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.
Table of Contents
- 1 Techniques of Sales Promotion
- 1.1 Consumer Promotion Techniques
- 1.2 Middlemen Promotion Techniques
- 1.3 Sales Force Promotion Techniques
- 2 Marketing Management Topics
Techniques of Sales Promotion
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:
- Price-off offers
- Quantity-off offers
- Premium (gift) offers
- Exchange scheme
- Trading stamps
- Fairs and exhibitions
- Public relations activities
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.
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.
These are instructions given to educate the consumers about using the product. This method may be used in products like vacuum cleaner.
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.
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.
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 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.
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:
- Free display
- Retail demonstrations
- Trade deals
- Buying allowance
- Free goods
- Advertising and display allowance
- Dealer loader
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.
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.
These are offered to encourage retailers to give additional selling support to the product, e.g., toothpaste sold with 30% to 40% margin.
Sellers give buying allowance of a certain amount of money for a product bought.
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.
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.
Sales contests are organized by the manufacturer. In this scheme rewards are provided to salesmen who have achieved exceptional targets.
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 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
Marketing Management Topics
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