In this way, promotional activities increase the standard of living by providing better goods at lower rates (due to large scale production and selling). The primary objective of a sales promotion is to improve a company’s sales by predicting and modifying your target customer’s purchasing behaviour and patterns. Normally a sales promotion leads to a sense of urgency among the customers to make the purchases immediately as the promotional offers are for a s о duration of time. Sales are the lifeblood of a business—without sales there would be no business in the first place; therefore it is very important that if a business wants to succeed, it should have a sales promotion strategy in mind. By definition, a sales promotion is an activity applied for a predetermined, limited period of time, with the aim of increasing consumer demand and stimulating sales. Copyright 10. Managing self space against the competition. To get benefits of the Economics of scale. The importance of motivation in a sales environment. Sales promotion acts as a bridge between advertising and personal selling. Related: 15 Factors that Affecting Market Segmentation. The Importance Of Sales Promotions Sales promotions provide a means of reaching out to potential customers directly, often at the point-of-sale. Although marketing is hugely important for a business to succeed, it can also be very expensive. Sales promotion does not include advertising, personal selling, and publicity. Especially for products like food, beverages, and appliances. Sales promotions often involve working with other organizations. Very often it would be seen that one product is widely used in one sector and not … Another reason which goes hand in hand in increasing sales promotions budget is decreased brand loyalty. What are the Disadvantages of Sales Promotion? The Importance of Sales in an Organization. The primary importance of a sales promotion is to offer an inducement to buyers, increasing sales. In particular, it enables the marketer to add time urgency and other behavioral influences to the promotion campaign. The importance of sales promotion increase is due to the thinking of new ideas for creating a favourable condition of selling, promoting sales and future expansion of sales. A successful sales promotion has the ability to nurture relationships with consumers through retention and engagement. Some sales promotions are aimed at consumers. It is a part of marketing strategy. Role and Importance of Sales Promotion Nothing happens until somebody sales something. Sales promotion is designed to be used as a short-term tactic to boost sales – it is rarely suitable as a method of building long-term customer loyalty. So if the promotion is well planned, measuring the impact is also very easy. This gives a chance to the retailers to play around with the manufacturers. Advertising certain items in web advertisements, seasonal catalogues, sales flyers, magazines and/or other print media, with or without discounting the item. Your email address will not be published. Sales promo is one of the seven aspects of the marketing mix, which are promoting individual selling, direct marketing promotion/ public relations, corporate image and exhibits. In some cases, the other components of the promotional mix support a sales promotion strategy. Show More. However, promotions can be planned to increase sales over a long period within a specific market segment, so it is not always about immediate results. Increase in volume of production and sales decreases per unit cost. Importance of Sales Promotion. But this could be achieved only with appropriate methods of largescale selling. Promotion is a key element in putting across the benefits of your product or service to the customers. Notify me of follow-up comments by email. 15 Factors that Affecting Market Segmentation. In the, 2. Gifting. As the term implies — the ultimate goal is sales or transactions. Sales promotion is a category of the promotional mix, alongside advertising, personal selling and public relations. One of the most common ways to promote your store during festival time or when there is … So unlike advertisement, where purchase after seeing the advertisement is a prolonge process, sales promotion aids in getting an immediate positive impact on the sales of any organisation. Remain competitive. eval(ez_write_tag([[250,250],'googlesir_com-large-mobile-banner-2','ezslot_9',124,'0','0']));Due to the prevalent market conditions, mass selling is quite Impossible without promotional activities. More and more promotional activities are required to induce the customers to purchase more and more products and Thus they produce the demand. In today’s competitive world, promotional activities play an important role which can be judged from the following facts: Every market is the imperfect market. Some promotions like scratch card, games, contests, free premiums etc create a lot of excitement and interest among the customers. viii. However, the phenomenon of sales promotion is not studied vary widely. Sales promotion encourages dealers and distributors to sell the product more. Sales promotion acts as a bridge between advertising and personal selling. Prohibited Content 3. When one manufacturer increases his promotional spending and adopts an aggressive strategy in creating a brand image, others are also forced to follow the suit. The producer generally provides information regarding the quality, uses, different uses of the products and the price, etc. We can summarise that sales promotion is a very important tool of marketing which includes samples, coupons, cash refund offers, prices off, premiums, prices, free trials, warranties, tie in promotions, point of purchase displays, and demonstrations for consumer promotion; price off, advertising and display allowance for Trade Promotion; and trade shows and conventions, contests for Salesforce promotion. The most important purpose that a promotion serves is that it sets a business apart from its competitors. There are several reasons explaining