be informative, persuasive or reassuring, depending on the job it has to do.
Social media is not a method — it is a channel that carries below-the-line activity cheaply.
The three forms of promotion
Above the line buys attention from strangers. Below the line talks to people who already know you exist. Most campaigns need both, in that order.
Above the line: advertising
Paid advertising in mass media aimed at reaching as many people as possible. It has four features worth naming in an exam: mass reach, non-targeted, high cost and brand building.
Three jobs advertising can do
Type
What it does
When it is used
Informative
Gives factual information about features, benefits and any legally required warnings, so customers can decide properly
New or complicated products, and regulated industries such as medicines and finance
Persuasive
Aims to change attitudes and convince people that this product is desirable or better than the alternatives
Crowded markets where products are hard to tell apart, especially luxuries
Reassuring
Reminds existing customers they chose well, encouraging them to stay loyal and buy again
Mature products with a big customer base already in place
Above the line works because
Above the line struggles because
Mass media reaches a large, mixed audience quickly and gives high visibility
It is expensive, which puts it beyond most small businesses
It builds a strong brand image and a sense of credibility and trust
Aiming at everyone means much of the spending reaches people who will never buy
Sound, images and graphics carry a message with real impact
There is almost no interaction — the audience cannot reply
One campaign can support every product in the range at once
People now skip, block and ignore adverts easily, so traditional media reaches fewer of them
Below the line: the methods you control
Sales promotions lift sales fast but train customers to wait for the next discount. Public relations is slower and cheaper, and the credibility lasts longer.
What each method is really for
Direct marketing — email, text, post or leaflets straight to named customers. Cheap, personal and easy to measure, but it tips into spam quickly, and building a customer database costs money.
Sales promotions — temporary incentives: buy one get one free, coupons, free samples, loyalty cards. They boost sales quickly and clear stock, but heavy discounts are expensive and attract deal-seekers who will not stay.
Personal selling — a salesperson dealing with one customer at a time. Excellent for complex or expensive products because relationships get built and questions answered, but staff cost money and it cannot reach large audiences.
Public relations — managing the business’s reputation through sponsorship, media coverage, community events and publicity stunts. Often cheaper than advertising and more credible, but slow, and the effect on profit is very hard to prove.
Where social media fits. Social media platforms are not a promotional method in their own right — they are vehicles that carry below-the-line activity to a chosen audience at almost no cost, and let customers talk back. Say it that way and you sound like you understand it.
Through the line
A single campaign that uses both: a television advert to create awareness, followed by social media adverts and targeted emails to push specific segments towards buying. The combination gives broad reach and a personal touch, which usually means better engagement and stronger recognition.
The cost is coordination. Running several channels at once needs marketing expertise, and every element has to carry the same message, or the campaign confuses people rather than persuading them.
The examiner’s favourite trap is a small business with a tiny budget. Do not recommend a television campaign. Show that you have read the financial position and suggest what they can actually afford — social media, sales promotions, local PR — and explain how to use it well.
Worked examples
WORKED EXAMPLE 1
A local gym has a promotion budget of $2,000 and wants more members before January. Recommend two promotional methods. [6 marks]
Step 1: Rule out what the budget cannot buy
$2,000 rules out television, radio and press. Above the line is out.Step 2: First method
A sales promotion: a discounted January joining fee, which creates urgency at exactly the right time of year.
Step 3: Second methodSocial media posts and local direct marketing, which cost almost nothing and reach people living nearby.
Sales promotion, supported by social mediaEvaluate: discounts attract members who leave when the offer ends, so the gym needs a retention plan for February.
WORKED EXAMPLE 2
A car manufacturer is launching a new electric model. Explain why it might use a through-the-line campaign. [4 marks]
Step 1: Why it needs above the line
A new model is unknown, so mass media creates awareness among a wide audience quickly.
Step 2: Why it needs below the line
Cars are expensive and complicated, so personal selling at dealerships closes the sale.
Step 3: Why combining them works
Awareness alone does not sell a car; a salesperson alone cannot reach the whole country.
Reach first, then conversionAdd the cost point: coordinating this needs expertise and often an agency, which is a real expense.
💡 Exam tip
Check the budget in the case before recommending anything. This is the single most common way to lose marks here.
Match the method to the product: expensive and complex needs personal selling; cheap and everyday needs mass reach.
Match the method to the audience: younger markets respond to digital, older markets often to print and post.
Describe social media as a channel for below-the-line activity, not as a method.
Say what each method costs as well as what it achieves.
Recommend two methods that support each other rather than one on its own.
⚠ Common mix-up
Promotion is not just advertising. Advertising is one part of it.
Above the line is not “better”. It is wider and more expensive, which is not the same thing.
Sales promotion is not personal selling. One is an offer, the other is a person.
PR is not free advertising. It takes time and often specialist help, and it cannot be controlled.
Reach is not sales. Being seen by millions is worthless if none of them are your target market.
Discounts have a hangover. Customers who came for the offer often leave when it ends.
Up next: Distribution Channels — how the product actually gets from the factory to the customer, and what each middleman costs you.
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