The Warc Blog

The Warc Blog

Promotions may not benefit brands, IPA warns
Stephen Whiteside, Reports Editor, Warc
Stephen Whiteside

A report released today by the IPA, the UK advertising industry body, has warned that the increased use of promotions could ultimately have negative results for brands.

Its study, Price promotion during the downturn: shrewd or crude?, quotes figures from the Institute of Sales Promotion suggesting that promotional expenditure will soon leapfrog adspend levels in the UK.

Given that manufacturers are also now expected by retailers to provide the majority of funding for deals in stores, the profitability of this strategy is open to question.

The erosion of brand loyalty that follows on from solely focusing on price poses another, related, problem.

Paul Polman, the chief executive of Unilever, is one leading executive who has spoken out about the perils of short-termism, but marketers still obviously need to push metrics other than price in to the mainstream.

A recent survey in the US drew these same conclusions. But how is this best to be achieved?

Subjects: Marketing, Brands

04 February 2010 09:01

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