Sales promotion is an effort to stimulate consumers to purchase more and more of a particular commodity. In this way, sales promotion includes advertising, personal selling and also publicity efforts of the enterprise. We may now define sales promotion in marketing activity, which involves personal selling, advertising, and supplementary efforts to promote sales.
Sales promotion stimulates demand for products. The main objective of sales promotion is to effect spot buying by prospective consumers through short term incentive, which are temporary and non recurring in nature.
The common sales promotion measures are samples, coupons, premium, bonus, offers, contests and demonstrations.
Sales Promotion
The business enterprise adopts different measures at dealers’, consumers’ and salesmen level to promote sales. These measures are mentioned as under :
Dealers’ level
The manufacturer tries to promote the sales of the product at dealers’ level and adopts the following measures :
Advertising media : The dealers of the product adopt different advertising media suitable to their enterprise and thus move the product to the consumers. As such sales is multiplied.
Special Demonstration : The product is specially demonstrated. Demonstration may be made through physical involvement of the demonstrator. The operation of the product is demonstrated. Demonstration boosts the sale of the product.
Dealers’ contest : The manufacturer organises dealers’ contest. The target of sale is fixed. The dealers achieving the target are rewarded. It motivates the dealers to make more and more sales.
Display : The product is displayed on show windows. Certain product is displayed in important corners and places. In certain cases manufactures of the product reimburse the cost of display to shop owners.
Prizes, Discounts : The manufacturer allows premiums to the dealer in case of extra sales and introduction of new product. Trade discount is allowed at higher rates. Sometimes prizes are awarded to dealers on sales. It encourages dealers to multiply sales.
Consumers’ level
The manufacturer of the commodity tries to impress consumers. He imparts education about the product, its novel and distinct features. The following measures are adopted for it :
Discounted and Prize coupons : Coupons are the certificates entitling the holder a specified saving on the purchase of specified product. The customer goes on collecting coupons and receives discount on the purchase. Sometimes prizes are awarded on the presentation of certain number of coupons. Retailers redeeming the coupons are reimbursed by the manufacturers of the product.
Reduction sales : The manufacturers try to clear their stocks and introduce the fresh variety of the commodity. For this purpose reduction sales, clearance sales off season discount, bumper sales, festival discounts etc., are announced. The customers in order to avails of the price reduction often purchase more of the commodity and the sales is boosted.
Samples : In order to popularise the product the manufacturer distributes free samples of the product among reputed customers. Sometimes free samples are distributed to general public. This method is very useful in introducing new product. It is persuasive but expensive technique. It is useful introducing products like soaps, detergents, talcum, tea etc.
Money refund : There are certain manufacturers, who promise to refund the price of the product, if it does not satisfy the consumer and does not contain the qualities claimed by the manufacturer. In certain cases the product is replaced. The provision of money refund encourage the customer to buy the product without any botheration. It definitely boosts the sale.
Gift : The manufacturer offers attractive and useful gifts with the product. It attracts the customer towards the product, because he is getting a gift with the product without making any extra payment. The sale is boosted with this offer.
Salesmen level
The dealer of the product encourages the salesmen to take extra pains to demonstrate and explain the utility of the product, and effect sales. Salesmen are paid extra remuneration for their extra efforts.
Salesman are provided financial and non-financial incentives. Cash incentives in the form of commission linked with the sale of the product is provided. The efforts of the salesmen are recognised. Sometimes they are promoted to higher ranks for their excellent performance.
Merits
Sales promotion is an effort to earn maximum profit by promoting sales. It has got the following merits :
Reduction in the cost of production: Sales are boosted by sales promotion activities. Increased sales requires that goods should be produced in large scale. The enterprise enjoys the internal and external economies of large scale production. In this way, cost of production is reduced.
Sales support to advertising, personal selling and other marketing measures : Sales promotion is a process of influencing consumers by furnishing them information regarding the product and persuading them to purchase the product. In this way, advertising and other marketing activities are supported by sales promotion.
