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Sales Promotion: Definition

- Apr 11, 2018 -


Sales promotion: definition


Sales promotion represents a variety of techniques used to stimulate the purchase of a product or brand. Sales promotion has a tactical, rather than strategic role in marketing communications and brand strategy. Researchers,Farhangmehr and Brito, reviewed the definitions of sales promotions in marketing texts and journals and identified a set of common characteristics of sales promotion, including: [3]

  • 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 products core benefits

  • Is not a single technique, rather it is a set of techniques used for a specific purpose


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: [4]

  • 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


Consumer sales promotion 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. 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”.[2] For example, a sales company may offer their consumers a bonus pack in which they can receive two products for the price of one. In these scenarios, this bonus pack is framed as a gain because buyers believe that they are obtaining a free product.[2] The purchase of a bonus pack, however, is not always beneficial for the consumer. Sometimes consumers will end up spending money on an item they would not normally buy had it not been in a bonus pack. As a result, items bought in a bonus pack are often wasted and is viewed as a “loss” for the consumer.

  • Coupons: coupons have become a standard mechanism for sales promotions.

  • Loss leader: the price of a popular product is temporarily reduced below cost in order to stimulate other profitable sales

  • Free-standing insert (FSI): A coupon booklet is inserted into the local newspaper for delivery.

  • Checkout dispensers: On checkout the customer is given a coupon based on products purchased.

  • Mobile couponing: Coupons are available on a mobile phone. Consumers show the offer on a mobile phone to a salesperson for redemption.

  • Online interactive promotion game: Consumers play an interactive game associated with the promoted product.

  • Rebates: Consumers are offered money back if the receipt and barcode are mailed to the producer.

  • Contests/sweepstakes/games: The consumer is automatically entered into the event by purchasing the product.

  • Point-of-sale displays:-

    • Aisle interrupter: A sign that juts into the aisle from the shelf.

    • Dangler: A sign that sways when a consumer walks by it.

    • Dump bin: A bin full of products dumped inside.

    • Bidding portals: Getting prospects

    • Glorifier: A small stage that elevates a product above other products.

    • Wobbler: A sign that jiggles.

    • Lipstick Board: A board on which messages are written in crayon.

    • Necker: A coupon placed on the 'neck' of a bottle.

    • YES unit: "your extra salesperson" is a pull-out fact sheet.

    • Electroluminescent: Solar-powered, animated light in motion.

  • Kids eat free specials: Offers a discount on the total dining bill by offering 1 free kids meal with each regular meal purchased.

  • Sampling: Consumers get one sample for free, after their trial and then could decide whether to buy or not.

New technologies have provided a range of new opportunities for sales promotions. Loyalty cards, personal shopping assistants, electronic shelf labels, and electronic advertising displays allow for more personalised communications and more targeted information at the point of purchase. For example, shoppers may receive alerts for special offers when they approach a product in a specific aisle. [5]


 

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