Detailed Analysis On Sale Promotions
Based on studies, sales promotion represents all marketing activities
, other than personal selling, advertising, and publicity that are used to stimulate consumer purchasing and sales effectiveness. The objectives of sales promotion are to increase sales, to inform customers about new products, and to create positive store or corporate image.
Sales promotion has the following three unique characteristics:
First, it usually involves short term activities (as opposed to advertising and publicity which tend to be longer in length).
Second, it usually offers some type of incentive to make a purchase.
Third, it can be successfully used in all channels of distribution with manufacturers, wholesalers, retailers, and consumers.
Sales promotion may be either consumer oriented or trade- (business-to business) oriented. Lets take a closer look at each of these types of promotions.
Trade promotions. These are sales promotion activities designed to gain manufacturers, wholesalers, and retailers support for a product. More money is actually spent on promoting to businesses than to consumers. Major trade promotions include the following:
Slotting Allowances. It is a cash premium paid by the manufacturer to a retail chain for the costs involved in placing a new product on its shelves. Slotting allowances can range from a few thousand dollars to more than $100,000 per product. In addition to buying space in the store, slotting allowances also pay for retailers cents-off specials on a product, charges for store shelves, penalties if a companys product doesnt sell, and store advertising and display costs.
Buying allowances. A buying allowance is a special price discount given by manufacturers to wholesalers and retailers to encourage them to either buy a product or buy a larger quantity of a product. This is true to printing businesses like that of the presentation folder printing business, wherein you can get as much as half the printing price in bulk printing of your presentation folders. Because of the price discount, wholesalers and retailers make more money on each product they sell. Thus they are more likely to promote the product to customers.
Trade shows and conventions. Trade shows and conventions are designed to reach wholesalers and retailers. They provide businesses with opportunities to introduce new products, encourage increased sales of existing products, and continue company and product support. During trade shows and conventions, print marketing materials are visible like flyers, presentation folders, folders and business cards. These particular marketing materials are important for distribution to those customers and company alike that participates in the trade shows and conventions. By participating in this kind of promotion, you will get to know and meet business competitors and future business partners. Aside from that, this is the chance to let the market know that your business exists.
Sales incentives. Sales incentives are awards given to managers and employees who successfully meet or exceed their companys set sales quota for a particular product or line of products. Awards may include cash and prizes. For example, you can give an incentive trip to those printing company that meet your quota for the month. You can give a trip-for-two to some countries or provinces for local customers who helped your employees exceed their regular monthly quota. This is a good way for you to be able to retain your customers especially the corporate ones. Some companies are very fond of this strategy to show their customers that they are valued and that it is a two way benefit.
by: Brad Kartel
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