Innovation in Brand Promotion: Reacting to the Economic Crisis with Digital Channels and Customer Insight

Despite increases in promotional pressure by manufacturers and retailers to counter the effects of the economic crisis, promotional effectiveness is decreasing. Brands are reacting by experimenting with innovation in promotion, enabled by new digital channels, customer insight derived from individual customer information and new intermediaries. We respond to a call for research on promotion innovation (Grewal et al., 2011) by analyzing the post crisis promotional scenario. We see it shaped by the convergence of three industries: loyalty, payments and apps. Players and solutions from these three areas are merging to make a blend of loyalty and price promotion available for brands to deliver over digital channels and in targeted ways. We discuss managerial implications and new research opportunities.