Sales Promotion

I INTRODUCTION

Sales Promotion, an element of the marketing process that can close the sale of goods or services to a potential customer by providing the incentive to buy. Sales promotion, advertising, and salesmanship are the major techniques used in merchandising products to the public. Salesmanship often takes the form of a face-to-face encounter between the buyer and seller; the presentation is set up to convince customers that the product on sale is essential to their satisfaction. The lack of personal feedback between buyer and seller is sometimes considered a drawback of the advertising approach. Selling by telephone, although it is significantly less effective than personal selling, is still considered an important method of merchandising. Since the 1980s, a growing promotional technique has been to use in-home shopping programmes on cable television channels and computer networks.

II HISTORY

The travelling salesman appeared late in the 19th century in Europe and in the United States. The early itinerant pedlar carried his goods on his back or on his horse, working his way from a port city through the hinterlands. With the coming of the railway and the assurance was given to sellers by new credit-reporting systems, salespeople with their sample cases moved across the land. Persuasive skill was less important in those days of unsatisfied demand, and orders were readily forthcoming. By 1900, however, with the increasing supply of manufactured goods, buyers became more discriminating in their purchases. Greater attention was given to training the sales force and to providing buyer incentives. The growth of industrialization and urban living led to the development of merchandising as a major business endeavour. The use of sales promotion practices has experienced steady growth in the 20th century.

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III PROMOTIONAL PRACTICES

The techniques of sales promotion are used both to motivate salespeople to improve their performance and to induce consumers to purchase goods and services. Although sales promotion works most closely with advertising, it is also related to other elements of marketing: production services, packaging, price, and distribution. At the manufacturing and wholesale levels of distribution, the methods used to motivate personnel to meet specific goals usually fall into two categories—sales incentive prizes (such as merchandise, travel, or cash awards) and sales contests. Both are based upon the salesperson reaching an objective above the normal sales quota.

Consumer promotions encompass a wide variety of techniques, including sampling of goods or services, store redeemable “money-off” coupons to encourage the trial of products, special price-reduced packages, mail-in premium merchandise offers, cash or coupon refunds by mail, special product packaging, contests, and sweepstakes. During recessions, when the demand for customers’ money becomes more competitive, there is greater participation in the refund, coupon, and premium offers.

Sales promotion, now fully recognized as a vital element in the marketing mix, has become a vast industry. In recent years, sales promotion expenditures have exceeded monies spent on advertising and there are strong indications that this pattern of growth will continue to maintain its economic edge.