Delens The above definitions reveal that sales promotion is a marketing device to stimulate demand for a product. Promotions that don't correspond with the brand's image can often do more harm than good by confusing the consumer. Outside sales promotion activities include advertising, publicity, public relations activities, and special sales events. It requires that the participants apply a skill in creating an idea, a concept or an end product contests are usually based on coining a name or a slogan for a new or existing product or answer a question related to a product. Loyalty cards, personal shopping assistants, electronic shelf labels, and electronic advertising displays allow for more personalised communications and more targeted information at the point of purchase. Strengthen relations with the trade. Sales promotion is implemented to attract new customers, to hold present customers, to counteract competition, and to take advantage of opportunities that are revealed by market research.
Sales promotion for companies is all about the ways the company markets the product or service it is touting in order to make money. Taking 25 percent off the price of a good without altering its benefits increases the customer's perception of value. The consumer may not also find such attractive offers in the neighbourhood kirana shop that has been servicing the area for a long time. For example, if there is a buy-one-get-one-half-off discount that seems profitable, a shopper will buy the product. For example, even though a product's price is discounted, the quality of that product may dissuade the consumer from buying the item. Why it works: Nothing creates a sense of urgency like realizing you already missed out on a deal—that is unless you now have an even better deal in front of you.
Coupons are generally issued along with the product. Point-of-purchase displays can generate impulse purchases, frequent flyer or other promotional memberships can strengthen , and sampling can provide product information for future purchases. The markup of the purchased item should more than cover the cost of the gift and still generate a net profit for the business. Thus, a marketing plan for one product might be very different than that for another product. Advantage: Entice Customers The primary benefit of sales promotions is that they induce customer traffic and sales by offering a lower price and better value proposition. Premiums may be classified In terms of whether they are offered free or at a reduced price. Examples here might include joint promotions between a manufacturer and a distributor, sales promotion leaflets and other materials such as T-shirts , and incentives for distributor sales people and their retail clients.
The buyer purchases the product and submits the evidence of purchase with entry form for contest. A premium may be inside the package, outside it or received through mail. Sales promotion is aimed for 3 types of consumers. Such coupons are published in newspapers and magazines. Sales promotion, by itself, cannot produce results. Typically a sales promotion can be run in several ways: i. Sales Promotion Of all the different promotion techniques marketers can use to educate, persuade or remind consumers and retailers of their products, they often spend the most on sales promotion.
Sales companies most commonly use this approach because the misinterpretation of consumers usually results in an increase of sales and profit. Certain tools are to be used only in the introduction stage of a product, while others will be used in the growth and maturity stages. An extra commission paid to retail employees to push products. Firms with small budgets cannot compete with big companies, which spend huge sums of money on advertising. Sales promotion is widely used for creating brand awareness and liking among consumers. The marketer cannot use any sales promotional tool at any time. First, it's often focused on short-term results.
These stimulate customers to make purchase promptly on the spot. Relative Importance of sales promotion: In determining the relative importance to place on sales promotion in the overall marketing mix, a small business should consider its marketing budget, the stage of the product in its life cycle, the nature of competition in the market, the target of the promotion, and the nature of the product. Car dealerships have year-end close-out sales. Finally, sales promotion tends to work best when it is applied to impulse items whose features can be judged at the point of purchase, rather than more complex, expensive items that might require hands-on demonstration. Consumer Acceptance As competition intensifies and promotions proliferate, consumers have learnt to earn the rewards of being smart shoppers. The number of sales promotional activities to be performed are too many, distribution of free samples and gifts, making such offers as price off and money refund, holding contests, participating in trade fairs and exhibitions, display and demonstration of goods and so on.
Learn More in the Library's Blogs Related to this Topic In addition to the articles on this current page, see the following blogs which have posts related to this topic. Incentive — they incorporate some concession, inducement or contribution designed to represent value to the receiver 3. It means that if a customer has a coupon of some product he will get the discount mentioned therein whenever he buys it. In addition, buyers tend to refrain from purchasing bonus packs online because of the skepticism of fraud and scams that may come with the deal. It also involves a cash payment or a fee given to the retailer in exchange for a slot or position on a shop shelf. Consider several types of sale promotions when finalizing your marketing and sales plan.
They enable manufacturers to test how high a list price they can charge, as they can always discount it. Result is declared on the basis of all the forms received by a particular date. One Definition of Public relations Public relations includes ongoing activities to ensure the overall company has a strong public image. The customer who buys a product sees an extra value in the purchase like a discount, etc. For example, if the size of a product is misleading, buyers will not want to buy it.