SALES PROMOTION 2 MKT 405 Distribution Management M

SALES PROMOTION - 2 MKT 405: Distribution Management M Wahidul Islam Summer 2014

Planning, Forecasting & Budgeting Warehousing and Logistics Sales Force Management Elements of Distribution Management Channel Information Systems Distribution Channels Product Pricing and Promotion Product Visibility

WHAT IS SALES PROMOTION? “Sales Promotion, a key ingredient in marketing campaigns, consist of a diverse collection of incentive tools, mostly shortterm, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade” Philip Kotler

TRADE PROMOTIONS Directed towards the channel members OR Resellers � Retailers � Wholesalers � Distributors � Dealers Usually companies spend more money on Trade Promotions than Consumer promotions

OBJECTIVES OF TRADE PROMOTION Persuade the reseller to carry the company’s product To encourage retailers to promote / support company’s product To encourage retailers to display company’s Po. P material To get better shelf space To stock and display new products To make retailers and their sales staff more interested to push the company’s products

TYPES OF TRADE PROMOTIONS Trade Allowances Cooperative advertising Trade Promotions Trade Shows Trade Contests Training programs

TYPES OF TRADE PROMOTIONS TRADE ALLOWANCES A major type of trade promotion Resellers are offered financial incentives to purchase, promote, display company’s products Different execution types � Off-invoice allowance � Slotting allowance New Product Placement � Promotional / Merchandizing allowance Advertising and sales support activities � Drop-ship � Exit fees allowance

TYPES OF TRADE PROMOTIONS TRADE CONTESTS Monetary rewards given to resellers’ sales persons for achieving sales goals Also known as spiff money or push money Can have negative impact on end customers as sales persons may push the wrong product

TYPES OF TRADE PROMOTIONS TRAINING PROGRAMS & TRADE SHOWS Training Programs � Training for resellers to know more about the product’s features, benefits and USPs � Can be conducted in separate venue or during the sales person’s visit Trade Shows � Trade show / trade fair / exhibitions a useful way of showcasing the product � Can convey products benefits to resellers as well as end customers as well

TYPES OF TRADE PROMOTIONS COOPERATIVE ADVERTISING Cost of advertising is shared by two or more organizations Three types � Horizontal Group of retailers providing similar products sponsor a common campaign � Vertical Cooperative Advertising Company and retailer together run a campaign � Ingredient-sponsored Cooperative Advertising Manufacturers of raw materials and component parts help successful promotion of the end product to the customer.

REFERENCES Chapter 17 – Sales Promotion � Havaldar K. and Cavale V. M. (2011) Sales and Distribution Management – Text and Cases (2 nd Edition) Delhi: Tata Mc. Graw-Hill Education Private Limited

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