SALES PROMOTION MBA 4 SEM

TH

SUBMITTED BY, SUJIT BHUSHAN ROLL NO -10

1) What is sales how it is different from marketing?

Marketing is identifying customer needs wants and desire converting them into products and services. Sale is we already have the product or service we have to sale it Sales is a onetime process(means just selling the product to the customer) but marketing is ongoing process (Identifying the customer needs, developing the desired product, sales and then after sales services or customer. sale is transactional business, only focus on single transaction i.e. sales oriented and no after sales service. sales;-sales oriented ,no post purchases services, focus on Product feature rather than prod. benefit. Marketing:-customer satisfaction oriented, after sales services, focus on product benefit. It is activity included sales programmed. Sales is the process by which company sells their product without taking care of their needs and wants. Marketing is a process of understanding the needs and wants of the customer and available the desired product to the customer in retuned to the companys profit It is customer oriented process. Sales is simply the selling out of products by the company. It is company's oriented process. let's think about this question for a moment. Without marketing you would not have prospects or leads to follow up with, but yet without a good sales technique and strategy your closing rate may depress you. Marketing is everything that you do to reach and persuade prospects. The sales process is everything that you do to close the sale and get a signed agreement or contract. Both are necessities to the success of a business. You cannot do without either process. By strategically combining both efforts you will experience a successful amount of business growth. However, by the same token if the efforts are unbalanced it candetour your growth. Your marketing will consists of the measures you use to reach and persuade your prospects that you are the company for them. It's the message that prepares the prospect for the sales. It consists of advertising, public relations, brand marketing, viral marketing, and direct mail.

The sales process consists of interpersonal interaction. It is often done by a oneon-one meeting, cold calls, and networking. It's anything that engages you with the prospect or customer on a personal level rather than at a distance. Your marketing efforts begin the process of the eight contacts that studies show it takes to move a prospect or potential client to the close of the sale. If marketing is done effectively you can begin to move that prospect from a cold to a warm lead. When the prospect hitsthe"warm" level it's much easier for the sales professional to close the sale. Marketing is a process of understanding the needs and wants of the customer and available the desired product to the customer in retuned to the companies profitIt is customer oriented process. sales is simply the selling out of products by the company. It is company's oriented process. marketing is the business activity which governs and direct the flow of goods from the manufacturer to consumer. sales is also a business activty which start from the product. marketing aims profit through coustomer satisfaction but sales aims profit through higher sales volume. In marketing customer is purpose of business and treated as the fem. but in sales the customers are treated as the last link in the chain.

2)Sales promotion is the wastage of money explain the argument by agreeing and disagreeing fact?
Some people believe that advertisement is a waste of company's money and energy. Most consumers know what they need and don't pay much attention on advertisements, so the advertisement has little effect but cost too much. However, I disagree with the statement because I consider that advertisements have their own special use. On one hand, advertisements can send useful and opportune messages for new products and new shops. When a new product comes into being or a new shop starts business, people can hardly know if there is not an advertisement about it. So, advertisement is necessary to propagate a new thing. It can be a useful promotion to tell all people to have a try on it. On the other hand, people who know what they want to buy may not actually determine that which brand they will choose or where they want to go for purchase. Advertisement can help these consumers exactly. For instance, my sister wanted to buy a pair of new boots. She called me to ask which shoe store is economical. I just remembered an advertisement I see on the newspaper several days before. It is said that boots in "The Happiness Market" is selling at a discount. So I told my sister to go there and she did. Anther factor shows that some interesting advertisements can make people happy and impressed them to be potential consumers. They will keep the brand and the product in mind. Some day when they need some similar products, they will choose to buy the product in the interesting advertisement. Even when their friends or relatives need those things, they can also an oral promotion for the product. Actually, advertisement is so expensive that makes some company cannot afford it. Also, it must take much energy to create an impressive advertisement. But I think the money and energy pay for the advertisement is worthwhile for a company. Advertisements are an important part of the brand promotion. So if a company launches a new product in the market, people will not be aware of the recent advances unless they are made aware so with the present generation, most indispensable source of information is print and electronic media so advertisements though requiring a huge investment are necessary to enhance the productivity and sale of a company in today's competitive market Advertisements are putting wrong feelings in children's and others mind. If there is add of bicycle or any other thing then they will force to buy that thing. Adds are only the waste of money because it costs a lot. It led to increase in price of product. The reason is simple since more and more people are getting acquainted with the media it becomes simple for the company to reach the masses within very few days. Also this makes the people aware of the product and indirectly helps the company to increase its sales. Since mass public in India still follow

