Sales Promotion

Chapter No. 17 Page No. 281
Advertising and Sales Promotion Management
SALES PROMOTION CONSUMER PROTECTION IN INDIA

SALES PROMOTION

PROMOTION IS A COMPREHENSIVE TERM, AND
COVERS THE ENTIRE GAMUT OF ADVERTISING,
PUBLICITY, PUBLIC RELATIONS, PERSONAL SELLING
AND SALES PROMOTION.

SALES PROMOTION IS THUS A PART OF PROMOTION,
AND IS RESTRICTED TO DIRECT INDUCEMENT ON A
SHORT TERM BASIS GIVEN TO CONSUMERS OR TRADE
SO AS TO STIMULATE PURCHASES OF PRODUCTS AND
SERVICES.


SALES PROMOTION

SALES PROMOTION OPERATES AT THREE LEVELS
AT THE LEVEL OF:
CONSUMER :CONSUMER PROMOTION

DEALER / DISTRIBUTORS :TRADE PROMOTION

SALES PERSON :SALES FORCE PROMOTION


GROWING IMPORTANCE OF SP

TODAY SALES PROMOTION IS ATTRACTING MORE AND
MORE OF THE PROMOTIONAL BUDGET.
COMPETITIVE PRESSURE ALSO CALLS FOR THE USE
OF SP.
WITH MORE AND MORE BRANDS FLOODING THE
MARKET, THE PRESSURE TO OCCUPY DISPLAY SPACE
AT RETAIL OUT IS MORE ( RETAILERS THUS DEMAND
MORE SP)
ADVERTISING HAS REACHED THE TARGET AUDIENCE
WHEN THEY WERE AWAY FROM THE STORE. SP TOOL
AT THE POINT OF PURCHASE REMIND THE BUYER.


CONSUMER PROMOTION TOOLS

CONSUMER CONTESTS WITH PRIZES
PRICE-OFF DEALS
PURCHASE PRICE REFUND
COUPONS
SAMPLES
PREMIUMS OR GIFTS.

CONT……


CONSUMER PROMOTION TOOLS

REWARDS PLAN ON PURCHASES
FREE TRIALS
PRODUCT WARRANTIES
CROSS PROMOTIONS
POINT OF PURCHASE (POP)
DISPLAY AND DEMONSTRATION


CONSUMER PROMOTION
AIMS

TO MAKE SLOW MOVING PRODUCTS FAST MOVING
TO REGULARISE SALES FLUCTUATIONS
TO OVERCOME SEASONAL RECESSION
TO CLEAR UNSOLD STOCKS OF OLD PRODUCT
TO EFFECT SALES OF A SPECIFIC PACK SIZE

CONT…..


CONSUMER PROMTION
AIMS

TO HELP LAUNCH A NEW PRODUCT
TO MEET A COMPETITOR’S STRATEGY
TO BUILD GOOD WILL BY SHARING THE GAY SPIRIT
TO IMPROVE PRODUCT’S VISIBILITY ON THE SHELF
TO ENCOURAGE TRADE TO SUPPORT THE PRODUCT


ROLE OF COUPONS
WHEN NEW PRODUCTS ARE LAUNCHED

ADS MAY CARRY COUPONS OF PRICE-OFF
COUPONS OF FREE PRODUCTS ARE INSERTED IN ADS
COUPONS ARE USED TO RETAIN THE EXISTING
CUSTOMERS AND TO ATTRACT NEW CUSTOMERS
COUPONS ARE USED AS A TOOL TO PENETRATE THE
MARKETS
TO KEEP THE CUSTOMERS AWAY FROM COMPETITIVE
PRODUCTS
TO BUILD RELATIONSHIP WITH CUSTOMERS


PROMOTING THE SP SCHEME

PROMOTIONAL SUPPORT IS A MUST FOR ANY SP
SCHEME
THE CAMPAIGN SHOULD BE DIRECTED TO THE
CONSUMERS FOR WHOM IT IS MEANT.
IT SHOULD ALSO TAKE INTO CONFIDENCE THE TRADE
CHANNELS
THE SALES FORCE SHOULD KNOW ITS ROLE AND BE
MOTIVATED TO DO THEIR BEST.


