Types of Consumer Sales Promotion tools 1. (c) When we want to amplify the results of the advertising, (d) When we want to increase the number of retail stores to sell our products, and. The focus of advertising to create reason for purchase the focus of promotion is to create an incentive to buy. Promos try to maintain their effectiveness by one-upmanship. It involves making use of marketing communication and initiatives like seasonal discounts, financial schemes, etc. Free samples are developed for introducing new products. It is to be seen that where a contest does not contravene the MRTP Act, and does not come under the unfair trade practices. Retailers use promos to attract customers inside, and then encourage them to buy other products. Marketing managers use sales promotions to stimulate buying and increase consumer interest in a product. To increase buying response by ultimate consumer, and 2. 3. The Indian consumer still has suspicions about cash rebate. 5. Many of you must be confused about promotion and sales promotion. The manufacturers can use three methods to measure the effectiveness of sales-promotion-. Free samples are small and packaged portion of the (main) merchandise distributed for free. Customer Sales Force Structure: The sales force is organized along customer or industry lines. Rewarding just one person is to be avoided. The maximum and minimum discount must be stated. This monitoring covers brand / premium availability, brand visibility, movement of the brand at the retail outlets on day-to-day basis, competitor’s countermoves, etc. Consumer incentives could be samples, coupons, free trial and demonstration. The value of a freebie should not exceed the value of the product itself. Promotions differ from advertising in that advertising offers reasons to buy, while promotions offer incentives to buy. Large sales force with a hierarchical order calls for contests for different groups, and eligibility criteria restrict the participation to each group. Moreover, if the purchaser is not satisfied with the product, the whole price or part of it will be refunded. To increase sales of any product, producers adopt different measures like distributing samples, gifts, coupons, bonus, etc. For retailers, objectives include inducing retailers to take up new items, encouraging higher stock levels, etc. Retailers thus demand more S.P efforts from their suppliers. The present contest will earn the winner a fellowship during which the winner will help Ogilvy write a guide to selling in the 21st century. Reduction in prices stimulates sale of goods. A coupon is a certificate that fetches buyers a saving when they purchase a specified product. The company can use sales promotion to achieve many objectives. They are generally directed at children. It should not be easily capable. Sales promotion operates at three levels: (i) At the level of consumer, it is called consumer promotion, e.g., free gifts, samples, price-offs. Some activities like event associations do enhance the brands. Promotion is not only addressed to consumers but also to dealers. 500. Definition of Sales Promotion 3. It consists of mostly collection of those short-term incentive tools, which are designed to stimulate purchase of a particular product or service. They should be carried out in small bursts and phased out. It covers those marketing activities other than advertising, publicity, and personal selling that stimulate consumer purchasing and dealer effectiveness. What constitutes a new order? (iii) To conduct experiments about incentive value, duration and distribution media. Moreover, distributing samples to customers also involves expenditure. Only 15 per cent POP material that is supplied is displayed and that too for half of its useful life. Promos support mainline advertising. The most common objectives under pro-active category are: 1. The retailers are poor in administration of complete schemes, whereas the wholesalers are poor at generating the primary demand. Sales promotion aimed at consumers is called ‘consumer sales promotion‘. The present contest will earn the winner a fellowship during which the winner will help Ogilvy write a guide to selling in the 21, Sales Promotion – Sales Representative Level Promotion, 1. There was a joint concert of Nescafe and Samsung. Sales promotion and publicity, when combined with advertising and personal selling programmes, really add up to more than the sum of the parts. Creating talking points for salespersons. The reusable package itself serves as a premium. Personal meeting with the executives are arranged. Mostly in-house journals, circular letters, personal letters motivational letters and reminders are used to promote the contests. For example- Sensodyne Toothpaste meant for relieving tooth sensitivity is a unique product introduced in India. Personal selling is an integral part of the firm’s communication mix which is made up of non personal communication tools. Contests are conducted to attract new