the trends of superstars (sometimes even blindly) using well renowned personalities (superstars and cricketers) it further improvises the profits (sales) of the company (ex: using of luxury bathing soap LUX various actress right from madhubala to katrina kaif of today are used for advertisement). Also the fact that if he/she (superstar) is using a particular product then it depicts the quality policy of the product and also its effectiveness. Though sometimes the company makes false acquisitions (of making smarter look by using this cosmetic or generating fairer skin by using so and so product or reducing your obesity within few days without any exercise) leads to the misguidance of the the uneducated people. But then there are certain advertisements like (TB awareness done by vivek oberoi or the advertisement done by amitabh bacchan for polio) certainly helps the public health issues to come forward and thus helping the poor and needy individuals of society. In my view though the advertisement help the masses or it is not the waste of resources to improve its resourcefulness the government (broadcasting unit) should see to it that it doesn't pollute the social harmony of society as well as it should not affect the youth by any of the means (ex: the ads of certain company shows all the girls in those skimpy dresses clinging to individual just for the sake that he uses the product). Yes of course it is marketing strategy of the company but then the company must also ensure that the advertisement does really market the product or it is weakening the social health of society. Finally to conclude I would say that any advertisement done with a view of reaching the masses for promotion of goods with a social aspect in mind would surely make it more resourceful.

3) sales promotion is essential for every kind of organizations explain this statement through the examples?
Sales promotion is an important component of a small business's overall marketing strategy, along with advertising, public relations, and personal selling. The American Marketing Association (AMA) defines sales promotion as "media and non media marketing pressure applied for a predetermined, limited period of time in order to stimulate trial, increase consumer demand, or improve product quality." But this definition does not capture all the elements of modern sales promotion. One should add that effective sales promotion increases the basic value of a product for a limited time and directly stimulates consumer purchasing, selling effectiveness, or the effort of the sales force. It can be used to inform, persuade, and remind target customers about the business and its marketing mix. Some common types of sales promotion include samples, coupons, sweepstakes, contests, in-store displays, trade shows, price-off deals, premiums, and rebates. Businesses can target sales promotions at three different audiences: consumers, resellers, and the company's own sales force. Sales promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another. It is particularly effective in spurring product trial and unplanned purchases. Most marketers believe that a given product or service has an established perceived price or value, and they use sales promotion to change this price-value relationship by increasing the value and/or lowering the price. Compared to the other components of the marketing mix (advertising, publicity, and personal selling), sales promotion usually operates on a shorter time line, uses a more rational appeal, returns a tangible or real value, fosters an immediate sale, and contributes highly to profitability. In determining the relative importance to place on sales promotion in the overall marketing mix, a small business should consider its marketing budget, the stage of the product in its life cycle, the nature of competition in the market, the target of the promotion, and the nature of the product. For example, sales promotion and direct mail are particularly attractive alternatives when the marketing budget is limited, as it is for many small businesses. In addition, sales promotion can be an effective tool in a highly competitive market, when the objective is to convince retailers to carry a product or influence consumers to select it over those of competitors. Similarly, sales promotion is often used in the growth and maturity stages of the product life cycle to stimulate consumers and resellers to choose

