Page 172 - DMGT507_SALES AND PROMOTIONS MANAGEMENT

Sales and Promotions Management

Notes 9.4 Sales Promotion Planning Guidelines

Planning process starts with situation analysis. To start with, the promotion planners must first
consider the corporate policy with regard to sales promotion. Joseph S. Mair has recorded one
such policy statement in Handbook of Sales Promotion, ed. Stanley M. Ulanoff. The policy says:
1. "Sales promotion is an integral part of the marketing mix."
2. "Sales promotion should be used as an offensive weapon in the brand's marketing arsenal,
not merely as a defensive reaction when a problem arises."
3. "Sales promotion should extend and reinforce the brand's advertising and positioning,
whenever possible."
4. "Sales promotion should be developed as campaigns, not as single, unrelated events."

5. "Good sales promotions are built upon sound strategic planning."
The first step in promotion planning is situation analysis. This would include product or brand
performance analysis, competitive situation including the promotion activities of major
competitors, distribution situation, and consumer behaviour with respect to sales promotions.
Political/legal aspects concerning sales promotion are also considered. Based on marketing
objectives and strategies, the promotion objectives would be developed. It is critically important
to set unambiguous and measurable objectives and these should be developed in coordination
with advertising and other promotion mix elements. The next step would be the allocation of
budget to sales promotion out of the combined total budget for advertising and sales promotion.
Considering the objectives and the budget allocation, each promotion event must be carefully
created. There is vast choice of promotion tools, and the combination of these tools seems to be
endless. Each sales promotion tool has its own advantages and disadvantages and these may
change when different tools are combined.

Sales Promotion Objectives

Some of the important objectives of sales promotion include:
1. Increase sales volume
2. Attract new customers
3. Launch new product and increase trial

4. Encourage repeat purchase
5. Clearance of excessive inventories
6. Motivate dealers to stock and sell more
7. To gain advantageous shelf-space

8. To increase store traffic
9. To block competitors' moves
10. Motivate sales force

Type of Promotion to use

There are three types of promotions that can be used, singly, or in combination:
1. Consumer promotion

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