Tma Notes

objectives of sales promotion are:-
1. Increase in Sales Volume
2. Launch New Product and Increase Trial
3. Encourage Repeat Purchase
4. To Block Competitor’s Moves
5. Encourage Dealers to Participate in Display and Sales Contest
6. Deflect Customer’s Attention from Price
7. To Supplement Advertising and Personal Selling Efforts.
Advantages of Sales Promotion

1. Introduce New Products: Sales promotion techniques are the most
effective ways of introducing innovative products in the market by
business organizations. Companies sometimes face difficulties in
creating a market for new products. Sales promotion enables in
attracting peoples towards these products using penetration price
policy, discounts, coupons, and several other benefits. In this way, it
induces clients to buy the brand products that lead to increase
demands for newly developed products.
2. Generate New Leads: It generates a large number of leads for
business by exposing more and more customers and other business
partners to the products of the company. Sales promotion serves as
a communication link between the producer and the customer. It
supplies all important information about products to clients and
resolves all their queries. Techniques of sales promotion aim at
differentiating the products by explaining the benefits of the brand
over others that is how it stands out from the crowd. This eventually
enables in attracting high number of leads thereby increasing the
customer base.
3. Large Scale Production: Sales promotion facilitates an organization
is enjoying economies of cost by carrying out large-scale production.
It focuses on increasing the demand for the company’s products by
doing a mass promotion in the market. An increase in sales volume
will ultimately lead to reducing the per-unit cost to the company by
doing mass production of products.
4. Immediate Returns: It offers more quick and immediate returns in
comparison to other components of the promotion mix like
advertising and personal selling. Sales promotion uses different
methods for boosting the sales volume within a short period of time.
Measures like free samples, discounts, coupons, providing free trials,
giving product demonstrations etc. are helpful in attracting more
customers for buying products thereby raising the overall sales
volume.
5. Strengthen Customer Involvement and loyalty: Another important
benefit provided by sales promotion is that it keeps existing
customers re-engaging with brand and builds loyalty among them. It
is a mechanism used by organization that keeps on interacting with
customers once they make purchases with brand or subscribe to its
email’s newsletter. Sales promotion team keeps on sending
promotional emails and messages to customers on a regular basis to
keep them engaging which leads to developing a close connection
with them.
6. Better Control: Sales promotion techniques provides effective
control in the hands of management for regulating the promotional
activities of organization. Programmes of sales promotion are more
cost-efficient having lower promotional costs and provide quick and
better returns. Managers can easily evaluate the results of each
promotional programmes in relation to their cost factor.
7. Improve Public Image of Firm: It has an effective role in building a
strong image of firm in market. Sales promotion provides customers
with all necessary information about products and resolves all their
queries. Clients in presence of right information are able to choose
right product by easily doing a comparison of brand products with
other competitors in market. This results in better service experience
of customers with their brined thereby building a strong position in
market.
Disadvantages of Sales promotion
1. Increase Price Sensitivity: Sales promotion is disadvantageous for
business organization if it is provided on a regular basis by
organization. Customers may become too price-sensitive and wait for
promotional deals to be announced by the company. They may not
buy products from routine sales at the market and instead buy at
discounted price which lowers the overall organizational profitability.
2. Costly: Sales promotion raises the expenses of business
organization which have adverse impact on their profit margin.
Techniques of sales promotion like free samples, discounts, and
coupons require huge costs on the part of company. It is uncertain
whether all these measures will provide equal returns that reduce the
profitability of business.
3. Tarnish Brand Image: Sales promotion may also lower the
perception of customers towards the brand in case it is overused by
the organization. When products are offered continuously at
discounted price by brand then the customers believe it as a regular
price. They may doubt the product quality of the brand in comparison
to other competitors providing products with no offers and price
reductions.
4. Short-Term Orientation: Sales promotion is meant for short-term
which boosts the sales volume for a shorter period by offering distinct
offers and benefits to customers. Short-term sales volume is quite
difficult to maintain and has a negative influence on the long-term
future of business.

Tma Notes

Uploaded by

Copyright:

Available Formats

Tma Notes

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Tma Notes

Uploaded by

Copyright:

Available Formats

objectives of sales promotion are:-

1. Increase in Sales Volume

2. Launch New Product and Increase Trial

3. Encourage Repeat Purchase

4. To Block Competitor’s Moves

5. Encourage Dealers to Participate in Display and Sales Contest

6. Deflect Customer’s Attention from Price

7. To Supplement Advertising and Personal Selling Efforts.

Advantages of Sales Promotion

You might also like