Promotes acceptability of the product : Sales promotion activities are product oriented efforts. It is an impersonal method, which makes the product acceptable in the market.
Demerits
Sales promotion activities suffer from the following weaknesses :
Fictional incentives : The cost of incentive provided to the consumers is added to the sales price of the product. In this way incentive provided is no real but fictional.
Seasonal Benefits : Sales promotion measures are adopted irregularly so the benefits derived from these measures are also irregular. In this way these benefits are not regular and permanent.
Inferior quality of goods : Sales promotion incentives are given generally on product, which are inferior in quality and thus difficult to be marketed.
Advertising
Advertising in an activity, which establishes non-personal contact of the business with the consumers regarding its product, idea and services.
Advertising maintains distinct identity of the product. It exposes its specialities and novelty. It creates curiosity among consumers to purchase and own commodity. In this way, advertising is a sales promoting activity, which creates mass market for the product by sustaining its demand among existing consumers and creating demand among new consumers.
Special features
- Advertising is the means to establish non-personal contact between manufactures and consumers.
- It creates prospective consumers and sustains the existing consumers.
- It is paid form of communication.
- Advertising is sponsored by producers and manufacturers.
- Advertising is always consumer oriented and it moves buyers towards product.
- Advertising increases the price of the commodity.
Purpose of advertising
- Making an immediate sale.
- Building primary demand.
- Introducing price deals.
- Informing about the products availability.
- Building brand recognition and brand insistence.
- Helping salesmen by arousing awareness of the product among retailers/ consumers.
- Creating a reputation for service, reliability and research strength.
- Increase market share.
- Modifying existing product appeals.
- Informing about price and special features of the product.
- Increasing the frequency of the use of the product.
- Increasing the number and quality of retail outlets.
- Building overall image of the company.
- Effecting immediate buying action.
- Reaching new areas or population with existing areas.
- Developing overseas market.
Importance of advertising
Advertisement is advantageous to the producers and manufactures due to the following reasons :
Benefits to the manufacturers
Creates demand and Increases sales : Advertisement is sale promoting activity, which increases sales by creating demand for the advertised product.
Steady demand : Regular advertising sustains the demand of the product. Novel and new uses of product are told. For example, use of cold coffee during summer and use of fridge throughout the year. Advertising maintains steady demand of the product.
Quick sales and lesser stock : Advertised goods sell quickly, so the funds are not blocked in stock. The problem of safe storage does not arise.
Retailers’ interest : Retailers prefer to sell advertised goods, because it is quickly sold without any difficulty.
Reduction in cost : Increased sales of advertised goods requires their production on very large scale, which results in internal and external economies and consequently cost of production is reduced.
Creation of goodwill and good image : If the advertised product satisfies consumerism, the reputation of the company is built. Sometimes the name of the company becomes the symbol of standard commodity.
Encouragement to better work : The workers involved in the production of advertised standard goods feel the sense of pride. In this way they are further encouraged for better performance.
Benefits to the consumers
Consumers are benefited by the advertisement in the following ways :
Easier shopping : Advertised product is easily available at uniform rates. Chances of being cheated are minimised.
Improvement in the quality of the product : The manufacturers of advertised goods go on improving their product, so that their reputation may be maintained in the market. The customers thus get improved quality of goods.
Elimination of unnecessary middlemen : Advertised standard product can be directly sold to the consumers. In this way, unwanted corrupt channel of middlemen is eliminated.
Consumers’ education : Advertising media informs the consumers about the utility and uses of the product. It also demonstrates how to use the product. In this way even illiterate people can identify and use the product.
Availability of the product at fair price : These commodities are available at fair price. Due to decreased cost of production (because of large scale production) these commodities are available at comparatively cheaper price.
Benefits to the society
Advertising is beneficial to the different classes of the society in following manner :
Encouragement of research work : Advertising encourages research work. Continuous efforts are made to improve the quality of the product, to make it more useful and to put the product to novel and different uses.
