Download Chapter Fifteen - Cengage Learning

Sales Promotion
• Activities or materials that are direct inducements to
customers or salespersons
• Objectives
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To draw new customers
To encourage trial of a new product
To invigorate the sales of a mature brand
To boost sales to current customers
To reinforce advertising
To increase traffic in retail stores
To steady irregular sales patterns
To build up reseller inventories
To neutralize competitive promotional efforts
To improve shelf space and displays
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Sales Promotion Methods
• Consumer sales promotion method
– Designed to attract consumers to particular retail
stores and to motivate them to purchase certain
new or established products
• Trade sales promotion method
– Designed to encourage wholesalers and retailers to
stock and actively promote a manufacturer’s product
• Factors influencing the choice of sales promotion
method
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Objectives of the sales promotional effort
Product characteristics
Target market profile
Distribution channels
Availability of resellers
Competitive and regulatory forces in the environment
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Sales Promotion Methods (cont’d)
• Rebate
– A return of part of the purchase price of a product
• Coupon
– Reducing the purchase price of a particular item by a
stated amount at the time of purchase
• Sample
– A free product given to customers to encourage trial
• Premium
– A gift a producer offers to a customer in return for
buying its product
• Frequent-user incentives
– A program that rewards customers who engage in
repeat (frequent) purchases
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Sales Promotion Methods (cont’d)
• Point-of-purchase displays
– Promotional material in the retail store designed to
inform customers and encourage purchases
• Trade shows
– Industry-wide exhibits at which many sellers display
their products
• Buying allowance
– A temporary price reduction to resellers for purchasing
specified quantities of a product
• Cooperative advertising
– A manufacturer agrees to pay a certain amount of the
retailer’s media cost for advertising the manufacturer’s
product
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