Almost all promotions make use of one or more of these tools, alone or in some carefully developed combination. Exchange Schemes. In other words, prizes are awarded on the basis of chance”. A well-known television programme in India, “Surabhi”, is an example of this type of promotion. This is useful for drawing attention to product improvement. The same agency says. Coupons; 3. Trade incentive could be price off, free goods and allowances. Fairs and Exhibition 5. When coupons are offered by the manufacturer all the costs associated with advertising and distributing the coupons, redeeming their face values, and paying retailers a fee for handling, are borne by the manufacturer. 5. Radio 1. The consumer-oriented promotion tools are aimed at increasing the sales to existing consumers, and to attract new customers to the firms. Definition: The Promotion Mix refers to the blend of several promotional tools used by the business to create, maintain and increase the demand for goods and services. In this case, the customer exchanges the old product for a new one. Evidence suggests that customers look at refunds as rewards for purchase. LIST OF TOOLS• Free samples: These are distributed to attract consumers to try out a new product and thereby create new customers. A lottery prize is decided on the basis of chance and requires a “consideration” for entry that may be proof-of-purchase of ticket or a product. Television and/or Movies 1. Advertising: It is a paid form of non-personal mass communication by an identified sponsor. Media Introductions 1. Manufacturers often offer extra incentives to retailers to gain their co­operation. ADVERTISEMENTS: This article throws light upon the top five elements of promotional mix of products. Coupons are particularly attractive to consumers who are price sensitive. The refund offer may sway the decision in favour of the promoted product. The premium is likely to offer a reason and an incentive to buy the product. The consumers were offered the facility of paying the balance in 24 equal monthly installments. Sales promotion activities include special offers, displays, demonstrations, and other nonrecurring selling efforts that aren’t part of the ordinary routine. As the use of sales promotion techniques continues to increase, companies must consider what they hope to accomplish through their consumer promotions and how they interact with other promotional activities such as advertising, direct marketing, and personal selling.When marketers implement sales promotion programs without considering their long-term cumulative effect on the … ix. The list apparently appears to be short, however, considering the possible combinations, the figure reaches to about eight million different approaches. Refunds and Rebate – An offer by manufacturer to give back certain amount of money to consumer. It is termed as banded pack offer when two or more units of a product are sold at a reduced price compared to the regular price (couple of months ago, Lux International offered a similar deal. materials may be Diaries, calendars, Literature, Sign Boards, Packing Bags, Posters, etc. Many sales promotions are not effective brand building tools. Name and define five consumer sales promotional tools. A producer of branded wheat flour, “Shakti Bhog Atta”, announced an interesting promotion. As the product is primarily targeted at kids, these premiums had great appeal to them. The vast majority of businesses use several different marketing tools, such as advertising, direct mail, and market research to boost their sales. It can be regarded as an excellent approach to boost sales in a short period. A price deal for customers means a reduction in the price of promoted product and the customer saves money on purchase. e. Samples given to professionals to recommended product; e.g., doctors by pharma Cos. 2. By announcing a price discount on some popular consumer item, the retailer’s intention is to increase store-traffic. For example, Washotex came up with a scheme to pay 20 per cent now and take home Washotex washing machine. Entertainment of Customers (when standardised product is sold in bulk lots). Much depends on the ingenuity of promotion planner. ADVERTISEMENTS: Elements of promotional mix are also called as tools, means, or components. Incentive to Salesmen e.g., some prize of salesmen achieve their predetermined targets. This involves offering products to consumers at discounted or reduced prices by a certain percentage from the regular price of the product. In such a case the objective would be to encourage shopping at a particular store and buy a certain manufacturer’s brand. (c) Consumers use coupons for products which are consumed regularly, such as tea, coffee, laundry products, etc. 50 and the quantity contained in the pack is 100 gms. The pack contained four cakes of soap at the price of three). The dealers may be given information of the company’s performance, future plans, and so on. From company’s point of view, shelf space is so important that if it is provided by the wholesaler or retailer to a particular product or company the consumer will buy it. This means a refund is repayment of total money paid for purchase, while the rebate represents repayment of only of part of the money paid for purchase. Consumer incentives could be samples, coupons, free trial and demonstration. Their interest is not tied up with any brand or manufacturer, unless there has been an agreement with the marketer of some co-operative venture. It refers to reduction in price on a particular item during a particular period. There is a subtle difference between these two terms. Sales Promotion is a tool used to stimulate sales by employing incentive element to attract customers. Example—”Exchange your black and white television with a colour television.”