Sales Promotion Objectives: 15 Objectives of Sales Promotion

Sales promotion is set of those promotional activities other than advertising, personal selling and public relations that stimulate buyer’s buying enthusiasm.

Sales promotion includes providing information about the attribution of the products and communicating messages aimed at satisfying its shareholders, government dealers and the like.

Sales promotion objectives are consistent with marketing objectives. However, they may vary with the type of target market and points of channel.

The objectives for retailers may be to carry new items, encourage off-season buying, and offset competitive promotions, build brand loyalty, and so on.

ADVERTISEMENTS:

The objectives for the sales force may be to encourage a new product or model, stimulate off-season sales, and persuade more prospective buyers, and so on. The objectives for consumers may be to encourage more usage and purchases of a larger number of units and attract competitors’ brand users.

The various objectives of sales promotion can be summed up as follows:-

1. To Increase Sales Volume 2. To Increase the Use By Present Customers 3. To Introduce a New Product 4. To Attract New Customers. 5. To Counter a Competitor’s Sales Promotion Device

6. To Assist a Salesman in Selling 7. To Increase Goodwill 8. Buy Bigger 9. To Reduce Seasonal Decline 10. To Develop Preferences and Convictions of Buyers.

ADVERTISEMENTS:

11. Repeat Purchase 12. To Help the Firm Remain Competitive 13. To Increase Sales in Off-Seasons 14. In-Store Activities 15. To Add to the Stock of the Dealers.

Learn about the Sales Promotion Objectives

Sales Promotion Objectives – Top 6 Objectives

Sales promotion efforts are generally designed to assist the other communication activities undertaken by a store. For example, awareness may be generated through advertising but sales promotion may be used tactically to overcome any resistance to purchase. The desire may be created by advertising, but its conversion into sales would be done by sales promotion by offering a short-term incentive. Thus, a quicker sales response results from sales promotion.

The various objectives of sales promotion can be summed up as follows:

Objective # 1. Stop and Shop:

Customers who are just passing by, with no intention of purchasing, would be encouraged to enter the store. The promotional activity may be such that it does not directly hint at a purchase, but just a free trial. For example, free hairstyling done using a hair gel sold by the store.

Objective # 2. Shop and Buy:

ADVERTISEMENTS:

Once the customers have been persuaded to enter the store, they have to be convinced to purchase by presenting the merchandise in such a manner that the customer feels a desire to buy. For example, the store could offer a money-off voucher with the hair gel bottle or the customer would be entitled to get a shampoo if they purchase the hair gel.

Objective # 3. Buy Bigger:

The promotional activity aims to persuade the customers to buy in a greater quantity or buy other products in addition. For example, customers who buy a bigger pack may be entitled to enter into a contest or they can get a free gift or customers who purchase merchandise more than a specified amount would get similar benefits.

Objective # 4. Repeat Purchase:

The final objective is to encourage customers to return again and again to the store. This is achieved by instilling loyalty among the customers through previous purchases. The goodwill can be created by schemes like continuity programmes or store cards. Regular customers are offered cards whereby after a certain amount of purchases they are entitled to a gift for example, a trip to Mauritius.

Sales can basically be increased by two methods. Either the number of transactions is increased or the size of the average sale is increased.

This can be achieved by a number of activities; some of them are listed below:

(a) Increasing the number of transactions:

(i) Sales promotion methods can be used to persuade more people into the store and convince them to buy.

(ii) Point-of-sale incentives can be improved to generate quicker sales response.

(b) Increasing the size of the average sale:

ADVERTISEMENTS:

(i) Promotions can be introduced on high-margin goods, so the overall profitability improves.

(ii) Customers may be encouraged to buy more quantities by offering them various incentives.

Objective # 5. Supplier-Originated Sales Promotions:

Sales promotions can originate from two sources — suppliers or the retail store itself. The suppliers can initiate various sales promotion activities at their end. The retailer is not actively involved in them. The retailer plays no part in such promotional activities; he sells the merchandise as usual, with no significant effort and expenses from his end. He does not play any role in designing such activities.

