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Elements of Sales Promotion

Updated on March 28, 2013



Promotional Objectives

Promotion, broadly speaking, is any method of informing, persuading, or reminding consumers-wholesalers, retailers, users, or final consumers about the marketing mix of Product, Place, and Price which has been assembled by the marketing manager.

The objectives of promotion are to inform, persuade, or remind consumers of the company's marketing mix. To better understand the reasons for these various objectives, some historical perspective is useful.

The promotion variable today is quite complex, but this was not always so. Most firms, especially when beginning operations, try to handle the whole marketing job themselves including the promotional aspect. The vendor in primitive markets relied upon his loud voice for attracting attention and informing consumers of the availability of his services.

As markets were transformed into retailing centers, merchants because even more concerned about attracting trade to their stores. -Informing customers of 'the availability of supplies was highly important. Some type of outside promotion was necessary, 'and signs on stores and in prominent places around the city and notices in printed matters were sometimes used.

As the markets grew larger and the number of customers increased,the importance of attracting customers grew. The task of personally attracting customers become enormous and more expensive. Increasing reliance was placed on mass methods of informing many consumers about the availability of the merchant's products. These mass methods were more economical in reaching large numbers of consumers and informing them of the product's availability.

Effective promotion consists of four fundamental and interrelated jobs. These are:-

(1) to get Attention

(2) to hold Interest

(3) to arouse Desire,

(4) to obtain Action.

The first letters of these four jobs have been combined, to aid recall, into a single four-letter word, AIDA, which can be remembered easily as a well- known opera.

Promotional Methods

Sales promotion includes all those marketing activities, other than personal selling, advertising and publicity, that stimulate consumer purchasing and dealer effectiveness, such as display's shows and exhibitions demonstrations and various non-recurrent selling efforts not in the ordinary routine. It is also defined as all forms of sponsored communication apart from activities associated with personal selling, it, thus, includes trade shows and exhibits, couponing, sampling, premiums, trade allowances, sales and dealer incentives, cents-off packs, consumer education and demonstration activities rebates, bonus, packs, point of purchase material and direct mail.

The fundamental internal factors that have enhanced the role of sales promotion are:

(1) Promotion has become more acceptable.

(2) Appointment of more and better qualified executives.

(3) Expectation of quick returns.

Growth of Sales Promotion

This is due to several factors which contribute to the rapid growth of sales promotion, particularly in consumer markets. They are internal and external factors.

1. Internal Factors

a) Promoting is accepted by top management as an effective sales tool. Now a days toplevel managers realise and accept that sales promotion effect sales. It will increase the sales volume.

b) Product managers are qualified to use sales promotion tools, product managers realise the importance of promotion. Hence they practise sales promotion tools effectively.

c) It is the duty of the product managers to increase the sales volume and this attracts the sales promotion tools to achieve the aim the objective

II. External Factors

a) There is widespread use of branding. Promotional activities are essential as they are more practical than advertising.

b) Competitors have become promotional-minded

There is cuthroat competition, and the market is flooded with numerous protects, hence promotional activities are essential.

c) During the period of inflation and recession, the consumers are more deal-orientedand the promotional techniques facilitate sales.

d) The present stage of trade demands more deals from manufactures.


Advantages and Limitations of Sales Promotion


1. It stimulates in the consumers an attitude towards the product.

2. It creates a better incentive in the consumers to make a purchase. It is a demand creator.

3. It gives direct inducement to the consumers to take immediate action.

4. It is flexible. It can be used at any stage of a new product introduction.

5. Sales promotion leads to low unit-cost, due to large-scale production and large scale selling.

6 It is an effective supporter of sales. It helps the salesman and makes his effort more productive.

7 The promotional tools are the most effective to be used in increasing the sales volume.

Limitations :-

1. Sales promotions are only supplementary devices to supplement selling efforts of other promotion tools

2. Sales promotion activities are having temporary and short life. The benefits are also short-lived for three or four months. Then the demand will fall down

3. They are non-recurring in their use

4. Brand image is affected by too many sales promotion activities. Consumers are of the opinion that due to the lack of popularity and overstocking of products of a company these sales promotional activities are conducted.

5. There is a feeling in the minds of the customers that sales promotional activity tools are used to sell inadequate or second grade products.

6. Discounts or rebates are allowed by boosting the prices of the goods, with a view to sell at a gain which is not real.

7. Immediate increase In demand is stimulated by this. Hence it is a short-lived tool

8. It is expensive and leads to a raise in the price of products sales promotion is ineffective

a) When there is a declining market for an established brand

b) When there is no product improvement.


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