Sales Promotion Technique

November 26, 2017 Marketing

Sales Promotion Techniq Axia College of University of Phoenix Sales Promotion Techniques Sales promotion describes promotional methods using special short-term techniques to persuade members of a target market to respond or undertake certain activity. As a reward, marketers offer something of value to those responding generally in the form of lower cost of ownership for a purchased product (e. g. , lower purchase price, money back) or the inclusion of additional value-added material (e. g. , something more for the same price). Sales promotions are often confused with advertising.

For instance, a television advertisement mentioning a contest awarding winners with a free trip to a Caribbean island may give the contest the appearance of advertising. While the delivery of the marketer’s message through television media is certainly labeled as advertising, what is contained in the message, namely the contest, is considered a sales promotion. Sales promotions are used by a wide range of organizations in both the consumer and business markets, though the frequency and spending levels are much greater for consumer products marketers.

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One estimate by the Promotion Marketing Association suggests that in the United States alone spending on sales promotion exceeds that of advertising. Promotions are all about deals, visibility, and working to “grab” the customer. Deals are the way to brand loyalty or creating product awareness and this is done by promotions which include: coupons, rebates, promotional Pricing, trade-ins, loyalty programs, sampling and free trials. Most consumers are quite familiar with this form of sales promotion, which offers purchasers price savings or other incentives when the coupon is redeemed at the time of purchase.

Coupons are short-term in nature since most (but not all) carry an expiration date after which the value may not be received. Also, coupons require consumer involvement in order for value to be realized. In most cases involvement consists of the consumer making an effort to obtain the coupon (e. g. , clip from newspaper) and then presenting it at the time of purchase. Rebates, like coupons, offer value to purchasers typically by lowering the customer’s final cost for acquiring the product.

While rebates share some similarities with coupons, they differ in several keys aspects. First, rebates are generally handed or offered (e. g. , accessible on the Internet) to customers after a purchase is made and cannot be used to obtain immediate savings in the way coupons are used. (So called “instant rebates”, where customers receive price reductions at the time of purchase, have elements of both coupons and rebates, but for our purposes we will classify these as coupons due to the timing of the reward to the customer. One of the most powerful sales promotion techniques is the short-term price reduction or, as known in some areas, “on sale” pricing. Lowering a product’s selling price can have an immediate impact on demand, though marketers must exercise caution since the frequent use of this technique can lead customers to anticipate the reduction and, consequently, withhold purchase until the price reduction occurs again. Trade-in promotions allow consumers to obtain lower prices by exchanging something the customer possess, such as an older product that the new purchase will replace.

While the idea of gaining price breaks for trading in another product is most frequently seen with automobile sales, such promotions are used in other industries, such as computers and golf equipment, where the customer’s exchanged product can be resold by the marketer in order to extract value. Promotions that offer customers a reward, such as price discounts and free products, for frequent purchasing or other activity are called loyalty programs. These promotions have been around for many years but grew rapidly in popularity when introduced in the airline industry as part of frequent-flier programs.

Loyalty programs are also found in numerous other industries, including grocery, pizza purchasing and online book purchases, where they may also be known as club card programs since members often must use a verification card as evidence of enrollment in the program. Many loyalty programs have become ingrained as part of the value offered by a marketer. That is, a retailer or marketing organization may offer loyalty programs as general business practice.

Under this condition loyalty program does not qualify as a sales promotion since it does not fit the requirement of offering a short-term value (i. e. , it is always offered). However, even within a loyalty program that is part of a general business practice, a sales promotion can be offered such as special short-term offer that lowers the number of points needed to acquire a free product. References All items retrieved May 2, 2009 www. knowthis. com www. about. com www. unitedstatesmarketingassociation. com


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