What is sales promotion? Discuss it's types.

Sales promotions are the set of marketing activities undertaken to boost sales of the product or service. Sales promotion is designed to be used as a short-term tactic to boost sales – it is not really designed to build long-term customer loyalty. Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales. These efforts can attempt to stimulate product interest, trial, or purchase.
Some sales promotions are aimed at consumers.  Others are targeted at intermediaries (such as agents and wholesalers) or at the firm’s sales force.
Types of consumer sales promotion tools
  1. Demos and Sampling
Samples are most commonly used in grocery stores to introduce a new food product. A demo is another form of sampling when a product or service is demonstrated during actual use. A small business owner such as a home improvement contractor could work with a local hardware store to demonstrate a home improvement project.
  1. Coupons
Coupons can be used as a way to attract new customers or to develop customer loyalty. Mail coupons to targeted households as an incentive for someone to shop at your store or purchase your product.

    3.       Price Reduction
A price reduction allows customers to buy your products at a lower price for a specified period of time. A price reduction may take the form of a sale or an in-store event like an unadvertised special on certain items. A price reduction may also be used to take attention away from a competitor.


  1. Free Products
Giving something away is another way to lure customers to your place of business. For your grand opening event, you can provide everyone who attends with free food or drink or free merchandise. You can also give away items containing your brand or slogan such as coffee mugs or t-shirts. Another idea is to give away prizes to the first 25 people who enter your place of business on a given day.

     5.       Flash Sale
A flash sale is basically an offer that only lasts for a limited time and it’s a great way to create a sense of urgency for the customer to buy. Many retailers are now adopting this strategy as a way to sell more products and get rid of surplus stock.

     6.       Loyalty Points

Rewarding your customers will help you build a solid base of loyal fans and it will entice people to shop more at your online store. Offering a loyalty point system is a popular promotion. You could think about setting up a virtual card: The customer can gain points every time they buy and then use their points to get money off future purchases, or if they buy 9 items, they get the 10 th free.

Types of sales promotion tools for intermediaries
1.       Buy Back Allowances
After a certain purchases made by wholesalers or retailers they receive sum of money as buy back allowances as per the predetermined schemes of the company.
2.       Merchandise Allowances
In this methods resellers are offered more units of the goods in regular prices.
3.       Cooperative advertising
This method is a participative advertising process where manufacture pays certain amount of advertising to the resellers
4.       Sales contests
Sales contests are organized between resellers to recognize and reward the most efficient channel members,

E.g. Touring Thailand and Malaysia after meeting certain units of goods sold is popular among Nepalese entrepreneurs.

1 Comments

  1. Really appreciate....

    Gives more knowledge in short time.....


    Thank u .amit

    ReplyDelete
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