INTRODUCTION, MEANING AND DEFINATION OF SALES PROMOTION
BY
SMART LEARNING WAY
CONTENTS
INTRODUCTION TO SALES PROMOTION.
MEANING OF SALES PROMOTION.
WHAT IS
SALES PROMOTION?
DEFINITIONS OF SALES PROMOTION.
WHY
INCREASE IN THE SALES PROMOTION?
ADVANTAGES OF SALES PROMOTION.
DISADVANTAGES
OF SALES PROMOTION.
DIFFERENCE BETWEEN ADVERTISMENT AND SALES
PROMOTION.
CONCLUSION
BIBLIOGRAPHY.
INTRODUCTION
Sales promotion offers a direct inducement to
act by providing extra worth over and above what is built into the product at
its normal price. These temporary inducements are offered usually at a time and
place where the buying decision is made. Not only are sales promotions very
common in the current competitive market conditions, they are increasing at a
fast pace. These promotions are direct inducements.
In
spite of the directness, sales promotions are fairly complicated and a rich
tool of marketing with innumerable creative possibilities limited only by
the imagination of promotion planners.
Sales promotion is often referred to by the names of ‘extra purchase value’ and
‘below-the-line selling’.
Today
we find companies in almost all sectors offering some sort of a promotion
scheme. These sectors range from automobiles to beverages, from financial
services to foods, from household durables to services, from household products
to business products, from personal care to textiles and apparel.
MEANING OF SALES PROMOTION
Every businessman wants to increase the sale
of goods that he deals in. He can adopt several ways for that purpose. You
might have heard about “lakhpati bano”, “win a tour to Singapore”, “30% extra
in a pack of one kg”, “scratch the card and win a prize” etc. You might also
have seen gifts like lunch box, pencil box, pen, shampoo pouch etc. offered
free with some products.
There are also exchange offers, like in
exchange of existing model of television you can get a new model at a reduced
price.
You may have also observed in your neighboring
markets notices of “winter sale”, “summer sale”, “trade fairs”, “discount up to
50%” and many other schemes to attract customers to buy certain products.
All
these are incentives offered by manufacturers or dealers to increase the sale
of their goods. These incentives may be in the form of free samples, gifts,
discount coupons, demonstrations, shows, contests etc. All these measures
normally motivate the customers to buy more and thus, it increases sales of the
product. This approach of selling goods is known as “Sales Promotion”.
Personal selling involves face-to-face contact
with specific individuals, while advertising is directed towards a large number
of potential customers. They also help
in increasing sales of goods.
Thus, advertising can be used as means of
communication to inform potential customers about the incentives offered for
sales promotion. Personal selling can as well include communication of the
incentives to individual customers. But, sales promotion differs from
advertising and personal selling in terms of its approach and technique.
Sales promotion adopts short term,
non-recurring methods to boost up sales in different ways. These offers are not
available to the customers throughout the year. During festivals, end of the
seasons, year ending and some other occasions these schemes are generally found
in the market.
Thus, sales promotion consists of all activities other than
advertising and personal selling that help to increase sales of a particular
commodity.
What is Sales Promotion?
Various techniques to enhance brand value
Integrated activity: Ad/PR/Marketing
·
Increasing
brand value for:
Consumers
Consumer sales promotion
Retailers
Trade-market sales promotion
DEFINITION OF SALES PROMOTION
Sales promotion includes incentive-offering
and interest-creating activities which are generally short-term marketing
events other than advertising, personal selling, publicity and direct
marketing. The purpose of sales promotion is to stimulate, motivate and
influence the purchase and other desired behavioural responses of the firm’s
customers.”
“Sales Promotion is a Marketing Discipline
that Utilizes a Variety of Incentive Techniques to Structure Sales-Related
Programs Targeted to Consumers, Trade, and/or Sales Levels that Generate a
Specific, Measurable Action or Response for a Product or Service.”
Purpose
of sales promotion:
• Attract
new tries or brand switchers
• Reward
loyal customers
• Increase
repurchase rates
Sales promotion refers to many kinds of
incentives and techniques directed towards consumers and traders with the
intention to produce immediate or short-term sales effects.
Sales promotion is a promotional marketing technique
designed to create sales for a product over a defined period of time. Sales
promotion activities are measurable in terms of products moved, coupons
redeemed, number of contest entries, or other quantifiable count.
Sales promotions are short-term marketing
techniques used by a manufacturer for a specific purpose, like increasing
market share or to encourage sales during off-peak periods. Sales promotions
are often one component in an advertising or marketing campaign. A variety of
sales promotion tools are available, such as price reductions, product
giveaways and special trial periods.
In marketing, sales promotion is one of the
four aspects of promotion. Sales
promotions are non-personal promotional efforts that are designed to have an
immediate impact on sales. Sales promotion is media and non-media marketing
communications employed for a per-determined, limited time to increase consumer
demand, stimulate market demand or improve product availability.
“Sales promotion, a key ingredient in marketing
campaign, consists of a diverse collection of incentive tools, mostly short
term, designed to stimulate quicker or greater purchase of particular products
or services by consumers or the trade.”
