Você está na página 1de 13

Sales Promotion at different Level and different programme

 
One of the most difficult marketing decisions facing companies is how much to
spend on promotional John Wanamaker, the departmental - store magazine,
said, "I know that half of my advertising is wasted but I don't know which
half."
Thus it is not surprising that industries and companies vary considerably in how
much they spend on promotion. Promotional expenditures might amount to 30-
50% of sales in case in cosmetics industry and only 10-20% in the industrial
equipment industry. Within a industry, a low and high spending companies can
be found.
How do companies decide on their promotion budget? There are mainly four
methods of this :
• Affordable Method :
Many companies set the promotion budget at what they think the company can
afford. One executive explained this method as follows : "Why, it’s simple.
First I go upstairs to the controller and how much they can afford to give us this
year. He says a million and half. Later, the boss comes to me and asks how
much we should spend and I say ‘Oh about a million and half."
It is a method which is uncertain one and makes long term planning difficult.
• Percentage of Sales Method :
Many companies set their promotion expenditures at a specified percentage of
sales. Accordingly the sales is set on the basis of sales.
In this a specified sales percentage is decided for the promotional budget
Advantages of this method :
First, its use means that promotional budget vary with what a company can
afford.
Second, it encourages the management to think in terms of the relationship
among promotion costs, selling price, and profit per unit,
Third, it encourages the competitive stability to the extent that competing firms
spend approximately the same % of their sales on promotion.
Inspite of the advantages, the % sales method has little to justify it. Its
reasoning is circular : It views sales as the determiner of the promotion rather
than as a result. It leads to budget setting by availability of funds rather than by
marketing opportunities.
• Competitive Parity Method :
Some companies set their promotional budget to achieve share-of-voice parity
with other competitors. Two arguments are made in support of competitive
parity method. One is that the competitors expenditure represents the collective
wisdom of the industry. The other is that maintaining a competitive parity helps
prevent promotional wars.
Neither argument is valid. There are no grounds for believing that competition
knows better what should be spent on promotion.
• Objective and Task Method :
The objective & task method calls upon marketers to develop their promotion
budgets by defining their specific objectives, determining the task that must be
performed to achieve these objectives, and estimating the cost of performing
these tasks.
Deciding on the promotion mix :
Companies face the task of distributing the total promotion budget over the five
promotional tools :
• Advertising
• Sales Promotion
• Public Relations and Publicity
• Sales Force
• Direct Marketing.
Whatever method a company adopt for promoting its product it must be from
above mentioned method.

Sales Promotion
Promotion is the final element in the marketing mix. After the nature of product is
decided, its price fixed and the methods of distribution decided, the manufactures has to
take effective steps in meeting the consumers in the markets. In the present consumer
oriented markets it is the duty of manufacturers to know what is required by the
consumer. It is also their duty to make the customers know where, when how and at what
prices. The products would be available.
 
Meaning of Promotion
The term promotion is the term and includes mainly three type of sales
activity :
1. Mass impersonal selling methods (Advertising).
2. Face to face personal selling (Salesman ship).
3. Activities other than personal selling and advertising such as point of
purchase display (P.O.P.) show and exhibitions, demonstrations and other non
securing selling efforts. This form of activity is called ‘Sales Promotion’.
There are two type of promotion blends :-
1. Pull Blend.
2. Push Blend.
Both of these are closely related to the channel of Distribution.
1. A pull blend is one in which mass impersonal, sales efforts are given the
greatest emphasis. The purpose of pull blend to pre-sell to the final consumers.
So that they demand the product at the retail level of distribution. The firm
adopting this strategy would spend more on advertising and sales promotion
rather than in personal selling. These efforts pull down the product from the
manufacturer.
2. A push blend emphasizes personal selling. Naturally firms adopting this
method develop a strong sales force at both the distributor and the dealer level. This
method would tends to push the product through the channel of distribution.

Promotion and Selling


The term promotion is very often used as a synonym for selling. But selling is a
narrow term which includes only transfer of title or personal selling. Promotion on
the other hand is broader in its outlook and includes a variety of activities used
ultimately for increasing sales volume.
 