. Sales promotion. A promotion of offering refund or rebate by a marketer is a promise to give back a certain amount of money after the purchase. Another variation of this technique is “buy-one-take-one-free”, or some similar offer (it could be “same for less” or “more for the same”). Additional quantity of the same product or additional unit of the product is appreciated as a reward by the consumer. These are all different approaches to offer immediate reward to the consumer at the time of purchase. Trade-oriented sales promotion programmes are directed at the dealer network of the company to motivate them to the sell more of the company’s brand than other brands. CONSUMER PROMOTION TOOLS Sreepathy R Naik M140401me IEM 2014-16 2. Sales contest – It involves salesmen or dealers to motivate them to increase their sales performance during a given period, with prizes going to those who did best. Advertising: Advertising is defined as any paid form of non-personal presentation and promotion of […] This would help to load-up the consumer. Marketers choose premiums that have much appeal to the consumes, or products that are related in some way to the products of the marketer. Sales promotion activities include special offers, displays, demonstrations, and other nonrecurring selling efforts that aren’t part of the ordinary routine. The pricing Strategies of these products are considered as no frill low prices where the promotion and the marketing cost of a product are kept to a minimum. Consumer promo­tion methods are those which directly encourage consumers to buy product in more and more quantity. Hundred prizes of Rs. POP material is often tied in with television or print messages to increase effectiveness. 1. Price-Off Offer 4. In short direct marketing, promotional tools are used as the most effective one in the case of developing one to one customer relationships and in the situation of highly targeted marketing efforts. For instance, the Hawkins pressure cooker manufacturer announced an attractive price reduction, up to Rs.150 off, on a new Hawkins in exchange for any old pressure cooker. Types of promotional activities. Consumer promotions are used by retailers to induce customers to buy products or services. Before publishing your Articles on this site, please read the following pages: 1. It is a special incentive given to the dealer in the form of cash or in kind to push and promote the sale of a product, especially a newly launched product. It can be used effectively with other promotional tools. Whenever the store-traffic increases, customers visiting the store not only buy promoted product, but some of them buy other products as well. For example- a 15 to 60 percent off on clothes before some festive season in retail shops are examples of sales or sales promotion. The two types of sales promotion tools consumer are as follows: A. Samples; 2. More often discounts are offered to match or beat the competitor’s prices. The ways you promote your organization will largely determine whether you successfully plant the right messages in the minds of your target audience. Getting a printer free with the purchase of a computer, or getting a bar of detergent free with the purchase of four cakes of toilet soap, or getting a Swiss knife well below the market when the consumer purchases a microwave oven, are typical examples of premium. Convention – By this the company gets many benefits like finding new sales leads, contacting customers, introducing new products, meeting new customers, selling more to present customers, and educating customers with publication and audio-visual materials. Samples – Small quantity, sometimes free of cost or sometimes at minimum price, sent door to door personally or through mails or with other products etc. It can also be used to reinforce advertising for the good or service. ii. If there are three different models of a product and because of the discount offer the price of the higher end model appears not too high to the consumer, compared to the lesser- priced model, then consumer may buy the higher end model. Booster for Dealers – For example, Telco offered 2% discount to dealers if payments, made upfront to reduce mounting inventories and boost sagging morale of dealers. Determining the quantum of discount depends on the consumers’ price perceptions and may be difficult to decide. Trade Association Meetings, Conferences and. Price discount generally do not stimulate consumers to buy a product in large quantities if the unit value is low, product is not bulky, and the holding cost is not high. Sales promotion is generally defined as those marketing activities that provide extra values or incentives to the sales force, the distributors, or the ultimate consumer and can stimulate immediate sales. It can also be used to reinforce advertising for the good or service. In general, some of the commonly used consumer-oriented promotion tools are as follows: In this case, small units of free samples are delivered door to door, sent through direct mail, attached to another product, or given along with the purchase of some other product (e.g., soaps, soft drinks, detergents or other items). Such service providing flourmills are locates in almost all localities. 2. It is common during festival season or during off-season period. In the Sales Promotion Tutorial, we saw that promotions can be classified into three main areas:. The motivation to purchase and continue purchasing the product gets shifted to the incentive of premium as the purchase situation is one of total low-involvement as far as the product category is concerned. When consumers do not perceive any meaningful persuasive differentiation between brands and the market is competitive, such promotions work very well. This dampens the competition for a while. A customer was required to buy a pack of & 7 O’clock P II for Rs. Consumer and trade promotions are short-term marketing strategies. Conventions displaying their wares to large audiences at relatively low cost. The range covers low as well as high-involvement products. The elements are: 1. 1. Special Commission on achieve pre-determined sales targets, Higher rate for Higher sales. iv. Our mission is to provide an online platform to help students to discuss anything and everything about Economics. Digital Library > Defining and Serving a Market > Market strategy"How to Establish a Promotional Mix". ADVERTISEMENTS: Everything you need to know about the tools and techniques of sales promotion. Content Filtrations 6. A firm may organize dealer conferences. xiv. Direct premiums are used to reward the customers immediately at the time of purchase, and mail premiums require the customers to take some action, such as mailing the proof of multiple purchases to the marketer. It is a natural instinct to want to target as many people and groups as possible. Share Your Word File The premiums can be used to solve a competitive price advantage or to counter the competitor’s coupon promotion. In India, contests and sweepstakes are very popular promotional techniques and are frequently used in diverse product categories and services. Premium offers provide a point of difference, more so when the product category is fairly crowded. For example, the regular price of a standard pack of a product is Rs. Refunds are quite effective in competitive situation where consumers