that product over the competitionrather than in the introduction stage, when mass advertising to build awareness might be more important. Finally, sales promotion tends to work best when it is applied to impulse items whose features can be judged at the point of purchase, rather than more complex, expensive items that might require hands-on demonstration. Sales promotion has grown substantially in recent years. There are several reasons for this dramatic growth in sales promotion. First, consumers have accepted sales promotion as part of their buying decision criteria. It provides reluctant decision makers with an incentive to make choices by increasing the value offered by a particular brand. Second, the increasing tendency of businesses to focus on short-term results has helped spur growth in sales promotion, which can provide an immediate boost in sales. Product managers also tend to view sales promotion as a way to differentiate their brand from that of competitors in the short term. Third, the emergence of computer technology has enabled manufacturers to get rapid feedback on the results of promotions. Redemption rates for coupons or figures on sales volume can be obtained within days. Finally, an increase in the size and power of retailers has also boosted the use of sales promotion. Historically, the manufacturer held the power in the channel of distribution. Mass marketers utilized national advertising to get directly to consumers, creating a demand for the heavily advertised brands that stores could not afford to ignore. With consolidation and the growth of major retail chains, however, retailers have gained the power to demand incentives from manufacturers to carry their products. Many sales promotions are designed to provide benefits to the retailers.

4) Explain the various methods used to promote sales by fmcg company? Sales promotions have become a vital tool for marketers and its importance has been increasing significantly over the years. In India, sales promotions expenditure byvarious marketing companies is estimated to be Rs 5,000 crores and the emphasis on sales promotion activities by the Indian industry has increased by 500 to 600 percent during the last 3 to 5years (Economic Times, June 15, 2003). In the year 2001, there were as many as 2,050 promotional schemes in the Rs 80,000 crore FMCG Industry (Dang et. al, 2005).Given the growing importance of sales promotion, there has been considerable interest inthe effect of sales promotion on different dimensions such as consumers price perceptions, brand choice, brand switching behaviour, evaluation of brand equity, effecton brand perception and so on. One of the purposes of a consumer promotion is to elicit adirect impact on the purchase behaviour of the firms customers (Kotler, 1998; Blattbergand Neslin, 1990). Research evidence suggests that sales promotions positively affectshot-term sales (Priya, 2004). Research on price promotion has consistently reported high sales effect and high price elasticity for brand swhich are on promotion (Blattberg, Briesch and Fox, 1995). Studies have shown that price promotions enhance brand substitution within a product category (Dodson et al,1978), affect aggregate sales (Gupta, 1998), and significantly affect stock piling and purchase acceleration (Blattberg, Eppen and Lieberman, 1981, Neslin, Henderson andQuelch, 1985). However, there have also been studies that suggest that sales promotion affects brand perceptions. Researchers have found out that promotions, especially price promotions, have negative effect on brand equity (Mela et al, 1997). In another study, Schultz (2004) argues that over dependence on promotions can erode consumers pricevalue equation. The results of a study by Jedidi etc. al (1999) indicates that in the long term, advertising has a positive effect on brand equity where as price promotions have a negative effect. Similarly, Yoo et. al (2000), based on structural equation model, suggests that frequent price promotions, such as price deals are related to low brand equity, where as high advertising spending, high price, good store image and high distribution intensity are related to high brand equity. There is also a managerial belief that if a brand is supported with frequent promotional offers, the equity of the brand tends to get diluted. On the contrary, there have also been studies that indicate brands benefit from promotions. Amongst the elements of marketing mix, sales promotions have long-term influence on brand equity (Yoo et. al, 2000). Mariola &Elina, (2005), based on a sample of 167 buyers suggest that monetary and non-monetary promotions are useful to create brand

equity because of their positive effect on brand knowledge structures. The researchers in this study propose to explore whether the phenomenal growth of sales promotion as a promotional tool in marketing products in India is perceived favorably by the consumers and examine the differential effect, if any, of two types of sales promotion namely cash discount and free gift on consumers perception. Sales promotion is aimed at boosting the sales in shorter duration by providing effective incentives to the buyers. Advertising is aimed at boosting the sales by giving reasons to buy and sales promotion is aimed at boosting sales by giving incentives to customers. Sales promotion integrated or combined with advertising will be more effective than doing only one of the two alone. Sales promotion consists of:- Consumer promotion which uses free samples, free trials, discount coupons, loyalty rewards, cash paybacks, discounted prices, prizes etc.- Trade promotion which includes discounted prices to the retailers, advertising and display allowances to retailers, certain amount of free goods if dealer or retailer buy scertain minimum quantity etc.- Business and sales force promotion include trade shows and conventions, sales contests among sales people of company/dealers and their recognition, specialty advertising by way of the give-aways like pens, tee shirts, bags, key chains, calendars, torches and such goodies with companys products and companys name etc displayed on them. Various tools/methods of sales promotions have been mentioned earlier for consumerpromotion, trade promotion and business and sales force promotion. The choice of thesetools/methods depends on: Type of market/customers

