Marketing Management Assignment help on : Promotion
Introduction
Promotion is one of the pillars of marketing. A product which has many features that may interest the consumers, but these features need to be communicated to the consumers by means of promotion. There are various methods of promotion and one of the method ‘Sales promotions’ is the topic of study.
Like any other promotional media, sales promotion is also applied to create an urge in the mind of consumer to go ahead and purchase the product. So the concept revolves around impacting the consumer behaviour. The sales promotion provides additional incentives to buy the product over and above the attributes and their values to that product. These incentives may come in form of price discounts or in form of non-price items such as loyalty benefits to consumers, contests/ sweepstakes etc. The sales promotion is used to counter the competition in the product category. All the concepts related to sales promotion are discussed in further paragraphs.
Concept of sales promotion
Definition
Sales promotion is defined as a set of promotional activities done for a short period to support other promotional activities such as advertising, personal selling, direct promotion etc., which come in form of incentives to influence the consumer behaviour patterns.
How sales promotion works
(Kotler & Keller, 2011)
Sales promotion works on three basic characteristics:
- Communicating the product features and the benefits to the consumers in such a way that the consumers feel that the product meets their needs better than the other products in the market.
- Incentive to be provided for purchasing the product is provided in such a way that it instigates the impulse purchase by the consumer at first occasion and slowly and slowly making that customer a loyal one. So, basically the consumer should feel that sense of value addition to him at first purchase and try the product.
- Invite the consumer to engage in the purchase of the product and thereby promoting the product.
So basically, it is a short term promotional act that induces the purchase by the customer. It must be backed by other promotions and services to sustain the consumer.
Sales promotion tools
(Kotler & Keller, 2011)
Sales promotion tools can be classified as- Price promotions and non-price promotions. These tools are used by both manufacturers and retailers. In case of price promotions, the incentives are given in form of temporary price reductions in form of bulk discounts by manufacturers to retailers or point of sale discounts to consumers by retailers; coupons to the customers on their purchase which may be redeemed to buy other products of same brand; loyalty rewards for the loyal customers in form of prizes etc. The main concept is to give a feeling of value for money to the buyer.
In case of non-price promotions, the incentives are given in form of sampling where the company can induce a trial for its product by providing some free samples to the customers and getting them to know about its unique features; promotional contests like lucky draws to pull the customer towards point of sale; promotional events to do the publicity of the product among the target customers. All these are effective in influencing the purchasing behaviour of the customers.
Research findings on sales promotion
The sales promotion is used extensively by manufacturers and retailers to increase their customer base in the market. It is mostly done for new product launches or to beat the competitive products. The research shows that sales promotion has short term and long term effects on the consumer behaviour and hence a very effective promotional media.
Short term effects of sales promotion
The immediate effect of sales promotion is the product switching by the consumer. The product switching may be in form of brand switching by the buyer or switching to a new product category which is perceived to be better in terms of satisfying the need than the existing product category. In short, the perceived value of the product increase and hence the purchase is made (Jobber & Lancaster, 2006).
The other effect is the increase in the purchase which will come in form of more stock of the product being purchased by the consumer to avail the promotional incentives. This can help in inventory management as well as promotion of the product.
Long term effects of sales promotion
The long term effects of sales promotion come in form of product loyalty. The impulse created by the short term incentive activities should be backed by other promotions as well as good after sales performance of the product (Schultz & Robinson, 1998). The attributes of the product as perceived at the time of purchase should be tangible to the consumer to repeat the purchase and thereby becoming loyal to the product.
Sales promotion as an industry practice
The sales promotion being a relevant media is extensively used by in industries (Low & Mohr, 2000). Ranging from consumer durables, FMCG to automotive industry, this is followed in all B2B as well as B2C marketing strategies. The important point is to segment the consumer market and prepare a sales promotion program matching the needs of the segment (Hellman, 2005). Market research studies are done from the consumer data collected from points of sale for segmentation exercise.
Conclusion
It can be concluded that sales promotion is a short term yet very effective promotional tool. It can play with the psyche of the consumer and hence induce an impulse purchase. In the long term, it can create product and brand loyalty. Most of the industries use this tool by backing it up with proper market research and satisfying the customers need by tailoring the incentives as per the market segments.
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