Objective # 6. In-Store Activities:

The following are the main in-store promotional activities:

ADVERTISEMENTS:

(i) Price-off Pack:

The product is sold at a reduced price from its normal selling price. This is in the form of a discount where a customer has to pay less to purchase a product. Usually, it is mentioned on the pack that a certain amount is off. For example, a one litre bottle of cola may say Rs 10 off. So, if the bottle normally sells at Rs 50, the customer now has to pay only Rs 40 for the same.

(ii) Premiums:

These are in the form of small gifts that a customer gets on purchasing a product. The gifts are usually attached to the pack, or inside the pack. For example, the customer could get a jigsaw puzzle inside a ‘ pack of cornflakes, or a free mug with the purchase of a health drink.

ADVERTISEMENTS:

(iii) Self-Liquidating Premiums:

In these schemes, the customer has to write to the supplier for the gift enclosing empty packets, bottle crowns, etc. of the product plus some money. Basically, the customer provides some proof of purchase along with some money.

For example, the scheme could be-

5 bottle crowns + Rs 25 – One cap

10 bottle crowns + Rs 35 – One purse

15 bottle crowns + Rs 50 – One watch

ADVERTISEMENTS:

The gifts are likely to be bought in bulk by the supplier, giving him the benefit of large discounts. Thus, the per unit purchase price is low enough to be covered by the profit on all extra sales made. And since the customer also sends in some amount of money, the purchase price is easily covered. Another advantage is that these gifts serve as promotional materials, as the name of the supplier is usually mentioned on them.

(iv) Personality Promotions:

Many companies use show-business personalities to endorse their products. The suppliers tend to associate the charisma associated with these personalities with their products. The idea being that the customer would be attracted towards purchasing the product. However, the appeal of these personalities may be declining because so many companies use the same celebrity models.

Therefore, the customer is not able to associate that person with a single product. So, many companies now use personalities selectively to avoid overexposure. For example, T. N. Sheshan, the former Election Commissioner, was used by Safal vegetables since he did not appear for any other product and he had an honest and upright image. Therefore, people would tend to believe his statements.

(v) Competitions:

The information about these competitions is usually printed on the packs. The customer needs to follow the instructions and apply. Generally, proof of purchase (may be in the form of empty packs) is required to participate in the competition, but not necessarily so. ‘Britannia khao, World cup jao’ was one such promotional scheme. The advantage to the supplier is that the budget is known well in advance, the requisite number of prizes being prearranged. Also, the supplier can get a decent amount of publicity when he announces the winners and the prizes.

ADVERTISEMENTS:

(vi) Co-Operative Promotions:

Sometimes, two or more products share and fund a joint in-store promotion. For example, shaving foam and after shave lotion.

(vii) Sampling:

The customers are given product samples for trial. This is usually an in-store activity. Sometimes, a demonstrator may also be present to explain the product. These samples aim at inducing trial of the product. These products are such that customers, if left on their own, would be reluctant to spend money and give them a try. The product may be entirely new and customers may have little knowledge about them. For example, soya bean milk, exotic mushrooms, etc.

(viii) Coupons:

Price-off coupons are printed on the pack or in store hand-outs, and the customers can use them to save substantial amounts on their next purchase of the brand. The effectiveness of this type of promotion can be significantly reduced if the store allows the coupon to be redeemed for different products. This is called ‘mal-redemption’.

ADVERTISEMENTS:

(ix) Buy One, Get One Free:

The customer can get two units of the product at the price of one. Or another variant could be that he buys three packets and gets the fourth one free. Sometimes, the customers have to send the empty packets to the supplier for getting their free products.

This may not be very effective and enticing due to the hassles involved in it for the customers. However, it reduces the cost of promotion because of the low ‘redemption rate’. Of the many customers who buy the product very few would send the empty packet back to the supplier and redeem their gift.

(x) Multi-Packs:

Here two or more packs are attached and sold for a better and attractive price than the price of the items singly. It would be ‘economical’ for the customers to buy a pack of three as it is available at the price of two packets. Thus, the price per unit of the product is reduced for the customer.