customers. Too much of it affects the long-term brand equity. Themes must be measurable objectively and be relevant to the company’s sales curve. (c) When there is intensive competition on consumer sales promotions. To effect sales of a specific pack size (Vicks large size bottle) or in a specific market(s). Promos no longer generate excitement. Contest is not an intelligence test, and so should be absolutely clear. Such a shift has several reasons. This structure can lead to problems if a single l arge customer buys many different company products. Being a competitive world, most companies use a combination of various sales promotional methods to defeat competitors, attract and retain customers and most importantly, to increase the sale of their products … Cash refund offers are rebates allowed from the price of the product. A reusable container can be reused after the product is reused. Point-of-purchase displays give a real payoff, sales rising by 25 to 50 % or even more. But such an approach may cause further slowdown in certain categories, e.g., pastes and soaps on promotion do not lead to category growth. Used positively, they are a great device. Once the marketing strategy assigns promotion-mix the role of using “pull-push” in case of sales promotion and only “pull” in case of advertising, the promotion objectives have consumer as well as trade orientation, and the sales promotion strategies focus on different consumer promotions and trade deals. Today, sales promotion is attracting more and more of the promotional budget. Each programme should have its individual implementation and control. To gain additional market share or additional revenue. Such salesman are sales-force. Demonstrations are provided free of cost. It induces trials and generates loyalty. One maxim is, do promote, but not at the cost of brand equity. Benefits 10. For example, a 15 to 60 percent off on clothes before some festive season in retail shops are examples of sales or sales promotion. Says that the sales gain would have to be large enough to compensate for the reduction in revenue necessary to fund the promotion. We'll cover promotions to increase sales, to encourage repeat business, and to boost brand awareness. (i) Price-offs or off-invoice or off-list. The first difference is Personal Selling is an element of promotional mix, where salesman visits the customer and displays the goods in order to initiate purchase. Sales promotion is that “something extra” (2 + 2 = 5). It can be used as a stock clearance scheme. On the close of the contest, wide publicity is given to achievers and their photos are flashed. In the mid-90s, promos were just some trivial giveaways. To make salesman’s efforts effective, some of the tools of the salesmen-oriented sales promotion are as follows: – Bonus to Sales Force: A quota of sale is fixed. 6. Huge Collection of Essays, Research Papers and Articles on Business Management shared by visitors and users like you. Sales force is linking between companies and customer. When a competitor takes a non-promotional route, the promotion led brand is vulnerable. For example- sales up to Rs. Product Sales Force Structure: The sales force sells along product lines. Sales promotion objectives could be either pro-active or reactive. Promos should be designed keeping in mind the brand objectives and consumer behaviour. The basic aim is to increase consumption and usage. Goods are sold at reduced prices during slump season. In a recent Tata group contest, the participants had to select the ‘Pride of India’, complete a slogan, and send the entry with an empty packet of any Tata tea or coffee, and one could win a Mercedes Benz or a Tata Sumo Deluxe car. Similarly, Videocon offered Rs.7,000 off on its No-frost model of refrigerator against an old fridge. Essays, Research Papers and Articles on Business Management, Sales Promotion: Objectives, Importance, Techniques, Examples, Methods, Types and Tools, Top 8 Tools of Sales Promotion (With Advantages and Disadvantages), Sales Promotion: Meaning, Merits, Limitations and Methods, Advantages and Disadvantages of Franchising. It also affects the brand equity. Many sales promotion campaigns involve the use of incentives. By themselves, they cannot build brand perception. 3. Contest prizes are becoming attractive. Couponing gets a boost in a competitive environment. Techniques 12. 7. (1) Consumer Promotion- Activities intended to educate or inform the consumers and those intended to stimulate the consumers. 5. Account Disable 12. In a bundle, one product works as an effective awareness builder and a trial inducer for the other product. Demonstration of products induces customers to buy. They are non-recurring in their use. Indeed the contest is brickmanship! 5. User 6. To get you started with this worthwhile strategy, here are 15 sales promotion ideas, accompanied by real examples, and categorized by the business goals they can help you achieve. Promos magnify brand value continuously. (2) Dealer Promotion- Activities to increase the interest and enthusiasm of dealers and distributors. Producers may distribute gifts to consumers to increase sales of products. 