Page 175 - DMGT507_SALES AND PROMOTIONS MANAGEMENT

Unit 9: Sales Promotion

terms may be related to display arrangement and its timing. Consumer promotion may require Notes
coupon expiry date, or rebate claim date. Contests and sweepstakes would require spelling out
the conditions of participation, etc. Depending on the specific type and technique of promotion,
market conditions, and consumer response pattern, there would be different terms and conditions
associated with sales promotion.

Notes Protection from Competition
Sales promotions in general are easily imitated by competitors and legally there is nothing
that any manufacturer can do about such moves. The very purpose of gaining short-term
competitive advantage is lost to the manufacturer. For example, if a marketer announces
"one cake of soap free with three cakes purchased" and other competitors announce the
same or some similar deals on their brands then the advantage is likely to be lost. One
way to gain some protection is to develop a promotion, which would be complex to copy
and allow reasonably lengthy start to the innovator. Another way is to join hands with
other well-known non-competing firms and develop an exclusive joint promotion (tie-in
promotion) that cannot be imitated in a hurry. For example, Ariel and Vimal Suiting
developed a joint promotion.

Promotion Evaluation

Sales effect before, during, and after the sales promotion can be measured by studying the sales
figures. In case of objectives related to trial purchase, or change in consumer awareness and
attitude as a result of increase in perceived value of the product, measurement may be difficult.

Pre-testing can be conducted by using focus groups and consumer panels. Portfolio test is
relatively expensive but a more effective method. A portfolio of sales promotions is prepared
and shown to consumers in person and their responses are noted. It is often quite helpful to
evaluate the response of resellers before implementing the promotion programme. The simplest
way is to seek resellers' opinion and suggestions.
Concurrent testing is done when the sales promotion is in progress. Concurrent testing may
permit the promotion manager to modify the sales promotion if needed. In case of consumer
contest the response to promotion can be adjudged by the number of entries received at some
interval and if need be the contest period can be extended.

Post-testing assesses the change in consumer awareness and attitude. To assess this, telephone
calls, questionnaire mailed to consumers, and personal interviews can be used. To measure the
sales effect, sales figures before the promotion period can be compared with figures at the end
of promotion, and one month after the promotion ends. It is very likely that the sales in the
month following promotion will come down. If the sales return to pre-promotion levels then
perhaps, the sales jump was because of brand switchers and deal prone consumers. However, if
the regular sales settle at higher than normal period levels then definitely the promotion proved
successful in increasing the long-run sales by attracting new customers and perhaps also attracted
customers away from other competing brands.

Task Develop a complete sales promotion programme for a new brand of cellular
phone.

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