For example, one Maggi noodles packet free with the purchase of four, or one gets three soaps at the price of two. Frequently, a ‘stretched’ version of the pack obviates the extra shelf space required. Such schemes are popular in toiletries and drinks.

ADVERTISEMENTS:

(xi) In-Store Salespersons:

The supplier provides his own personnel to explain the benefits of the displayed products to the customers. These personnel persuade the customers to purchase by clearing their doubts and mentioning the advantages that their product has over other products. An example would be ‘demonstrators’ used in the electrical white goods market. For such schemes to work effectively, further inducement may need to be offered such as reduced prices.

Once the customer shows his interest in the product, the salespersons can take off from there and complete the sale. Any doubts and questions that arise in the minds of the customers can be cleared then and there, thus overcoming the resistance. This promotion is used selectively, normally in supermarkets, department stores, etc. The number of customers visiting must be large enough to cover the costs involved.

Even though the retailer is not actively involved, he has to be well informed for achieving the planned objectives of promotional schemes. That is, the retailer needs to see over the collection and redemption of coupons, reorganisation of the store layout, shelf displays, etc.

(xii) Point-of-Purchase (PoP) Display Material:

Most suppliers produce sales-aid materials which are placed near the products to attract customers and induce them to purchase.

Examples of this type of material are:

(a) Leaflets:

These provide details of the product the advantages of a particular retailer’s products over the competitor, unique features and benefits, price, etc. For example, leaflets providing information about a particular model of a car are kept in a car showroom.

(b) Special Fittings:

The products are kept in the special racks or stands provided by the suppliers. For example, racks provided by toothbrush suppliers, dry-battery stands, glass case for watches, etc. These fittings make the product prominent compared to other .products, kept in normal racks. As these fittings are large and attractive, and kept at conspicuous places, they attract the attention of the customers.

(c) Demonstrators:

Sometimes demonstrators are used in this context. For example, a children’s product may use a person dressed as their logo (for example a teddy bear) in the store. Such a person can give away samples of the product or stand near the rack storing the product to induce purchases.

Many retailers use the display material provided by suppliers very selectively due to the danger of producing a cluttered and uncoordinated retailing environment. If every supplier wants his individual rack to be placed in the store, it would lead to a much disorganized environment. And since every supplier has his distinct looking stand, the store would lose its consistency in appeal. In some cases, the suppliers and retailers collaborate to produce a mutually acceptable point-of-sale display material.

Sales Promotion Objectives – 8 Main Objectives

The purpose of sales promotion is to increase sales. The main objective of a commercial concern is to increase its sale.

The objectives of sales promotion are described below in detail:

1. To Increase Sales Volume:

Today, in the scientific age of specialization, sales promotion has become a vital need. In its absence, it is useless to imagine an increase in sales. For the constant sales-increase, it is better to determine the sales promotion programmes on the basis of changing policies and to implement them with new strategies. This certainly pre-determines the scope of sales promotion.

2. To Increase the Use By Present Customers:

Sales promotion is also done so that the present customers may increase the use of a product. Customers are told new methods how to use the product and this is done through work demonstration and cinema. In some conditions, customers leave their old products and adopt goods with new packaging and the latest improvement.

The fulfilment of these needs is possible through sales promotion programmes. In its absence, the old customers are not attracted towards the latest goods of the seller.

3. To Introduce a New Product:

The main purpose of sales promotion is to introduce a new product among customers. For this purpose, sales promotion plans are started. These new customers raise the collective sales volume.

4. To Attract New Customers:

Sales promotion is also used to generate new customers. For this purpose, sales promotion plans are started. These new customers help increase total sales.

5. To Counter a Competitor’s Sales Promotion Device:

Some products have a good market. Such products do not gain much advantage by these sales promotion devices. In some conditions, they have to start sales promotion plans because competitor sellers also start such plans. In these conditions, sales promotion devices are started to counter the other sellers’ plans.

6. To Assist a Salesman in Selling:

Sales promotion provides help in sales. Through the medium of sales promotion institutions make the work of sellers easy and direct contact is established with customers.

