marketing Communications

…sales promotion

4

…introduction to…

…introduction to

learning content…sales promotion

when it can be used

what it can achieve

what it is

direct inducement or incentive

buy sooner rather than later

a means to accelerate sales

price is often the key variable……but there are other ways of adding value

understanding sales promotion…

audiences…there are three broad audiences to whom sales promotions can be targeted…

consumers members of the distribution network (intermediary)

the sales forces of both manufacturers and resellers

cost effective short-term increase in sales…

…and increase the amount of product used by current

customers

there to stimulate trial…

manufacturer to consumer

manufacturer to consumer

often provide in-store promotions…

mainly used in supermarkets and other similar

retailers

these “push” the product at the consumer

manufacturer to intermediary

used to increase sales at PoP…

…and the seller is rewarded or

remunerated

via the sales force ‘pushing’ the product to the

consumer

manufacturer to sales force

sales promotion media…

packagingretail environment… POS/POP

digital media… SMS, email, apps, viral campaigns

personal selling may be used to offer and deliver a discountprint advertisements may contain a voucher

digital aggregation

social media

iBeacon

sales promotion…mainly used in a short-term tactical sense but……can contribute to longer term strategic

and image building objectives

offer something over and above the normal product offering that acts to stimulate the target audience into actionreferred to as a ‘below-the-line’ tool – as no payments are made to media owners

all sales promotion offer a form of persuasion, a direct incentive

examples of sales promotion…

value increasing… price/quantity/quality altered

discount pricing

money-off couponspayment terms (i.e. interest free credit)

refunds

guarantees/buybacks

multipack or multi-buys

quantity increases

value adding… something extra

special features (limited editions)

valued packaging

product trial

samples

in-pack or in-mail giftsgift coupons

examples of sales promotion…

loyalty schemescompetitions/prize draws

value adding… loyalty schemes

value increasing… quantity increases

value increasing… money-off coupons

value increasing… multipacks

value adding… free gift

value adding… product trial

reasons for sales promotions…

reach new customers/brand switcherssupport new product launches

reduce distributor riskreward behaviour

retention

preserve cash flow

integration with other comms activities

induce action

add value

Fill, 2016

Lee (2002) puts forward four main reasons…

a form of inertia – this is what we have always

donea way of meeting short-term sales objectives

a reaction to competitor activities

a way of meeting long-term objectives

reasons for sales promotions…

High Low

New Product or Market

Withhold Sales Promotion

Use Sales Promotion to Stimulate Full

Trial

Established Product or Market

Non-Loyals – Use for SwitchingLoyals – Use Carefully

Non-Loyals – Attract for Trial

Loyals – Reward for Increased Usage

Involvement

Fill, 2016

when to use…

changing nature of sales promotions…

changing consumer behaviourthe rise of digital media

hence, new solutions have led to the use of digital media

and the integration of sales promotion with the other

marketing communications tools.

lack of innovation in the industrysupermarket chains now desire sales promotions that are exclusive to them

sales promotion

when it can be used

what it can achieve

what it is