When used moderately with careful planning, sales promotion increases sales, even after the promotions period is completed. A. Sales promotion helps to supplement and support both advertising and personal selling. It cannot, therefore, be used continuously. The flexibility of sales promotion has the potential of being used by small and large companies, selling goods or services, and by profit and non-profit organizations. Sales promotion has its own advantages and disadvantages. Disadvantages. Sales promotion can prove useful for marketers in several ways. Promotional pricing is one of the most powerful sales strategies there is. This is because everyone loves to buy things for cheaper. 2. Popular brands move fast in the market without much effort. Offer Details: Sales promotion has its own advantages and disadvantages. The number of sales promotional activities to be performed are too many, distribution of free samples and gifts, making such offers as price off and money refund, holding contests, participating in trade fairs and exhibitions, display and demonstration of goods and so on. While sales promotion is a powerful and effective method to produce immediate short term positive results, it is not a cure for a bad product or bad advertising. Meaning of Promotion Mix. For more information on our use of cookies see our Privacy Statement. 7. It draws their attention to the products/services being offered. Free sample, gifts, demonstrations etc., can induce the consumers to act fast. Advantages and Disadvantages of Sales Promotions. The costs need to be carefully planned and monitored, or a sales promotion … 4. Advertising approaches the buyer indirectly and personal selling approaches the buyer directly. Measuring the effectiveness of sales promotion can be easy when compared to measuring the effectiveness of advertising and personal selling. Another drawback of sales promotion is that there is a tendency on the part of all the competitors to use the same method of sales promotion at the same time. As an incentive to keep going out to sell, many managers have rewards and perks they are allowed to offer to their sales team. Some sales promotions are aimed at consumers. Sales Promotion. You cannot try to prevent a customer who would pay regular price from taking advantage of … Advertising, marketing, free sample distribution, discounts are common tactics used by the companies.Sales campaign is also a type of strategy to boost the sales of products and services produced by a company.. When compared with advertising and personal selling, sales promotional activities are less expensive. The marketer cannot use any sales promotional tool at any time. Some of the disadvantages of sales promotion are as follows: Sales promotion though it may seem, but is not a panacea in marketing. If you discount a $10 item to $8, you miss $2 in revenue. If you disable this cookie, we will not be able to save your preferences. Sales Promotion Tool # 1. Advantages and Disadvantages of Sales Promotion, Trends: Customer Expectations, Communication and Delivery, Trends: Tracking, Clutter and Need For Creativity. Creates Employment 7. are concerned, there is always a feeling that these are not real and the price would have already been hiked. A sales promotion plan can be made more effective when it is hedonic benefit oriented in the case of food products and utilitarian benefit oriented in the case of personal care products. Many of you must be confused about promotion and sales promotion. Sales promotion is designed to be used as a short-term tactic to boost sales – it is rarely suitable as a method of building long-term customer loyalty. Large Turnover and Huge Profits 5. Promotion of Sales 2. Keeping this cookie enabled helps us to improve our website. Advantages & Disadvantages of Sales Promotions | Bizfluent. For example, displays and demonstrations help them to,understand the product mechanism. It enables both the dealers and the consumers to enjoy certain tangible benefits, e.g., free samples, gifts, price reductions, etc. Let’s now say that there are three shirts … And the … This means that every time you visit this website you will need to disable cookies again. Personal selling requires efficient and committed salesmen. 7. These include: Helps Create Awareness of New Products – Sales promotion is a highly effective methods for exposing customers and business partners to new products and for moving customers to take an action (e.g., sample a product). 15 Main Advantages and Disadvantages of Sales Promotion ... DISCOUNT (2 days ago) Disadvantages of Sales Promotion Despite its recent widespread use as an important element of marketing campaigns, the essence of sales promotion is that it is intended as a very short term influence on ‘sales’. It helps the salesman and makes his effort more productive. Branded goods with loyalty are no exception. Price Deals: Sales Promotion – Advantages and Disadvantages. This is particularly true when competition is intense, when there is a long buying cycle, or when companies are selling highly technical products or expensive products with lots of options. Many sales jobs also have reward structures to be earned. Advantages of Sales Promotion. The Cambridge Dictionary defines a sales promotion as an activity or series of activities done to increase sales of a particular product. It creates a pricing advantage compared to the competition. 3. Can stimulate quick increases in sales by targeting promotional incentives on particular products. 4. Quora. Promotion mix refers to the combination of all marketing efforts employed by company for doing mass scale promotion of its products. For example by reducing its price or advertising it. 9. This leads to an overall increase in promotional costs. Customers may become too price-sensitive and wait for promotional deals to be announced by the company. 