In a climate where marketing and advertising budgets are under pressure, every campaign needs to work a little harder for the money invested in it.

One way that marketers stretch their budgets a little further is through promotions and incentives, which deliver excellent results if they are executed properly. The secret to their success is that they drive direct (an often immediate) response from customers.

Online media is quickly emerging as a preferred channel for promos for many companies in the UK and US because it is a cost-effective and highly measurable way of getting your promotional assets out into the market.

One recent report from Web research firm Borrell Associates shows that there is a distinct shift "away from classic online spending" in the US in favour of non-advertising marketing expenditures, such as promotions. According to Borrell, promotions will be the biggest form of online advertising by 2012, bigger than either paid search or display adverting.

Why the online medium works for promos

The Web is an ideal environment for promotions. It's an immediate channel, where a customer is simply a click away from your Website once he or she comes across your promotion in an ad or receives an email from you with a voucher attached. Once you've established contact with the customer, you can engage with him or her and start building a relationship.

The single biggest drawback in offline promotions is the cost involved in producing and distributing assets such as vouchers, coupons and competition entry forms. This problem doesn't exist in the online environment.

The customer can simply cut and paste a code from a virtual voucher when shopping on your Website, or fill out an online form to enter your competition. If you're trying to drive traffic to your physical stores, you can allow customers to print out a voucher themselves to bring along to your shop.

Another benefit of using the online channel for promotions lies in the fact that it allows for shorter lead times than the offline world does. This gives you the ability to respond quickly to any new opportunities in the market with a tactical campaign.

Once you've started your promotion, it's easy to measure what sort of response you're getting. You can see exactly how many people are taking up your offer, compared to how many were exposed to it.

If your success rate is lower than you hoped, it is cost effective and easy to adapt your assets and advertising strategy to get better results. You can easily increase the discount you offer or change the incentives you're offering without needing to throw away printed collateral that cost you a fortune to produce.

Getting it right

The same basic principles of running an offline campaign also apply in the online world. You should create your promotional campaign around a set of clear, quantifiable objectives, whether these are building up your email database, driving sales of your product or service, or bringing new customers into your fold with the goal of building long-term relationships.

You need to select appropriate vehicles for your campaign, perhaps initially focusing on reach, and then measure the responses that you're getting as well as the costs of achieving the desired result (be it a sale, generating a lead or simply selling a product on special).

Provided the campaign runs for a fair amount of time (months rather than weeks), you can optimise your campaign - including the creative, placement, and incentives - if you're not happy with the results you're getting. The most important element of an online campaign is the call to action, so invest a lot of your energy into getting this right.

Also, remember that online promotional campaigns can be integrated with offline channels and campaigns to achieve powerful results. You can drive customers in the real world to your Website by giving them an online shopping voucher at one of your stores, or conversely, use a virtual voucher to drive traffic to your branches.

Closing words

Online promotions are a powerful tool for marketers facing pressure to do more with lower budgets. They allow marketers to go straight to the consumers with a value proposition, establish a relationship and keep them coming back for more. It's a tool that any savvy marketer should consider adding to his or her toolbox.