Promotion and Sales Promotion


Similarly the terms sales promotion can not be taken to mean what is commonly does.
Sales promotion, is only a part of the promotion. Basically promotion is an "exercise" in
information persecution and influence. Promotion has come to mean the over all co-
ordination of advertising selling, publicity and public relations. Promotion is a helping
function designed to make all other marketing activities more effective and efficient. But
sales promotion as such helps only the selling activity still, there exit same difference of
opinion on the real connection of the term sales promotion.
 
Acc. to A.H.R. Delons :-
"Sales promotion means any step that are taken for the purpose of obtaining or increasing
sales".
 
Acc. to W.Q. Kelly Opines :-
"Muddled misused misunderstood that is sales promotion Acc. to him the field
of sales promotion as a marketing activity is still vaguely defined and
organized.

Sales Promotion and Advertising


There is no universally accepted distribution between these two terms. To same
advertising includes all forms of mass media communication directed towards
influencing the end consumer. Sales promotion on the other hand, includes the form of
mass communication directed towards information and influencing the channel of
distribution (e.g. distributors, retailers etc.). Hence a price of product literature distributed
by retailers in sales promotion. These sales promotion merges on one side in to
advertising and on the other in to personal salesman ship. It is concerned with the
dissemination of information to whole salers, retailers, customers (both actual and
potential, and to the salesman).
Sales promotion is concerned with the creation. Application and dissemination of
material and techniques that supplement advertising and personal selling. Sales
promotion makes use of direct mail, catalogues, trade shows, sales contests, premiums,
samples, windows displays and other aids. Its purpose is to increase the desire of
salesman, distributors and dealers to sell a certain brand to make consumers more eager
to buy that brand. Personal selling and advertising do include prospects to make these
decisions. Sale promotion provides an extra stimulus.
 
Objective of Sales Promotion
1. To increase sales directly by publicity through media which are complementary to
press and poster advertising.
2. To disseminate information through sales man dealers etc. So as to insure the product
getting in to satisfactory use by the ultimate consumer.
3. To attract new consumer.
4. To face the competition effectively.
5. To help salesman in selling more to the retailers and consumers.
6. To check seasonal decline in sales. Generally speaking sales promotion involves
rendering the following services:-
(a) Services to dealers.
(b) Services to own salesman.
(c) Special publicity.
 
