BTech VIII SEM (CE)

Entrepreneurship and Project Management

(Theory) BTCHE 803T(BCHE)

Prepared by :
Ms. Sanjeevani Chavhan
Assistant Professor
Department Of Chemical Engineering ,
Laxminarayan Institute Of Technology , Nagpur
 Unit VI

Marketing for Small Business

Marketing Research
NEED OF MARKETING RESEARCH
 To undertake marketing effectively
 Changes in technology
 Changes in consumer tastes
 Market demand
 Changes in the product ranges of competitors
 Changes in economic conditions
 Distribution channels
PURPOSE OF MARKETING RESEARCH
 Gain a more detailed understanding of consumers
ne needs: Example views on products prices
packaging, recent advertising campaigns
 Reduce the risk of product business failure: There is
no guarantee that any new idea will be a commercial
success-Can help to achieve commercial success.
 Forecast future trends : it can also be used to
anticipate future customer needs.
USES OF MR

 marketing opportunities and problems.

 Generate, refine, and evaluate potential
marketing actions.
 Monitor marketing performance.
 Improve marketing as a process
 Reduces uncertainty
 Reduces risk
 Helps focus decision making
Advertising and Sales Promotion
Sales Promotion

"Sales promotion are those marketing activities that provide extra

value or incentives to the sales force, the distributors, or the
ultimate consumer and can stimulate immediate sales“.

"Sales promotion includes marketing devices for stimulating

buyer interest and product trial."
Types/kinds of sales promotion
Sales promotion is generally broken into three major categories:

1. Consumer-oriented sales promotion.

2. Trade-oriented sales promotion.
3. Business and Sales force Promotion

These promotional tools encourage consumers to make an immediate

purchase and thus can stimulate short term sales.
1.Consumer Promotion
Consumer promotion includes samples, coupons, money-refund offers,
prices-off, premiums, contests, demonstrations and trading stamps.
These tools are well utilised by marketing management. Samples are
free distribution of a product for the purpose of obtaining consumer
acceptance.
This may be done on a door-to-door basis, via demonstrations, or by
mail. It is useful for promoting new products. Coupons offer a discount
on new purchases of a product. They are certificates entitling the bearer
to a discount on the purchase of a specific product. Money-refund offers
are granted to cash purchasers.
1.Consumer-Oriented Sales Promotion & Tools.
Consumer-oriented sales promotion is targeted to the ultimate user of a
product or service.
Tools of Consumer-oriented sales promotion includes Rebates,
2. Couponing
3. Sampling,
4. Premiums,
5. Contests
6. Point of purchase materials.
7. Quantity Deals
8. Free trials
9. In-product gift
10.Out-product gift
Coupons
Coupons are certificates which
entitle a consumer to buy the
product at reduced prices.
These coupons can be mailed,
enclosed in other products or
attached to them or inserted in
magazines and newspapers.
Coupons are accepted as cash
retailers.
Samples
Samples are offers of a free amount
or a trial of a product for consumers.
The sample might be delivered door
to door, sent in the mail, picked up in
a store found attached to another
product or featured in an advertising
offer. Sampling is the most effective
and most expensive way to introduce
a new product e.g., Hindustan Levers
introduced Ariel Trial Pack for its
detergent powder Ariel Micro System.
Premiums:
Premiums (or gifts) are merchandise
offered at a relatively low cost or free, as
an incentive to purchase a particular
product. Reusable jars, key chains,
containers.

Free Trials:
Free trials consist of inviting prospective
purchasers to try the product without
cost in the hope that they will buy the
product.
Rebates
Rebates, like coupons, offer value to purchasers typically by lowering
the customer's final cost for acquiring the product.

Refund
Cash refund or rebate provides a price reduction after the purchase
rather than at the retail shop. The consumer sends a specified 'proof
of purchase' to the manufacturer, who 'refunds' part of the purchase
price by mail. It is a good device for creating new user and to
strengthen the brand loyalty.
Prizes (Contests, Sweepstakes,
Games )
Prizes are offers of the chance to win cash,
trips or merchandise as a result of purchasing
something. A contestant calls for consumers
Co., submit an entry - a jingle, estimate,
suggestion to be examined by a panel of judges
who will select the best entries. In
sweepstakes, the customers submit their
names which will be included in a drawing of
prize winners. A game presents consumers
with some puzzle or missing letters. All of
these tend to gain more attention than
coupons and premiums.
Point-of-Purchase and
Demonstration
POP displays and demonstrations take place at the point
of purchase or sale.