7. To Increase Goodwill:

In particular conditions an institution follows sales promotion policies so that the popularity of the institution may increase. The popularity of the institution grows when customers are offered free gifts and prices are reduced after a fixed time.

8. To Reduce Seasonal Decline:

There are some products whose demand falls badly in a particular season. The purpose of sales promotion is to reduce the seasonal decline. For example, the cold drinks companies start prize winning schemes to maintain their sales.

Sales Promotion Objectives – 3 Fundamental Objectives: Informing, Persuading and Reminding

Sales promotion objectives are consistent with marketing objectives. However, they may vary with the type of target market and points of channel. The objectives for retailers may be to carry new items, encourage off-season buying, and offset competitive promotions, build brand loyalty, and so on.

In spite of the several objectives of sales promotion, there are three which are fundamental, viz., informing, persuading and reminding. These objectives are attained through effective communication.

1. Informing:

Informing is to educate the consumers about the product. They must have some knowledge about the product offered by the producer. They should, therefore, be informed of the new product and told that the new products works better than all similar existing products. Free samples may be distributed to leading consumers who may be a source of advertisement for other prospective consumers.

2. Persuading:

Sales persons persuade consumers to buy products. They develop or reinforce a favourable set for attitudes and influence their buying behaviour. They supply comparative information on various products so that consumers may be willing to purchase the products promoted by them.

3. Reminding:

Reminding leads the firms to reinforce the previously satisfactory behaviour of the customer. For this purpose, it provides suitable knowledge for recollection. Reminding the consumers of their past satisfaction will persuade them to stay with the product and prevent them from shifting to competitors.

Sales Promotion Objectives – 5 Important Objectives of Sales Promotional Activities

Sales promotional activities serve the following objectives:

1. Providing Information – The producer generally provides the information regarding the quality uses, different uses of the products and the price etc. to the customer’s while introducing the product.

2. Increase in Sales – The main purpose of all promotional activities is to increase the sales of the products of the company. Promotional activities increases the sales by changing the elasticity of demand of the product through various techniques i.e. by distributing samples, free gifts, purchase pre-eminence discount etc. Such activities make the product popular.

3. Reducing Seasonal Decline – In slack season the promotional activities help in maintaining the sales of the product. Customers and middlemen are offered attractive discounts and free gifts along with their products to induce the persons to purchase their products.

4. To Keep the Memory Alive – One of the objectives of the sales promotion is to keep the memory of the product alive in the minds of present customers. Though this work is alone by advertising but other promotional activities help achieve these objectives.

5. To Induce Middlemen to Purchase More – The middlemen whole sellers and retailers are induced to purchase more stock by offering more facilities such as credit facilities, higher trade and cash discount and free gifts etc.

Sales Promotion Objectives – Top 5 Objectives

Sales promotion includes providing information about the attribution of the products and communicating messages aimed at satisfying its shareholders, government dealers and the like. In the marketing mix marketing communication is as important as other elements. In the broad sense of the term marketing communication mix includes all the four marketing P’s – Product, Promotion, Packaging and Price.

Product’s design, colour, packaging and price, all communicate something. As soon as the company decides to enter the market, all marketing mix elements reinforce the decisions or the position. In the narrow sense of the term marketing communication refers to the marketing tools which are normally classified under ‘promotion’, one of the four P’s they are called ‘promo tools’ and include various forms of ‘advertising’, sales presentations and demonstrations, point of purchase displays, sales aids (catalogue, literature, coupons, free samples) and publicity programs.

Objective # 1. To Provide Information:

The promotion communicates what is required to be communicated to various sections of the trade i.e., customers, government, shareholders and dealers etc. It informs the customers and dealers all about the product i.e., attributes, colour, size, design, uses, price, packaging etc.

It is necessary while introducing the product to the market and thereafter, if there is any change in these elements, through various promotion tools i.e., advertising, salesmanship, publicity, point of purchase etc. In the international situation it plays more significant role because the buyers in the foreign markets may be unaware of the product. Even if they are aware, their tradition and culture may prevent them from using it unless it is adapted to suit them and such changes are communicated to them effectively.