this phenomena: Increased brand parity and price sensitivity of consumer: With more brand choices available to the consumer and with the fact that product differences are becoming less and less apparent, consumers are becoming more and more reliant to the price and price incentives. Sales promotions are short-term incentives that are done to encourage the purchase or sale of a product or service [P.DALOK 200]. As an essential part of any promotional campaign they should be planned from the beginning. No business will ever need to run any promotions if there wasn’t any competition. Emphasis on sales volume directly contributes to the revenues of firms. Importance of Promotion. The issue of sales promotion has been receiving increasing attention from both advertising and marketing professionals and academicians. Sales promotions expenditures for most of the companies are increasing, however with the total promotional budgets staying relatively the same it can be assumed that the increase of expenditures on sales promotion come at the expense of decreasing advertising budgets. In the imperfect market conditions, the product cannot be sold easily only on the basis of price differentiation. Actually, in the sales promotion, there the most important part which is to create the interest of the consumers. Selling commonly includes face-to-face meetings between sales representatives and prospective buyers. For example, the results of NCH Consumer Survey indicate that on average 80.5 percent of consumers in US used coupons over the period of 1996- 1999. Importance of Sales Promotion for a Company! Due to the adversity of markets, the importance of sales promotion has increased tremendously. Sales promotion helps remove the consumer’s dissatisfaction about a particular product, manufacturer, and create brand-image in the minds of the consumers and the users. Content Filtrations 6. So, in order to aid the retailers and also to ensure that share of shelf space, many manufacturers have taken to sales promotion activities. Presently there are many brands which are selling in the market and because of this increasing competition and presence of so many brands, the retailers and distributors are finding it very difficult to anticipate future sales. Sales is a common promotional approach used by companies that market goods and services to consumers or organizational buyers. Consumer responsiveness to money saving options: Another explanation the change in reactions and responsiveness of customers towards these promotions. It is found that good sales promotion materials make sales of men’s efforts more productive. vii. The promotions can encourage customers to try your product or company, increase their frequency or quantity of purchases, they can help you build your database, cross-sell and extend and reinforce your brand. The distance between Producers and consumer has so widened in present days that to get them acquainted with the product, promotional activities are necessary. The sales promotion activities help in promoting the sales of the concern effectively. Related. One more reason for increasing sales promotion importance is that many product categories on the market are in the mature stage and according to the product life cycle theory, sales promotions are extremely effective in maturity stage of the product helping to boost sales. Purchases are more impulsive today than ever. These promotional objectives represent more than wishful … And as discussed earlier, the zipping and zapping cause a major loss of communication through advertisement. when a new product is introduced or there is a change of fashion or taste of consumers, existing stocks can be quickly disposed off; iv. Sales promotion encourages consumers also to buy the product. It can be specific tool of the marketing strategy of an enterprise. Important Part of Sales Promotion – Many times price adjustments form a part of sales promotion that a lower price in the short term stimulates interest in the product. The growth of large scale retailers, such a Supermarket, chain stores, etc. Plagiarism Prevention 4. Large scale production is the theme of the day. This leads to virtually a promotion war. The main purpose of all promotional activities is to increase the sales of the products of the company. Due to the prevalent market conditions, mass selling is quite Impossible without promotional activities. Any successful business leader will testify to the fact that sales are the lifeblood of any organisation. Answer (1 of 4): Sales promotion is only one part of what marketing experts would call the 'promotional mix'.It's a tool that can be used to achieve a number of different things, including an increase in consumer demand.What's the point of sales promotion? Promotional activities increase the sales by changing the elasticity of demand of the product through various techniques. eval(ez_write_tag([[580,400],'googlesir_com-medrectangle-3','ezslot_0',105,'0','0']));Related: Top 5 Important Determinants of Promotion Mix (Explained). To earn the benefits of Economics of scale. The customer is attracted to purchase the goods on the basis of such information. Sales promotion activities are generally performed at certain times thus, these are not regular activities, like the display, fairs, and exhibitions, demonstration, seasonal discount, free gifts, etc. To protect the market share in the age of competition. Thus, all marketing activities are undertaken to increase sales. The Importance Of Marketing Strategy 886 Words | 4 Pages. Often not surprisingly, they look like last minute panic measures and that can signal failure, not success. Tough this work is done by advertisement but other promotional activities help achieve the objectives. Sales Promotion Specialists Are Available As a result of economic liberalization, the number of management institutions has increased. Sales promotion is very important as it not only helps to boost sales but it also helps a business to draw new customers while at the same time retaining older ones. You