Sales promotion

 SALES PROMOTION

22.1 Introduction

According to American Marketing Association, sales promotion includes those sales activities that supplement both personal selling and advertising and co–ordinate them and help to make them effective such as display, show and expositions, demonstrations and other non recurrent selling effort not in the ordinary routing.

Sales promotion has various other definitions, as below:

• Sales promotions are short term incentives to encourage purchase or sale of a product or a service.

• Sales promotions are temporary incentives targeted at the trade (called trade promotions) or at end consumers (consumer promotions). While sales promotions generally aim to change purchase behavior, they very in whether they attempt to persuade trade customers or end consumers to buy a product for the first time, to buy more, to buy earlier or to buy more often.

• Sales promotion consists of a diverse collection of incentive tools mostly short term designed to stimulate quicker and / or greater purchase of particular products. Service by consumers or the trade.

From the above definitions it can be said that sales promotion refers to many kinds of incentives and techniques directed towards consumers and traders with the objective to produce immediate or short term sales effects. Sales promotion provides a direct inducement to purchase by giving something extra over and above what is built into the product at its normal price.

22.2 Objectives of Sales Promotion

Sales promotions are used with either proactive or reactive objectives. Following are the proactive sale promotion objectives:

1. To obtain more sales revenue or increase market share.

2. To increase the size of target market.

3. To ensure and build good experience of consumers with the product.

4. To deliver extra value from the product and build brand franchise.

Reactive sales promotion objectives are formulated when unfavorable market conditions crop up due to competition or more inventories etc.

Important sales promotion objectives are as under:

1. To lead to higher sales

2. Achieve sales of slow moving product at faster rate

3. Smoother out fluctuations in sales

4. Add new customers

5. Encourage repeat purchase

6. Reduce stocked product inventories

7. Motivate dealers to stock the products