Objective # 2. To Increase Sales:

Promotional campaign or communication mix seeks to increase the company’s sales by changing the elasticity of demand of the product through various techniques i.e., distributing samples, or free gifts, purchase premiums, coupons etc. activities make the product popular and increase the demand.

Objective # 3. To Keep Memory Alive:

Sales promotion keeps and memory of the product alive in the minds of the customers. Besides advertisement promotional activities help achieve this objective. It is required at all stages of product life cycles.

Objective # 4. To Reduce Seasonal Decline:

Some products are used in a particular season. Promotional activities help maintaining the sales of the product in slack season when demand is little. Customers and middlemen are offered attractive discounts and free gifts. Other sale techniques are used to the customers to purchase the product even in the off season. The practice of offering off-season discount is in vogue in almost all countries of the world.

Objective # 5. To Develop Preferences and Convictions of Buyers:

Sales promotion efforts are necessary to create awareness in the beginning, later on it seeks to develop brand image and product preferences among the buyers so that they may switch over to the company’s product. To acquire conviction on conviction of buyers, promotion efforts of the company must include the act of convincing the buyer about the quality of the product. It should be adapted to their needs and requirements.

Sales Promotion Objectives – 9 Main Objectives

Sales promotion objectives are consistent with marketing and marketing communications objectives. However, they may vary with the type of target market and points of channel.

The objectives of sales promotion are:

(i) Informing:

Informing is to educate the consumers about the product. They must have some knowledge about the product offered by the producer. They should, therefore, be informed of the new product and told that the new product works better than all similar existing products. Free samples may be distributed to leading consumers who may be a source of advertisement for other prospective consumers.

(ii) Persuading:

Salespersons persuade consumers to buy products. They develop or reinforce a favourable set of attitudes and influence their buying behaviour. They supply comparative information on various products so that consumers may be willing to purchase the products promoted by them.

(iii) Reminding:

(iv) To Introduce New Products:

Sales promotion is often used to motivate consumers to try a new product. Dealers are also induced to buy new products for resale. Usually free samples are given to introduce new products to customers. Discounts in cash or goods may also be offered to dealers to stock a new product.

(v) To Attract New Customers:

Sales promotion measures help to attract new customers. Usually additional customers are won away from other firms. Samples, gifts, prizes, etc., are used to encourage consumers to try a new brand or shift their patronage to a new dealer.

(vi) To Induce Present Customers to Buy More:

Sales promotion devices are also used to induce present customers to buy more. Product developments, offering three products at the cost of two are some of the devices used to encourage customers to buy more.

(vii) To Help the Firm Remain Competitive:

As all the companies conduct sales promotion activities, a company has to undertake sales promotion activities to remain competitive. Therefore, no company can escape from sales promotion activities.

(viii) To Increase Sales in Off-Seasons:

Since many products have seasonal demand like fans, refrigerators, an important aim of sales promotion of such goods is to encourage the purchase in off-seasons. That is why we find discounts, off-season price reduction of such items in the market.

(ix) To Add to the Stock of the Dealers:

The wholesalers and retailers who have a variety of goods in their shop can sell more efficiently and easily to customers. Therefore sales promotion activities are undertaken by the manufacturers to encourage dealers to have more stocks of goods.

Sales Promotion Objectives – Informing, Persuading and Reminding

Sales Promotion describes promotional methods using special short term techniques to persuade prospect of a target market to respond or undertake certain activity. As a reward, marketer offer something of value to those respondents in the form of lower cost of ownership for a purchased product, example – lower purchase price, money back, inclusion of additional value added material etc. (something more for the same price) Sales promotion is an important instrument in marketing to accelerate the marketing effort. It is regarded as an investment in today’s business.

As a result it can pay high dividends. It is an integral part of marketing effort. “Sales promotion is referred to the promotional activities other than personal selling, advertising and publicity, which stimulate consumer purchasing and dealer effectiveness.”

The manufacturer or marketer has a good product, reasonable price, attractive package, a good sales force. He also spends lot of money on advertising, but the product may not sell by itself to achieve his target. In this situation the sale of product has to be promoted through some influences at the point purchase where prospective buyers meet face to face.

