Introduction to Marketing : Nature, Importance and Core Concept of Marketing

Introduction To Marketing HM-303

16.14. CHECK YOUR PROGRESS: 4

16.14.1Given below are some statements which are wrong. Correct them in

the space provided below each.

a. ―Money back offer‖ helps customers to improve their status in the society and

so it is important to them.
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b. Existing stock can be quickly disposed off by sales promotion when dealers

want to compete in the market and that is why it is important to them.
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c. The importance of sales promotion is appreciated by consumers because they

cannot changeover to new brand of goods.
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d. Dealers consider sales promotion to be important because it involves cheaper

rates being offered to customers.
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e. For consumers, sales promotion has no importance even if it provides

information about improvement in quality of goods because that does not bring

monetary benefit.
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16.15 SUMMARY

In this chapter, we have discussed the meaning of Sales promotion, its
objectives and how to select, develop and implement sales promotion strategies.
More than any other element of the promotional mix, sales promotion is about
―action‖. Sales promotion is the final marketing mix element. It is about
stimulating customers to buy a product. It is not designed to be informative; a role
which advertising is much better suited to. Sales promotion consists of short-term

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Introduction To Marketing HM-303

incentives to encourage purchase or sales of a product or service whereas
advertising and personal selling offer reasons to buy a product or service, sales
promotion offers reasons to buy now.Promotional strategyis the function of
informing, persuading and influencing a consumer decision. It is as important to
non-profit organizations as it is to a profit- oriented company like Colgate-
Palmolive. Some promotional strategies are aimed at developing primary demand,
the desire for a general product category.

Sales promotion activities may be used singly or in combination, both
offensively and defensively, to achieve one goal or a set of goals. Sales-promotion
tools vary in their specific objectives. A free sample stimulates consumer
trialwhereas a free management-advisory service aims at cementing a long-term
relationship.Today, many marketing managers first estimate what they need to
spend in trade promotion, then what they need to spend in consumer promotion.
Whatever is left they will budget for advertising. There is a danger, however, in
letting advertising take a back seat, because advertising typically acts to build
brand loyalty. The question of whether or not sales promotion weakens brand
loyalty is subject to opt for different interpretations. Sales promotion with its
incessant price off, coupons, deals and premiums may devalue the product
offering in buyers‘ mind. Buyers learn that the list price is largely a fiction.

However, before jumping to any conclusion, we need to distinguish between price
promotions and added-value promotions.

16.16 GLOSSARY

 Sales promotion:It consists of short-term incentives to encourage the
purchase or sale of a product or service.

 Samples: Special offer of a trial amount of a product.
 Coupons: Certificates that offer buyers savings when they purchase

specified products.
 Seasonal products: Those products whose demand varies in a regular

pattern, season to season.
 Market share: Ratio or area of a market controlled by a particular company

or product.
 Dealer outlets: A place where business for retailing goods is done.

16.17 ANSWERS TO CHECK YOUR PROGRESS

16.8.1 Fill in the blanks:
(a) Publicity
(b) Consumers
(c) Market
(d) Personal
(e) Objective

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16.8.2 State Whether True or False?
(a) False
(b) False
(C) True
(d) False
(e) True

16.11 Fill in the blanks:
(a) Product
(b) Price
(c) Discount
(d) Fashion
(e) Sample

16.18 REFERENCES

 Greene, F. (n.d.). How to Develop a Sales Promotion. Retrieved

January12, 2012, from

eHow.com:http://www.ehow.com/how_6054727_develop-sales-

promotion.html

 Gupta, C.B. & Nair N.R. (2009) Marketing Management. New Delhi:

Sultan Chand & Sons

 Kour, P. (2009, October 28). Sales Promotion-Meaning and Definitions .
Retrieved January 20, 2011, from www.excellentguru.com:
http://www.excellentguru.com/index.php?option=com_content&view=arti
cle&id=196:sales-promotion-meaning-and-definitions-
&catid=43:marketing-management&Itemid=59

 Mamoria, C.B., Suri, R.K. &Mamoria, S. (2011). Marketing Management.

Allahabad: KitabMahal

 Nair, N.R. & Nair, S.R. (1993). Marketing. New Delhi: Sultan Chand
&Sons

 Rudani, R. B. (2009). Basics of marketing management. New Delhi: S.
Chand & company Ltd.

 Varshney, R. L. (2005). Marketing management. New Delhi: Sultan
Chand & sons.

 Wisest (2011, June 29). Selecting Sales-Promotion Tools. Retrieved
January 25, 2011, from
www.ideatodays.com:http://www.ideatodays.com/miscellaneous/selecting
-sales-promotion-tools.html

16.19 SUGGESTED READINGS C.N. Sontakki
 Principles of Marketing R. Srinivasan
 International Marketing Mukesh Dhunna
 Marketing Management Dr. R.B. Rudani
 Basics of Marketing Management
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Introduction To Marketing HM-303
 Marketing Management C.N. Sontakki

16.20 TERMINAL QUESTIONS
1. Explain the meaning of ‗Sales Promotion‘. Why is Sales Promotion
necessary? Describe the purpose served by sales promotion?
2. Explain briefly the objectives of sales promotion. What are the criteria for
setting the objectives of sales promotion? Explain the factors to be
considered in developing these criteria.
3. Explain the importance, functions and limitations of sales promotion.
4. What are sales promotion strategies? How are sales promotion strategies
developed?

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