Sales promotion - AbsoluteAstronomy.com

Sales promotion is one of the four aspects of promotional mix

Promotional mix

There are seven main aspects of a promotional mix. These are:* Advertising - Presentation and promotion of ideas, goods, or services by an identified sponsor...

. (The other three parts of the promotional mix are advertising

Advertising

Advertising is a form of communication used to persuade an audience to take some action with respect to products, ideas, or services. Most commonly, the desired result is to drive consumer behavior with respect to a commercial offering, although political and ideological advertising is also common...

, personal selling

Sales

A sale is the act of selling a product or service in return for money or other compensation. It is an act of completion of a commercial activity....

, and publicity

Publicity

Publicity is the deliberate attempt to manage the public's perception of a subject. The subjects of publicity include people , goods and services, organizations of all kinds, and works of art or entertainment.From a marketing perspective, publicity is one component of promotion which is one...

/public relations

Public relations

Public relations is the actions of a corporation, store, government, individual, etc., in promoting goodwill between itself and the public, the community, employees, customers, etc....

.) Media and non-media marketing communication are employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability. Examples include contest

Competition

Competition is a contest between individuals, groups, animals, etc. for territory, a niche, or a location of resources. It arises whenever two and only two strive for a goal which cannot be shared. Competition occurs naturally between living organisms which co-exist in the same environment. For...

s, coupon

Coupon

In marketing, a coupon is a ticket or document that can be exchanged for a financial discount or rebate when purchasing a product. Customarily, coupons are issued by manufacturers of consumer packaged goods or by retailers, to be used in retail stores as a part of sales promotions...

s, freebies

Freebie marketing

Freebie marketing, also known as the razor and blades business model, is a business model wherein one item is sold at a low price in order to increase sales of a complementary good, such as supplies or software...

, loss leader

Loss leader

A loss leader or leader is a product sold at a low price to stimulate other profitable sales. It is a kind of sales promotion, in other words marketing concentrating on a pricing strategy. A loss leader is often a popular article...

s, point of purchase displays, premium

Premium (marketing)

Premiums are promotional items—toys, collectables, souvenirs and household products—that are linked to a product, and often require box tops, tokens or proofs of purchase to acquire. The consumer generally has to pay at least the shipping and handling costs to receive the premium...

s, prizes

Prize (marketing)

Prizes are promotional items—small toys, games, trading cards, collectables, and other small items of nominal value—found in packages of brand-name retail products that are included in the price of the product with the intent to boost sales...

, product samples, and rebates

Rebate (marketing)

A rebate is an amount paid by way of reduction, return, or refund on what has already been paid or contributed. It is a type of sales promotion marketers use primarily as incentives or supplements to product sales. The mail-in rebate is the most common...

Sales promotions can be directed at either the customer

Customer

A customer is usually used to refer to a current or potential buyer or user of the products of an individual or organization, called the supplier, seller, or vendor. This is typically through purchasing or renting goods or services...

, sales staff, or distribution

Distribution (business)

Product distribution is one of the four elements of the marketing mix. An organization or set of organizations involved in the process of making a product or service available for use or consumption by a consumer or business user.The other three parts of the marketing mix are product, pricing,...

channel members (such as retailers). Sales promotions targeted at the consumer

Consumer

Consumer is a broad label for any individuals or households that use goods generated within the economy. The concept of a consumer occurs in different contexts, so that the usage and significance of the term may vary.-Economics and marketing:...

are called consumer sales promotions. Sales promotions targeted at retailers and wholesale are called trade sales promotions. Some sale promotions, particularly ones with unusual methods, are considered gimmicks by many.

Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales. These efforts can attempt to stimulate product interest, trial, or purchase. Examples of devices used in sales promotion include coupons, samples, premiums, point-of-purchase (POP) displays, contests, rebates, and sweepstakes.

Consumer sales promotion techniques

Price deal: A temporary reduction in the price, such as 50% off.
Loyal Reward Program: Consumers collect points, miles, or credits for purchases and redeem them for rewards.
Cents-off deal: Offers a brand at a lower price. Price reduction may be a percentage marked on the package.
Price-pack deal: The packaging offers a consumer a certain percentage more of the product for the same price (for example, 25 percent extra).
Coupons: coupons have become a standard mechanism for sales promotions.
Loss leader
Loss leader
A loss leader or leader is a product sold at a low price to stimulate other profitable sales. It is a kind of sales promotion, in other words marketing concentrating on a pricing strategy. A loss leader is often a popular article...