He has to take attractive and effective steps in meeting the consumer in the market after taking decision relating to the nature of products, its price and its distribution system. The marketer or producer try to fulfil all the requirements, as desired by the consumers. The objective of sales promotion is to induce the consumer to purchase more and more products and thus demand for the product is created.

There are three main objectives of sales promotion:

i. Informing.

ii. Persuading.

iii. Reminding.

i. Informing:

Informative promotion tends to convert existing needs into want. It also stimulates interest into a new product. Generally sales promotion techniques are designed to create interest in the mind of customer and customer is interested to take action for purchasing the product or service. For instance, a promotional scheme allows a customer to try a fee-based online service free for several days. This free access may include receiving product information via email. In a nutshell, informative promotion helps in increasing awareness of a new brand, product class, building, product image.

ii. Persuading:

Persuading generally becomes the main promotion goals, when the product enters the growth stage of its life cycle. In this stage target market has general product awareness and some knowledge about the product how the product fulfil their wants. Large scale production can be achieved only with the methods of large scale selling which is possible only through the promotional activities. But small scale production is not possible only on the methods of promotional activities.

Therefore, small businessmen try to attract the customers through persuading. They should build confidence in the mind of customer about the product through promotion and personal selling. The most important objective of sales promotion is to build demand by convincing customers to make a purchase.

iii. Reminding:

Reminding promotional scheme is used to complete the promotion activities in the mind of consumers. Reminder promotion is very active during the maturity stage of product life cycle. Once the customer has made a purchase, sales promotion can be used to both encourage additional purchasing and as a reward for purchase loyalty. Its purpose is to trigger a memory. It is used to maintain relationship with the customer.

Sales Promotion Objectives – Dual Objectives of Sales Promotion

Sales promotion has dual objectives:

1. To increase buying response by ultimate consumers and selling efforts and intensity by dealers as well as by sales personnel, and

3. To supplement and co-ordinate efforts of Advertising/Personal Selling. The result of an effective total marketing programme is sales success, which entirely depends on positive customer reaction and an intense, well organised selling effort by resellers and salespersons.

One study suggested the following reasons for undertaking actively all forms of sales promotion:

1. Calling attention to new products and product improvements,

2. Informing buyers of new brand and new package,

3. Improving market share,

4. Increasing usage rate by present customers,

5. Maintaining customer patronage and brand loyalty,

6. Obtaining dealer outlets,

7. Securing additional shelf-space and added display,

8. Creating talking points for sale persons, and

9. Meeting competition.

Sales Promotion Objectives – 8 Main Objectives

The main objectives of the sales promotion are:

1. To attract new customers by means of attractive gifts etc.

2. To increase the sales and encourage the present customers

3. To create goodwill among the prospective customers

4. To provide Information regarding the quality, uses, different uses of the products

5. To reduce seasonal decline, create the promotional activities help in maintaining the sales of the product in slack season

6. To rate good public image of the product and the organisation

7. To keep the memory alive through promotional activities

8. To motivate and attract the sales force by exhibiting their products in the important markets.

Sales Promotion Objectives – Stop and Shop, Shop and Buy, Buy Bigger and Repeat Purchase

Sales promotion is set of those promotional activities other than advertising, personal selling and public relations that stimulate buyer’s buying enthusiasm.

The objectives of the sales promotion are:

1. Stop and Shop:

Customers passing the store, who have no intention of going in, would be encouraged to enter by a sales promotion in-store, e.g. tasting a food buying new T shirts and jeans; brass wares, etc.

2. Shop and Buy:

Having persuaded customers to enter the shop, they could now be encouraged to buy by presenting the merchandise in such a manner as to create the purchase instinct in the customer’s mind; e.g. money-off vouchers, trade-in allowances.

3. Buy Bigger:

During the buying process customers would be persuaded to buy either a larger quantity of the same goods or to buy other products in addition, e.g. premiums, cash-back offers.

4. Repeat Purchase:

The final aim is to persuade customers to return again and again to the store trading on the goodwill and loyalty that previous purchases have, hopefully, instilled, e.g. store ‘club’ cards, or continuity programmes such as collecting a dinner service.