Sales Promotional at different levels
1. Sales promotion at Dealers Level :-
It may include various schemes some of which are discussed here.
(i) Advertising Materials :-
The advertising material prepared by the company such as store signs, banners, shelf
signs, board etc. are distributed to sub dealer for display purposes this is in fact a method
of advertising.
(ii) Store Demonstration :-
In the promises of the whole saler or the retailer the products sales personnel will conduct
special demonstration for the companies product. A personal demonstration is good to
introduce a new product at its peculiar advantage can be high lightened and the
consumer’s doubt clear. It can be used to restimulate an old product. A good
demonstration with a great dealer of action will draw heavy crowds in to the store and
will attract attention to the product.
(iii) Special Display and Shows :-
These are in seasonal in character but could be arranged in an elaborate manner and for
all the products of an company. Usually these are arranged along with trade fair and
exhibition. Besides effecting sales these shows impress the company’s name generally on
the public.
Sales promotion at consumer’s level
The various schemes of sale promotion at Consumer’s Level may include.
1. Coupons (A Chit of Stated Value) :-
These are given directly to the consumer these coupons are in most cases kept
inside the package. The consumers many receive a price reduction of the stated
values of the coupon at the time of purchase. The retailer receives
reimbursement for the value of the coupon form the manufacturer. Coupons act
as a short run stimulus to the sale of the product, since they are directly tied
with the purchase of the item. They encourage the retailer to stock the product.
What is important is that a coupon offer does not spoil the named price of the
brand nor does it un pair the margin of the dealers. But it is not easy to measure
the effectiveness of a coupon offer. One over knows how many customer
would have bought the product without the incentive. It is also difficult to find
out how many customers were held after the coupon offer expired.
2. Price-off-offer (Also known as bargain offer price packs) :-
This offer is intended to stimulate the sales during a slump season. In this
method the customer is offered a reduction from the printed price list. It is also
used when a substitute for competing product enters the market.
Many experts on sales promotion fed that ‘Off Schemes’ are among the weaker
and less desirable methods of promotion. These can be trade resentment
particularly when the retailer raises the price to retain his margin. Secondly that
is not conductive to building up brand loyalty. Consumers may simply shift to
the products that offer this scheme.
3. Samples :-
In the hope of converting a prospect into a customer a sample (Some quantity
of the product) may be given. This helps the consumer to verify the real quality
of the product. Various pair manufacturing companies offer this method. For
developing brand loyalty this method is quite useful. Sampling is a fast method
of demand creation because one knows the result as soon as the consumer has
had time to use the sample and buy the brand.
Disadvantage of Sampler :-
Offering sample in quit expensive. There is the cost of producing samples. The
distribution costs are also high. Sample have to be mailed to potential
customers or to be distributed through retail shops. There are also problems
when the real product does not resemble the sample supplied.
4. Money Refund Offer :-
An offer usually stated on the package is that manufacturers will return with in
a stated period part or all of the purchaser’s money if he is not completely
satisfied with the product.
5. Trading Stamps :-
A premium in the form of stamps is given by the sellers to consumers while
selling goods. The number and value of stamp that the buyer receives depends
on the values of the purchase. These stamps are redeemable through premium
catalogues at the stamp redemption centres.
6. Buy-Back Allowance :
This an allowance following a previous trade deal not offer a certain amount of
money for new purchases based on the quantity of purchases on the first trade
deal. It extends the life of a trade deal and helps to prevent part deal sales
decline. It greatly strengthens the buyer’s motivation to co-operate on the first
deal.
7. Premium :-
There are various forms of premiums provided by the manufacturer as sales
promotional devices :-
(a) Coupons are supplied for effecting price reductions.
(b) Factory in pack premium these are popular in the case of Body food and Tin
food items, Spoons, Cups, Measuring, Glass etc. and such other items are
packed with the product in the box itself. Factory in pack premium are
particularly goods for product meant for children. The Binaca Toothpaste packs
contain animal shape toys. These are very attractive and qutie popular among
the children.
(c) Self Liquidating Premiums :-
The cost of the premium is collected from the buyer himself. But when the
buyers pays for it he has to pay only a considerably low price for the premium.
This is possible for the manufacturer purchases the items in bulk at a premium
and his cost per unit as is substantially low.
 
Other Steps by Manufacturer for Promoting Sales
Dealers can be helps in different ways :-
1. Communicating Market News :-
Often this service is reciprocal the manufacturer may acquaint his dealer with
the fact relating to his production and prices while the dealer may familiarize
him in return with the information bearing on charges in the consumer's
demand, their like and dislike complaints and criticism, substitutes etc.
2. Inviting to Sales Conference and Convention :-
The gestures of regard and respect pave the way for better relation and co-
operation.
3. Offering Reasonable Terms of Sale :-
Of all the forms of encouragement, the monetary incentive evokes immediate
response. Hence every producer must offer the most responsible terms of sale
such as longer periods of credit and higher rates of descants.
4. Supplying suitable packages and useful things.
5. By taking the return back.
6. By furnishing them with sales literature and display materials.
 
