How does the promotion strategy effect the customer purchase Literature review

How does the promotion strategy effect the customer purchase - Literature review Example Mela, Gupta and Lehmann (1997) discussed the long-term impact of promotions on brand performance. Even though, this article takes dependent variable as brand performance instead of customer purchase, it has been chosen because brand performance is, after all, a determinant of customer purchase. Mela, Gupta and Lehmann (1997) investigated the long-term impact of advertising and promotion on customer’s brand choice behavior. Customer’s brand choice behavior depended upon two decisive factors. i. Is there any response of customers on the variables of marketing mix such as product, price, place and promotion? ii. If so, are these changes related to the promotional policies of retailers and manufacturers? The results of the study revealed that in long run, price promotion makes both types of customers; loyal and non-loyal. In addition to that, Mela, Gupta and Lehmann (1997) concluded that advertising has good affect on consumers’ brand choice behavior whereas promotions have bad affect on the brand choice behavior of consumers (Mela, Gupta and Lehmann, 1997). Personalization, also known as customization, is the popular concept of marketing. It has become a necessity for many organizations. Savadkoohi (2012) conducted a study to investigate advantages and disadvantages of customization for companies as well as customers. The paper emphasized upon the personalized online promotions and its impact on consumers’ buying behavior. Savadkoohi (2012) concluded that the successful online personalization strategies can increase the buying behavior of the customers and thereby, can affect the companies’ profitability. Nowadays, online marketing, selling and promotion have become very common. Companies utilize the platform of internet in order to attract more customers. Ye, Haohong and Fei (2010) conducted a study to investigate the impact of sales promotion on C2C online shopping behavior of consumer. In order to examine the relationship between these variables, Ye, Haohong and Fei (2010) used an empirical method. The results of the st udy revealed that online promotion has direct influence on the attitude of customers but the intention of purchase is not significant. However, it might help in building a brand perception in minds of customers. Therefore, online promotion can be effective in increasing the brand awareness (Ye, Haohong and Fei, 2010). Modi and Jhulka (2012) conducted a study in order to measure the impact of promotional schemes on the buying behavior of consumers. Modi and Jhulka (2012) examined five types of promotional schemes, which included Festival Season Offers, Special Gift, Exchange Offer, Product Warranties and Contest Prizes. A questionnaire was constructed in order to perform the research and gather the relevant data. Chi square test was performed to test the null hypotheses. The results of the study revealed that promotional schemes can be proved as effective tool to organizations for selling their products. The authors further stated that promotional schemes can be very useful especiall y in the car purchasing decision of consumers (Modi and Jhulka, 2012). Costa, Epperson, Huang and McKissick (2002) conducted a study to determine the impact of advertising and promotion on the scanned purchases of Vidalia onion. Another aim of the study was to examine the expected return on expenditure of promotion. In order to gather the data of Vidalia onion, scanned copies from the supermarket were collected. Vidalia Onion Marketing Order generates the promotion expenditure. In order to carry out the research, Costa, Epperson, Huang and McKissick (2002) utilized error component model for 10 different markets for the period of 1996 to 2001. Results of the study revealed that advertising and promotion expenditures influenced the demand of Vidalia onion substantially over the research period. Keeping in mind the seasonality of Vidalia onion, more promotional activities can be done in order to increase the