Sales promotion

1. RESHMI ASHOK KUMAR MACFAST Sales promotion

2. According to George W. Hopkins, “Sales promotion is an organised effort applied to the selling job to secure the greatest effectiveness for advertising and for dealer’s help.” The major function of sales promotion is to serve as a connecting link or a bridge between advertising and personal selling which are the two wings of promotion. It helps salesmen to boost up selling. Definition

3. Purpose of Sales Promotion To disseminate information to the potential customers. To encourage the customers to try to a new product. Sales promotions yield faster responses in sales than advertising. Sales promotion is considered as a special selling effort to accelerate sales. Brand switchers are primarily looking for low price, good value and premiums. Sales promotions are likely to turn them into loyal brand users. It helps to defeat competitor’s promotional activities.

4. To increase buying response at the customer’s level. To increase the sales effort of dealers and sales personnel. To attract new customers. To capture major share of the market. To create a favourable attitude towards the product. To simplify the job of the middlemen. To meet the competition of other firms. To effect off-season sales to boost the sales. To stimulate the demands by popularising the product. Objectives of Sales Promotion

5. To establish and maintain communications with large market segments. To keep the memory alive. To create additional talking points to sales-persons. To create brand image. To remove customer’s dissatisfaction. To retrieving lost account. To motivate sales force. To encourage repeat sales. To clear excessive inventories. To block competitor’s move. To speed up the sales of slow moving products. To generate short-term cash.

6. To deflect customer’s attention from price. To secure shelf-space in the selling places. To counter-balance price competitions. To build goodwill. To improve manufacturer-dealer relationship. To differentiate the company and its product from its competitors. To inform the public about the new product and its specialities, attraction and advantages. To stock more at the level of traders, through whom aggressive sales can be effected. To bridge the gap between advertising and personal selling.

7. It stimulates in the consumers an attitude towards the product. It creates a better incentive in the consumers to make a purchase. It is a demand creator. It gives direct inducement to the consumers to take immediate action. It is flexible. It can be used at any stage of a new product introduction. Sales promotion leads to low unit-cost, due to large-scale production and large-scale selling. It is an effective supporter of sales. It helps the salesman and makes his effort more productive. Advantages of Sales Promotion

8. Sales promotion is effective when: A new brand is introduced. We have to communicate a major improvement or attraction in product. Enlarging the result of advertising. Increasing the number of retail stores in order to sell out products. Engaging or embarking upon aggressive sales campaign.

9. Sales promotions are only supplementary devices to supplement selling efforts of other promotion tools. Sales promotion activities are having temporary and short life. The benefits are also short-lived for three or four months. Then the demand will fall down. They are non-recurring in their use. There is a feeling in the minds of customers that sales promotional activity tools are used to sell inadequate or second grade products. Immediate increase in demand is stimulated by this. Hence it is a short-lived tool. Disadvantages of Sales Promotion

10. It is expensive and leads to a rise in the price of products. Discounts or rebates are allowed by boosting the prices of the goods, with a view to sell at a gain, which is not real. Sales promotion is ineffective when: There is a declining market for an established brand. There is no product improvement.