Definition: Sales promotions are the set of marketing activities undertaken to boost sales of the product or service.
Description: There are two basic types of sales promotions: trade and consumer sales promotions. The schemes, discounts, freebies, commissions and incentives given to the trade (retailers, wholesalers, distributors, C&Fs) to stock more, push more and hence sell more of a product come under trade promotion. These are aimed at enticing the trade to stock up more and hence reduce stock-outs, increase share of shelf space and drive sales through the channels. However, trade schemes get limited by the cost incurred by the company as well as the limitations of the trade in India to stock up free goods. Incentives can be overseas trips and gifts.
But sales promotion activity aimed at the final consumer are called consumer schemes. These are used to create a pull for the product and are advertised in public media to attract attention. Maximum schemes are floated in festival times, like Diwali or Christmas. Examples are buy soap, get diamond free; buy biscuits, collect runs; buy TV and get some discount or a free item with it and so on. Consumer schemes become very prominent in the 'maturity or decline' stages of a product life cycle, where companies vie to sell their own wares against severe competition.
The impact of sales promotions:
Sales promotions typically increase the level of sales for the duration they are floated. Usually, as soon as the schemes end, the sales fall, but hopefully, settle at a higher level than they were before the sales promotion started. For the company, it can be a means to gain market share, though an expensive way.
Following are the measure steps in promotion of a product or service
Step 1. Develop A Promotional Filing System.
Create a promotional folder that includes all of your past promotional direct mail pieces. Create another for advertising that has a successful track record. Create a third folder for innovative marketing strategies that catch your attention from other industries. When you are ready to create your own promotional calendar, you will have a filing system FULL of proven and innovative ideas to help you brainstorm.
Create a promotional folder that includes all of your past promotional direct mail pieces. Create another for advertising that has a successful track record. Create a third folder for innovative marketing strategies that catch your attention from other industries. When you are ready to create your own promotional calendar, you will have a filing system FULL of proven and innovative ideas to help you brainstorm.
Step 2. Evaluate And Brainstorm
Now that you have a collection of ideas to brainstorm from, you can go back and evaluate each one. As you evaluate past promotional ideas, pay attention to why they drove traffic to your business. Also evaluate what did not work so that you don’t make those same mistakes a second time. Sometimes your best promotion ideas fail simply because they were held on the wrong day or the wrong month. With a little adjusting it could be a winner the second time around.
Now that you have a collection of ideas to brainstorm from, you can go back and evaluate each one. As you evaluate past promotional ideas, pay attention to why they drove traffic to your business. Also evaluate what did not work so that you don’t make those same mistakes a second time. Sometimes your best promotion ideas fail simply because they were held on the wrong day or the wrong month. With a little adjusting it could be a winner the second time around.
Step 3. Develop Your Strategic Plan
To be successful in retail you must plan promotional events far in advance. Plan to implement a MINIMUM of six promotions per year. That is minimum! When I had my retail stores I was implementing some type of promotional event every month. This is easy when you have a strategic plan in place. You must keep reminding customers to come back to your store. The number one reason why customers don’t return to you time and time again is because you allow them to FORGET about you. Keep reminding them and get them excited about shopping at your store more often.
To be successful in retail you must plan promotional events far in advance. Plan to implement a MINIMUM of six promotions per year. That is minimum! When I had my retail stores I was implementing some type of promotional event every month. This is easy when you have a strategic plan in place. You must keep reminding customers to come back to your store. The number one reason why customers don’t return to you time and time again is because you allow them to FORGET about you. Keep reminding them and get them excited about shopping at your store more often.
Step 4. Involve Your Team
After you have outlined your promotional ideas for the year, hold a staff meeting to discuss them. Share your ideas on a large calendar board and let your team know that you are PLANNING for success. Ask your staff to share their creative ideas too. Set sales goals for each promotion and offer a bonus reward to each salesperson that reaches their goals. Once your team buys into your promotional plans, they will BUY into SELLING more customers on attending too. Plan to have enough staff on hand to make the event run effectively.
After you have outlined your promotional ideas for the year, hold a staff meeting to discuss them. Share your ideas on a large calendar board and let your team know that you are PLANNING for success. Ask your staff to share their creative ideas too. Set sales goals for each promotion and offer a bonus reward to each salesperson that reaches their goals. Once your team buys into your promotional plans, they will BUY into SELLING more customers on attending too. Plan to have enough staff on hand to make the event run effectively.
Step 5. Plan Out The Details
Evaluate your best promotional days and months. Select days and months that you drive the most traffic to your store. Plan out all the details of the event. Leave nothing to chance. The more you plan out the details and systematize your events, the easier and more successful they will be.
Evaluate your best promotional days and months. Select days and months that you drive the most traffic to your store. Plan out all the details of the event. Leave nothing to chance. The more you plan out the details and systematize your events, the easier and more successful they will be.
Step 6.
Reserve And Design Advertising
Plan your advertising and direct mail well in advance. Build excitement for the event by featuring the benefits of attending. Create a call to ACTION. Tell your customers WHAT, WHERE, WHEN and WHY. Offer short deadlines, powerful offers and guarantees with teeth.
Plan your advertising and direct mail well in advance. Build excitement for the event by featuring the benefits of attending. Create a call to ACTION. Tell your customers WHAT, WHERE, WHEN and WHY. Offer short deadlines, powerful offers and guarantees with teeth.
Step 7.
Contact The Media
If you are putting on a charity event, contact the media well in advance. Send a press release about the event and ask the media to attend. Tell them how your event will benefit the community or share details about a cause. Take your own photos at the event as well and send them along with a follow up press release.
If you are putting on a charity event, contact the media well in advance. Send a press release about the event and ask the media to attend. Tell them how your event will benefit the community or share details about a cause. Take your own photos at the event as well and send them along with a follow up press release.
Step 8.
Create Attention Getting Direct Mail
Spend 50 percent of your time writing a GREAT headline that is
BENEFIT RICH. You must HOOK their attention quickly before your direct mail
gets trashed. Make your offer and event so exciting that it triggers a FEAR OF
LOSS in the customer’s mind. Allow them to think about what they will be
missing if they don’t attend.
Step 9.
Develop Promotions Based Around A Theme
If you want to stand out from the competition, you must be DIFFERENT. The more you conform to be like everyone else, the less successful you will be. Create fun events around unique holidays. Promote when your competition is not promoting. Your event does not have to be a SALE. There are lots of ways to promote without giving the store away. Make your events so much fun that your customers promote you back with word of mouth advertising.
If you want to stand out from the competition, you must be DIFFERENT. The more you conform to be like everyone else, the less successful you will be. Create fun events around unique holidays. Promote when your competition is not promoting. Your event does not have to be a SALE. There are lots of ways to promote without giving the store away. Make your events so much fun that your customers promote you back with word of mouth advertising.
Step 10.
Plan An OTB Increase For Special Events
Why would you want to create more promotional events? To keep your store in your
customer’s mind and to INCREASE SALE AND PROFITS! Therefore you must increase
your open-to-buy and invest in additional inventory. Keep giving your customers
more reasons to come back to YOU time and time again.
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