By Rohini Gonsalves
A business needs sales to survive and when sales grow, a business grows. Therefore, the primary focus of every business is to increase sales. Amongst other things, sales promotion tools are used to achieve this objective. A business needs to choose these tools wisely to achieve its short-term and long-term goals. Step one is then to define these goals. Some of the goals may be:
- To launch a new product, variant, product line, branch, vertical: The objective here is to attract new customers or invite the existing customers to try a different option. The sales promotion tool used here would be a free trial. The mode of implementation of the tool will depend on the specific goal to be achieved. Some instances are:
- To market test a new variant by inviting credible members of the target group to try and share feedback as a part of a focus group activity.
- To attract new users by sending a small sachet pasted on a newspaper or inviting target groups to experience the service for free.
- To educate on using the product by going to a housing society/college/community to display the use of the product and distribute free samples.
- Cross selling by packaging the new variant along with an existing product.
- When one wants to position the new product/variant as a premium offering, it may be used as a reward to buyers after meeting certain criteria. For instance, a hospitality service provider may give a premium experience if the customer spends a certain amount of time or money within a stipulated period. So, the free trial also acts as an upselling tool.
- To increase the sales of existing products: Businesses forecast the demand for their products, and intend to increase the sales during the off peak season. The tool used is to reward the buyer for buying or buying more than the usual quantity. Some of such situations are:
- To encourage off peak purchase by creating bigger packaging and offering a small quantity of the product free e.g., 20% extra on buying 165 gms instead of the 150 gms
- To reward higher purchase by giving a sizable freebie e.g., Buy 2 get a bag free, or buy 2 get 50% off on the 3rd.
- To expedite the buying decision by introducing limited period/limited edition offers.
- To encourage more sales by offering a free service or increased benefits e.g., free delivery, membership points etc
- To clear stocks near expiry by giving free products. e.g., buy 2 for the price of 1
- To generate leads: B2B businesses generate leads and eventually convert these leads into business by using tools like:
- Participating in exhibitions and trade fairs is the best way to meet industry players and display their products alongside competition. It is used in technical/industrial products to attract new business as well as new collaborations and partnerships.
- Inviting industry partners to sponsored conferences by creating an opportunity for information sharing and value addition. Also leaving them with a great experience of the hospitality of the sponsor.
- Sponsored plant/facility visits is a great tool to impress decision makers to personally witness the abilities and strengths of the business.
- To build loyalty: A loyal customer is an asset to any business. It has a direct impact on the profitability of the business by reducing new acquisition costs and generating steady sales.
- To reward a milestone by giving the customer an aspirational gift or title for buying more like a Premium Membership Card or an entry into a lucky draw
- To build a sense of belonging or ownership by offering them the opportunity to view or buy the products even before they hit the market. Like inviting them to a first peek at a designer collection or a launch/premier of a product.
- To get social media endorsements: With changing times, it is important to use the opportunity to promote business via social media channels. Businesses today need to get the right people to endorse their products. Therefore, one of the most vital objectives is to get renowned people, celebrities and influencers to experience the product and share their positive reviews. Businesses go the long mile to create opportunities to invite such individuals to try their products by:
- Inviting them to the launch of a category.
- Sending them free samples and asking for feedback.
- Hosting events where they can come and interact with their fans and followers.
- Paying influencers to endorse their products.
Sales Promotion is undoubtedly a very expensive affair and hence the business needs define goals clearly and track the effectiveness of the campaigns. The impact of sales promotion activities is generally more long lasting and goes a long way to build customer loyalty. The greatest benefit of all sales promotion activity is the impact it has on the brand image. Good sales promotion activities leave the brand etched in the minds of the customers for life.
“You don’t close a sale, you open a relationship if you want to build a long-term, successful enterprise.” – Patricia Fripp
About the Author:
The author, Rohini Gonsalves, is a gold medallist in marketing, sales management, and sales promotion from Bhartiya Vidya Bhavan. She holds more than 15 years of experience in the field of marketing and sales, is a marketing consultant and also the founder of Sevarat, a Panjim-based start-up that provides geriatric care services to elderly patients.
Anyone wishing to avail of her services may contact her on:
Mobile: +91 8329 857965
Email: [email protected]