Encouragement to Press work : The use of newspapers, magazines, periodicals, hand-bills, posters, etc. as advertising media encourages the press work. Regular advertisement helps the press in reducing cost of publication.
Higher standard of living : The use of standardised quality of product by the consumers raises their standard of living.
Encouragement to artists : The attractive and effective copy of the advertisement requires proper designing, setting and display. All these activities are performed by artists, so advertisement is a source of encouragement to artists.
Glimpse of national life : Display and demonstration of the product through advertisement and the use of these product by the people manifests the glimpse of the national life.
Important advertising media
Important media of advertisement are named as under :
- Press
- Direct mail
- Outdoor advertising media
- Dealers’ aid
- Fairs and exhibitions
- Cinema/Film advertising
- Radio
- Television
- Prize contest
Press
it is a form of advertising in writing. Generally the following two methods are used:
Newspapers : Newspapers are read regularly by millions of people throughout the country daily. It carries the message immediately in the desired area. It is the cheapest and effective source of publicity.
Magazines : Magazines may be weekly, monthly, quarterly, half-yearly and even annual. There are trade, economic, social and technical, journals and periodicals. These magazines are studied and retained for certain period. It is the effective source of advertisement.
Advantages
Wide Circulation : Advertisement message reaches a very large population in different parts of the country and even foreign countries.
Repetitive Value : Advertisement can be repeated many times. It is very effective in popularising new brand or new item.
Timeliness and Flexibilities : Advertisement message can be changed as per the change of events and situations.
Economical : This media of advertisement is very economical, because it cover large population at a small cost.
Disadvantages
Short life : Newspapers are short lived, so if the advertisement is missed by the reader, there is not any chance for it to impress the reader. It is generally read once by the reader.
Poor presentation : Generally cheap and rough paper is used for printing newspaper. As a result, it is not in a position to offer desired result.
Hasty reading : We go through the newspaper in haste and make its cursory reading, so it is sometimes overlooked by the reader.
Direct mail
Appeals are directly sent to the consumers through circulars, letter leaflets and catalogues. Messages explain the utility, speciality and novelty of the products and motivate consumers to purchase the product.
Outdoor Advertising Media
Outdoor advertisement is the display of advertised message outside the business premises. The various form of outdoor advertisement are posters, handbills, advertisement boards display, painting and electrical signs. We use walls, boards, electric poles, buses, railway station, trams, important crossing etc. for the display of the advertised message.
No doubt, outdoor displays catched the attention of the buyers. These posters and bills create news consumers of the product and sustain the old customers. Outdoor advertising is blessed with attraction, repetition, wide coverage, selection of target consumers etc. But it has few limitations also.
Limitations
Brief message : Measures adopted in outdoor advertisement are incapable of providing complete details about the product.
Lacking in acceptance : Generally attention is not paid by the general masses on the advertised appeal, so the method proves ineffective.
Lacking believability : People do not believe in the contents of appeal. They feel that there must be wrong statement about the product.
Consumers’ response unknown : There is not direct contact between the advertiser and the consumer, so the advertiser does not feel the response of the consumer about the product. As such necessary improvement in the product can not be made.
Dealers’ aid
Beautifully packed and packaged products are sent to the dealers. Various incentives and discounts at higher rates are allowed to the dealers. Dealers are in the this way influenced to make their sincere efforts to make more and more sales of the product.
Fairs and exhibitions
Products are displayed and exhibited in the local, national and even international fairs and exhibitions. There may be different exhibitions for different products. The display of product creates its demand.
Cinema advertising
Films are the most popular source of recreation. A very large number of people visit cinema houses for their recreation. Cinema slides of the advertised product is made and shown in the cinema houses. It is an audio-visual method of publicity. During the film shows in the cinema houses it is shown. These days video cassette reels also contain advertisement. It is also an audio-visual method and influences the consumers effectively.
Radio
Radio is an audio media, which is used for advertising also. It has national and even international network and is an effective media of influencing consumers on mass scale. Messages through radios reach every corner of the nation and even world, where press advertising can not be made available.
