Name: Eman Zafar
FA18-BBA-036
Assignment # 02
BBA 6
CRM
Submitted to: Sir Abid Saeed
4/14/21
Sales Promotion
A Marketing Communication (MC) function that offers a tangible added-value
designed to motivate and accelerate a response. The objective of sales
promotion is to motivate consumer behavior immediately.
Sales Promotion Tools
1. Premiums
2. Specialties
3. Coupons
4. Price Reduction
5. Rebates
6. Sampling
7. Sweepstakes, Contests, and Games
Assignment Title
Visit your local store and analyses the use of “Sales Promotions” & bring in
writing three real life examples along with the pictorial support. Explain how this
promotion will be able to develop a relationship with customer.
Answer: Before writing down three real life examples using sales promotion tools. Let’s
first know each sales promotion tool individually. So I am going to write a brief
introduction about these tools to know what actually these tools do.
Sales Promotion Tools
Brief Introduction
1. Premium: Premium refers to goods offered either free or at low cost as an
incentive to buy a product. A premium may be inside the package, outside it or
received through mail. The reusable package itself serves as a premium.
Premium is generally offered for consumer goods such as soap, toothpaste etc.
2. Coupons: A coupon is a certificate that fetches buyers a saving when they
purchase a specified product. Coupons are generally issued along with the
product. They entitle the holder to either a specified saving on a product or a
cash refund. They are used for consumer convenience goods. They may be
distributed door to door, by mail or they may be inserted in packages.
Sometimes, coupons may be part of magazine or newspaper advertisements.
3. Sampling: Samples are defined as offers to consumers of a small amount of a
product for trial. Free samples are given to consumers to generate their interest
in the product. Samples help consumers verify the quality of the product. They
are delivered at the doors of consumers. They are also sent by mail or given to
customers in the retail store itself. Sometimes, samples are attached to another
product.
4. Rebates: Rebates are cash refund offers allowed from the price of the product.
It is an offer to refund part of the purchase price of a product to consumers who
send a proof of purchase to the manufacturer. Moreover, if the purchaser is not
satisfied with the product, the whole price or part of it will be refunded. Cash
refunded offer is stated on the package.
5. Sweepstakes, Contests, and Games: Sweepstakes are games of chance
people enter for the opportunity to win money or prizes. The companies and
organizations that conduct these activities hope consumers will not only enter
their games, but also buy more of their products and ideally share their
information for future marketing purposes. Marketers have become increasingly
sophisticated in the way they approach “gaming” aspect of sales promotions.
Contests are games of skill offered by a company, that offer consumers the
chance to win a prize.
6. Price Reduction: Price reduction offer consumers savings off the regular price
of a product. The reduced prices are marked by the producer directly on the label
or package. Price packs can be single packages sold at a reduced price (such as
two for the price of one) or two related products banded together (such as a
toothbrush and toothpaste). By lowering the price for a short time, a brand
artificially increases the value of a product or service by creating a sense of
scarcity.
7. Specialties: Specialty advertising involves giving away gifts in the form of small
handy items with the permanent promotional message imprinted on them for the
target market. Hence this gifts serves as the promotional product as they bring
with them some specific message. It is a gift branded with the giver's name or
logo. Pens, pencils, calendars, mugs and t-shirts are common ad specialties that
companies give away to consumers.
Three Real Life Examples
Premium: let’s take an example of premium
Nestle EveryDay
Nestle Everyday Powder Milk of 1Kg
offers their customer with a free Mug as an incentive which we call premium sales
promotion. Now what they are doing is that they are trying to differentiate themselves
from other milk brands in a way that they are providing something extra for free so
whenever any customer would come to purchase milk powder at any retail store he/she
would get attracted towards Nestle everyday milk powder because of the Free mug
attached with it. This would motivate them to buy this powder so that they enjoy a cup of
tea in their new nestle everyday mug with their loved ones. Generally, the purpose of a
premium is to motivate customers to buy a product multiple times.
Colgate Toothpaste
Another example is that of Colgate toothpaste that is offering a free toothbrush. Now the
customers they go for buying Colgate because they are getting a free tooth brush
because it will cost them around Rs.100 if they buy a tooth brush separately so instead
of buying separately they buy Colgate tooth paste where they are getting a tooth brush
as an incentive which will cost them low. Offering incentives to customers is an effective
way to increase sales and build customer loyalty.
Price Reduction: let’s take an example of price reduction
Black Friday is known as a day when consumers can save big money on a variety of
items, from appliances to shoes. Over the years, the amount spent on Black Friday has
increased. By putting the prices of the products low retailers and businesses often see
their earnings turn positive, putting their profits "in the black" in their accounting books.
The most obvious benefit to lowering the price is that we are able to attract more
buyers. There are people who will buy at a lower price point that wouldn’t buy at a
higher price point.
Sampling: let’s take an example of sampling
As we sampling is something offered to consumers of a small amount of a product for
trial. Why do they want customers to try their product? So that they are able to increase
their sales. It is extremely beneficial to offer product samples to potential customers, as
this increases exposure and also allows the customers to get a taste of your product
and leave them wanting more. It also allows consumers to leave feeling confident about
their purchase. So this is what Nestle Milk Pack did. They offered 6 free Oreo biscuits
on the purchase
1 Litre Nestle milk pack
carton.
By doing so the customers are going to try Oreo biscuits and if they like they will be
persuaded to by the product and spread the word to family and friends. This will help
establish consumer confidence, which obviously leads to developing loyalty of brand in
the long-run.
Sweepstakes, Contests, and Games:
Dew PUBG Challenge
Buy a Special PUBG Mobile Label Mountain Dew 400ml bottle and find the code under
the cap! And Visit www.dewchallenge.com and register your squad!
The purpose of these promotional games is that the customers are require to purchase
the marketed commodity or make a purchase offer on it and then they can participate
free of charge to win rewards. This makes the youngsters to buy mountain dew in order
to register themselves for the tournament so that they are able to win rewards.
THE END
