Image Guidelines 5. When a firm wants to attract new users, sales promotion tools can reduce the consumersâ risk of trying something new. Importance of Sales Promotion for a Company! The Importance Of Marketing Strategy 886 Words | 4 Pages. Before publishing your articles on this site, please read the following pages: 1. The main purpose of all promotional activities is to increase the sales of the products of the company. In the imperfect market conditions, the product cannot be sold easily on the basis of price differentiation. In some cases, the other components of the promotional mix support a sales promotion strategy. Sales promotion is an important component of a company's marketing communication strategy along with advertising, public relations, and personal selling. The business world today is a world of competition. Actually, in the sales promotion, there the most important part which is to create the interest of the consumers. Catalogs and other sources of information are an essential promotional component for many lines. Sales are the lifeblood of a business—without sales there would be no business in the first place; therefore it is very important that if a business wants to succeed, it should have a sales promotion strategy in mind. It is essential for the survival of a manufacturer. Shoppers have learnt pretty well that they are supposed to be smart and make their purchases exactly as and when they have the best offers being given by the retailers and manufacturers. Finally the reason that is very relevant to highly competitive markets where companies find themselves constantly fighting for the smallest piece of market share – “prisoner’s dilemma” spiral – which is very similar to a price war situation. To protect the market share in the age of competition. z describe the importance of sales promotion in business. It can be concluded that sales promotion includes all these activities (except advertising, publicity, and personal selling) which attract both the distributors and Consumers towards goods and services of the enterprise so that the sales of the enterprise may increase. Increased Standard of Living and Employment Opportunities. The importance of sales promotion increase is due to the thinking of new ideas for creating a favourable condition of selling, promoting sales and future expansion of sales. Plagiarism Prevention 4. eval(ez_write_tag([[580,400],'googlesir_com-medrectangle-3','ezslot_0',105,'0','0']));Related: Top 5 Important Determinants of Promotion Mix (Explained). The Importance of Sales in an Organization. Emphasis on sales volume directly contributes to the revenues of firms. Increasing importance of sales promotions as a percentage of the total advertising and promotional budget and increasing at a rate of 12 percent per year over the last 10 years, studies that strive to understand the impact of sales promotions on consumers are very important. Privacy Policy 8. The growth of large scale retailers, such a Supermarket, chain stores, etc. Take for exampl… The advertisement helps the organisation to reach to their targeted customers in an effective manner and … One of the most common ways to promote your store during festival time or when there is … The producers have spent much more amount on sales promotion than on advertisement. Sales promotions are short-term incentives that are done to encourage the purchase or sale of a product or service [P.DALOK 200]. Due to the adversity of markets, the importance of sales promotion has increased tremendously. (Blattberg, Neslin 1990). Promotional activities increase the sales by changing the elasticity of demand of the product through various techniques. Some sales promotions are aimed at consumers. The shelf space since limited in the retail outlets, is creating a lot of competition among the manufacturers for that space. This facilitates the success of the sales promotion. Sales promotions expenditures for most of the companies are increasing, however with the total promotional budgets staying relatively the same it can be assumed that the increase of expenditures on sales promotion come at the expense of decreasing advertising budgets. Sales promotion is newly accepted by management as an effective sales tool. Due to the adversity of markets, the importance of sales promotion has increased tremendously. Importance of Sales Promotion. They can be an inexpensive way of increasing awareness, of reaching new buyers or extending the buying choices of existing audiences. (Shimp 1993). For example, the results of NCH Consumer Survey indicate that on average 80.5 percent of consumers in US used coupons over the period of 1996- 1999. Sales promotion acts as a bridge between advertising and personal selling. They enjoy these offers very much and respond very positively to these. 1. The primary objective of a sales promotion is to improve a company’s sales by predicting and modifying your target customer’s purchasing behaviour and patterns. What are the Disadvantages of Sales Promotion? Related. – Answered. Large-scale selling is possible only with the help of promotional activities. 15 Factors that Affecting Market Segmentation. Sales promotion consists of those activities that are designed to bring a companyâs goods or services to the favorable attention of consumers. For Selling the Goods in Imperfect Market, Every market is the imperfect market. In this way, promotional activities increase the standard of living by providing better goods at lower rates (due to large scale production and selling). One more reason for increasing sales promotion importance is that many product categories on the market are in the mature stage and according to the product life cycle theory, sales promotions are extremely effective in maturity stage of the product helping to boost sales. Previous post: How QR Codes Can be Used to Share Your Content. Normally a sales promotion leads to a sense of urgency among the customers to make the purchases immediately as the promotional offers are for a s о duration of time. No business will ever need to run any promotions if there wasn’t any competition. Increase in volume of production and sales decreases per unit cost. You have to stay ahead of your competitors in order for customers to keep doing business with you. However, promotions can be planned to increase sales over a long period within a specific market segment, so it is not always about immediate results. Related: 15 Major Importance of Creativity in Entrepreneurship.eval(ez_write_tag([[250,250],'googlesir_com-large-mobile-banner-1','ezslot_5',107,'0','0']));eval(ez_write_tag([[250,250],'googlesir_com-large-mobile-banner-1','ezslot_6',107,'0','1'])); Nothing happens until somebody sales something. In the conditions of severe competition, there is increasing pressure on brand managers to show fast results in terms of increased sales and nothing is as effective in short run as sales promotions to achieve this goal. Advertising certain items in web advertisements, seasonal catalogues, sales flyers, magazines and/or other print media, with or without discounting the item. As an essential part of any promotional campaign they should be planned from the beginning. Related: 15 Factors that Affecting Market Segmentation. Your email address will not be published. What are other benefits you think of around sales promotions? In slack season, the promotional activities help in maintaining the sales of the product, Customers and middleman are offered attractive discounts and free gifts along with their products to induce the persons to purchase their products. 18 Reasons and the Importance of Product Innovation (Explained), 20 Importance of The Study of Business Environment. / Marketing / The importance of motivation in a sales environment; The importance of motivation in a sales environment . Due to the diversity of the market, the importance of sales promotion has increased tremendously. Sales promotion is very important as it not only helps to boost sales but it also helps a business to draw new customers while at the same time retaining older ones. Dictating certain terms with the help of promotional Objectives for Mikey 's Store Words... 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