Quiz 18: Sales Promotion Overview and the Role of Trade Promotion
Promotion is the act of taking something to the next level and inducement is the support helpful in getting the desired level or results. Thus, promotional inducement means the support that helps to take the firm to the desired level. Promotional Inducement can be considered as a force that will rule the market by persuading the customer by persuasive speech and can reshape the offer according to the need of the opposite party. The direct way of inducement is a sales promotion. But, it also involves trade promotion, financial benefits, timings, and reduction in cost for the retailer's quick results. Promotional inducement is considered as more descriptive than the sales promotion because of the following reasons: • A sale is for short term as the main target of the firm is to sale a product as soon as possible. Promotional inducement is the level increment to capture the market for the specific product, hence it is long term. • Sales involve the sale of products only. However, promotion involves product, market segmentation, and financial decision as well. • Sales cause temporary effect as the sales promotion will attract customer once or twice. Promotion inducement has permanent effect as it focuses on the decision like increase in the fund for promotional activities, after sales activities. • Sometimes the sales person due to lack of knowledge or other reason hurt the customer, but the other promotional inducement techniques behave as a savior to the company, • Promotional inducement increases goodwill of the company.
Factors that have accounted for Production's Rapid Growth Sales promotion is marketing activities used to boost the sales of company's product and services. Personal selling advertising, direct marketing, public relation are promotional mix. There are 2 types of sales promotion as below: 1. For trade - Schemes, discounts freebies, commission, incentives. 2. For consumer- Festival coupons and free gifts on commodities. The factors that have accounted for sales promotional rapid growth are as follows: 1. Innovation- In today's era there is regular transformation or change in the market, that is, innovation (product and method idea packaging). Sales promotion is needed for making that change visible. Stock to overcome excessive stock the sales promotion is encouraged. 2. Competition-to overcome the fear of competitor and to show the customer how our product is better than competitor we need sales promotion. 3. Merchandise-due to the increasing trend of retail marts the product must get the customer's attraction. The best way of attracting them is through promotional strategy. 4. Brand life- this involves the loyalty and proficiency of the product. The both loyalty and proficiency depend on the goodwill and market share. Promotional activities help the company to reach customer and product get customer's attraction. 5. Price sensitivity- the price elasticity of the product. The consumers have become price conscious and purchase up to his purchasing power. 6. Fragmentation of market-segmentation of market on the basis of various measures like age gender, marital status. 7. Acceptability - The customer is the king of the market and knows about the quality and other parameters they will not have blind faith. For example, N shoes sold on discount will not affect its quality. 8. Technology-the life of a technology affect the sales promotion. Sales of an obsolete technology will never get benefit out of sales promotion. There is a continuous effort to increase the sales promotion a success. Today 70-80%of total expenditure by the company is on sales promotion. Due to this sales promotion have become the decision criteria for customer. The sales promotion have been consistently working for the last decade or so and they came out with various techniques like buy one get one free, customer relationship management, freegifts, discountprices, sponsorship to events and many more that is efficient as it get the short term benefit to the business and retailers, challenge to competitor. This is possible with the help of technology and financial deals.
Role of Social Media in Sales Promotion Online sales promotion or the internet medium for sales promotion is the channel of sales promotion using a blend of communication and technology. This can be achieved through search engines, linking profiles, e-mailing, social networking, referral marketing inbound marketing etc. Today's era is majorly affected by both technology and communication. Thus, in order to make it efficient, the sales promotion must be a step ahead in these two areas. This is helpful to both the customer and the producer, as a larger segment of market is being targeted through internet. The internet is being considered as an economical and easy source of promotional activities. The customer gets the benefit for having easy access in turn saving their time, money and stress of product comparison. This is a simple way to gather information such as the habit and demography of customer. Online marketing is best as personal selling is integral part of this technique. Affiliate program make the visitor business partners. Paid incentives are purchased. Search engine optimization also is more organic, natural way to add value to the product. Social media is helping customers connect publicly as well. Through the social media of publicity, the user is the common public and they will by the part of the groups for a good time. This is one of the best ways of online marketing as on social media people are connected with each other through various chains. Hence, this is considered to be the best way to express a company's views, share information and interact with the customers. Just like spreading information and sharing personal experience by word of mouth, the customer gets a chance to connect with even more number of people via online media and appreciate their product experience, eventually helping increase the product stake in the market. So precisely, to get long term customer every company has to build customer loyalty. To show how much the company cares for the customer, E-mail leads to gifts. The best mode of social media is as follows: 1. To choose the best campaign. 2. Clubbing social media and e- commerce. 3. Make everyone part of action. 4. Be strategic towards updates. 5. Make easy promotion towards network.