Sales Promotion

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  • 1. Sales Promotion Prepared By: - Vivek Sharma Roll No. 06 ISMC, Noida
  • 2. Sales Promotion
    • Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers or sales-force to stimulate the immediate sales.
    • Sales promotion describes promotional methods using special short term techniques.
  • 3. Types of sales promotion
      • Consumer promotion
      • Trade promotion
      • Sales-force promotion
  • 4. Objective of Sales Promotion
      • Building product awareness
      • Creating interest
      • To increase the sales volume in short term
      • Attract more customer
      • Encourage the customer for buying
  • 5. Objective of Consumer Promotion
    • Retain the customer
    • Increase repurchase
    • Brand Switching
    • Store Switching
    • Increase footfall
  • 6. Objective of Trade Promotion
    • Buy More
    • Building Relationship
    • Stock during off season
    • Display of new product launch
    • Competition
  • 7. Objective of Sales Force Promotion
    • Increase the level of Motivation
    • Getting market information
    • Encourage selling a new product
  • 8. Major Consumer-Promotion Tools
    • Free Samples: - Company provide samples of the product by mail, by retail store, attached in magazines.
      • For Example - Clinic Plus Provide samples of its shampoos in Big Bajar and attached with Times of India.
    • Coupons: - Company provide coupons to their customers inside the pack of product or inserted in magazines and newspaper ads.
      • For Example - Mr. White provide coupons inside the pack. Returned empty pack and get Rs 5 off in next purchase.
  • 9. Major Consumer-Promotion Tools
    • Discounts: - Company provide discount offers to their customers when they buy the product.
      • For Example - Globus provide 50% discount on its product.
    • Buy 1 Get 1 Free: - Company provide offers to their consumers to buy 1 product and get another 1 free.
      • For example - Lux offers to their customer buy 3 get 1 free offer.
    • Combo Offer: - A Combo pack is two related products banded together.
      • For Example - Colgate offers a combo pack of toothbrush free with toothpaste.
  • 10. Major Trade-Promotion Tools
    • Price-Off : - A straight discount off the list price on each case purchased during a stated time period.
      • For Example - Nokia offers to their retailers price off facility.
    • Allowance: - An amount offered in return for the retailer’s agreeing to feature the manufacturer’s products. An advertising allowance and display allowance compensates retailers for advertising the manufacturer’s product.
      • For example - Samsung and LG provide allowances to their retailers in the season of Diwali.
  • 11. Major Trade-Promotion Tools
    • Free Goods: - Offers of extra cases of merchandise to intermediaries who buy a certain quantity or who feature a certain flavor or size.
      • For example - Nestle Eclairs provides free goods offers to their retailers.
    • POP Displays: - This is extra tool of sales promotion given by a company to retailers to boost the sales.
      • For example - Outside signs, window displays, counter pieces, product display.
    • Push money: - An extra commission paid to retailers to push the products.
      • For example – Nokia provide their retailers sale 5 pack of mobiles and get extra 2% margin.
  • 12. Advantage of Sales Promotion
    • Increased Buying Confidence Customer
    • Increased Retention
    • Increased Repeat purchase
    • Increased short term sales
    • Increased Brand switching
    • Good short term promotional tool
    • Provide quicker results
  • 13. Disadvantage of Sales Promotion
    • Dangerous in long term basis
        • Damage the image of product in customers mind
        • Reduced the effect over the customer
        • Risk factor getting high
        • Less profit margin
  • 14. Example
    • Nike provide its customers flat 40% reduction on the product MRP.
    • The objective of using this techniques is to attract more new customers and increase the footfall of the store.
    • The other objective of Nike is to clearance the stock and bring the new trend.