perceive little or no differentiation among brands. Meetings and Seminars by Producers of all dealers/ distributors where all problems of middlemen are discussed and solutions given. If advertising is related to “buy our product” then sales promotion is the representation of “buy the product now”. Content Guidelines 2. Consumer & Trade Promotions As Marketing Strategies. Share Your PPT File, Sales Promotion Tools and Techniques – 2 Important Methods: Consumers Promotion Methods and Dealer Promotion Methods, Sales Promotion Tools and Techniques – Consumer Promotion Tools, Trade Promotion Tools and Business Promotion Tools, Sales Promotion Tools and Techniques – 12 Commonly Used Tools: Coupons, Free Samples, Price-Off Offer, Fairs, Exhibition, Free Gifts, Competitions and a Few Others, Sales Promotion Tools and Techniques – Price Deals, Price Pack Deals, Refunds and Rebates, Coupons, Sweepstakes, Premiums, Sampling, Continuity Plans and a Few Others. Personal Selling. Depending on the consumers’ value perception of the premium, the consumers may even be agreeable to purchase the product at a slightly high total price for the combination of the product and the premium. There were no first of second prizes, the top prize was a Santro car, besides many other prizes. Price deals (price-off, price-cut, cents-off, denote the same thing), iii. It is also possible that the retailer bought excessive stocks when the manufacturer offered trade deal and to clear this excess inventory the retailer offers a price discount to consumers. xv. Step Two: Segment Your Overall Market. The retailers serve as the agents of manufacturer in accepting and redeeming the coupons and send the collected to the concerned manufacturer along with their claims of reimbursement. As opposed to businesses—which typically make large purchases to meet previously […] You drive sales by promoting the benefits of your company's goods or services to pools of potential buyers. These must be of small size but adequate quantity. For more Business Studies , keep visiting and get ready for your exams. If advertising support has been effective, or prior to offering price discount, there has been a sample drop of the product, then even first time buyers may purchase the product. The tools of sales promotion are applied to boost sagging sales by attracting the customers and offerings of distinct incentives of purchase. Contests and sweepstakes generate considerable interest and awareness, and can be used to gain large sales increases. Various tools for direct marketing are emails, text messages, catalogues, brochures, promotional letters and so on. Eight significant differences between personal selling and sales promotion are described in this article. Akai offered a 14″ colour television on purchase of 21″ colour television. The first example presents the use of ‘chance’ in case of a consumer non-durable, which is a low-involvement category product and there is hardly anything like brand loyalty. Personal selling is also one of the most effective tools for integrated marketing communication. Where multiple purchases are involved as proof of purchase, generally the usual inter-purchase interval is more, and consumers are more likely to stay with the brand. 300,000 or more, or jewellery of the same value, then a number of prizes in the immediate value range, a large number of prizes of small value, and a larger number of consolation prizes. Disclaimer 9. Some authors have considered more elements, too. 6. Sales Promotion: Sales promotion covers those marketing activities other than advertising, publicity, and personal selling that stimulate consumer purchasing and dealer effectiveness. Coupons generally attract older, better educated, urban, middle-income families. Special credit terms may provide to encourage bulk orders from retailers or dealers. Price discounts (also called cents-off deals) are communicated to the consumers through advertising, at the point-of-purchase by listing the reduced price on the package or signs near the product or window display, or by the sales people. Tools and programmes for dealer/distributor sales promotion . A judicious combination of techniques can be used to achieve almost any promotion objective. This website includes study notes, research papers, essays, articles and other allied information submitted by visitors like YOU. In fact, in most households the flour comes from flourmills where people take their wheat to be converted into wheat flour. ‘Price off’ offer; 8. The focus of advertising to create reason for purchase the focus of promotion is to create an incentive to buy. It is very stimulating short-term sales, especially when the discount provided is genuine one. Promotions are used to gain potential customers or keep current customers satisfied. These tools are unique in their way and directed differently to these three groups. This technique is often used to introduce a new large size of the product, or to encourage continued usage, and also to increase consumption. Consumers kept on buying the same brand and collected many coupons, most not winning anything because in most cases the coupons had the same or different letters, not fit to complete the desired word. This type of refund policy builds store loyalty among consumers who continue the patronage. It is a natural instinct to want to target as many people and groups as possible. If more correct entries are received, the second stage then involves a draw of chance to decide the winners. A contest is based on testing the skill or ability and may not involve the proof-of-purchase (this is called a “consideration”) to enter the contests. It refers to exchange of old product for a new product at a price less than the original price of the product. Personal and nonpersonal communication channels can be used for marketing communications. Winners are determined by a drawing from all entry forms. Welcome to EconomicsDiscussion.net! In this article we explore: 1) the relevance of identifying customer needs to marketers, 2) main customer needs and marketing techniques used to discover them, 3) customer discovery 4 steps -3 phases, 4) customer validation, and 5) modern marketing strategies to … , such as advertising a more expensive wristwatch is Rs refund policy builds store loyalty among consumers who price! Current users, and many Timex watches had great appeal to them at the... Big Bazaar issues coupons for selected items identify and define two 2 consumer sales promotional tools their weekly flyers via mail along! 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