Sales Promotion: Definition, Techniques, Types, Example

August 24, 2020January 16, 2023 Priyanshi Shah 0 Comments

In this guide, we will look at what is sales promotion, Definition, Techniques of sales promotion, Advantages, Disadvantages, and Examples.

What is Sales Promotion?

Sales promotion is a prime component along with personal selling and advertisement in the promotion. It gives prompt reason to buy the product. In simple terms, it is a group of techniques and is carried out for a short period of time, which quickly attracts the customer’s attention, resulting in increased sales and profit.

Definition:

According to Kotler, “Sales Promotion are short-term incentives that encourage the customer to buy the product or services. Sales Promotion has an immediate effect on customers.

According to A.H.R. Delens, “Sales Promotion means any steps that are taken for the purpose of obtaining an increasing sale. Often this term refers especially to selling efforts that are designed to supplement personal selling and advertising and by co-ordination helps them to become more effective.

Techniques Of Sales Promotion:

1. SALE

When business units offer the product at a lower rate, it is known as a Sale. Normally it is used when a business decides to stop the production of that particular product or to achieve the goal of selling products.

2. FACILITY OF INTEREST-FREE LOANS:

This technique is used when the product is high priced and the customer cannot afford to pay altogether. For e.g. providing interest-free loans on electrical appliances. Here a customer can begin the usage of products by paying a small amount of it.

3. DISCOUNT:

The word discount is enough to attract customers. The discount means a reduction in price than the original price.

4. PRIZE COUPON:

The customers are given the coupon as a code and the date of declaration of the prize is mentioned. On that particular day the winner gets announced and is presented with various benefits.

5. ADVERTISEMENT COUPON:

Marketing manager estimates sales and makes marketing plans which presents benefit to the customers. Here, the marketeer makes an interesting advertisement that attracts customers to buy under a specific period or up to a specific limit. Discount coupons or granting gifts on shopping more than the specified limit, fall under this category.

6. GIVE AWAY SAMPLES:

Making the customers use the product is mandatory for any business, and when the product samples are given for free, customers tend to use it. Satisfied customers further ensure buying the same product even at high prices. This is one of the best marketing methods.

7. GIFT VOUCHERS:

Producers organize various competitions to promote their products. For e.g. The company producing beauty products would collect the information about the customer by organizing the makeup contest and the new product is given as a prize.

8. SUPPLEMENTARY GIFTS:

Focusing on the requirements of the customers’ free supplementary gifts are given along with the main product. Sometimes supplementary gifts may not relate to the main product. For e.g. giving free toothpaste with a facewash.

Advantage:

The sales promotion method provides various benefits to the business. Below mentioned are some of the Pros of sales promotions:

1. ATTENTION VALUE:

If any business uses Sales promotion techniques by offering various discounts, prizes, free samples directly attract the attention of the customers. Therefore, as many incentives offered results into the attention of a large number of customers.

2. CREATION OF NEW PRODUCT:

Many companies offer their newly introduced product at a lower cost so as to create demand for it. Offering free samples of the new products also attracts customers. And the satisfied customers would buy the product at a high price also and so it also results in an increase in demand. Therefore, Sales Promotion motivates prospects to test the new product.

3. BRING EFFECTIVENESS IN TOTAL PROMOTIONAL EFFORTS:

Promotional techniques increase the effectiveness of advertisements and personal selling. For e.g. 20% extra offered to customers on the food items with the help of advertisements. The advertisement of the product is done and 20% extra offer is the promotional techniques. Therefore, we used promotional techniques and advertisement together which also helps in increasing the sale.

4. CREATES BETTER AND QUICK IMPACT:

Promotional activities like free gifts, samples can encourage customers to act fast. For e.g. if a free mug is offered to customers with 1 pack of coffee, free conditioner on 1 bottle of shampoo.

Disadvantage:

Promotional techniques also have some drawbacks which affect the business and product. Below mentioned are some of the cons of promotional techniques:

1. REFLECT CRISIS:

If a firm uses Sales promotion again and again it indicates that there is no demand for product. Because the brand is popular enough there is no need for promotional techniques, customers would purchase them at a high price also.

2. DAMAGE PRODUCT IMAGE:

If promotional techniques are used frequently it affects the image of the product. Customers may feel that the product is of low quality.

3. COMPETITORS USES SAME METHOD:

There is a possibility that all competitors use the same method at the same time. This approach does not benefit all of them. For e.g. all the manufactures of the air condition offers off-season discounts, then the customer will decide only on the brand’s popularity.

4. EFFECTIVE FOR SHORT TERM:

As the promotional techniques are carried out for a short period their benefits will also remain for a short period.

5. UNABLE TO BENEFIT INDIVIDUALLY:

Using only Promotional techniques does not give good results if advertisements and personal selling are not included. For e.g. gifts offered to the customer are advertised so that customers can know about the deals and personal selling of free samples that also take place while achieving the goal of Sale.

Examples:

The products are promoted using various tactics. Here are some of the examples of sale promotions tactics:

1. Festival sales

Festivals times are the biggest opportunity for the manufacturers to promote their product as people tend to spend a lot during festivals. So, they provide their customers with various discounts on their respective products to meet their surge in sales during festival seasons.

2. Giveaway and free samples

The giveaway strategy is very beneficial when the companies create a new product. They distribute free offer coupons. They advertise on social media sites and ask them to do certain tasks to win the product free of cost.

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