Sales Promotion

George seems to be desperate when I met him. He seems to be under tremendous pressure.

I asked “What happened Yaar? You seem to be under pressure”

He shook his head in agreement. “Yes man. You know the new product we had introduced in the market recently.  Sales are not happening as we expected. So I thought, I will meet you and do some brain storming on what to be done.”

“So what exactly you expect from my side?” I leaned forward in a listening position.

“Well, you just advice on what all sales promotion activities I should do?”

“Okay, Okay. Now tell me , do you know what all methods are there for sales promotion?” I enquired.

“Yes Yes. Coupons,  Price offer,  Exchange Offers, Loyalty Program,  Buy one get one free Free Samples I think these are some of the sales promotion activities.”  George said all these in one breath. Then took a sigh.

“Bingo!! They are. Now do you know where to and when to use each of these activities?” I threw a question.

“Not exactly.”

“Hmmm.  Coupons are used to attract new clients or developing customer loyalty. Its for a short term.” I said.

“Yes like the pizza coupons coming along with the newspapers”

“Exactly. Like that, the Price offer is for immediately boosting the sales volume and driving customer attention away from the competitor’s products. This has to be handled carefully. It should be for a short period and should not be repeated in immediate future”

“Like the Grand Diwali sale?”

I nodded” Yes.  You might be familiar with the exchange offer. In home appliances market they are using it very successfully. They take the old fridge or Television for an exchange price and give you new equipment at a lower price. The idea is to kill the competition even if the customer is using a competitor’s product. This way you create an artificial requirement in customer’s mind to get rid of the old product easily and buy a new one with new technology, in discounted rate. Even in telecom market or software market you can successfully implement this idea. Consider this example. The customer is using a competitor’s mobile or internet connection or a competitor’s software product and paid for the product for, say, one year. Give them an offer that they buy your package and get extra hours free. These free hours will be  equivalent to the time remaining with the competitor’s package.  Here both the customer and you will be in a win-win situation. For the customer, he need not wait till the package gets expire to go for your product. He won’t loss the money he had paid to the competitor. For you it’s a new customer. Another method is loyalty program. This can be used for increasing sales volume among the existing customers.”

“That I understand. I have seen the buy one get one free sale in textile showrooms.” George interrupted.

“Even you can use this scheme in any segment. Buy one expensive product and get a smaller one free. Like buy a TV and get the remote free. Or take one year internet connection from our company and get anti-virus free.”

“I have one more method to add in the list.” George said. I stared at him.” Money back offer”. He said dramatically.

“Of course. That’s the best way to bring in doubting Thomas in. Last one is free samples. You might have received free samples of shampoo, washing powder, coffee powder, etc. while purchasing various items from the market. Sometimes these free samples are also distributed by the shopkeeper even without purchasing any item from his shop. These are distributed to attract consumers to try out a new product and thereby create new customers. Some businessmen distribute samples among selected persons in order to popularize the product. For example, in the case of medicine free samples are distributed

among physicians”

“Thanks man.  Thanks for the detailing. We will have another sitting for deciding which the best promotion method is to start with for my product.”

“The pleasure is mine. Walk in whenever you want”. I went till the door to see off George.

NO…. the most beautiful word !!

For many of us NO means rejection, opportunity lost or even end of the world. Well, but not for everyone. Take example of Arun, the star sales man of the company. When someone says no, he sees an opportunity. For any sales call, on firsthand the customer says YES he feels there is something missing .Most of the times he will right. If the customer accepts the product or service from the first presentation itself, it means he has not understood the product well. Or, in rare cases very much aware and was just looking for someone t come and ask him to buy. In the first case once the sales closure is done, the client will start realizing the limitation of the product or service which he had just bought or he will start developing a feeling that for the particular product, the price he had given was a bit high. This will start developing as an irritation and slowly even minute mistakes will be seen as major flaws. On the other hand, if he was well versed with the product and aware of the average price, then there won’t be much problem to the sales man or support team.

Now take another instant where Arun had approached a client and he said NO on first place, Arun would have gone back and done homework on why the customer said NO. Is that the product is not good? Or whether the client needs more features? Is that the client is not confident about the company? May be he is in touch with another vendor and for a bargain he had said NO? Or worst case, doesn’t he actually needs the product? This homework will help Arun to pitch the product in a different way. By adding more features or addressing his queries in a satisfactory way Arun might be able to close the deal in a win-win situation. Every potential buyer will have lots of concerns before he places the order. Some, they raise directly, some other, indirectly. So its sales man’s duty to find out why he had said NO and address it, rather than getting dejected by a NO. When a sales man gets a NO from the customer, he can be sure, if the deal happens, it will be a genuine one and the prospect will be a strong point of reference for your services, in future. So take the NO in a positive way and start working around.

The Don

Like Billions of people around the world, The Godfather was, is, one of my favorite novels.

Reading and re-reading it, had left some strong messages in my life. There are lots of business lessons in this small book.

  1.    Its not personal, its business (Tom Hagen to Sunny)

It’s a real big lesson. Nobody is above business or company. No one is indispensable. If your attitude, your ego or long term association makes you feel that without you nothing happens, the system will chuck you off. While taking hard decisions for business, don’t feel weak. “Because it is not personal, its business”.

2.     Never tell anyone outside the family what you are thinking (Don Colreone to Sunny)

Lately I was having a discussion with one of my friends, who run a company. He was emphasizing the importance of wearing a mask. A mask which covers your feelings, emotions, thoughts and plans. He was right in a way. As a businessman/ business woman you should not let your competitor have a faint idea of what you are going to do next. For Don it is his or his men’s life at stake and for you, your business.

3.     Offer that cannot be refused (Micheal to Kay Adams)

 Don makes an offer that cannot be refused. Even though it’s a threat, in real life if you are able to make an offer that cannot be refused, you will be the king. For that, Like Don, you need to study your prospect to the core. Find out what is his/her weak point or pain area. Hit it hard. The deal will be yours.

4.     Never hate your enemies, it will affect your judgment (Don Corleone)

This is the most common mistake marketing and sales people often make. If a competitor offers a product/ service at a lesser price, it is common for a sales person to shrug it off as “Nobody can offer it at this rate. If someone offers, it means there is something fishy in it.”  He/she won’t study the proposal carefully or try to understand how the competitor is able to afford it in a lower price. Try to adapt the system if you find it money saving and pass on the benefit to the customer.

5.     Never get angry, never make a threat, reason with people (Don)

When you deal with vendors, customer or employees make sure you never get angry. Rather you should start persuading people to carry out the plan.

6.     Keep your friends close, but your enemies closer.”– Michael to Pentangeli

Constant update on market is the key of business success. You should constantly watch what your competitors are doing and think how to improve your services so that you can beat competition. If you are not aware about your competitive products, you are sure to bump in the market.