Television
It is the latest advertising media. It is audio-visual. It displays the utility of the product and creates demand for the product. It is the costliest method of advertisement. Big business houses telecast their own serials and advertise their product thought cable TV network.
This method has greater impact on viewers because special features can be demonstrated. Advertisement is made attractive, charming and effective by its association with films stars, sportsmen and professionals.
Merits
Effective method : T.V. is an effective advertising media because it has the benefits of audio, visual and motion.
Wide coverage : Television, these days has wide coverage. It covers not only the place within country but also foreign countries. Telecasting can be viewed even at the distant place. It is the form of mass appeal.
No loss of the message : Telecast messages reach the viewer intact. There is no possibility of loss and distortion of the message in transit.
Flexibility of the message : The contents and timings of the advertisement can be changed as per requirement.
Demerits
Costlier : Advertising through television is very expensive. Only few big business houses can bear its expenses.
Brief exposure : Telecast message are very brief and short lived, so large number of people do not catch and understand the advertised appeal. It has limited exposure.
Religious and family restrictions : There are certain religion and families who do not allow their children to view television programme. Many families restrict TV viewing of their children.
Unsuitable exposure timings : Timings of the exposure of television programme do not suit the many viewers, so they are deprived of the advertised appeal of the product.
Prize contest
Many companies organise prize contest. These contests may concern sports quiz and other competitions. Newspapers, magazines, radio and television may be used for organising these contests.
Factors determining suitable advertising media
While taking decision regarding suitable media of advertisement, the following factors must be taken into consideration :
Message to be communicated : If the message to be communicated is brief, costly advertising media like television may be adopted. In case of detailed message, bills, posters and newspaper may be used.
Cost of the advertisement : If the cost of advertisement is lower, it may be adopted by firms of smaller size. Costly advertising media will be suitable for enterprises of bigger size.
Necessity of repetition : If the advertisement appeal is to be repeated from time to time, cheap media of advertisement will be suitable.
Related consumer group (selectivity) : Advertising media should correlate the consumer group using goods. The consumers’ group may belong to higher, medium and lower income group. Advertisement media should suit the income level, and nature of work of the consumer.
Nature of advertised product : The advertisement media should be in accordance with the nature of product.
Size of the business firm : Large sized firms can adopt costly advertising media, whereas small sized firms should adopt cheap media of advertisement.
Limitations of advertising
Inspite of various advantages from advertising to producers. Consumers and society suffers from the following limitations of it :
Source of discontentment
Advertising sometimes compels us to use those commodities, which we do not require. In this way, our wants are unnecessarily increased. If wants unsatisfied we feel discontentment. Increasing wants promote materialism. Desire to have more and more things is multiplying and life style is badly affected.
Misrepresentation of facts
Advertisement generally speaks very high of the product. Sometimes products advertised are defective, imitated and adulterated. In this way, consumers are misled and suffer losses with the use of the commodities instead of benefits.
Increase in the price of the product
Advertising adds to the cost of production and the price of the commodity is unnecessarily increased. The consumer pays for the advertised commodity more than what he would have paid for the same unadvertised commodity. Advertisement costs are passed on to the consumers in the form of high prices.
Advertising confuse rather than helps
There are so many advertisements of certain products such as television, detergents, tooth pastes, electrical goods etc., that the consumers get confused as to which product should be purchased. Every manufacturer is making tall claims about the product and consumer is not competent enough to make the best choice.
Danger of monopoly
Advertisement differentiates the product with other products and leads towards monopoly. Generally, standard products are advertise. Consumers become habituated of using the same commodity. In order to take undue advantage of the continuous demand, the enterprise forms a monopoly. It absorbs the demerits of monopoly such as charging unreasonable price, reducing the supply of the products, restricting the flow of product to certain market. Consequently consumers are the worst sufferers.
Salesmanship
Salesmanship is part of salesman’s business to create demand by demonstrating, that the need does exist, although before his visit there was no consciousness of demand.
