Sales promotion is one of the important subsets of promotion . The terms sales promotion and sales promotion are also used for sales promotion .
Promotion has different subcategories, including direct marketing, personal selling, advertising , public presence, and sales promotion.
Along with product design (Product) and pricing (Price) and product distribution methods and channels (Place), you should also think about promoting the product and introducing it and convincing the customer to buy (Promotion). Otherwise, you won’t make many sales.
The meaning of sales promotion
Sales promotion is one of the promotion methods that focuses on increasing sales in the short term. This is done by increasing the value proposition or by reducing the purchase costs.
Therefore, whenever the sales of your product are less than you expected, you can increase the pressure for sales by using various sales promotion methods.
A more scientific and accurate name for this sales promotion is sales incentive . Because if you want to increase your sales, you have to offer incentives anyway. These incentives can be provided to the following groups:
- Customer and final consumer
- Dealers and distributors
- Colleagues within the organization
Incentive for colleagues within the organization
Suppose you have come to the conclusion that you need to run a sales promotion program now. Because the sale of the product is less than you expected and you need to increase the amount of sales.
One of the ways to promote sales is to consider incentives for your colleagues. These incentives can be monetary or non-monetary.
For example, if you have a large sales team, you can install the names and photos of top salespeople on the company wall.
Or you can announce that if each salesperson’s sales exceed a certain threshold, you will give them a vacation or an incentive trip.
Special commissions for certain sales, cash prizes, and in short any form of prize can be an incentive to sell more.
Just note that we are talking about short-term plans here. For example, when your company has only 200 customers and you want to increase the number of customers to 1000 with pressure and in a short time, you can go for this type of incentives for colleagues.
Therefore, long-term reward and payment and service compensation programs are usually not considered as sales promotion methods.
Remember that if you take care of your employees, they will take care of your customers, and your customers will take care of your shareholders.
Incentives for sellers and distributors
In addition to encouraging employees, incentives can be considered for sellers and distributors, both wholesalers and retailers, which are also called Trade Incentives.
Discounts for cash purchases are one of the easiest ways to incentivize sellers and distributors.
Of course, sometimes incentives are provided in the form of goods. For example, for every 20 packages of product A, one package of the same product or maybe another product is given to the seller as a discount.
Usually, in long-term cooperation, discounts and incentives are also considered for seasonal or annual sales volume, so if you can sell X units of our product this season, you will receive… as a reward.
In fast-moving consumer goods (FMCG), the variety of incentives is much greater.
For example, many manufacturers are willing to offer special discounts to supermarkets, provided that they place their products in the right place and in front of the customer.
If you go to bookstores and you see that the books of some publishers are always placed in a special place, it is possible that this is due to such an agreement.
Incentive for the customer and the final consumer
We have all experienced examples of sales promotion for consumers. Therefore, here we briefly mention some of these methods:
Discounts and price reductions
The simplest form of promotion is to reduce the price of the product and announce it to the customer before buying. Volume discounts, discounts on some products, as well as occasional discounts, including launch discounts, are examples of using discounts for promotion. Despite the simplicity of using this method, we must remember that repeating it continuously or in short intervals can make the customer uncustomary and we can no longer simply sell the product to the customer at the original price.
Coupon
A sheet is provided to the customer that by collecting them or delivering it individually, he can use the discount or receive other goods for free.
discount code
It is a method that has become widespread in the digital world these days. In addition to playing the role of incentive, the discount code can also be effective for tracking customers, in this case we give different discount codes to different sales channels and later we get statistics on which channel was more successful.
Sampling
The product sample is provided to the customer for free use at the stores.
Promotional gifts
Gifts that are given to customers in exchange for buying a specific product or a specific volume of the product. For example, when a coffee producer includes a coffee cup for those who buy large packages of coffee.
Customer loyalty programs
Usually, a part of customer loyalty programs is devoted to repeat purchases, and customers who make frequent and continuous purchases receive special points.
These frequent purchase incentives can also be considered as sales promotion.
The effectiveness of the sales promotion program
In sales promotion programs, you allocate a part of your profit to your customers or consumers or your employees, and you hope to increase your sales and profits by doing so.
But this does not always happen. Sometimes the cost of running a promotion program is more than its benefits.
The recommended way to succeed in promotion programs is to define your goals and success indicators when designing the program.
For example, if you want to consider a twenty percent discount for your sales for four weeks, specify what you expect from this sales promotion program?
Do you want to increase your sales volume? How much increase do you want? In other words, how much should your sales increase to consider your program a success?
Do you want to attract new customers? How many customers do you aim to attract?
It is only by specifying success indicators that you can compare different promotion programs and measure their effectiveness.
Remember that you must do these things before running the sales promotion. If you go to the definition and determination of indicators during the implementation and after the implementation, you will probably get caught in the trap of numbering and justifying the project.
Finally, I am very eager to know, as a customer and consumer, which sales promotion methods have you come across recently that have been successful and professional in your opinion, so that you can share them with us?
