catatan

One of elements of marketing mix is promotion. The rest is product, price and place. Producers have to consider all of elements of marketing mix to meet business objectives. One element strengthens each other. Promotion makes consumers know about the products whether goods or services. Promotion also concerns to the existing product when it enters new market. Promotion also applies to the new product to be sold whether in the existing market or new market.

There are some forms of promotion.
a. Advertisement
b. Promotion
c. Personal selling
d. Public relation
e. Customer service

There are some aims of promotion.
a. To increase sales of existing product
b. To increase market share of existing product
c. To introduce the new product to the existing market
d. To expand the new product to the new market
e. To accrue either product or company image
f. To accrue profit

Explanation.

a. Advertisement

There are some processes of advertising.
1. Set objective
2. Determine the advertising budget
3. Determine the campaign activity
4. Determine the media of advertising
5. Evaluate the effectiveness of advertising

There are some types of advertising.
1. Informative advertising
The main objective of this advertisement is giving full information about the product.
2. Persuasive advertising
The main objective of this advertisement is persuading either consumers or target audiences to buy the product. Target audience is people who are proposed to buy the product.

There is one model that is called AIDA Model to promote product. AIDA Model is abbreviation of Attention, Interest, Desire and Action.
1. Attention. How to make consumers aware with the product.
2. Interest. How to make consumers interested with the product.
3. Desire. How to make consumers want to buy the product.
4. Action. How to make consumers have bought the product.

Producers have to pay attention with the media that is used. Every advertising media has both advantages and disadvantages. Producers have to concern with the objective of advertising. Here some of media advertising.
1. Television
2. Radio
3. Newspaper
4. Leaflet
5. Internet
6. Poster
7. Neon light

b. Promotion

There are some types of promotion.
1. Price reduction. Consumers have discount for the next product that they buy. Seller might give 50% discount for the second good that consumers buy.
2. Gift. Consumers need to collect the coupon and then exchange to get present from the seller.
3. Competition. Seller gives present to the consumers by following competition. Consumers might get present if they win.
4. Point of sales display and demonstration. Company chooses certain shops to sell its product. Apple has AppStore to be place to sell its product.
5. After-sales service. It occurred sometime when costumers bought product but then they were unsatisfied with the product whether it was broken or different sort. If the product is broken consumer needs to go to shop and repairs the product. It is no cost for consumer. When the product is distinction with what consumer ordered than it needs to be exchanged.
6. Free sample. Producer when launch new product will give to consumer to try the new product. Might be in the market and usually for daily product such as drink, bread and etc.

c. Personal selling

At most company sells product based on its expectation. It happened when Cigarette Company sent ‘sales promotion girl’ directly to consumers to persuade them buy cigarette. Insurance company does also by sending ‘person’ to give explanation to consumers both other companies and individual.

d. Public relation

The objective is making good image of company in consumers mind. In practise public relation is giving sponsorship to particular events such as cigarette company supports sport events to shape image that cigarette company care to human health.

e. Customer service

Customer service could be done in some ways such as
a. Giving advice to consumers based on their need
b. Giving free sending service to consumers
c. Giving credit facilities to consumers so hopefully every consumer can afford it.
d. Giving after-sales service if there is imperfect product

Nowadays are common for businesses to allocate some money from their profit as a part of responsibility activity to society, employees and environment. Business also gets recognition from society by holding this activity

Public limited company also has some drawbacks such as shares’ price is sensitive to external issue rather than company’s performance, less secrecy due to company must report to general public for its financial statement, otherwise shareholders may lose their money of share price fluctuation.

In businesses are well known that there are six pricing strategies applied. A business might use all pricing strategies by considering usefulness of each pricing strategies. Let us discuss them one by one.

Cost-plus pricing
Price of product is determined by calculating cost of production each item and added with percentage of profit expected. Example: cost of production for making 100 chocolate bars is $100. Producer expects to get 10%. Calculating the selling price each chocolate bar! By using formula “cost of production divided by total production times 10%” will be get selling price of the product is $1.1.

Penetration pricing
Penetration pricing is used when the new product tries to enter market. The price is set lower than competitors’ price. Example: existing products are sold at average price of $10-$12. By using penetration pricing, new product is sold at $8. The lower price wishes attracting consumers’ attention to buy this product.

Price skimming
Opposite of penetration pricing, producer is charging higher price than competitors’ brands due to novelty factor. This product is new invention in the certain industry. Example: iPad’s Apple is new invention in gadget industry. Cost of this product is only $10 but the selling price is $400. There are no competitors for this product at the time.

Competitive pricing
Price of product is set in line or just lower than existing products. Example: the new product by using penetration pricing could use “competitive pricing” after has certain market share that has been expected. Product by using price skimming will being consider to lower its price due to there are many new competitors are entering market. To maintain exists consumers that already loyal.