: the price of a popular product is temporarily reduced in order to stimulate other profitable sales
Free-standing insert (FSI): A coupon booklet is inserted into the local newspaper for delivery.
On-shelf couponing: Coupons are present at the shelf where the product is available.
Checkout dispensers: On checkout the customer is given a coupon based on products purchased.
On-line couponing: Coupons are available online. Consumers print them out and take them to the store.
Mobile couponing: Coupons are available on a mobile phone. Consumers show the offer on a mobile phone to a salesperson for redemption.
Online interactive promotion game: Consumers play an interactive game associated with the promoted product.
Rebates
Rebate (marketing)
A rebate is an amount paid by way of reduction, return, or refund on what has already been paid or contributed. It is a type of sales promotion marketers use primarily as incentives or supplements to product sales. The mail-in rebate is the most common...

: Consumers are offered money back if the receipt and barcode
Barcode
A barcode is an optical machine-readable representation of data, which shows data about the object to which it attaches. Originally barcodes represented data by varying the widths and spacings of parallel lines, and may be referred to as linear or 1 dimensional . Later they evolved into rectangles,...

are mailed to the producer.
Contests/sweepstakes/games: The consumer is automatically entered into the event by purchasing the product.
Point-of-sale displays:-
- Aisle interrupter: A sign that juts into the aisle from the shelf.
- Dangler: A sign that sways when a consumer walks by it.
- Dump bin: A bin full of products dumped inside.
- Glorifier: A small stage that elevates a product above other products.
- Wobbler: A sign that jiggles.
- Lipstick Board: A board on which messages are written in crayon.
- Necker: A coupon placed on the 'neck' of a bottle.
- YES unit: "your extra salesperson" is a pull-out fact sheet
  Fact sheet
  A fact sheet, factsheet or one-sheet is a presentation of data in a format which emphasizes key points concisely. The layout is simple and often standardized, e.g...
  
  .
- Electroluminescent: Solar-powered, animated light in motion.
Kids eat free specials: Offers a discount on the total dining bill by offering 1 free kids meal with each regular meal purchased.

Trade sales promotion techniques

Trade allowances: short term incentive offered to induce a retailer to stock up on a product.
Dealer loader: An incentive given to induce a retailer to purchase and display a product.
Trade contest: A contest to reward retailers that sell the most product.
Point-of-purchase displays: Used to create the urge of "impulse" buying and selling your product on the spot.
Training programs: dealer employees are trained in selling the product.
Push money: also known as "spliffs". An extra commission paid to retail employees to push products.

Trade discounts (also called functional discounts): These are payments to distribution channel members for performing some function .

Retail Mechanics

Retailers have a stock number of retail 'mechanics' that they regularly roll out or rotate for new marketing initiatives.

Buy x get y free a.k.a. BOGOF for Buy One Get One Free
Three for two
Buy a quantity for a lower price

Political issues

Sales promotions have traditionally been heavily regulated in many advanced industrial nations, with the notable exception of the United States

United States

The United States of America is a federal constitutional republic comprising fifty states and a federal district...

. For example, the United Kingdom

United Kingdom

The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

formerly operated under a resale price maintenance

Resale price maintenance

Resale price maintenance is the practice whereby a manufacturer and its distributors agree that the latter will sell the former's product at certain prices , at or above a price floor or at or below a price ceiling...

regime in which manufacturers could legally dictate the minimum resale price for virtually all goods; this practice was abolished in 1964.

Most European countries also have controls on the scheduling and permissible types of sales promotions, as they are regarded in those countries as bordering upon unfair business practices

Unfair business practices

Unfair business practices encompass fraud, misrepresentation, and oppressive or unconscionable acts or practices by business, often against consumers and are prohibited by law in many countries. For instance, in the European Union, each member state must regulate unfair business practices in...

. Germany

Germany

Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...

is notorious for having the most strict regulations. Famous examples include the car wash that was barred from giving free car washes to regular customers and a baker who could not give a free cloth bag to customers who bought more than 10 rolls.

Consumer sales promotion techniques

Trade sales promotion techniques

Retail Mechanics

Political issues

See also