Download Role of Sales Promotions

Role of Sales Promotions
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To increase customer awareness
To introduce new products and services
To increase sales volume and revenue
To combat competition
To encourage current customers to
purchase more
• To stimulate demand in non-peak periods
Types of Sales Promotions
• Push Techniques
– Point-of-sale displays
– Cooperative
advertising
– Advertising materials
– Traditional and
electronic collateral
materials
– Meetings and
conventions
• Pull Techniques
– Sampling
– Price reduction
promotions
– Coupons
– Combination offers or
bundling
– Premiums
– Contests and
sweepstakes
Coupons
• Advantages
– Tangible inducement
– Limited time for
discount
– Can focus on specific
objectives
– Can calculate the
maximum cost in
advance
• Disadvantages
– Possible fraud
– Redemption rates are
not easily predicted
Sampling
• Advantages
– Gets consumers to try
the product
– Represents real value
to the consumer
– May produce referrals;
word-of-mouth
• Disadvantages
– Can be expensive if
done for too long
– Food needs to be
fresh; may be
unattractive
– May displace paying
customers
Premiums
• Advantages
– Consumers like to get
things free or at a
good price
– Positive word-ofmouth if unique
• Disadvantages
– Storing and handling
the premium
– Employee theft
– Must match or exceed
quality image of firm
– Forecasting demand
for premium is difficult
Contests
• Advantages
– Consumers are
involved in the process
because of skill/talent
– Creates interest in
product
• Disadvantages
– May be difficult to
judge; select winner(s)
– Rules may be too
lengthy or complicated
and turn off customers
Sweepstakes
• Advantages
– Entry is easy; no
purchase is necessary
– Rules simple; focus is
on prizes
– May create more
interest since entry is
easy
– Selection of winner is
easy
• Disadvantages
– Entry box may be
stuffed; rules not
followed
– Chance of winning
good price is small;
may discourage
consumers from
participating
Steps to a Successful
Promotion
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Select the target market
Establish specific objectives
Select the promotional technique
Brainstorm about potential offer
Create the promotional theme
Develop the promotional budget
Select the media to promote the offer
Develop an implementation timetable
Conduct internal training of staff
Work the plan
Monitor results
Evaluating the Impact of Sales
Promotions
• Administrative costs associated with
conducting the sales promotion
• Cost of displaced sales among existing
customers
• Additional revenue from new customers
Suggestive Selling
• Develop a positive attitude
• Do not try to manipulate the guest
• Suggest favorite items or items that you are
knowledgeable about
• Use props to support suggestive selling
• Always make positive suggestions
• Be attentive to guests’ needs
• Don’t make excuses for why suggestive selling
will not work
Training Guest-Contact
Personnel
• Product-service Knowledge – cognitive
aspect
• Physical Skills – psychomotor aspect
• Attitude – affective aspect
• Reassurance – affective aspect
Components of a Press Kit
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Fact sheet
Description of the local trading area
Special features of the product-service mix
Specific details about the product
Photographs
Biographical sketch of the general
manager
Public Relations Techniques
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News releases
Photographs
Letters, inserts, and enclosures
House organs and newsletters
Speeches and public appearances
Posters, bulletin boards, and exhibits
Audiovisual materials
Open houses and tours
Guidelines for Public Relations
• Identify photographs when submitted
• Do not damage or mutilate photos by folding, stapling, or
writing too hard on the back
• Qualify the publications that you send to
• Provide contact information
• Do not send too many releases at one time
• Be brief and provide a summary of release
• Be careful when placing logo on photos
• Synchronize with the timing of the publication
• Do not threaten to pull advertising if not covered
Evaluating Public Relations
• Personal Observation
• Public Opinion Surveys
• Use Objective Measures
© 2010 John Wiley & Sons, Inc.