Promotional pricing
Price of the product is set lower than competitors’ price for short time. Example: to sell unsold product, producers use this pricing strategy to get rid stock. Producer gives 50% discount for two days only or by giving promotion “buy two, get one free”.

Psychological pricing
Producer is charging unique price to make consumer attracted. The price can be higher or lower than competitors’ price. Higher price will reflect as a status symbol for high income consumer. Lower price in daily product will reflect value-money for consumers. Producer can also use $99 than $100 to charge product price.

There are some forms of organisation in businesses. Firstly, form of business organisation is sole trader. This company is owned and controlled only by one person. This is common businesses in all over countries in the world. In developing countries such as Indonesia there are many companies formed sole trader. Some advantages of sole trader become most consideration why people are choosing this business. That are easy setting up the business due to few legal requirement even in Indonesia there is legal requirement to build the business but practically person who wants to set up this business does not fulfil the government’s legal requirement. Another advantages are the owner becomes the only boss, keeping all the profit that company got, owner decides work-time or holiday and policy for company also secrecy of the business.

Some disadvantages are most likely for big-size business such as national or multinational businesses choosing another form rather than sole trader. That are unlimited liability because there is no separated legal identity, there is no person to discuss with and there is limited capital to expand the business so that a company remains small-size.



Secondly, form of business organisation is partnership. Definitely partnership is a group or association of people consist of 2 to 20 people which own and control the business. Some advantages of partnership are more capital to invest, sharing skill to run and expand the business, there is much more motivation among the partners to show their performances and few legal requirements. Partnership also has disadvantages such as sole trader that has unlimited liability. Another disadvantage are the owners have to share profit, to become barrier among the owners to run business if there is disagreement, dishonest might rise among the owners and less secrecy rather than sole trader.                

Sole trader and partnership have unlimited liability that means the owner must responsible with the debt that company has even to sell their personal possession to pay all the company’s liabilities. In law there is no separated legal identity between the owner and the company.

An example case is Gita as an entrepreneur has shoe-shop. Name of her company is Gita Shop. Gita was built her company since she was in college on 2010. She was taking design major in her university. Her company is expressing her potential and skill. Her company is growing a day to day so that Gita needs more capital and partner to discuss with her. Finally, Gita has agreed with Wirjawan that graduated from accountancy major. They are now becoming partner and the shop is already becoming partnership. They share responsibility to run the shop. They also share capital, risk and profit. Gita always discusses with Wirjawan every decision related the company. Their company is growing and expanding to add other branches.

• By income/social status
• By region
• By gender
• By age
• By lifestyle
• By use of product

• Sales: Sales department has responsibility to set up target of sales.
• Research and development: This department has job to do research for predicting future consumers’ requirement.
• Promotion: This department ensure that strategy has been applying increase product selling. For example by strategy buy 1 get 2.
• Distribution: By distributing in the right place of product makes customer more easily to obtain product.

• Helping to create profit
• Fulfilling current consumers’ requirement
• Predicting future consumers’ requirement
• Providing product to customers

• Increasing sales to obtain more profit
• Increasing market share of product
• Maintaining market share of product
• Developing new market of product
• Creating market share of new product 
• Increasing brand image of product

Private sector is organisation that owned by society. Public sector is institution that owned and controlled by government.

Businesses have different objective in different economic circumstance. When economic is growing business gain profit as much as possible. In other hand, when economic circumstance is recession business makes decision to be survive than gain profit.

Indonesia offers huge opportunity to people all over the world. With 240 million inhabitants, business activity easier to gain profit in Indonesia. Indonesia also home for 45 million people in middle-class consumers. It will be bigger year to year consumers class in Indonesia. Indonesia is in growing now. It gives opportunity to business to obtain profit as much as possible before the Indonesia economy go to recession.

To be an entrepreneur is not easy as we assumed before. We have to have skills to run and manage our business. Entrepreneur also has to take a risk to set up his/her business and might be successful or will be bankrupt. So that reasons only a few people who want to be an entrepreneur. It is not save for them especially in fulfill their living cost by day to day. Most of people thought that more save to be an employee than an entrepreneur. Becoming an employee gives safety to them and lower risk than an entrepreneur.

Nowadays, some of people think to become social entrepreneur. They concern about three bottom line of the social entrepreneur. That is, business, social and environment (Stimpson and Farquharson, 2002). Entrepreneur always has mindset to maximize his/her own business profit. Sometime business endanger environment by throw its waste to river that it damage river environment. It differences than social enterprise that has big concern to sustainable environment. On business side for social enterprise will reinvest its profit and some of profit will be given to owner. On social side, social enterprise is giving attention to create job for disadvantage society. And for environment side, social enterprise is running its business environmentally sustainable way.