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What is a sales promotion and what is its relevance in business?

Sales promotion is a very important part of the sales process for any company or business, since it is used to complement advertising and personal sales.

Therefore, by making this combination of information and communication, it will be useful for us to make sales more effective. In other words, all personal selling and advertising will help us to provide the reasons why the customer should purchase a product or service.

On the other hand, sales promotions will provide all the reasons why purchases should be made as soon as possible.
Sales promotions will represent everything that is used as part of marketing activities, which serves to stimulate and boost all sales or purchases of a product through some incentives.

What is a sales promotion and what is its relevance in business
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Table of Contents

Sales promotion objectives

The following are the main objectives of sales promotion at the company level:

  • Motivate the entire sales team.
  • Help boost the entire sales figure significantly.
  • Liquidate Stocks.
  • Get more liquidity in the short term.

The main objectives of sales promotion at the market level:

  • To be able to capture consumers who are undecided.
  • To increase the consumption habit.
  • To be able to differentiate from the competition.
  • Introduce new products to the market.
  • Make price comparison more difficult.

The main objectives of sales promotion at the distribution level:

  • Liquidate the distributor's stock.
  • Liquidate all perishable or declining products.
  • Improve the image in front of distributors.
  • Accelerate stock rotation.
  • Gain presence at the point of sale.
  • Extend distribution.
  • Motivate and involve the distributor directly.
Hand shake at business meeting agreement sales

The importance of sales promotions

The current market presents us with a large number of products and services, which together with the progress made in communications and the different means of advertising that exist, represent a great challenge for any company, person or business to be able to obtain a place and stay firm in the market.

Therefore, sales promotions will be able to make a big difference. All these are necessary to differentiate from the services or products that we can offer, persuade all buyers and thus provide information that is directed to the process of the final decision to purchase.

If we talk about the economic point of view, the main objective of sales promotions is to increase the demand for the product or service.

Many companies or businesses seek through sales promotions so that the demand decreases little when the price of the product tends to rise and helps sales to increase considerably when the price drops.

What could be achieved with efficient sales promotions?

If the right sales promotions can be carried out, it will be possible to obtain great benefits that will be important for the company or business. Among these benefits we have:

Product differentiation

A good use of sales promotions will help to differentiate or distinguish our products or services from the rest of the competitors. This is very favorable if the offer of our products is the same or similar to others in the market.

One of the most used strategies when these cases occur is to offer our product at a slightly lower price for a short period of time.

Attract new customers

One of the main reasons for using sales promotions is to attract new customers during this low-price sales period.

Increase the market share of our company or business.

When a good sales promotion is carried out, it will help us to increase market share.

Since this promotion will increase sales, which in turn reduces the sales that our competition can get.

Resulting in a large increase in market share and a reduction in the share of all our competitors.

The introduction of a new product

Sales promotions can be used to introduce a new product to the market.

You can offer the product at a low price and add an advertisement indicating that it is a new item, which could help you persuade all consumers to try the product.

In the opposite case, you can also use all the sales promotions to discontinue the item that has had few sales. In this case, you can use a sign that says: “Flash sale discount”.

Shopping mall sales and promotion

Sales promotions and their target audience

The main objective of sales promotions is not limited to end consumers. It should be borne in mind that it also covers all intermediaries who are a major link in the chain of sales and distribution of products or services.

All sales promotions must reach the intermediaries so that they can get to know and become familiar with the product.
On the other hand, wholesalers have to promote to retailers and finally, the latter will have to promote to consumers.

As mentioned above, the objective of sales promotions is to disseminate all the necessary information to potential customers about the products and services offered.

Due to the great competition that exists between the different companies and industries, this has put pressure on the different sales promotion techniques used by each salesperson.

References

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