might have heard about “lakhpati bano”, “win a tour to Singapore”, Due to the adversity of markets, the importance of sales promotion has increased tremendously. To support and supplement the salesman effort. It is an important promotional strategy to – Spread information about the brand to new customers or new market Stabilize sales volume and fulfil short-term sales goals Manufacturers are locked into defensive reactive escalation of sale promotional expenditures. Content Guidelines 2. Most of the sales promotion devices (such as contests, premium, coupons, etc.) Introduction Sales promotion is one of the seven aspects of the promotional mix, which are advertising personal selling, direct marketing publicity/ public relations, corporate image and exhibitions. The importance of sales promotion is the unique role it plays in the marketing mix. Promotional activities increase the sales by changing the elasticity of demand of the product through various techniques, like, by distributing samples, free purchase, premiums, discounts, etc. It is essential for the survival of a manufacturer. An element of promotion mix – Sales promotion is one of the important elements of promotion mix, other than advertising, personal selling and publicity. Sales promotion acts as a bridge between advertising and personal selling. Because sales promotion can attract attention and motivate trial purchase, … In its first year, a company might spend as much as half of its sales on marketing programs. it helps to introduce new products in the market by drawing the attention of potential customers; iii. Loyalty programs can be an effective sales promotion tool and allow you to track and measure your results. The Objectives Of Promotional Objectives For Mikey's Store 1090 Words | 5 Pages . An appealing sales promotions can be notable by increasing customer traffic to retail outlets. Disclaimer 9. Show More. It is essential for the survival of a manufacturer. Catalogs and other sources of information are an essential promotional component for many lines. Sales promotion is an important component of a company's marketing communication strategy along with advertising, public relations, and personal selling. There are also a number of other factors that have led to the increase in the importance of sales promotion and the shift in marketing dollars from media advertising to consumer and trade promotions. For the birth of new product or new brand, sales promotion is very important. Consumer behaviour has changed drastically. Trigger of First Impressions – Often, customers’ first perception of a product is formed as soon as they learn the price . In this way, sales promotions help to spread the word and increase demand of a particular product or service. Today advertising in any media has become very expensive. As mentioned before, salespeople bridge the gap between customer needs and the product/service that fulfils that need. Desire to have an immediate positive impact on sales. Sales promotion is important for manufacturers because i. it helps to increase sales in a competitive market and thus, increases profits; ii. Required fields are marked *. The distance between Producers and consumer has so widened in present days that to get them acquainted with the product. These functions and objectives of sales promotion may be as follows: 1. (Blattberg, Neslin 1990). Engender customer loyalty. Sales Promotion – Top 7 Importance. Sales promotions give potential customers an additional reason to consider doing business with you and your company. 1. Sales promotion is newly accepted by management as an effective sales tool. Sales promotion is an important component of a company's marketing communication strategy along with advertising, public relations, and personal selling. For Selling the Goods in Imperfect Market, Every market is the imperfect market. Sales Promotion: Definition, Purpose and Importance. It is a part of marketing strategy. 15 Major Importance of Creativity in Entrepreneurship. When a firm wants to attract new users, sales promotion tools can reduce the consumers’ risk of trying something new. Such activities reduced his time spent in prospecting and reduce the turn downs. Image Guidelines 5. Sales promotion is an important component of a promotion campaigning programme. (Shimp 1993). One well-planned, far-reaching promotion is better than heaps of little one-offs that bear no relation to the overall strategy. Everybody wants prime space, especially during new product introduction. Sales promotion is equally important to producers, middlemen and consumers. The shelf space since limited in the retail outlets, is creating a lot of competition among the manufacturers for that space. Most of the sales promotion devices (such as contests, premium, coupons, etc.) Among the most costlier are the audio visual ones which are considered to be the most effective ones. Large-scale selling is possible only with the help of promotional activities. Related. Sales promotion helps to remove the consumer ’s dissatisfaction about a particular product and manufacturer. In slack season, the promotional activities help in maintaining the sales of the product, Customers and middleman are offered attractive discounts and free gifts along with their products to induce the persons to purchase their products. Promotions can often shape the characteristics of brands, for example, McDonald’s Monopoly board is something truly unique to the brand, regularly bringing consumers together to discuss prizes and the probability of getting that all important Mayfair! Such activities make the product popular. Marketing specialists have mentioned that use of sales promotion has dramatically increased in past decade. CODES (5 days ago) The importance of sales promotion increase is due to the thinking of new ideas for creating a favourable condition of selling, promoting sales and future expansion of sales. Product and manufacturer marketing mix days that to get them acquainted with the boom! 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