PROMOTING THE SP SCHEME
FOLLOW - UP

THE MARKET IS TO BE ASSESSED SOON AFTER THE
SCHEME BEGINS
THE MONITORING COVERS BRANDS / PREMIUM
AVAILABILITY, BRAND VISIBILITY, MOVEMENT OF THE
BRAND AT RETAIL OUTLET ON DAY TODAY BASIS
COMPETITOR’S COUNTER MOVES
TIMELY INTERVENTION IN THE FORM OF REMINDER
ADS, ADDITIONAL SALES FORCE, AND ADDITIONAL
POP.


CONSUMER CONTEST ( OBJECTIVES)

TO REVITALIZE A TEPID BRAND
TO INCREASE PRODUCT USAGE
TO INTRODUCE NEW PRODUCTS
TO FAMILIARISE CONSUMERS WITH UNIQUE / SPECIFIC
ASPECTS OF BRAND
TO MEASURE AD EFFECTIVENESS
TO GENERATE MAILING LIST & OVERALL GOOD WILL
TO GENERATE SLOGANS TO PROMOTE THE BRAND.


FACTORS AFFECTING THE CONTEST

THE TYPE OF THE CONTEST
THE PRIZE OFFERED
THE PROMOTION OF THE CONTEST
THE RULES GOVERNING THE CONTEST


OBJECTIVES OF TRADE PROMOTION

THE TRADE IS MOTIVATED TO CARRY THE BRAND
THE TRADE IS MOTIVATED TO CARRY A LARGER
INVENTORY
THE TRADE IS MOTIVATED TO USE POP TOOLS, AND
PRICE REDUCTION
THE TRADE IS MOTIVATED TO PUSH THE PRODUCT.


TRADE PROMOTIONAL TOOLS

PRICE OFFS OR OFF INVOICE OR OFF-LIST
ALLOWANCES LIKE ADVERTISING ALLOWANCE OR
DISPLAY ALLOWANCE
FREE GOODS ON A CERTAIN QUANTITY, PUSH MONEY,
FREE SPECIALITY ADVERTISING ITEMS


TRADE PROMOTION
(CONSIDERATIONS)
THE CAPABILITIES OF THE PARTIES.
THE TERMS / SCHEME SHOULD DISCOURAGE
UNSCRUPULOUS TRADE PRACTICES ON THE PART OF
TRADE
SCHEME SHOULD BE PROPERLY COMMUNICATED.
RESULT EXPECTED MUST BE CLEARLY STATED
REGULAR SUPPLIES OF PRODUCTS / GIFTS DURING
THE PENDENCY OF THE SCHEME
BOOKING OF SHELF SPACE OF PROMINENT DEALERS
MUST BE DONE SUFFICIENTLY IN ADVANCE
CONT…….


TRADE PROMOTION
(CONSIDERATIONS)

THE GIFT SHOULD BE OF GOOD QUALITY
SALES CONTEST(TARGET / PRIZE ON ZONAL BASIS)
POP MATERIAL AND ITS DISPLAY NEED SUPERVISION
RETAILERS WHO LAUNCH THEIR OWN SCHEME CAN
BE PERSUADED TO PROVIDE A SPECIAL SUPPORT TO
THE COMPANY’S PRODUCTS
MRTP PROVISIONS MUST BE RESPECTED


PROMOTION
(SALES REPRESENTATIVE LEVEL)
SP TOOLS ARE :
1. INCENTIVE PROGRAMME :
THESE ARE MOTIVATIONAL TOOLS LINKED TO
SALES ACHIEVEMENT OF CERATIN LEVEL
2. SALES CONTEST OF REPRESENTATIVE:
SALES REPRESENTATIVES ARE MADE TO COMPETE
AMONG THEMSLEVES TO ACHIEVE HIGHER GOALS
AND BENEFIT THE ORGANISATION.REWARDS ARE
GIVEN EITHER IN CASH OR KIND OR BOTH


PROMOTION
REPRESENTATIVE LEVEL PROMOTION MUST HAVE AN
ELEMENT OF EXCITEMENT
SHOULD BE CAPABLE OF ENTERTAINING THE
PARTICIPANTS
IN-HOUSE JOURNALS, CIRCULAR LETTERS, PERSONAL
LETTERS, MOTIVATIONAL LETTERS REMINDERS ARE
USED TO PROMOTE THE CONTEST
ON THE CLOSE OF THE CONTEST, WIDE PUBLICITY IS
GIVEN TO ACHIEVERS
FURTHER ACTIVITIES ARE PLANNED TO AVOID
DIPPING SALES, AFTER THE CLOSE OF THE CONTEST.


