What is Sales Promotion?
Sales promotion is one of the components of the marketing element known as “Promotional Communication,” the other elements of which are advertising, public relations, and personal selling. The primary purpose is to drive sales. Furthermore, promotional incentives must be exceptional in nature, as they serve as a tool designed to generate short-term results. Finally, one must not lose sight of the end customer or the distribution channel.
The Main Objectives Of Promotion at the Distribution Level are:
- Liquidate perishables (low sales) or those in the declining stage
- Accelerate Inventory Turnover
- Improving Image Among Distributors
- Expand the distribution
- Strengthen outlet presence
- Liquidate Distributor Inventory
- Motivate and directly involve the distributor
The Characteristics of Sales Promotion
The definition of sales promotion – along with a comparison with other elements of the communications mix – serves to highlight several interesting features of promotion:
- The purpose of sales promotion is to increase the ability and desire of salespeople, distributors, and resellers to market the company’s products, while at the same time stimulating the desire of potential customers to buy by bringing the products closer to them.
- Sales promotion is an incentive that is discontinuous in terms of time, form, and nature. As a result, it should be specific to each launch and limited in duration. However, this does not prevent a successful promotion from being repeated.
- Promotion is used to boost short-term sales.
- It is an incentive unrelated to the intrinsic characteristics of the product. The goal is not to improve the product itself, but to boost sales momentum. If, for example, the packaging is improved for promotional purposes, the initiative is no longer a promotion, because packaging is an integral part of the product’s characteristics or qualities.
- Promotion is an incentive that differs from advertising. The latter motivates, informs and then sells; promotion, conversely, generates a direct sale. Confusion between these two concepts arises from the fact that most advertising initiatives require communication and advertising often serves as the vehicle used for this purpose. Advertising “brings” the customer closer to the product, while promotion “brings” the product closer to the customer.
- Promotion is an incentive that can take many forms. It includes a variety of actions depending on the specific context; for example, this could include a free gift, a discount, or entering a sweepstakes.
- It should be implemented by establishing a link between the promotional benefit offered and the product, on the one hand, and between that benefit and the customer, on the other. For example, if you are promoting a toothpaste, a relevant promotional benefit could be a toothbrush or floss.
The Advantages of the Promotion are That
- It makes it possible to compensate for price differences or discounts offered by competitors.
- It stimulates sales in the short term and ensures stability in the long term.
- The results and costs can be monitored with great precision.
- It facilitates cleaning up production surpluses or inventory reduction.
- It manages to capture – if only temporarily – a share of the market from competitors.
The Main Drawbacks of the Promotion are:
- The customer risks focusing more on the benefit offered than on the product itself.
- Faced with fierce competition in terms of promotions, it is necessary to constantly increase the value of the gifts offered to customers.
- The risk of the customer becoming addicted to these promotions remains.
Sales Promotion Effectiveness
Ultimately, promotion is neither good nor bad. it may prove effective or ineffective, depending on whether or not it achieves its intended objectives.
To define these objectives, it is essential to consider both the advantages and disadvantages just highlighted.
This allows for the problems that promotions are likely to solve, as well as the situations in which it would be inadvisable to resort to them.
The main situations in which it is advisable to launch a promotion are when:
- The number of customers buying the product is not sufficient.
- It is necessary to introduce a new product.
- Buyers don’t buy in large quantities, or buy very often.
- Competition is fierce in certain local regions or at certain times of the year.
- Inventory turnover is slow.
Conclusion
Sales promotion remains one of the elements of the promotional mix. The main elements of this mix are advertising, personal selling, direct marketing, as well as publicity and public relations.