Special features
- Personal selling concerns individual personal appeal.
- Salesmanship is oral form of communication.
- It establishes direct contact with limited number of persons.
- Buyers doubts are immediately clarified.
- Provides an opportunity to suit the needs, motives and behaviours of the buyers.
Process of personal selling
There are three important steps in salesmanship :
Pre-sales preparation
The salesman familiarises himself with he product, market, organisation and the art of selling. He acquaints himself with the market conditions and business environment. He also develops ability to visualise the buyers’ behaviour and motive.
Locating probable customers
The salesman after his preliminary preparation regarding product, market and business environment locates the probable customers. The salesmen pick-up customers, needing the product having ability, willingness and authority to buy. These customers must be accessible to the business.
Pre-approach
Before presenting product for sales, an efficient salesman finds out the needs, preferences, nature, behaviour and personal traits of the prospect.
Qualities of salesman
Salesmanship is a highly skilled profession, which demands a very high degree of proficiency. A successful salesman possess the following qualities:
Knowledge of self
Salesmanship is a skilled profession. The salesman has to influence the customer. It requires that the salesman should be aware of its strong and weak points. In this way, he should extract the customer towards his strong side and avoid negotiations and conversation on his weak side.
Knowledge of the product
The salesman must have thorough knowledge about the product, he has been selling. He should know the constituting element of the product, the utility of these elements, technique of its production, the plus points of the product as compared to the other products available in the market. Knowledge of the product will enable him in meeting objections raised by customers and removing customers’ doubts.
Knowledge of the enterprise
The salesmen should have perfect knowledge about the enterprise, he has been representing. He should be aware of the policies, programmes, past history of the enterprise, and attitude towards customers. This knowledge will enable him to represent the enterprise effectively.
Personal qualities
In addition to the above qualities the salesman should also possess the following personal qualities :
Physical attributes : The salesman should possess sound health and attractive personality. He should have good personal appearance, habits, stamina, manners, posture-voice, dress and way of addressing.
Mental attributes : A successful salesman should possess the qualities of presence of mind, imagination, judgement, self-confidence, initiative and general intelligence. He should be alert, active and attentive. He should be quick to grasp the situation and act accordingly.
Social attributes : The salesman has to deal constantly with different type of customers, so he should be capable of according different types of treatment to different types of customers. He should be patient listener, frank but not offensive and good humoured. He should be convincing conversationalist. Politeness, courtesy, cheerfulness and pleasant habits are his other qualities. A self-centred (introvert) silent and submissive man cannot be a good salesman.
Vocational attributes : The vocational attributes are the specific qualities which a salesman must posses. These traits include aptitude, ambition, enthusiasm, discipline, and training. Salesmanship is a highly skilled vocation requiring high degree of mind, body and heart.
Advantages
Personal selling has got the following advantages :
Identification of the prospects : Personal selling pin-points the exact customer, whereas advertising being a method of mass communication beats about the bush. Advertising can not distinguish between prospect and suspect customer.
Personal contact : In case of personal selling personal contact with the customer is established. It provides an opportunity to satisfy the customer with commodity.
Immediate Sale : Personal selling results in immediate sale and the deal is finalised, whereas it is not possible in case of advertising.
Display and demonstration of the product : In case of personal selling, product can be effectively displayed and demonstrated.
Two way communication : Personal selling is the best method of two way communication.
Knowledge of objection : In case of personal selling, the enterprise knows the objection of the customers. The salesman tries to meet the objection and remove the doubts raised.
Personnel quality of salesman promotes sales : Even if the product is very good the commodity does not sell itself. It has to be pushed through to customers. The personal selling is also required even if the quality of product is good. A good salesman identifies the prospect, presents the right type and quality of the product to suit the needs and motives of the prospect and results in actual sales.
Salesman provide invaluable feed back information to top management about the tastes, behaviours and attitudes of the customers. It helps the management in developing product to match the expectations of the customers.
There are few limitations also for the personal selling but one can overcome easily over them.