“Sales Promotion, in a specific sense refers
those sales activities that supplement both personal selling and advertising an
co-ordinate them an help to make them effective, such as displays, shows and
expositions, demonstrations, an other non-recurrent selling efforts not into
the ordinary routine.”
Sales promotion is frequently defined in terms
of what it is not, typically as those marketing communications activities which
do not fall into the categories of advertising, selling or public relations.
This is not very helpful, but definitions trying to explain what this
encompasses are often flawed, by failing to embrace all of the marketing tools
regarded as sales promotions in practice.
We can define sales promotions as ‘marketing
activities usually specific to a time period, place or customer group, which
encourage a direct response from consumers or marketing intermediaries, or an
added item, service or opportunity.
“Sales promotion refers to any consumer or
trade program of limited duration that adds tangible value to a product or
brand.”
Sales Promotion is an activity designed to
boost the sales of product or service of any organization. It may include an
advertising campaign, increased PR (PUBLIC RELATION) activity, a free-sample
campaign, offering free gifts or trading stamps, arranging demonstrations or
exhibitions, setting up competitions with attractive prizes, temporary price
reductions, door-to-door calling, telemarketing, personal letters or other
methods.
Through the offer of additional benefits. The
three key elements of this definition Are that sales promotions are:
1 1.
Non-standard:
Promotions are usually temporary, and may be limited to certain customer groups
(such as airline frequent flier schemes) or specific to a particular
distribution channel (as in ‘tailor-made’ promotions involving a producer and a
single retailer).
2 Response orientated: Promotions seek a
direct response from customers, or those who deal with customers on the
producer’s behalf. The direct response sought is not Necessarily a sale.
Promotions may encourage Consumers to send for a brochure, visit a
dealer or consume a sample. The ultimate aim is always sales, but this is true
of marketing generally.
3 Benefit orientated: Promotions offer their
targets additional benefits, beyond the ‘standard’ marketing mix.
Why the increase in Sales Promotion?
Growing retailer power
Declining brand loyalty
Increased promotional sensitivity
Brand proliferation
Fragmentation of consumer market
Short-term focus
Increased managerial accountability
Competition
Clutter
ADVANTAGES OF SALES PROMOTION
Mainly there are 4 advantages of sales promotion they are:
·
Price
discrimination.
·
Effect
on consumer behaviour.
·
Effect
on trade behaviour.
·
Regional
Difference.
DISADVANTAGES OF SALES PROMOTION
Mainly
there are 4 disadvantages of sales promotion they are:
·
Increased
price sensitivity.
·
Quality
image may become tarnished.
·
Merchandising
support from dealers is doubtful.
·
Short-term
orientation.
DIFFERENCE BETWEEN ADVERTISEMENT & SALES
PROMOTION
ADVERTISEMENT
By using a variety of persuasive appeals, it
offers reasons to buy a product or service.
E.g.: Good Network, Promises and Delivers.
SALES PROMOTION
Besides giving reasons in the form of
different appeals, they offer incentive to the consumers to buy the product or
service now.
For new users, 1HUTCH no. is given free for 1
month & SMS is free for 3 months.
Appeals are emotional or functional in nature.
Eg: the current ad of “Wherever you go, our
network follows.”
• Time-frame
is long term.
• The
primary objective is to create an enduring brand image.
Appeals are rational
It justifies whatever it says.
• Time
frame is short term.
• To
get sales quickly or to induce trial.
Indirect and subtle approach towards
persuading customers to buy a product or service.
Direct in approach to induce consumers to buy
a product or service immediately by temporarily changing the existing
price-value relationship of the product or service.
CONCLUSION
Clearly, sales promotion plays an important
role in total promotion mix. To use it well, the marketer must define the sales
promotion objectives, select the best tools, design the sales promotion
program, implement the program, and evaluate the results. Moreover, sales
promotion must be coordinated carefully with other promotion mix elements
within the integrated marketing communications program.
BIBLIOGRAPHY
Fundamentals
of marketing
William J. Stanton.
Michael J. Etzel.
Bruce J. walker.
Published by: McGraw-hill, INC.
by :
J C Gandhi.
Published by: Tata McGraw-hill Publishing Co.ltd.
Marketing Management Text and Cases
by:
Douglas J. Darymple.
Leonard J. Parsons.
Published
by: John Wiley & Sons.
Marketing Management
by:
Philip Kotler.
Published by: Pearson Education Pvt. Ltd.
Marketing Management
by:
S.A. Sherlekar.
Published by: Himalayas Publishing House.
Marketing Management
by:
Philip Kotler.
Kevin Lane Keller.
Published by: Pearson Education Pvt. Ltd.
Principles of Marketing
by:
Philip Kotler.
Gary Armstrong.
Published by: Asoke K. Ghosh, Prentice-Hall of India Pvt. Ltd.
Marketing Management
Published by: ICFAI Center for Management
Research Banjara Hills, Hyderabad.
Marketing Management ( study guide)
Published by: ICFAI Center for Management
Research Banjara Hills, Hyderabad.
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