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.