PROMOTION

PIT FALLS WHICH MANAGEMENT MUST GUARD

THE GOALS MUST NOT BE UNATTAINABLE
REWARDING JUST ONE PERSON IS TO BE AVOIDED
SALES VOLUME SHOULD NOT BE THE ONLY GOAL OF
EACH CONTEST
SAME PRIZES FOR EACH CONTEST ARE TO BE
AVOIDED
CONT…..


PROMOTION

PIT FALLS WHICH MANAGEMENT MUST GUARD

SOMETIMES STAFFERS OTHER THAN SALES
REPRESENTATIVES SHOULD BE INCLUDED IN THE
CONTEST
YEAR END CONTESTS ARE SEEN AS POOR PLANNING,
HENCE ARE BETTER AVOIDED
CONTEST IS NOT AN INTELLIGENCE TEST
SALES CONTEST HAVE GOALS TO ACCOMPLISH


MANAGING PROMOS

PROMOS CAN BE USED ANYTIME ANYWHERE

TWO PODUCTS WHICH ARE RELATED OR UNRELATED
CAN BE BUNDLED TOGETHER, AND EITHER PRODUCT
MAY INDUCE A BUYER TO BUY THE PRODUCT. IN A
BUNDLE ONE PRODUCT WORKS AS AN EFFECTIVE
AWRENESS-BUILDER AND A TRIAL INDUCER FOR THE
OTHER PRODUCT. PREMIUM PRODUCTS ARE SOLD ON
PULL FACTOR AND A PROMO WORKS ON A PUSH
FACTOR.


EVALUATION OF SP

SP IS TO BE MEASURED BY:
PRE-TESTING IT
MONITORING IT DRUING IMPLEMENTATION
POST- TESTING.


EVALUATION OF SP

PRE TESTING ASCERTAINS COST-EFFECTIVENESS OF
VARIOUS ALTERNATIVES
IT ALSO ASSESSES THE MOST PREFERRED TERMS
ON WHICH TO OFFER SCHEME
PRE TESTING IS DONE BY PANEL METHOD OR BY MAIL
SURVEY OR BY A FIELD STUDY.


EVALUATION OF SP
MONITORING DURING IMPLEMENTATION

PRODUCT MOVEMENT
TERRITORYWISE SALES
OUTLETWISE SALES
GOALS SET VS PAST RESULTS
COMPETITIVE MOVES
MARKET MOOD
PROBLEMS ENCOUNTERED


EVALUATION OF SP
POST TESTING (ANALYTICAL)
REDEMPTION RATE OF COUPONS
SALES ATTAINED
COST EFFECTIVENESS
REDEMPTION OF TRADING STAMPS
SALES TURNOVER OF SPECIAL PACKS OR SELF
LIQUIDATORS
NUMBER OF ENTRIES RECEIVED FOR THE CONSUMER
CONTEST etc.


EVALUATION OF SP
POST TESTING

POST TESTING IS DONE BY:
MARKET RESEARCH STUDIES
OBSERVATION METHOD IN STORES
DESK ANALYSIS OF COLLECTED DATA


FREEBIES

TO STIMULATE STAGNANT DEMAND AND TO MOVE
ACCUMULATED INVENTORIES BLOCKING HIGH COST,
COMPANIES OFFER FREEBIES.


DECLINE IN SP

PROMOS NO LONGER GENERATE EXCITEMENT
CONSUMER HAVE STARTED LOOKING FOR VALUE
CONSUMERS TAKE PROMOS FOR GRANTED
WHEN PROMOS ARE ON PAR AMONGST THE BRANDS,
THEY TEND TO PICK THE BRAND ON THE BASIS OF
OFFER
RETAILERS HAVE TO EXERT MORE TO HANDLE
PROMOS

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