Sales promotion

Sales promotion is one of the elements of the promotional mix. The primary elements in the promotional mix are advertising, personal selling, direct marketing and publicity/public relations. Sales promotion uses both media and non-media marketing communications for a predetermined, limited time to increase consumer demand, stimulate market demand or improve product availability. Examples include contests, coupons, freebies, loss leaders, point of purchase displays, premiums, prizes, product samples, and rebates.

Sales promotions can be directed at either the customer, sales staff, or distribution channel members (such as retailers). Sales promotions targeted at the consumer are called consumer sales promotions. Sales promotions targeted at retailers and wholesale are called trade sales promotions.

Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales. These efforts can attempt to stimulate product interest, trial, or purchase. Examples of devices used in sales promotion include coupons, samples, premiums, point-of-purchase (POP) displays, contests, rebates, and sweepstakes.

Sales promotion is implemented to attract new customers, hold present customers, counteract competition, and take advantage of opportunities that are revealed by market research. It is made up of activities, both outside and inside activities, to enhance company sales. Outside sales promotion activities include advertising, publicity, public relations activities, and special sales events. Inside sales promotion activities include window displays, product and promotional material display and promotional programs such as premium awards and contests.

Sale promotions often come in the form of discounts. Discounts impact the way consumers think and behave when shopping. The type of savings and its location can affect the way consumers view a product and affect their purchase decisions. The two most common discounts are price discounts ("on sale items") and bonus packs ("bulk items").

Short-term effects and duration;
Operates and influences only the last phase of the purchase process;
Exhibits a secondary role in relation to other forms of marketing communication;
Performs an accessory role regarding the product's core benefits
Is not a single technique, rather it is a set of techniques used for a specific purpose

thumb|Cokecaps is a manufacturer-sponsored sales promotion targeted at consumers.

Both manufacturers and retailers make extensive use of sales promotions. Retailer-sponsored sales promotions are directed at consumers. Manufacturers use two types of sales promotion, namely:

:1. Consumer sales promotions: Sales promotions targeted at consumers or end-users and designed to stimulate the actual purchase

:2. Trade promotions: Sales promotions targeted at trade, especially retailers, designed to increase sales to retailers, to carry the product or brand or to support the retailer in consumer-oriented promotions

Sales promotion is useful when:

:1. To launch new products to the existing market.

:2. To boost sales of a product that's already being sold.

:3. To bring a product into a new area or to new customers.

The impact of sales promotions may be short-lived unless supported by broader marketing efforts that foster long-term customer relationships and brand loyalty.

Types

Consumer sales promotions are short-term techniques designed to achieve short-term objectives, such as to stimulate a purchase, encourage store traffic or simply to build excitement for a product or brand. Traditional sales promotions techniques include:

Price deal: A temporary reduction in the price, such as 50% off.
Loyal Reward Program: Consumers collect points, miles, or credits for purchases and redeem them for rewards.
Cents-off deal: Offers a brand at a lower price. The price reduction may be a percentage marked on the package.
Price-pack/Bonus packs deal: The packaging offers a consumer a certain percentage more of the product for the same price (for example, 25 percent extra). This is another type of deal "in which customers are offered more of the product for the same price". A "gain" view on a purchase results in chance taking For example, if the price of a product is $93 and the sales price is $79, people will initially compare the left digits first (9 and 7) and notice the two digit difference. Risky choice framing references back to the gain-or-loss thought processes of consumers.

Most European countries also have controls on the scheduling and permissible types of sales promotions, as they are regarded in those countries as bordering upon unfair business practices. Germany is notorious for having the most strict regulations. Famous examples include the car wash that was barred from giving free car washes to regular customers and a baker who could not give a free cloth bag to customers who bought more than 10 rolls.

Sales promotion

Types

See also

References