Sales Promotion.pdf
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Sales promotion tools are used to stimulate quick sales and promote sales in a given territory and time period. The importance of sales promotion to marketers is that it helps drive sales in fast growing and competitive markets where products are becoming standardized. Factors contributing to the growth of sales promotions include growing consumerism, heightened competition, rising media costs, and standardized products. Sales promotion objectives for consumers include generating trial, increasing inquiries, boosting repurchases, and motivating traffic. Objectives for trade promotions include inventory building and providing promotional support through margins, allowances, and subsidies. When planning a sales promotion program, marketers should analyze product market situations, consumer purchase patterns, and opportunities and threats to decide on objectives and budgets.
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For this week’s deliverable, you are to provide a draft of your plan for the final paper. Similar to an outline, your draft will include each of the major headings of the paper; however, you will also need to include details in paragraph or bullet point format of what you will include within each heading. You must also include inline (intext) citations where appropriate and include the references at the end in APA format.
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In this draft, you should include the following sections that will be in your written report:
Executive Summary (this is written last and is usually one page long)
A. Introduction
B. IMC Objectives (Quantify)
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· Attract new customers
· Retain existing customers
· Branding objectives
· Marketing and corporate objectives
C. Market Analysis
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a) SWOT
b) Segmentation and Targeting
c) Positioning
d) Product/Service
e) Customer Profile
f) Marketing Channels
D. Communications Strategy Plans
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Executive Summary (this is written last and is usually one page long)
A. Introduction
B. IMC Objectives (Quantify)
Identify the brand and the principle objectives of the campaign and quantify where possible:
· Attract new customers
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· Branding objectives
· Marketing and corporate objectives
C. Market Analysis
A detailed analysis will provide the specific details for decision-making:
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Sales Promotion.pdf
- 2. 17.2 Sales promotion collectively comprises the tools used to promote sales in a given territory & time.They are shot term in nature & Are designed to to stimulate quick sales. • Importance of sales promotion to a marketer is attributed to the following reasons: • Fast growing market • Increasing competition among brands • The maturing and standardization of products
- 3. 17.3 Factors Contributing to Growth of Sales Promotions: (a) Growing consumerism in India and an upwardly mobile Indian market (b) Heightened inter-firm rivalry within the industry (c) Trade’s resistance to invest additional resources in the product mix of different companies (d) Fragmentation of viewers and readers arising out of multiple television channels, newspapers and magazines (e) The mass media cost has been on the rise and most companies find sales promotion as a more cost effective alternative (f) With technologies and products getting standardized, differentiation between firms has got blunted and price wars have now become a reality in most consumer goods
- 4. 17.4 Sales Promotion Helps (i) Helps in securing trial and defending shelf space against competition; (ii) Smoothens out the manufacturing capacities of firms in such a way that the peaks and the valleys are minimized; (iii) Provides opportunities to manufacturers to reach out to market segments with differing price sensitivity; (iv) Adds excitement to the in-store merchandizing of consumer goods; (v) Motivates trade to keep more and push more of those brands that are on promotion
- 5. 17.5 Consumer promotion objectives Vehicles used (a) Generate trial: (i) New products (ii) Related products (iii) Brand switchers (b) Enquiries (c) Repurchase (d) Traffic building (e) Increased rate of purchase Coupons Discount sales Free samples Contest demonstrations Gifts Mail in coupons Catalogue offers On-pack coupons Mail in coupons Continuity promotions Special events Annual sales Festival sales Retailer coupons Multipacks Special price for two Information on new usage situations
- 6. 17.6 Trade Promotions Objectives Vehicles (a) Inventory building (b)Promotional support •High margins •Allowances for additional shelf space and merchandizing •Returns allowance •Joint promotion •Sales contests •Merchandize allowance •Subsidy for promotion budgets
- 7. 17.7 Sales Promotion • Sales promotion and the Brand’s stage in its life cycle- • Introductory Stage- advertising helps awareness creation & brand positioning while sales promotion induces trial • Growth Stage- Advertising helps competitive differentiation & market expansion,while sales promotion helps to create and reward loyalty. • In Maturity market advertising helps reminding customer about product availability,while promotion helps maintain customer loyalty and attract new customers. • Planning the Sales promotion Programmes- Considerable time in planning and a long term analytical planning approach which involves – • Review of the Product Market Situation –Marketer should examine trends in his brand sales and product category sales. • Consumer Purchase Patterns • Distribution methods
- 8. 17.8 Planning the Sales promotion Programmes • Identification of Opportunities & Threats • Deciding on Sales Promotion Objectives • Deciding on Sales Promotion Budgets- next question comes how much to spend ? 1) Direct fixed & variable costs- costs of physical distributing samples,placing advertisements,& point of purchase material. 2) Likely Market Responses- a) Redemption rates b) Displacement rates c) Acquisition rates d) Stock up rates e) Conversion Rates f) Product line effects
- 9. 17.9 Major Consumer Promotion Tools Samples Coupons Cash Refund offer Price Packs Premiums Contests Free Trials Patronage awards Free trials Product Warranties Tie-in-promotion Point of Purchase Displays