2. Different methods like bonus, sales-force contest and sales meetings can be applied as sales-force promotion. (iii) The trade is motivated to use POP tools, and price reductions. (iii) Free goods on a certain quantity, push money and free speciality advertising items. Brand expectations are built by Ford by asking participants to identify celebrities inside the car, and to win a foreign trip. The accountability of redemption of coupons or refunds and rebates should be properly fixed. According to Schultz and Robinson (Sales Promotion Management, Chicago: Crain Books), the objectives should be Specific, Measurable, Clear and Concise, Practical, Affordable, and Attainable. Sales Promotion Objectives: Increase in Sales Volume, Encourage Repeat Purchase and To Block Competitor Moves Sales Promotion Objectives – Top 7 Objectives: Launch New Products and Increase Trail, Encourage Dealers to Participate in Display and a Few Other Objectives. The parties should be clear about goals and role of one another. To build goodwill by sharing the gay spirit. Novel themes – the focus is on recreation and fun linked with the current sales scenarios. Promos have limited reach and cannot change brand perceptions across the entire spectrum of customer universe, even if supported by the company. The Basis of Consideration in Trade Promotion are: (a) The capabilities of the parties. Temporary – What length of time would qualify for being temporary? Couponing has the advantage over direct rebates in the sense that couponing does not make the ‘cheapness’ explicit. There are motivational tools linked to sales that achieve a certain level or cross that level. Advertising messages may promote the adoption of goods, services, persons, or ideas. Names of consumers are included in a list of prize winning contest. Promos should be targeted properly to be effective. Samples are one of the most important tools of sales promotion. Sales promotions are only supplementary devices to supplement selling efforts of other promotion tools. Rebate is a partial refund to someone who has paid more or extra on purchase of a specified quantity or value of goods within a specified period. Binaca used to give those animal replicas. The product manager type organisational structure in which product managers are constantly goaded to sell more has given a boost to SP. To develop favourable consumer experience with the product. Those who look at SP tools in a store setting are very good prospects, or else they would not have been in-store in the first place. Conventionally, the glamour in promotion is stolen by advertising. Later, the announcement of a few more prizes, writing of reminders, etc., generate an air of expectancy. 20,000 on the car would have smacked of an inferior quality. (ii) Allowances like advertising allowance or display allowance. 3. Premium refers to goods offered either free or at low cost as an incentive to buy a product. Pro-Active or Reactive; 8. Communication of the team of judges, and criteria of judging. Why Use Sales Promotion? We have to use sales promotion sparingly. Short purchase cycles mean short-term effects. It is an attempt to squeeze maximum out of promos. Sales reps need to close more sales, and they will more readily accept and execute sales strategies that they feel are designed to help them get lead after lead, and meet and exceed sales quotas and goals. Therefore, it is necessary to classify sales promotions into two broad categories – sales promotions aimed at consumers and sales promotions aimed at distribution channels (which is more commonly referred to … (i) The trade is motivated to carry the brand. The marketer has to determine the size of the incentive, conditions for participation, duration of promotion, the distribution vehicle and timing of promotion, total sales-promotion budget and the incentive cost in order to arrive at a full programme. It gives extra incentive to the customer to make a purchase. A visit to your nearby supermarket will reveal numerous sales promotion schemes of various products, simultaneously vying for our attention. A marketing man today wants a short-term increase in sales of the current year, rather than waiting to build the brand over a period of five years, by which time he may or may not be in the organisation. One has to communicate with the consumer through advertisements and POPs at the retail level. To illustrate, National offers Rs.500 off on its grinder mixer if a consumer brings his own old grinder mixer. Some agencies working in this field in India are Glea Public Relations of Shri Nair, Wiz.Com (a division of Wizcraft) of Timmins, Joseph and Sarkari and Fountain-head of Murry and D’Souza and Tellis. When the decision is to discontinue a product, or close down the business. 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