Aggressive Selling
Meaning :-
Goods are produced for market. Manufacturers have to make efforts to sell all
they produce. When the manufacturers uses various sales efforts to obtain
increased sales volume for his product it is called aggressive selling or
offensive selling. The sales efforts which a manufacturer makes to retain his
customers i.e. to protect his already established market against against his
competitors is termed as defensive selling. In contrast to this aggressive selling
is concerned with the sales efforts made with the express objective of selling
more by expanding the market for the product of the selling firm.
Aggressive Selling and Defensive Selling :-
Aggressive selling is based on the answer to the question how much does the
firm gain (in term of sales with profit) by using this method defensive selling is
based on consideration as to how much the firm will lose if it does not use this
method increase of sales can be obtained from two sources:-
1. New customers if the market is expending.
2. From the competitors i.e. those consumers who were purchasing similar
product of competiting firms, if the market for the product is static.
Acc. to H. Whitehead :-
"In case of an expanding market all the firm may stand to gain by following the
methods of aggressive selling but if the market is static manufacturer of a new
market will have to be much more aggressive to capture the established market
of competitors".
When Aggressive selling is resorted ?
Usually manufacturer of a new product has to do aggressive selling :-
1. When the product has been improved.
2. When the manufacturer’s product is supervisor in quality to the product of
the established competitor.
3. When the total market for the product or line of product to expanding.
4. If the manufacturer’s share of the market is comparatively small.
5. If the manufacturer has unused production capacity with heavy investment in
plant and equipment he will like to develop the demand for his product rapidly
so that demand for his product is equal to the optimum production capacity of
his plant ; and
6. When primary demand for a product must be created and provision must be
made in the channel of distribution to educate consumers regarding the new
product and to instruct them in its use.
Method of Aggressive Selling :-
Sales promotion efforts use for aggressive selling may be divided in two
classes.
1. Trade Promotion.
2. Consumer Promotion.
1. Trade Promotion :-
Under trade promotion methods special incentives are offered to the trader to
buy products of the firm. Such incentive may take one or more of the following
firm :-
(a) Cash Allowance :-
A definite percentage of discount is allowed on the purchase of given unit of a
product.
(b) Extra Product :-
Instead of giving any cash allowance extra product is given with each unit of
product ordered. For instance if a box normally contains 20 Cakes of Soap,
special box contains 25 cakes may be made and sold at the same price as that of
the box of 20 cakes.
(c) Gifts :-
Various gifts are awarded in return for an order of a particular magnitude.
 
2. Consumer Promotion :-
Under consumer promotion method special incentives are offered to the
consumers to buy the firms product. The more prominent amongst such
incentives are as following.
(a) Coupons :-
A coupon of a giving value is sent to the consumer. By presenting this coupon
to the retailer consumers can purchase a particular product mentioned on the
coupon at a reduced price. The retailer sells the products mentioned. In the
coupon to such consumer (consumers presenting the coupons) under and
agreement with the manufacturer at a price lower than the user retail price.
Thus the consumer get the benefit of reduced price to the extent of the value of
the coupons.
(b) Self Liquidating Offers :-
Under this system, the firm offers an article at an attracting price if the
consumer send a given sum of money accompanied by a given number of box
tops from the packages of a particular product the benefit to the consumer is
that he receives the articles at a bargain price.
(c) Bargain Packs :-
Under this system a product is sold at a reduced price for a short period Bargain
pack method encourages new consumers to try the product. It is also helpful in
obtaining large displays in the shops.
(d) Sampling :-
The method involves giving the product or a small quantity of the product to a
consumer free with the hope that the customer will be favourable impressed
with its actual use and will eventually become a regular purchaser of the
product.
A firm selling new product or an extensively improved product finds this
methods useful. Also a firm whose market is hold by competitors whose free
sampling almost expensive.
The above mentioned methods may be reinforced by adopting.
(i) Direct method of selling through.
(ii) Offer of door to door selling.
(iii) Hire purchase and installment payment methods of selling and by forming
combination.
Other Methods of Aggressive Selling :-
(i) Employment of ‘Missionary Salesman also known as Promotional
Salesman’. These salesman call upon retailers and aggressively promote a
product.
(ii) Instead of using wholesalers, the firm may develop its own sales force to
call directly on retailers.
(iii) The firm may follow a compromise method by employing a
manufacturer’s agent and giving him a large enough commission to encourage
him to sell product intensively and aggressively.
(iv) New territory exploitation sales promotion has a particularly important role
in developing the company’s product in new territories.
(v) Increment and promotions.
(vi) Letters to dealer and Customer.
In fact, an ingenious sales manager can devise any number of incentives
schemes for promoting the sales volume.

Você também pode gostar