Objectives of sales promotion (see the earlier point) The nature of market competition Appropriateness of the methods/tools Cost effectiveness of methods/tools Following factor need to be thought of and developed: Quantum of the incentives to be offered (considering its possible and expectedbenefits) Duration of sales promotion program Deciding the lead time of sales promotion preparation and sell-in duration (theduration within which the targeted sales will be accomplished) Timing of promotion campaign Terms and conditions of participation by the prospective/existing customers Mode of distribution of incentives.

5) Explain the various tools needed to promote the sales of various industries?
To increase the sale of any product manufactures or producers adopt different measures like sample, gift, bonus, and many more. These are known as tools or techniques or methods of sales promotion. Let us know more about some of the commonly used tools of sales promotion. (i) Free samples: You might have received free samples of shampoo, washing powder, coffee powder, etc. while purchasing various items from the market. Sometimes these free samples are also distributed by the shopkeeper even without purhasing any item from his shop. These are distributed to attract consumers to try out a new product and thereby create new customers. Some businessmen distribute samples among selected persons in order to popularize the product. For example, in the case of medicine free samples are distributed among physicians, in the case of textbooks, specimen copies are distributed among teachers. (ii) Premium or Bonus offer: A milk shaker along with Nescafe, mug with Bournvita, toothbrush with 500 grams of toothpaste, 30% extra in a pack of one kg. are the examples of premium or bonus given free with the purchase of a product. They are effective in inducing consumers to buy a particular product. This is also useful for encouraging and rewarding existing customers. (iii) Exchange schemes: It refers to offering exchange of old product for a new product at a price less than the original price of the product. This is useful for drawing attention to product improvement. Bring your old mixer-cum-juicer and exchange it for a new one just by paying Rs.500 or exchange your black and white television with a colour television are various popular examples of exchange scheme. (iv) Price-off offer: Under this offer, products are sold at a price lower than the original price. Rs. 2 off on purchase of a lifebouy soap, Rs. 15 off on a pack of 250 grams of Taj Mahal tea, Rs. 1000 off on cooler etc. are some of the common schemes. This type of scheme is designed to boost up sales in off-season and sometimes while introducing a new product in the market. (v) Coupons: Sometimes, coupons are issued by manufacturers either in the packet of a product or through an advertisement printed in the newspaper or magazine or through mail. These coupons can be presented to the retailer while buying the product. The holder of the coupon gets the product at a discount. For example, you might have come across coupons like, show this and get Rs. 15 off on purchase of 5 kg. of Annapurna Atta. The reduced price under this scheme attracts the attention of the prospective customers towards new or improved products. (vi) Fairs and Exhibitions: Fairs and exhibitions may be organised at local, regional, national or international level to introduce new products, demonstrate the products and to explain special features and usefulness of the products. Goods are displayed and demonstratedand their sale is also conducted at a reasonable discount. International Trade Fair in New Delhi at Pragati Maidan, which is held from 14th to 27th November every year, is a wellknown

example of Fairs and Exhibitions as a tool of sales promotion. (vii) Trading stamps: In case of some specific products trading stamps are distributed among the customers according to the value of their purchase. The customers are required to collect these stamps of sufficient value within a particular period in order to avail of some benefits. This tool induces customers to buy that product more frequently to collect the stamps of required value. (viii) Scratch and win offer: To induce the customer to buy a particular product scratch and win scheme is also offered. Under this scheme a customer scratch a specific marked area on the package of the product and gets the benefit according to the message written there. In this way customers may get some item free as mentioned on the marked area or may avail of price-off, or sometimes visit different places on special tour arranged by the manufacturers. (ix) Money Back offer: Under this scheme customers are given assurance that full value of the product will be returned to them if they are not satisfied after using the product. This creates confidence among the customers with regard to the quality of the product.