SALES PROMOTION

AGNES MIRIAM. I

SALES PROMOTION• Collection of incentive tools, mostly short

term, designed to simulate quicker or greater purchase of particular products or services by consumers or the trade.

• Used by most organizations including manufacturers, distributors, retailers, and non-for-profit institutions.

OBJECTIVES• To create a long term relationship with a

retailer• To attract new triers• To reward loyal customers• To increase the repurchase rates of occasional

users• To attract brand switchers

ADVERTISING VS SALES PROMOTIONADVERTISING SALES PROMOTION

TIME Long Term Short Term

DEFINITION One-way communication of a persuasive message by an identified sponsor, whose purpose is non-personal promotion of products/services to potential customers.

A Promotion usually involves an immediate incentive for a buyer (intermediate distributor or end consumer). It can also involve disseminating information about a product, product line, brand, or company.

PRICE Expensive Not very expensive

SUITABLE FOR Medium to Large Companies Small to Large Companies

SALES Assumption that it will lead to sales Directly related to sales

EXAMPLE Giving an advertisement in the newspaper about the major products of a company

Giving free products, coupons etc.

PURPOSE Increase sales, Brand building Increase Sales

RESULT Slowly Very soon

MAJOR DECISIONS

• Establishing objectives• Selecting consumer promotion tools• Selecting trade promotion tools• Selecting business and sales force promotion

tools• Developing the program• Implementing and evaluating the program

MAJOR CONSUMER PROMOTION TOOLS

• Samples• Coupons• Cash refund offers(rebates)• Price packs(cents-off deals)• Premiums(gifts)• Frequency programs• Prizes(contests, sweepstakes, games)• Patronage awards• Free trails• Product warranties• Tie-in promotions• Cross-promotions• Point-of-purchase(p-o-p)displays and demonstrations

MAJOR TRADE PROMOTION TOOLS

• Price-off (off-invoice or off-list)• Allowance• Free goods

MAJOR BUSINESS AND SALES FORCE PROMOTION TOOLS

• Trade shows and conventions• Sales contests• Specialty advertising