This document provides an overview of sales promotion. It defines sales promotion as activities undertaken to boost short-term sales, such as incentives and rewards that encourage customers to purchase now. The purpose is to generate faster, more measurable sales results and attract new or occasional customers. Sales promotion is differentiated from other promotional tools by its short timeline, rational appeal, tangible value, and focus on immediate sales. The main objectives are to introduce new products, attract customers, and increase sales during off-seasons. Advantages for manufacturers include increased profits and sales, while consumers benefit from lower prices and incentives. Major tools include consumer promotions like contests and premiums, and trade promotions such as point-of-purchase displays and trade shows. Key decisions involve

1. ALL YOU NEED TO KNOW ABOUT
SALES PROMOTION
E2BAIS3 GROUP ‘C’ STUDENTS
Principles of Marketing
ADDIS ABABA UNIVERSITY
SCHOOL OF COMMERCE
DEC,29/2013

2. WHAT IS SALES PROMOTION?
Set
of
marketing
activities
undertaken to boost sales of the product
or service.
 It describes incentives and rewards to
get customers to buy now rather than
later.
. Means to give short term incentives
to encourage purchase or sale of a
product or service (AMA)

3. Purpose of Sales Promotion
Yield faster, more measurable results in sales
Stimulate consumer trial
Attract new triers or brand switchers
Reward loyal customers
Increase repurchase rate of occasional users
Enhance Brand Image

4. Sales Promotion Vs Other Promotional
tools
In order to understand the basic role and function
of sales promotion, one must differentiate between
sales promotion and other components of the
marketing mix.

Sales promotion usually operates on :
a short timeline (temporarily),
uses a more rational appeal,
returns a tangible or real value,
fosters an immediate sale, and
contributes highlyreasonable, practical and functional desirability
The to profitability.

of a product or service to a potential consumer

5. Main objectives of Sales Promotion
To introduce new products or
services :
To attract new customers
To induce existing customers to
buy more
Helps the firm to remain
competitive
To increase sales in off-seasons

6. Advantages of Sales Promotion
Can be viewed from two point of
views
Manufacturers
helps to increase sales in a competitive market and
thus, increases profits;
helps to introduce new products in the market by
drawing the attention of potential customers;
 When a new product is introduced or there is a change
of fashion or taste of consumers, existing stocks can
be quickly disposed off;
 It stabilizes sales volume by keeping its customers

7. Advantages…Con’t
consumers
the consumer gets the product at a cheaper rate;
 It gives financial benefit to the customers by
way of providing prizes and sending them to
visit different places;
 The consumer gets all information about the
quality, features and uses of different
products;
 Certain schemes like money back offer creates
confidence in the mind of customers about the
quality of goods

8. Disadvantages of Sales Promotion
Increased price sensitivity
Quality image may become
discolored
Dealers forward buy and divert
stocks
Merchandising support from
dealers is doubtful
Short-term orientation

9. Major tools of Sales Promotion
•To increase the sales of a
product, the producers or
manufacturers use various
tools of sales promotion.

10. MAJOR TOOLS ……CON’T
Consumer Sales
Promotion
Directed to consumers of goods and service

Trade Sales Promotion
Directed to distributors and retailers

11. Consumer Sales Promotion

12. Trade Sales Promotion

13. Objectives, Merits & Demerits of TSP

14. MAJOR DECISIONS IN SALES PROMOTION
Establish
Objectives
Selecting the Appropriate
Tools
Developing the Program
Pretesting, Implementing and
Controlling the Program
Evaluate Results

15. 1. Establishing Objectives
Objectives for Consumers
• Purchase larger size units
• Lead nonusers to trial
• Attract switchers from competing
brands
Objectives for the Sales Force
• Encourage support of new products
• Encouraging more prospecting

16. Establishing ….Con’t
Objectives for Retailers
• Carry new items in stock
• Carry a higher level of inventory
• Off-season buying
• Stock related items
• Offset competitive promotions
• Build brand loyalty
• Enter new retail outlets

17. 2. Selecting the Appropriate Tools
Consumer Promotion Tools
• Manufacturer Promotions
• Retailer Promotions
• Consumer-Franchise Building
Promotions
• Non-Consumer-Franchise
Building Promotions

18. 3. Developing the Program
• Integration of various tools
• Factors:
• Size of Incentive
• Conditions for Participation
• Duration
• Distribution
• Timing
• Total Sales-promotion Budget

19. 4. Pretesting, Implementation &
Control
• Pretesting is important to ensure
efficacy of promotion tools
• Implementation
• Lead time: preparation prior to
launch
• Sell-in time: begins with
promotional launch and ends when
95% of merchandise is distributed to

20. 5. Evaluation of Sales Promotion
•Brand switching
•Repeat purchasing
•Purchase
acceleration

21. Some local Examples on Promotional
tools
1) Consumer Oriented Promotion
COMPANY/ORGANIZATION NAME
PRICE DEAL
Local Boutiques
CONTESTS/SWEEPSTAKES
SPECIAL EVENTS
PREMIUMS
CONTINUITYPROGRAM
SAMPLING
2) TRADE ORIENTED PROMOTIONS
POINT-OF-PURCHASE (POP) DISPLAYS
TRADE SHOWS
PUSH MONEY
DEAL LOADERS
TRADE DEALS
BUYING ALLOWANCES
ADVERTISING ALLOWANCES

22. THANK YOU!
Any Questions?