Sales promotion consists of short-term incentives to encourage immediate or earlier purchase of products and services. Whereas advertising focuses on reasons to buy, sales promotion emphasizes reasons to buy now. Sales promotion makes up 77% of marketing expenditures on average for consumer packaged goods companies. Popular sales promotion techniques include buy-one-get-one-free offers, loyalty programs, discounts, coupons, competitions, and free samples. Marketers must carefully plan sales promotion programs by determining incentive size, participation criteria, promotion period, and evaluating the program's effectiveness and returns on investment.

1. IMC - Prof. Rajesh Satpathy

2. Sales Promotion
Sales Promotion:
Personal selling and advertising often work closely with another
promotion tool, sales promotion. Sales promotion consists of
short-term incentives to encourage the purchase or sales of a
product or service. Whereas advertising offers reasons to buy a
product or service, sales promotion offers reasons to buy now.
Sales promotion is the most short-term of the promotion mix
tools. Whereas advertising or personal selling says “buy,” sales
promotions say “buy now.”

3. Sales Promotion
Sales Promotion Definition:
“ Short-term incentives to encourage the purchase or sale of a
product or a service. Sales promotion includes a wide variety of
promotion tools designed to stimulate earlier or stronger market
response”.

4. Sales Promotion
Rapid Growth of Sales Promotion…
Sales promotion tools are used by most organizations, including
manufacturers, distributors, retailers, and not-for-profit
institutions. They are targeted toward final buyers (consumer
promotions), retailers and wholesalers (trade promotions),
business customers (business promotions), and members of thebusiness customers (business promotions), and members of the
sales force (sales force promotions).
Today, in the average consumer packaged-goods company, sales
promotion accounts for 77 percent of all marketing expenditures.

5. Sales Promotion
Today, consumers have become more deal oriented. In the current
economy, consumers are demanding lower prices and better
deals.
Sales promotions can help attract today’s more economy-oriented
consumers. The growing use of sales promotion has resulted in
promotion clutter, similar to advertising clutter.promotion clutter, similar to advertising clutter.
In developing a sales promotion program, a company must first
set sales promotion objectives and then select the best tools for
accomplishing these objectives.

6. Sales Promotion
Sales Promotion Objectives:
Sellers may use consumer promotions to urge short-term
customer buying or enhance customer brand involvement.
Objectives for trade promotions include getting retailers to carry
new items and more inventory, buy ahead, or promote the
company’s products and give them more shelf space.company’s products and give them more shelf space.
For the sales force, objectives include getting more sales force
support for current or new products or getting salespeople to sign
up new accounts.

7. Sales Promotion
Some examples of popular sales promotions activities:
1. Buy-One-Get-One-Free (BOGOF) - which is an example of a
self-liquidating promotion. For example if a loaf of bread is priced
at Rs. 10, and cost Rs.3 to manufacture, if you sell two for Rs.15,
you are still in profit - especially if there is a corresponding
increase in sales. This is known as a PREMIUM sales promotionincrease in sales. This is known as a PREMIUM sales promotion
tactic.
2. Customer Relationship Management (CRM) incentives such as
bonus points or money off coupons. There are many examples of
CRM, from Petroleum Companies to banks to supermarkets.

9. Buy one get one free Petro Mile Card

10. Sales Promotion
3. New Media - Websites and mobile phones that support a sales
promotion.
For example, in the United Kingdom, Nestle printed individual
codes on KIT-KAT packaging, whereby a consumer would enter
the code into a dynamic website to see if they had won a prize.
Consumers could also text codes via their mobile phones to the
same effect.same effect.
4. Merchandising- additions such as dump bins, point-of-sale
materials and product demonstrations.

11. Dump Bins
POP Displays

12. Sales Promotion
5. Free gifts e.g. Subway gave away a card with six spaces for
stickers with each sandwich purchase. Once the card was full the
consumer was given a free sandwich.
6. Discounted prices e.g. Budget airline such as SpiceJet e-mail
their customers with the latest low-price deals once new flights
are released, or additional destinations are announced.are released, or additional destinations are announced.
7. Joint promotions between brands owned by a company, or
with another company's brands. For example fast food restaurants
often run sales promotions where toys, relating to a specific
movie release, are given away with promoted meals.
Eg. MTV & NTT Docomo mobile promotion technology

13. Low price deals
Gift Card
Low price deals
mobile-phone-based joint
promotion trial using a new
access technology

14. Joint Promotion

15. Sales Promotion
8. Free samples: tasting of food and drink at sampling points in
supermarkets.
For example Red Bull was given away to potential consumers at
supermarkets and at petrol stations by a promotion team.
9. Vouchers and coupons: often seen in newspapers and
magazines, on packs.magazines, on packs.
10. Competitions and prize draws: in newspapers, magazines, on
the TV and radio, on The Internet, and on packs.

16. Free Sample Offer

17. Sales Promotion
11. Finance deals: for example, 0% finance over 3 years on
selected vehicles.
Many of the examples above are focused upon consumers. Don't
forget that promotions can be aimed at wholesales and
distributors as well. These are known as Trade Sales Promotions.
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.

18. Sales Promotion
Sales promotion:
Short-term incentives to encourage the purchase or sale of a
product or a service.
Event marketing (or event sponsorships):
Creating a brand-marketing event or serving as a sole or
participating sponsor of events created by others.
Trade promotions:
Sales promotion tools used to persuade resellers to carry a brand,
give it shelf space, promote it in advertising, and push it to
consumers.
Business promotions:
Sales promotion tools used to generate business leads, stimulate
purchases, reward customers, and motivate salespeople.

19. Planning Sales Promotion Programmes
Beyond selecting the types of promotions to use, marketers must
make several other decisions in designing the full sales promotion
program. First, they must determine the size of the incentive.
A certain minimum incentive is necessary if the promotion is to
succeed; a larger incentive will produce more sales response. The
marketer also must set conditions for participation. Incentivesmarketer also must set conditions for participation. Incentives
might be offered to everyone or only to select groups.

20. Planning Sales Promotion Programmes
Marketers must determine how to promote and distribute the
promotion program itself. A Rs. 10/- off coupon could be given out
in a package, at the store, via the Internet, or in an advertisement.
Each distribution method involves a different level of reach and
cost.
Increasingly, marketers are blending several media into a totalIncreasingly, marketers are blending several media into a total
campaign concept. The length of the promotion is also important.
If the sales promotion period is too short, many prospects (who
may not be buying during that time) will miss it. If the promotion
runs too long, the deal will lose some of its “act now” force.

21. Planning Sales Promotion Programmes
Evaluation is also very important. Many companies fail to evaluate
their sales promotion programs, and others evaluate them only
superficially.
Yet marketers should work to measure the returns on their sales
promotion investments, just as they should seek to assess the
returns on other marketing activities. The most commonreturns on other marketing activities. The most common
evaluation method is to compare sales before, during, and after a
promotion.

22. Planning Sales Promotion Programmes
Evaluation is also very important. Many companies fail to evaluate
their sales promotion programs, and others evaluate them only
superficially.
Yet marketers should work to measure the returns on their sales
promotion investments, just as they should seek to assess the
returns on other marketing activities. The most commonreturns on other marketing activities. The most common
evaluation method is to compare sales before, during, and after a
promotion.

23. Planning Sales Promotion Programmes
Now, Marketers should ask: Did the promotion attract new
customers or more purchasing from current customers? Can we
hold onto these new customers and purchases? Will the long-run
customer relationship and sales gains from the promotion justify
its costs?
Clearly, sales promotion plays an important role in the totalClearly, sales promotion plays an important role in the 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 overall IMC program.

24. Thank You!