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Integrated Marketing Communications
The Promotion Mix
Marketing Textbooks Boundless Marketing Integrated Marketing Communications The Promotion Mix
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Concept Version 9
Created by Boundless

Sales Promotion

Sales Promotion stimulates market demand, product availability and coordinates public selling, advertising and public relations.

Learning Objective

  • Explain how sales promotion is used in the promotional mix


Key Points

    • Sales Promotions - increase the perceived value of a product and are usually offered for a limited amount of time.
    • Consumer Sales Promotions - target the end user or the customer such as coupons or point of purchase displays.
    • Trade Sales Promotions - target organizational customers such as dealers, distribution channels or sales teams that stimulate immediate sales such as sales incentive contests or dealer wholesale price discounts.
    • Retail Sales Promotions – are devised and initiated by in-store management such as "buy one get one free" programs or "kids eat free" nights.
    • Promotional Mix – a marketing plan's seven components consisting of sales promotion, advertising, personal selling, direct marketing, publicity/public relations, corporate image and exhibition.

Terms

  • sales promotion

    media and non-media marketing communication employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability

  • Promotion

    dissemination of information about a product, product line, brand, or company

  • sales promotion device

    A type of offer, in the form of a rebate, coupon or price deal that stimulates product sales or prompts a customer to take action

  • loss leader

    a sales promotion device that offers a temporary reduction on a popular product's price to stimulate sales on other products being offered.

  • Aisle interrupters

    product signs that jut into the aisle from the shelf, a point of purchase sales promotion device


Full Text

The primary objective of a sales promotion, a catch all marketing function, is to stimulate market demand, improve product availability and to coordinate public selling, advertising and public relations. A successful sales promotion is meant to prompt a targeted consumer group to show interest in the product or service, try it or ideally buy it. They are delivered to targeted groups via media and non-media marketing communications during a pre-determined, limited amount of time. It is a component of a marketing plan's "promotional mix" that usually includes advertising, personal selling, direct marketing, publicity/public relations, corporate image and exhibition. Sales promotion cannot compensate for a poor product, a declining sales trend, ineffective advertising or can it create strong brand loyalty.

There are two types of sales promotions; consumer and trade. A consumer sales promotion targets the customer while a trade sales promotion focuses on organizational customers that can stimulate immediate sales.

Contests, coupons, giveaways, loss leaders, point of purchase displays, premiums, prizes, product samples and rebates are sales promotion devices. They are delivered via mixed forms of media such as print, digital, electronic (radio and television) and online in various forms of new media.

Sales Promotions Have Purpose

Sales promotions launch new products, especially ones with perceived high risk, they create repeat customer purchase patterns, move large amounts of products quickly, counter the strategy of a competitor and can move marginal customers to make a choice.

Consumer Sales Promotion Techniques

Consumers attract the greatest number of sales promotion devices. Commonplace techniques include price deals that offer a temporary price reduction while cents-off deals offer a brand at a lower price, usual as a percentage marked on the package. Price pack deals offer a certain percentage more of the product for the same price while a loss leader offers a temporary reduction on a popular product's price in to stimulate sales for other products offered. Reward programs involve collecting points, miles, or credits from purchases and then redeeming them for rewards. The purchase of a product can also enter a buyer in a contests, sweepstakes, or online games.

One of the most common sales promotion techniques involves coupons. They are used to lower prices, for discounts, free goods and value added giveaways. They are dispensed as neckers placed around the 'neck' of a bottle, on-shelf meaning available where product is displayed, as a free-standing insert (FSI) or booklet that is delivered inside the local newspaper, at checkout, on-line, and displayed and shown on mobile phones for redemption. Now, by tweeting or posting sale promotions, the circle of communication is wider than ever. Even "cashback" or rebate offers can be redeemed on line instead of through the mail.

Point-of-sale displays are in-store sales promotion techniques. Aisle interrupters or signs jut into the aisle from the shelf, hanging signs called danglers sway with consumer traffic, product dump bins stimulate curiosity, glorifiers elevate products for better visibility, wobblersigns draw attention and lipstickboards convey product information written in crayon.

Other in-store sales promotions include pull-out fact sheets, special lighting and animated displays powered by solar energy and policy promotions such as "ladies nights" or "kids eat free" offers.

Trade Sales Promotion Techniques

Wholesalers, retailers and other organizational groups are offered a wide array of sales promotion devices such as trade allowances or short term incentives to encourage retailer to stock up on a product, dealer loaders incentivizing product purchase and display, trade contests for selling the most product, point-of-purchase displays to create impulse buying and spiffs or bonus commissions on certain products and trade or functional discounts paid to distribution channel members for conducting sales and special events.

Sales Promotion Techniques at the Retail

Retailer sales promotion devices are regularly rolled out for new marketing initiatives. For example "buy one, get one free, three for two, buy quantity and receive a lower price or percentage discounts on specific days of the week.

Price Deals

Co-promotional, sales promotion involving two different products

Sales Promotion

Rebates -mail in or online redemption offers customers money back on products or services

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