Sales Promotion

Marketing communication
activities, other than
advertising, personal selling,
and public relations, in which
a
short-term incentive
motivates a purchase.
Steps involved in sales
promotion
 Establishing the sales promotion
objectives
 Selecting the sales promotion tools.
 Constructing the sales promotion
 Pre-testing the sales promotion
program
 Implementing & controlling
 Evaluating the sales promotion results
Uses of Sales Promotion
Immediate
Immediate Purchases
Purchases

Increase
Increase Trial
Trial

Boost
Boost consumer
consumer inventory
inventory

Encourage
Encourage repurchase
repurchase
Uses
Uses Increase
Increase ad
ad effectiveness
effectiveness
of
of
Sales
Sales Encourage
Encourage brand
brand switching
switching
Promotion
Promotion
Encourage
Encourage brand
brand loyalty
loyalty
 Objectives of Sales
Promotion
Sales
Sales Promotion
Promotion
Type
Type of
of Buyer
Buyer Desired
Desired Results
Results Examples
Examples
••Reinforce
Reinforcebehavior
behavior ••Loyalty
Loyaltymarketing
marketing
Loyal
Loyal Customers
Customers ••Increase consumption
Increase consumption ••Bonus packs
••Change Bonus packs
Changetiming
timing
••Sampling
Sampling
Competitor’s
Competitor’s ••Break loyalty
Break loyalty ••Sweepstakes,
Customers ••Persuade to switch Sweepstakes,
Customers Persuade to switch contests,
contests,premiums
premiums
••Price-lowering
Price-lowering
••Persuade to buy your
Persuade to buy your promotion
Brand
Brand Switchers
Switchers brand promotion
brandmore
moreoften
often ••Trade
Tradedeals
deals
••Appeal
Appealwith
withlow
low ••Coupons,
Coupons,price-off
price-off
Price
Price Buyers
Buyers prices
prices packages,
packages,refunds
refunds
••Supply
Supplyadded value ••Trade
addedvalue Tradedeals
deals
 Objectives
For
For consumers—
For consumers—
consumers—
•• More
More usage
•Moreusage
usage
•• Purchase
Purchase of
ofoflarge
large size units
•Purchase large sizeunits
size units
•• Building trial
Building
•Building trialamong
trial amongnon
among nonusers
non users
users
•• Attracting
Attracting trial
trial among other brand
•Attracting trial among otherbrand
among other brand users
users
users
Objectives(cont.)

For retailers—
Stocking new items or large volumes

Off season buying

Building brand loyalty

Gaining entry into new retail outlet

Objectives(cont.)

For sales force—

Encourage support

Stimulate sales in off season

 Sales Promotion

Sales
SalesPromotion
Promotion
Targets
Targets

Consumer
Consumer Trade
Trade
Sales
Sales Promotion
Promotion Sales
Sales Promotion
Promotion
 Tools for
Consumer Sales Promotion
AA certificate
certificate that
that entitles
entitles
Coupon
Coupon consumers
consumers to to an
an immediate
immediate
price
price reduction.
reduction.

A
A cash
cash refund
refund given
given for
for the
the
Rebate
Rebate purchase
purchase ofof aa product
product during
during
aa specific
specific product.
product.

An
An extra
extra item
item offered
offered to
to the
the
Premium
Premium consumer,
consumer, usually
usually in
in exchange
exchange
for
for some
some proof
proof of
of purchase.
purchase.
Tools for
Consumer Sales Promotion
Loyalty AA promotional
promotional program
program designed
designed
Loyalty to
Marketing to build
build long-term,
long-term, mutually
mutually
Marketing beneficial
beneficial relationships
relationships between
between
Program
Program aa company
company and and key
key customers.
customers.
Frequent
Frequent A
A loyalty
loyalty program
program inin which
which loyal
loyal
Buyer
Buyer consumers
consumers areare rewarded
rewarded for
for
Program
Program making
making multiple
multiple purchases.
purchases.

A
A promotional
promotional program
program that
that allow
allow
Sampling
Sampling the
the consumer
consumer the
the opportunity
opportunity to
to try
try aa
product
product or
or service
service for
for free.
free.
 Tools for
Consumer Sales Promotion

Promotions
Promotions that
that require
require skill
skill or
or
Contest
Contest ability
ability to
to compete
compete for
for prizes.
prizes.

Promotions
Promotions that
that depend
depend on
on
Sweepstakes
Sweepstakes chance
chance oror luck,
luck, with
with
free
free participation.
participation.
Tools for Trade Sales
Promotion
Trade
Trade Allowances
Allowances

Push
Push Money
Money

Training
Training

Free
Free Merchandise
Merchandise
Unique
Unique Tools
Tools
for
for Store
Store Demonstration
Demonstration
Trade
Trade Sales
Sales
Promotion
Promotion Conventions
Conventions && Trade
Trade Shows
Shows
Developing the sales
promotion program

Size of incentive
Condition for participation

Distributor vehicle

Duration

Timing

Overall budget
Distribution Vehicles
Outdoor
Newspapers
–signs
Magazines
–transit
Radio Shopping guide
Televisions –in-store
Direct mail Yellow pages
Internet
Implementing &
controlling
 Lead time
 Sell-off time
Evaluating the sales-
promotion results
For
For consumer
consumer promotion—
promotion—
••Sales
Sales performance
performance movement
movement
••Analysis
Analysis of
of consumer
consumer panel
panel data
data
••Consumer
Consumer surveys
surveys
••Experimental
Experimental studies
studies
Short-term and long-term
effects
of sales promotions
Sales

Long-term effect
Short-term
effect

Promotion
Period
Planet M
 Leading retailer in Music and
accessories.
 Started in 1999.
 Promoted by Times of India Group.
 Managed by Times Retail.
 Focus on urban consumers (Metros).
Objectives

 Short term sales increase

 Long term sales increase
 Customer loyalty
 Planet M as a Brand
Sales Promotion Team

TOI

Store Manager Store Manager Store Manager

Staff Staff Staff

Consumer Sales Promotions

 Duration -1 month
 3 to 4 promotions every month
 Seasonal promotions
 Targets every Planet M customer
 Consumer Sales Promotions

 Tools used
Free trials of music and video games
Point-of-Purchase display
Club Membership to frequent customers
Free gifts like posters, fancy mugs, etc.
Discounts on Items
 Mix of these
Distribution vehicles

 Times of India newspaper

 Radio Mirchi
 In-store announcements
 Posters for their promotional programs
Trade promotions-Recording
Companies
 Discounts to push their cassette sales
 Sponsor artists to perform in the stores
 Benefits all three
Planet M
Recording companies
Artists
Pre-tests ,Implementation and
evaluation
 Store notes given to employees
Operational details
Facts and figures

 For celebrity events staff is made to go

through “dry runs”.
Pre-tests ,Implementation and
evaluation
 Evaluation
Data base
Analyzed
 Promotion model is upgraded
 Depending on the success the model is
repeated
Analysis

 Very promotion intensive industry

 No competition now for Planet M
 New ideas of promotion.
Focus on club membership
Sponsor college fests
Thanks