60% off Offer Details: 15 Main Advantages and Disadvantages of sales promotion. It can only supplement advertising and personal selling which are vital for a business. Distribution of free samples and gifts, money refund and coupon offers, demonstrations, exchange of old for new and so on can be made by the manufacturers themselves. If used over the long-term, customers may get used to the effect. Enhances Goodwill 4. The customers can also raise their queries and get clarification immediately. To change or remove cookies click HERE. Sales Campaign: Basic Elements, Advantages, and Disadvantages. Sales promotion is non-recurrent in nature. 1. Advantages of sales promotion Sales promotion is used to entice customers to buy a product/service. One of the biggest aims and advantages of sales promotion is that it helps boost the sales of a company. Sales promotion is thus a part of promotion, and is restricted to direct inducements on a short-term basis given to consumers or trade so as to stimulate purchases of products and services. 9. Disadvantage: Limits Your Revenue Sales promotions naturally limit your per-transaction revenue opportunities. Disadvantages of sales promotion 1. 2. The number of sales promotional activities to be performed are too many, distribution of free samples and gifts, making such offers as price off and money refund, holding contests, participating in trade fairs and exhibitions, display and demonstration of goods and so on. This may not be possible in the case of advertisement and personal selling. Sales promotion, by itself, cannot produce results. What are the advantages and disadvantages of promotional pricing?. Cookie information is stored in your browser and performs functions such as recognizing you when you return to our website and helping us to understand which sections of the website you find most interesting and useful. Sales Promotion Disadvantages Increased Price Sensitivity: Since sales promotions activity is an integral part of marketing and sales, the consumers begin to wait for promotional deals. It involves additional expenditure on the part of the business. Advantages of Advertising – 1. Such an approach may not benefit all. Extreme use of it can also harm the brand value. The moment the various inducements offered by the marketer are withdrawn, the demand is bound to fall. Social and Moral Qualities of a Salesman | Requisites of Good Salesman, Top 10 Merits and Criticisms of Sales Promotion, 8 Most Important Objectives of Sales Promotion, Physical and Psychological Qualities of a Salesman, Meaning & Essential Features of Economic Planning, Audit of Shares – Issued for Cash | Issued for Consideration other than Cash, Single Storey Industrial Building | Merits, Demerits, Suitability, Production Planning | Characteristics | Importance | Phases | Pre-Requisites, Localization of Industries | Meaning | Causes | Advantages | Disadvantages, Special Privileges of Private Company over Public Company in India. 5. 10. They may, at the most, need the help of the dealers only. Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings. Whereas, in the case of advertisement, media are required, e.g., Radio, TV and Coupons and rebates provide useful information about … It is a mix of various tools and techniques which aims at enhancing sales of company’s products by … KnowThis.com uses cookies so that we can provide you with the best user experience possible. As far as the various types of discounts (cash discount, off-season discount and festival discount etc.) Adds to the Cost of Production and Product 2. When compared with advertising, sales promotional activities can create better and quicker impact. Apart from the heavy expenditure to be incurred on advertisement and personal selling, the business may have to spend further on sales promotion. 6. For example, if all the manufacturers of air-conditioners offer off season discount (during winter), the consumer may only decide based on brand popularity. Advertising. Most of the sales promotional activities can be undertaken by the manufacturers themselves. Please enable Strictly Necessary Cookies first so that we can save your preferences! Coupons and rebates provide useful information about how pricing influences consumers’ buying behavior. Sales promotion offers such as price cut, discount, free gift etc., may sometimes create an impression that these are being done to sell a poor quality product. In addition to their primary purpose of boosting sales in the near term, companies can use consumer sales promotions to help them understand price sensitivity. Pamphlets distributed to the consumers also provide useful information. One can, therefore, say that sales promotion satisfies the ‘A I D A formula’ to a greater extent. Good short term tactical tool. (e.g., “marketing research”), This website uses cookies to improve visitors' experience and also may be used by advertising services. 7. The salesmen of a business cannot perform their work effectively without the use of sales promotional tools like pamphlets, audiovisual aids, cell phones and pagers. Although sales promotion is an important strategy for producing quick, short-term, positive results, it is not a cure for a bad product, poor advertising, or an inferior sales team. WHAT IS IT EXACTLY? Expansion of Production 3. When used moderately with careful planning, sales promotion increases sales, even after the promotions period is completed. B. During the sale promotional period, there is always an increase in the level of sales. 6. Hence they wait for discounts, stock clearing sales, monsoon sales, festive promotion deals, etc. 2. While discounts may improve volume, they narrow profit margins. CODES (1 days ago) Using sales promotions maturity stage of the product can be prolonged and the firm can generate more and more revenues. 5. 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