Product Warranties
Product warranties are important promotional tools in
sensitive consumer markets.
2. Trade Promotion
Trade promotion encourages buyers to buy a larger quantity of the product. It is
also known as buying allowance because it is an offer of some discount on each
item of purchase above a minimum quantity. Hade promotion may take the form of
free goods, merchandise allowances, co-operative advertising, dealer sales
contests, and push money.

Free goods are offered to public and dealers after the purchase of certain items.
They boost the sales of a commodity by offering some additional commodities free
of cost. For example, a bar of soap is sold by offering a match box free of cost; the
sale of a coffee jar of 500 gms is accompanied by a free steel cup, and so on.
2. Trade-Oriented Sales Promotion & Tools
Trade-oriented sales promotion is targeted
toward marketing intermediaries such as
• Wholesalers
• Distributors, And
• Retailers.
Tools of Trade Oriented Sales Promotion
i. Free Display- The free display of material, at the point of
purchase (Popular Point of Sale (POS)).
ii. Retail Demonstration - In the premises of the wholesaler or
retailer, the product sales personnel conduct special
demonstrations of the product For example-car dealers.
iii. Trade Discount - The discount offered to retailers or
wholesalers. For example- retail book dealers are entitled to a
33.33% trade discount.
Tools of Trade Oriented Sales Promotion
IV. Dealer Contests - This is an indirect way of increasing sales. It is
conducted by the manufacturer, at a wholesaler or retailer level.
V. Special Displays - The producer, in collaboration with dealers, may put
up special shows of the product at fairs and exhibitions. Sometimes,
producers may compensate dealers for the space given for the display of
the product.
VI. Advertisement Materials -Advertisement materials prepared by the
company, such as store signs, banners, shelf signs, boards, etc. are
distributed to sub-dealers for display purposes. Its examples are Pepsi
and Coke.
Tools of Trade Oriented Sales Promotion
vii. Special Allowance - Manufacturers may offer special allowances
(usually mentioned as a percentage), in return for the retailer agreeing
to feature their product in some way. This is done in the case of new
products.
viii. Gifts-Manufacturers may offer free gifts to dealers, or to their sales
force to push the manufacturer's goods,
ix. Special Allowance - An extra discount is given if the retailer buys a
certain quantity For example- retail book dealer is entitled to a 30%
discount normally, but if he buys 50 books at a time, the publisher may
give a 35% discount
3. Sales Force Promotion
 Salesmen are motivated to sell products by offering bonuses,
contests and sales rallies. They are offered a bonus if the sale
increases above the minimum level. Sales contests are organised
as an effective measure of sales promotion. The main purpose of
sales contests is to increase the sales through retailers or sales
persons.

 An off-season sale can be motivated by such contests. When the

volume of sales is declining, it creates a sense of security and
stability. It is also useful in getting repeat orders from present
and past customers. The contest prizes may be cash awards,
merchandise prizes, travel and special honours.
3.Sales force Promotion Tools

(i) Bonus to sales force

(ii) Sales force contest and
(iii) Salesmen meeting and conferences.
Sales Force Promotion Tools
i) Bonus- The manufacturers sets a sales force attains the target,
bonus is given to them. So, bonus scheme encourages salesmen to
reach sales target.
ii) Sales Force Contest- Sales contests are conducted in order to step
up the selling efforts of sales force. Prizes are given to salesmen
who win in such contests by effecting maximum sales.
iii) Salesmen's Meet and Conferences- Meetings are conducted for
salesmen in order to broaden their knowledge and fine tune their
skill. Meetings and conference certainly quip salesmen with the
latest developments in the industry, etc.
Types/kinds of sales promotion

Sales promotion is generally broken into three major categories: :-

1. Consumer-oriented sales promotion
2. Trade-oriented sales promotion.
3. Business and Sales force Promotion

These promotional tools encourage consumers to make an immediate

purchase and thus can stimulate short term sales.
Distribution Channels
Seven Business Crises
Difference
Project Evaluation
Replacement problem