Techniques of Sales Promotion

  • Post last modified:8 August 2021
  • Reading time:8 mins read

Sales promotion techniques are known as promotion tools and the mode of their application is known as sales programme. These tools and programmes are divided under three heads.

Techniques of Sales Promotion

  1. Consumer Promotion Techniques
  2. Middlemen Promotion Techniques
  3. Sales Force Promotion Techniques

Consumer Promotion Techniques

The consumer promotion campaign is a step by step procedure, the first step being to set the goals and objectives. The organizing of consumer schemes is discussed below:

  1. Sample
  2. Price-off offers
  3. Demonstrations
  4. Quantity-off offers
  5. Premium (gift) offers
  6. Exchange scheme
  7. Trading stamps
  8. Refunds
  9. Fairs and exhibitions
  10. Public relations activities

Sample

Usually called consumer sample, free samples are given to consumers for trial to introduce a new product or to expand the market. The consumers can try the product.

Price-off offers

In the price promotion method, products are offered at a price lower than the normal price. The price is reduced on the product package through special printing of price. The percentage of price-off differs from product to product or service to service and it is decided by the manufacturer or supplier.

The reduction of the price does not cut into the retailers profit but is given from the manufacturer’s profit. This ensures the co-operation of retailers.

For example, 50% discount banners or sale banners at various shops and shopping malls, airlines giving different rates of discount for flying the same sector, etc.

Demonstrations

These are instructions given to educate the consumers about using the product. This method may be used in products like vacuum cleaner.

Quantity-off offers

Offering more quantity of product at no extra cost or nominal increase in the price of the larger quantity packs is known as quantity-off offer. Some examples are—three for the price of two, 25% extra, hotels offering 3 night stay at the rate/price of 2 night stay, etc.

Premium (gift) offers

These are temporary price reductions, which appeal to bargain instinct, e.g., instant coffee sold in carafe by one company was very successful. Towels, dinner ware, hairbrushes, key chains, artificial flowers, ball pens, toilet soaps, blades, were given as in pack premiums.

Exchange scheme

This technique offers to exchange the old product with new in payment of a fixed amount which is less than the original price for example, exchange of old black & white television for colour television by paying 6,000/- only (original price is 8,000/-)was offered by a particular producer of colour TV sets.

Trading stamps

Trading or bonus stamps are issued by retailers to customers who buy goods from there. The number of stamps given to a buyer depends upon the amount of purchases made by him.

For instance, in India Roman bonus stamps are issued at the rate of 2–1/2 per cent of the purchase amount. These stamps are given free of charge and the customers can redeem them to obtain products out of the specified list.

This technique induces customers to buy their requirements from the retailers who offer such stamps. The purpose is to increase customer loyalty.

Refunds

Refund is an offer to return a portion of the purchase price back to the consumers, once they provide the proof of purchase, such as receipt, etc. The refund form usually has to be mailed to the organization with receipt to get the refund. Many of the companies now provide coupons instead of refund. This ensures and enhances the chance of the consumer buying the product again.

Fairs and exhibitions

Trade shows, fashion shows or parades, fairs and exhibitions are important techniques/tools of sales promotion. They provide a forum for the exhibitions or demonstration of products. Free literature can be distributed to introduce the firm and its products to the public.

Fairs and exhibitions are organized usually by big firms or trade associations. At these fairs and exhibitions, business firms are allotted stalls where they display their products.

Fairs and exhibitions have wide appeal as several people visit them. Customers can be attracted through gifts, special concessions and free demonstrations of technical and speciality products. Fairs and exhibitions provide an opportunity to the visitors to observe the competing products and help to promote sales.

Public relations activities

These include greetings or thanks in newspapers, donating space for noble causes, offer of Privileged Citizen Card, etc. Their purpose is not to create immediate demand or to increase sales. They are designed to create a good image of the firm in the society.

Middlemen Promotion Techniques

The middlemen promotion techniques are as follows:

  1. Free display
  2. Retail demonstrations
  3. Trade deals
  4. Buying allowance
  5. Free goods
  6. Advertising and display allowance
  7. Dealer loader

Free display

The retailers are provided with materials from the manufacturers to advertise in their store. These can be posters, or other related materials for display. This ensures that the customers are aware of the product and in the case of some self-servicing product retailers, point of purchase (POP) advertising helps.

But the POP advertisement does not ensure the sale of product and the cost of providing the materials of display can be very high. There is provision of free display of material either at the POP or at the POS, depending on one’s view point. Display reaches consumers when they are buying and actually spending their money.

Retail demonstrations

These are arranged by manufacturers preparing and distributing the products as a retail sample, example, Nescafe Instant Coffee was served to consumers trying the sample on the spot of demonstration regarding the method of using the product.

Trade deals

These are offered to encourage retailers to give additional selling support to the product, e.g., toothpaste sold with 30% to 40% margin.

Buying allowance

Sellers give buying allowance of a certain amount of money for a product bought.

Free goods

It is offered to encourage repurchase of a product immediately after another trade deal. Seller gives free goods, e.g., one piece free with two, or two pieces free with 10, are common free deals.

Advertising and display allowance

These are also offered to retailers to popularize the product and brand name of the manufacturer.

Dealer loader

A gift for an order is a premium given to the retailer for buying certain quantities of goods or for special display done by the retailer.

Sales Force Promotion Techniques

There are tools like sales meetings, sales manuals, sales contests, incentives and many more. It is better to have tools that are interactive in nature as they help enhancing proper sales force promotion.

  1. Sales contests
  2. Sales manuals
  3. Sales meetings
  4. Training for salesmen

Sales contests

Sales contests are organized by the manufacturer. In this scheme rewards are provided to salesmen who have achieved exceptional targets.

Sales manuals

Training materials such as manuals, visual aids, flip charts, programme, learning books are most useful to sales people. Sales manual may be long or short depending upon the type of the products manufactured and sold by the company.

The sales manuals usually contain product details, applications, manufacturing processes, prices, sales techniques, etc. Some companies also have house journals that report about the company programme, new products, research activities, new policies, awards, promotions, etc.

Sales meetings

Sales meetings are generally organized for sales people from one area, region or district more frequently, usually once a month, once in two months, or quarterly. These meetings bring together sales people from different territories of the nation and are considered a popular way of educating sales people. There is a varying mixture of business and pleasure.

Training for salesmen

Dealer and distributor training for salesmen, which may be provided to give them a better knowledge of a product and how to use it. Dealer sales promotion provides the selling devices. Sales promotion devices at the point of purchase inform, remind, and stimulate buyers to purchase products.

People who see these devices are in a buying mood and thus they can be easily persuaded to buy those products.

Also Read: Sales Promotion

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