Promotion Reach vs. Promotion Efficiency

Business Context

Broad promotions reach large customer populations and can generate substantial traffic and sales. However, many recipients may already intend to purchase, have little interest in the promoted category, or require no incentive. Narrow targeting improves efficiency but can reduce total reach and miss customers whose potential demand is not visible in historical data.

Retail Consumer TRIZ Resolution

Retailers should combine broad discovery mechanisms with differentiated incentive allocation. Communications can reach wider audiences while stronger financial incentives are reserved for customers, products, or situations where incremental response is more likely. Lower-cost mechanisms can create awareness among uncertain audiences without providing maximum discounts universally.

Applicable TRIZ Principles

Principle 1 – Segmentation differentiates promotional treatment according to expected incremental response.

Principle 3 – Local Quality concentrates expensive incentives where their economic impact is strongest.

Principle 35 – Parameter Changes varies the type and intensity of promotional support instead of using a single offer.

Expected Outcome

Preserved promotional reach

Higher promotional efficiency

Lower unnecessary discount expense

Better incremental demand generation

Decision Indicators

Early indicators include:

Large portions of promotional sales would likely have occurred without incentives.

Broad campaigns generate high revenue but weak incremental margin.

Targeting improvements reduce reach more than necessary.

Identical discounts are provided to customers with substantially different purchase probabilities.

Promotional effectiveness is measured by response rather than incremental behavior.

These indicators suggest that reach and incentive intensity are being treated as the same variable.