Sales promotion is a blend of marketing activities and promotional items to intensify the efforts of your sales force, induce your intermediaries to stock and sell your products, and to persuade your customers to purchase the offering within a specified, limited time period.
Why customers respond to sales promotions * They have a positive feeling about your brand which is linked to an unconditional stimulus such as a discount * Reinforced reward - in-pack discount voucher and once tried they keep coming back. * Their attitude changes after trial - repeat purchase. * Foot in the door' technique - sample is tried to gain a larger order. * Sales force promoting benefits to alter customers perception of the offering. * Price perception - perceived benchmark by customers. Used by quoting the reference price and sales price to assist the customer to calculate the savings. * Decision making process - end of isle items trigger recognition to purchase or seeing a machine in a magazine and it reminds you to place an order for a service or part..
Type Of Sales Promotion Objectives * Encourages sales force to move slow moving items * Challenges sales force to locate and qualify new prospects * Set up more store displays * Train more distributor sales people * Induce wholesalers to carry a new product line * Persuade distributors to promote (push) a brand in their promotional activities * Persuade retailers to give a particular brand shelf space * Encourage retailers to support sales promotion campaign by carrying more inventory
Sales promotion is one of 6 elements in the marketing mix and should thus be used against the background of the firms overall marketing communication strategy. A firm selling expensive machines would not get involved in a sweepstake but would rather create a quality image through their distribution network by advertising in trade magazines and include personal selling in the mix.
How sale promotion affect sales * Brand switching - does not only occur with price promotions. Customers might also buy the brand most readily available, or the brand on display. This is why there is rivalry amongst marketers for the end of isle locations. * Repeat purchasing - * To create a habit of purchasing the offer * Product extension - to purchase same brand of microwave after a refrigerator was bought * Purchase acceleration - * Purchase larger volumes - bulk buying * Load customer to beat competitors promotion - two for the price of one
Category expansion - * Give the customer another reason to buy - baking soda to remove stains and odors. * Increase the consumption rate - recipe/technical books with a product showing new ways to use the product
What sales promotion can do * Stimulate sale force enthusiasm for a new improved or even mature product * Find new prospects * Rekindle sales of a mature product * Counteract seasonal slumps in sales * Facilitate the introduction of new products to the trade * Increase merchandising shelf space * Reduce stock and increase turnover * Neutralise competitive advertising and sales promotion * Obtain trial purchases from consumers * Retain existing users by encouraging repeat purchases * Increase product usage by loading up consumers * Reinforce advertising
Types of sales promotions Internal Sales Promotion Timing is very important. It should not become a regular routine event. Launch and feedback are two important factors. Campaign promotion will contribute to keen participation and constant feedback will keep enthusiasm at a high level.
Sale promotion to distributors This is to introduce new or improved products and to increase shelf space. Sales promotion can be in the form of trade allowances such as a price reduction if certain quantities have been reached. Cooperative advertising when the cost are usually split 50-50. Trade contest and incentives can be extended to the distributors management and staff.
Point Of Purchase One of the most important form of sales promotion. Displays are designed to attract attention and enhance the attractiveness of the products displayed. They come in various forms - Posters, mobiles, wobblers, shelf talkers, coupon dispensers, in-aisle display, end of aisle display, front of store display, standees, dump bins etc.
Specialty advertising Sale promotion that uses a number of materials and useful articles to carry your brand, such as T shirts, calendars, pens, diary etc
Trade Shows Provides effective opportunity to introduce new products and attract local and international dealers and distributors.
Sampling Offers a trial run and one of the most effective way to introduce a new or old product. Nivea cream had a very effective promotion with young ladies in leotards with blue balloons handing out samples.
Couponing This is a growing sales promotion technique in South Africa but we are far behind USA who redeem an estimated 8 billion coupons per annum.
Premiums A free give away to encourage customers to purchase the offering. Dunlop Tyres new give away is a cooler box with an assortment of picnic plastic containers inside.
Contest and sweepstakes A contest requires the participant to apply a skill to create something such as a slogan, new idea or concept - Five Roses Tea uses this form of promotion to great effect. the prize is usually a fantastic holiday. The degree of consumer involvement is high as it appeals to the human desire for a bargain. Sweepstakes are a game of chance with every entrant having an equal chance of winning- Readers Digest and charity organisations. This type of promotion creates a high level of consumer awareness and a renewed interest in products can be achieved.
Sales promotion is a very effective way to increase sales and price incentives are very effective where low brand loyalty exists. A mix in the offer could be a small reduction in price, a new benefit, being readily available and a challenge to try.